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ANZ just raised its home price outlook, now predicting uplifting growth across Australia’s capital cities. Here’s what’s driving optimism—and what it could mean for your property plans.

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ANZ home price forecast, Australian property growth, 11 percent price rise, capital city property market, Australia real estate 2025-2026, interest rate cuts impact, housing supply shortage, borrowing power boost, property market trends

Australia’s Home Prices Could Jump 11% by End of 2026 — Here’s Why

One of Australia’s major banks has just raised its housing market forecast, now predicting almost an 11% rise in home prices across capital cities by the end of 2026. Here’s how we got here—and why keen buyers and investors are watching closely.

A New Forecast Refresh

ANZ’s latest outlook estimates a 5% increase by the end of this year, followed by an additional 5.8% gain in 2026, bringing cumulative growth to near 11%.

Momentum for these projections is building. Following the Reserve Bank’s February rate cut, capital city home prices have already surged at a 7.4% annualized rate over the past quarter.

Why the Market Is Picking Up Speed

Two key drivers are in play:

1. Interest rate cuts — ANZ expects another 0.25% drop in August and a further reduction in November. These moves are boosting borrowing capacity nationwide.

2. Tight housing supply — Listings across capital cities are down more than 10% year-on-year, with total inventory approximately 29% below the 10-year average. Hobart is a standout, with new listings down 25% and total listings 29% lower.

This classic imbalance—higher demand, lower supply—is pushing prices upwards.

Who Stands to Benefit Most?

• Buyers in more affordable housing brackets are already seeing stronger gains (around 5.7%), compared to just 1.2% in the highest price quartile.

• ANZ predicts Melbourne could see affordability-driven strength in 2026, while Adelaide may face constraints due to recent price surges in that city.

What This Means for You

• Would-be buyers: Stay ready—if rates fall as expected, borrowing capacity could improve, and pricing momentum may accelerate.

• Investors: Regions with limited housing supply could offer strong short-term gains, but be wary of overvalued areas.

• Sellers: This could be an opportunity to capitalize before upward trends intensify.

Final Thoughts

With ANZ projecting nearly 11% property growth by 2026, Australia’s housing market is showing renewed optimism. Fueled by rate cuts and supply shortages, capital cities are poised for notable gains—especially in more accessible markets.

Staying informed and agile could make the difference between catching the wave or watching it pass by.