This will be very welcome news for any home owner …
Louis Christopher’s Boom and Bust Report is one of the most eagerly awaited property reports of the year. SQM Research has now released the latest edition – and here’s what it predicts:
Spot on
Longtime readers will know I highly rate Louis and his forecast because he’s generally on the money.
Just look at the report this time last year on the 2025 property market. It was spot on, if slightly conservative.
What I like about the Boom and Bust report is that, while it provides a base forecast, it considers a range of economic scenarios and how property will perform under each.
And in 2026, no matter the economic scenario, residential property value will rise across all capital cities.
Brisbane, Perth, Adelaide and Darwin housing prices are once again predicted to continue to record outperformance compared to our larger capital cities with the four cities tipped to record dwelling price rises of up to 16 per cent.
Boom and Bust hypothesis
There are some really important assumptions to note, though:
- Population growth will likely moderate to about 390,000 people or 1.4 per cent because of cuts to immigration. This will translate into new demand for about 150,000 dwellings.
- Dwellings completions will rise to about 180,000 dwellings, creating a small surplus for the year of about 30,000 dwellings for next year.
- Interest rates will remain steady until mid-2026, followed by a 0.25 per cent rate cut or two.
- Employment growth will slow creating a further rise in unemployment to 5 per cent.
SQM’s base case scenario assumes a steady but sluggish economy for 2026. Even so, the momentum from the strong housing price growth recorded in the second half of 2025 is expected to carry through until at least mid-2026. From there, anticipated interest rate cuts in the second half of 2026 will ensure ongoing price growth.
If these rate cuts do not eventuate, the capital city property markets are still expected to rise in value, but at a slower pace of growth. The interest rate cuts of 2025 plus the First Homeowner’s Deposit Scheme will continue to encourage buyers into the housing market.
