Everyone’s talking about it right now. The news says properties nationwide are falling. Your mates are saying the market’s crashing. Maybe you’re starting to wonder if you’ve missed your window, or if you should be worried about what you already own.
This isn’t the first time I’ve seen headlines like this. I’ve been doing this for well over twenty years, and I’m not losing any sleep over this one.
Every downturn plays out roughly the same way. The panic is real, but it’s rarely where people think it is.
Here’s what’s actually happening.
Property Isn’t One Market
There are two different markets right now, moving in opposite directions. Nobody’s reporting that part.
Let me explain.
In July prices nationally fell 0.7%, the biggest monthly drop we’ve seen in almost four years.
But that fall isn’t happening evenly. It’s concentrated almost entirely at the expensive end.
Line up every home sale in a city from cheapest to most expensive and you get two ends. Affordable at one end, and premium at the other.
See, over the last three months, the most expensive homes dropped 3.2% in value. The most affordable homes went up 0.3%.
Same three months. Same country. Two completely different markets.
That’s a 3.5-point gap that the national average hides completely.
It’s Not Just The Capitals
Zoom out past the capitals, and the same pattern shows up somewhere else entirely.
Break it down by location and the pattern holds again, just along a different line. It’s not about premium versus affordable this time. It’s regional versus the capitals.
Here’s something you might not expect.
Victoria’s state average is actually down over the past year. So how are we still finding growth in it? Because not every part of the state is moving the same way.
We’ve been actively targeting growth corridors across regional Victoria, chasing yields that are far exceeding the hotter capital city markets and growth to match.
And this isn’t us cherry-picking outliers. The average entry price across those corridors, $650,000, tracks right in line with the open market there, which sits at $625,700. This is what the data looks like across the board, not a handful of hand-picked wins.
Three things stand out here.
Regional Victoria’s kept climbing steadily all year, every corridor at or above the national average.
Sydney’s gone the other way entirely, backwards over the same twelve months.
And Perth and Adelaide, the two loudest growth stories of the last year, have both slowed hard this quarter.
Growth’s only half the story though
Now take a look at the graph below, it lines up entry price and rental yield across every market we’ve talked about so far.
Look at Ballarat and Sydney side by side. The same cost buys you roughly double the property in Ballarat, and a stronger rental yield on top.
Better growth, better yield, lower entry price. Same story across most of those towns.
And it’s not just Sydney that’s expensive by comparison. Brisbane and Perth have had a strong run too, but entry prices there are almost double what you’d pay across our regional VIC portfolio, from around $650,000.
Let’s put some real numbers on that. Take Brisbane. Its growth over the past year edges out Ballarat’s, 14.8% against 11.6%.
Sounds like Brisbane wins, right?
Except one Brisbane property costs about what two Ballarat properties would. Two rents, two growth stories, instead of one big bet.
The numbers, side by side:
By now you’re probably wondering why this is happening?
Let’s get into it.
What’s Actually Going On
Why is the affordable end holding up while the top of the market wobbles?
Good question. There’s no single answer, it’s actually a few things happening at once.
1. New and off-the-plan prices are anchored, established isn’t
Here’s the one most people miss entirely. It comes down to how prices actually get set.
One anxious seller drops their price, and suddenly that’s the new benchmark for the whole street.
Established homes move with whatever mood the market’s in that week.
New and off-the-plan pricing doesn’t work like that. A developer prices against what the land and build actually cost. It moves in small, deliberate steps, not swings.
Here’s what that actually looks like on the numbers as a running example.
A new house-and-land package has fixed inputs: roughly $170,000 for land, $340,000 to build. That’s a $510,000 cost base before a developer’s even made a cent. Add a 20% margin, $102,000, and you land on a price floor of roughly $612,000.
The principle holds everywhere. A developer can’t sell below what it costs without taking a loss. An established seller can, and sometimes has to.
Once an established property’s price falls close to what it’d actually cost to build the same thing new, the numbers stop stacking up.
So developers tend to hold their price. They slow supply instead of selling below cost.
That same anchoring is what protects you as a buyer too. If you’re buying new or off-the-plan, your price locks in at exchange.
Whatever the established market does before settlement doesn’t touch what you’ve agreed to pay. Settlement valuations are a separate, real conversation though, and one worth having properly.
2. First-home buyers have more room to move
First-home buyers have it easier than they used to. Low-deposit options are getting them in the door earlier, which sounds like good news, and it is, for them.
For you, it means more competition right where you’re looking to buy.
3. Investors have less room at the top
Two big changes are affecting investors: negative gearing and CGT.
Buy established after 12 May 2026, and your losses carry forward instead of offsetting your wages straight away.
The CGT discount’s changing too, down from 50% to an inflation-linked model, with a new minimum 30% tax on capital gains from 1 July 2027. That’s for established properties. On new builds, you can still choose the old 50% model or the new inflation indexation, whichever works better for you financially.
Banks have noticed too. Several of the majors have already tightened their borrowing calculators, so a lot of investors are finding they can borrow less against an established purchase than they could a year ago.
That’s pushing a lot of investor demand down-market, and toward new and off-the-plan stock specifically.
4. Renters aren’t getting relief either
This one isn’t really about prices at all.
Vacancy rates are sitting near 1.2%, some of the tightest on record. Renters priced out of a lease are exactly the kind of buyer who ends up looking at the affordable end of the market instead.
Whatever the headlines say about prices, that underlying demand for housing hasn’t gone anywhere.
Where We Stand
The affordable end isn’t immune, some cities are softer than others, but it’s holding up far better than the headlines suggest. Price point and timing matter more now than they did a year ago.
I’ll say this plainly. We’ve bought both new and established property for our clients for eighteen years, always guided by the numbers, not a formula.
Established property has been exactly the right call for plenty of our clients in that time.
Right now though in light of the recent changes, the numbers on resilience, yield and build cost favour new and off-the-plan stock, so that’s where I’m pointing people today.
This isn’t a reason to wait on the sidelines. It’s a reason to get your numbers right now.
Curious What This Means For You?
You might be wondering where you actually stand in all this. Whether you’re sitting in the resilient end of the market, or the one making headlines.
If you’re not sure, that’s exactly what a conversation with one of our Senior Property Wealth Planners can answer.
We’ll map out where the data actually points for your situation.
We’ll show you the opportunities that are moving right now.
We’ll walk through what buying new or off-the-plan could look like for you.
And answer any questions you’ve got along the way.
There’s no obligation or pressure here. We’re confident that once you see the numbers behind all this, you’ll have everything you need to make your next move.