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Domain's June Quarter 2026 House Price Report found combined capital city house prices fell 1.4 per cent over the June quarter to a median price of $1.28 million, while unit prices slid 1.2 per cent, marking the first quarterly decline for both property types in more than three years. Annual growth remained positive but slowed to nine-month lows.
The figures follow recent data from property analytics firm Cotality, which earlier this month reported national dwelling values had fallen 0.7 per cent over the final quarter of the 2026 financial year, also pointing to softer housing market conditions.
Sydney recorded the largest quarterly decline, with house prices falling 3.3 per cent to $1.73 million, while Melbourne house prices dropped 3.1 per cent and Canberra fell 2.5 per cent.
Brisbane, Perth, Adelaide, Hobart and Darwin all recorded quarterly gains, with Adelaide posting the strongest increase at 4.8 per cent to a record $1.125 million. The result saw Adelaide overtake Melbourne as Australia's fourth most expensive capital city for houses.
Unit prices declined in every capital city except Darwin, where values rose 5 per cent over the quarter. Sydney unit prices fell 1.5 per cent to $849 thousand, while Adelaide recorded the largest decline at 2.8 per cent.
Domain said the soft June quarter reflected changing market conditions, with higher interest rates, affordability pressures and weaker buyer confidence contributing to increasingly varied outcomes across cities and property types.
It said investors and first home buyers had become more price sensitive as borrowing costs increased and expectations for future price growth moderated.
Indeed, June data from credit reporting agency Equifax revealed that overall Australian mortgage demand in June was down 14 per cent year on year, with no state or age cohort recording positive growth.
Domain chief of research and economics Dr Nicola Powell said the latest figures pointed to a shift in market conditions.
"Three months of data confirm that higher interest rates, affordability pressures and weaker confidence are changing buyer behaviour and bringing the broad-based growth cycle to an end," Powell said.
"Australia is no longer moving as a single housing market. Sydney, Melbourne, Brisbane and Canberra are in decline. Adelaide continues to strengthen, and Darwin is bucking the trend in units, highlighting how local affordability, supply and demand are driving increasingly different outcomes."
Domain also reported that listings had increased, homes were taking longer to sell, auction clearance rates had fallen to their lowest level since April 2020 and sellers were increasingly adjusting their price expectations.
[Related: SMSF borrowing ban puts thousands of building contracts at risk]
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