Market Update 18 December

Fewer Homes for Sale as Summer Begins

Tight stock is shaping the summer property market – and changing the dynamics for both buyers and sellers.

SQM Research reports that the total number of listings fell 5.4% in November and is now 12.4% lower than a year ago. New listings dropped 11.3% month-on-month, while older listings also declined sharply, signalling that buyers are still active and absorbing available stock.

With fewer homes coming to market and demand holding firm, asking prices continue to rise and may climb further if supply tightens over summer.

What this means for sellers

• Less stock gives sellers more negotiating power.
• Well-priced homes are selling quickly thanks to active buyers
• Strong conditions may support higher sale prices in early 2026

What this means for buyers

• Competition increases when listings fall
• Pre-approval helps you move fast and reduces risk for the seller
• Knowing your true ceiling helps you avoid emotional bidding

The key to being prepared is knowing your buying power or get pre-approved before more competition enters the market.

Low Vacancies Keep Pressure On Renters

Low vacancy rates generally support stronger yields and fewer periods without a tenant. For investors thinking about entering or expanding, current conditions may offer a solid foundation, provided you choose the right location and price point.

PropTrack reports a national vacancy rate of just 1.4%, which is low by historical standards and continues to put pressure on tenants across the country.

Even though vacancies are slightly higher than recent lows, the market remains competitive. Properties are leasing quickly and rental prices are rising in many locations.

If you are renting now

Tight conditions can make it harder to get ahead. Higher rents leave less room for saving, and staying in the rental market longer exposes you to ongoing increases. Exploring ownership pathways sooner – even just checking your borrowing position – can give you more control over your housing costs.

If you are considering investing

Low vacancy rates generally support stronger yields and fewer periods without a tenant. For investors thinking about entering the market or expanding their portfolio, current conditions may offer a solid foundation, provided you choose the right location and price point.

Wondering whether to keep renting or buy an investment property? I can help you compare what each option might look like for your budget.

Two Major Schemes Easing the Deposit Hurdle For Buyers

Getting a foot on the property ladder is often hardest at the deposit stage, but two major federal schemes are widening the options for buyers with smaller deposits.

The 5% Deposit Scheme lets eligible first home buyers purchase with just a 5% deposit and no lenders’ mortgage insurance (LMI). Property price caps apply – from $500,000 in regional South Australia to $1.5 million in Sydney – so what you can buy depends on where you are searching.

Help to Buy goes further. It allows eligible buyers to enter the market with only a 2% deposit and no LMI, with the government taking up to 40% ownership in a new home or up to 30% in an existing home. Income caps apply – $100,000 for individuals and $160,000 for couples or single parents – and participants must live in the property. Previous homeowners who no longer own a property may also qualify.

Key takeaways for first home buyers

• You may now qualify with a 2–5% deposit instead of saving a much larger amount
• Lower deposits reduce upfront costs, but scheme rules affect your long-term position
• Lender participation differs and each scheme changes your borrowing power in different ways

If you’re not sure, get in touch with one of our experts to see whether you qualify for Government support.

Regulator Tightens Lending Rules for High Risk Loans

A key change to home lending is on the way – and it may influence how much some borrowers can access in 2026.

From 1 February, banks will be allowed to write no more than 20% of new mortgages at a debt-to-income (DTI) ratio of six times income or higher. Australia’s banking regulator, APRA, says lending standards remain sound, but it has seen an uptick in riskier applications and wants to act before housing-related vulnerabilities build up.

Who might feel the impact

• Borrowers stretching to the top of their budget
• Higher-income earners buying in expensive markets
• Investors or upgraders juggling multiple loans

Rather than reducing borrowing power for everyone, the change will mostly affect applications at the high end of what a bank is comfortable with. Each lender will respond differently – some may tighten maximum borrowing, others may tweak their calculators or take a closer look at higher DTI applications.

If you are planning to buy or refinance and want to see how these settings could affect your borrowing options, seek guidance to compare lenders and find a workable path to the best outcome.