Dwelling price growth was already easing ahead of the Federal budget and has continued to slow, with national dwelling prices flat in May. This is the softest monthly outcome since late 2024.
05 June 2026
13.05.2026
- Housing market sentiment eased modestly in the March quarter but remains strongly positive.
- Conditions diverged widely across major markets, with VIC recording the sharpest pullback.
- NAB is forecasting a 5% increase in the national dwelling price index over 2026.
Housing market sentiment eased a little in the March quarter, though it remains well above its long-run average, according to the NAB Residential Property Survey Q1 2026.
The NAB Residential Property Index fell to +58 in Q1 from +65 in Q4 but is still well above its long-run average of +22, following a strong rise over the past year. Conditions diverged across the major markets, with SA and NSW improving, while VIC recorded the sharpest pullback, with conditions also easing in QLD and WA.
NAB Senior Economist, Brien McDonald, said the survey points to a market transitioning from broad-based acceleration to a more uneven expansion.
“Housing market sentiment eased modestly in the March quarter but remains strongly positive with the NAB Residential Property Index (+58) still well above its long-run average,” McDonald said.
“Conditions diverged widely across the major markets, with SA and NSW improving, while VIC recorded the sharpest pullback, with conditions also easing in QLD and WA.”
Survey expectations for house price growth over both 12 months and two years were revised down, with prices in the ACT and VIC falling, while rental growth expectations edged higher.
On average, property professionals are forecasting more moderate price growth in the next 12 months and in two years’ time. Expected house price growth in the ACT is lowest, with price falls also predicted for VIC. Surveyed property professionals are slightly more bullish about growth in rents, with expectations for the next year now 3.1% and 3.5% in two years’ time.
Demand is increasingly supported by first home buyers, particularly for new builds, while investor participation softened. The market share of first home buyers in new housing markets in the March quarter increased to 40.7%, while local investor participation eased.
Supply-side frictions continue to constrain new development, with construction costs, planning delays and labour shortages remaining the main barriers to starting new housing developments.
“Overall, the survey points to a market transitioning from broad-based acceleration to a more uneven, supply-constrained expansion,” McDonald said.
According to Cotality data, the eight-capital city dwelling price index rose 0.2% month on month in April, though Sydney and Melbourne recorded falls. Looking ahead, NAB is forecasting a 5% increase in the national dwelling price index over 2026.
Read the full NAB Residential Property Survey Q1 2026.
