Nothing seems able to temper Australians’ love affair with property.
Despite home values being the most expensive on record relative to incomes and with no further rate cuts expected, Australians remain hyper-bullish on house prices.
The latest Westpac consumer sentiment survey, released on Tuesday, showed that the “Time to buy a dwelling” sub-index fell sharply by 10.6% to 86.2, reflecting degraded affordability.
As illustrated below by Alex Joiner from IFM Investors, sentiment is also the worst for those with a mortgage:
However, house price expectations barely moved, remaining at close to a 13-year high:
Nearly 80% of consumers still expect house prices to rise, according to Westpac’s survey.
As illustrated below by Shane Oliver from AMP, real estate is also viewed as a wiser place to invest than shares, although bank deposits or paying down debts is the most preferred option:
Given that most forecasts predict a solid rise in dwelling values in 2026, Australians’ bullishness towards housing makes sense.
For example, SQM Research’s latest Boom & Bust Report forecasts that home prices in capital cities will increase by between 6% and 10% in 2026, albeit on the proviso that the RBA delivers additional rate relief from mid-2026.
However, even if no rate cut is delivered, SQM research still expects capital city home prices to rise by between 4% and 8% in 2026.
