Australian Housing Market Breaks Free From Rate Logic as Prices Surge Again

The Australian housing market is entering 2026 with strong momentum despite a year of interest rate cuts that were supposed to ease pressure and, at least in theory, cool demand. Instead, the opposite is happening: home prices are rising again, affordability has deteriorated further, and the pipeline of new housing remains well below what's required to stabilise the market.

Economists surveyed by the AFR expect national property prices to climb another 65% this year, on top of an 8.6% jump in 2025, Australia's strongest performance since 2021. The explanation is straightforward: the country is still not building. . .