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Australian house prices cool but no crash in sight

Published July 26, 2026 at 9:02 PM UTC

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Australian house prices are beginning to slip, but experts say a property market crash is unlikely. Nationally, values have dipped in recent months after two years of rapid growth. Data from property analytics firms show that while Sydney and Melbourne have seen modest declines, some cities like Perth have continued to rise, with a surprise surge of $51,000 in just 90 days. The cooling is largely driven by the Reserve Bank of Australia's aggressive interest rate hikes, which have made borrowing more expensive and reduced buyer demand. However, limited housing supply and strong population growth are keeping prices from falling sharply. For homeowners, the slower market may mean less equity growth, but for first-time buyers, it could bring some relief. Renters, however, continue to face high rents due to low vacancy rates. The RBA is expected to hold rates steady in coming months, watching inflation and employment data. If the economy remains resilient, prices may stabilise rather than crash. The key question is whether the cooling will be enough to restore affordability without triggering a broader economic slowdown.