House price forecasts for 2026 and 2027 by capital city: what CBA, Westpac, NAB, ANZ and Domain expect, and what has happened so far

Six months ago the big four banks expected Australian home values to rise 3% to 5% in 2026. As this is written in late September, the same economists expect them to be flat at best, and two of the four expect falls. This page collects the current capital-city forecasts from the Commonwealth Bank, Westpac, NAB, ANZ and Domain, with the date each was published, and puts them beside what Cotality's Home Value Index has actually recorded. It is a record of what the forecasters say, not a prediction of our own, and every number below carries a date because the numbers have been changing monthly.

Two things to hold onto while reading. First, every forecast here is for a city-wide index; your house will do better or worse than its city depending on suburb, price bracket and condition, and in 2026 the gap between price brackets has been unusually wide. Second, the forecasters disagree by more than they usually do: for Sydney in 2026 the range runs from a 2% fall to a 10% fall. When professional forecasts disagree that much, the honest reading is that the direction is agreed and the size is not.

What has actually happened: Cotality to August 2026

Cotality's national Home Value Index fell 0.9% in August 2026, the fifth monthly fall in a row, leaving national values 3.6% below their March 2026 peak but still 2.7% higher than a year earlier. Seven of the eight capitals fell in the month. Sydney led the decline and is now lower than a year ago; the mid-sized capitals are still well up over twelve months but have turned negative over the quarter.

City	August 2026	Quarter	12 months	Median dwelling value
Sydney	-1.4%	-4.7%	-4.6%	$1,222,718
Melbourne	-1.1%	-3.9%	-4.7%	$786,718
Brisbane	-1.0%	-2.7%	+10.8%	$1,080,142
Adelaide	-0.8%	-1.6%	+8.6%	$937,207
Perth	-0.8%	-3.2%	+15.6%	$999,987
Hobart	-0.2%	-0.2%	+8.1%	$752,397
Darwin	+0.6%	+0.9%	+14.6%	$647,259
Canberra	-1.1%	-2.8%	-0.4%	$864,998
Combined capitals	-1.1%	-3.7%	+1.1%	$990,394
National	-0.9%	-3.1%	+2.7%	$912,885

Source: Cotality Home Value Index, August 2026 results, released 1 September 2026. Dwellings (houses and units combined).

The national outlook, forecaster by forecaster

Forecaster	Published	2026	2027	Note
CBA	13 May 2026, revised 4 June 2026	Flat (was +3% in May, +5% in March)	Recovery; +3% in the May table	National dwelling prices; June note gave no new city figures
Westpac	22 June 2026	0% (about 2% lower from June)	+3%	Five major capitals combined
NAB	4 August 2026	-5% (was -2% in June, +5% in March)	Not stated	Eight capital cities
ANZ	15 June 2026; further cut reported August 2026	-2.1% (June); -4.3% (later note)	-3.3% (June); -3.4% (later note); +3.8% in 2028	Capital cities; the later figures are as reported, not from an ANZ release we could read
Domain	25 June 2026	FY27 (to June 2027): houses -2.5% to +1.5%	Units -0.7% to +3.3% over the same year	Combined capitals, financial year

The pattern is the same in every series: a positive forecast in March, a cut after the May Budget's negative gearing and capital gains tax changes, and a further cut in June or August as the Reserve Bank's rate rises fed through. CBA's Trent Saunders and Ashwin Clarke put it directly on 4 June: the tax changes "accelerated a slowdown that was already underway", and they now expect prices to stabilise and lift in 2027 as lower prices and interest rates ease borrowing constraints. Westpac's Matthew Hassan expects the correction to be "more material in Sydney and Melbourne" with growth "slowing abruptly" but staying positive for the year in Brisbane, Adelaide and Perth. NAB's August Housing Monitor is the most bearish, with declines of about 10% in Sydney and Melbourne and 2% to 4% across the mid-sized capitals.

City by city

The table below puts each forecaster's calendar-year figures side by side with the actual twelve-month change to August 2026. CBA's city figures are from its 13 May table and predate its June national downgrade, so treat them as the top of CBA's range. Domain's figures are for houses over the financial year to June 2027, not calendar years. Blank cells mean the forecaster did not publish a figure for that city.

City	Actual, 12 months to Aug 2026	CBA (13 May) 2026 / 2027	Westpac (22 June) 2026 / 2027	ANZ (15 June) 2026 / 2027	NAB (4 Aug) 2026	Domain FY27 houses
Sydney	-4.6%	-2% / +3%	-3% / +2%	-8.4% / -2.9%	about -10%	-7% to -3%
Melbourne	-4.7%	-3% / +3%	-4% / +5%	-7.7% / -2.3%	about -10%	-8% to -4%
Brisbane	+10.8%	+11% / +4%	+9% / +3%		-2% to -4%	+3% to +7%
Perth	+15.6%	+16% / +4%	+13% / +5%		-2% to -4%	+5% to +9%
Adelaide	+8.6%	+8% / +3%	+7% / +4%	2027: -6.4%	-2% to -4%	+4% to +8%
Hobart	+8.1%	+3% / +2%	+1% / +3%		-2% to -4%
Canberra	-0.4%	+1% / +3%				-4% to 0%
Darwin	+14.6%	+6% / +2%

Sources: as listed at the end of this page. "About -10%" and "-2% to -4%" are NAB's wording for Sydney and Melbourne and for the mid-sized capitals respectively. ANZ's later downgrade, reported in August and September, did not include city figures we could verify.

Sydney

Every forecaster has Sydney falling in 2026 and the disagreement is only about how far: 2% at CBA in May, 3% at Westpac, 8.4% at ANZ, around 10% at NAB, and 3% to 7% for houses over the financial year at Domain, which in dollars is $52,000 to $122,000 off the median house. Cotality has already recorded a 4.7% fall over the June-to-August quarter, so the milder forecasts are close to being used up. For 2027 the banks split: CBA and Westpac expect a modest recovery of 2% to 3%, ANZ a further 2.9% fall. Westpac's note that Sydney looks "susceptible to an air pocket near term" is the phrase to remember. Our Sydney market page tracks the suburb-level data.

Melbourne

Melbourne's forecasts are slightly worse than Sydney's for 2026 and better for 2027. CBA had -3%, Westpac -4%, ANZ -7.7%, NAB about -10%, and Domain -4% to -8% for houses over FY27, which would take the median house below $1 million for the first time since 2021. Westpac is the most optimistic on the rebound, at +5% in 2027, on the argument that Melbourne's "weaker starting point" leaves "more scope for gains" once rates turn; ANZ expects a further 2.3% fall. Melbourne has also lost 3.9% over the quarter to August. See our Melbourne market page.

Brisbane

Brisbane is where the forecasts diverge most. CBA's May table had +11% for 2026 and Westpac +9%, both reflecting a very strong first half; Domain has +3% to +7% for houses over FY27; NAB, writing in August after the market had turned, has a fall of 2% to 4%. Cotality's numbers explain the gap: Brisbane is still up 10.8% over twelve months but fell 2.7% over the quarter to August and 1% in the month. Whether the year ends positive now depends on the last four months. For 2027 the forecasters who publish a number are all modestly positive, at 3% to 4%. Our Brisbane market page has the suburb tables.

Perth

Perth had the strongest run of any capital, and the forecasts made before winter reflect it: CBA +16%, Westpac +13% for 2026, Domain +5% to +9% for houses over FY27. Like Brisbane, Perth has since turned, down 3.2% over the quarter to August though still up 15.6% over the year. NAB groups it with the mid-sized capitals at -2% to -4%. For 2027 CBA and Westpac have +4% and +5%. Westpac's summary, "coming into slowdown from a very strong start and with extreme tightness", captures why the falls so far have been modest. See our Perth market page.

Adelaide

Adelaide is the mid-sized capital the forecasters like most for resilience and the one ANZ singles out for the sharpest 2027 correction, at -6.4%. CBA had +8% and Westpac +7% for 2026, Domain +4% to +8% for houses over FY27, and NAB -2% to -4%. Cotality has Adelaide down 1.6% over the quarter, the smallest fall of the mainland capitals, and up 8.6% over the year. Westpac calls it "resilient" on "strong price gains, rising demand" but notes new building is lifting supply. Our Adelaide market page has the detail.

Hobart

Hobart's recovery from its 2022 to 2024 downturn has been, in Westpac's words, "slowly forming but looks fragile". CBA had +3% for 2026 and +2% for 2027; Westpac +1% and +3%. Cotality has Hobart up 8.1% over the year and almost flat over the quarter, the smallest quarterly move of any capital. See our Hobart market page.

Canberra

Canberra has behaved like a smaller Sydney: down 0.4% over the year, 2.8% over the quarter and 1.1% in August. CBA had +1% for 2026 and +3% for 2027; Domain has houses -4% to 0% over FY27, up to $43,000 off the median. NAB's survey respondents have been the most negative on the ACT of any state for two quarters running. Our Canberra market page covers it.

Darwin

Darwin was the only capital still rising in August 2026, up 0.6% in the month and 14.6% over the year, and it is the least forecast: CBA is the only one of the five to publish a figure, at +6% for 2026 and +2% for 2027. Darwin's market is small enough that a single project or a change in defence or resources activity moves it, which is why the banks mostly leave it out. See our Darwin market page.

Why the forecasts moved so far, so fast

• Interest rates. The Reserve Bank raised the cash rate three times in the first half of 2026, 75 basis points in total, reversing the 2025 cuts that the March forecasts had assumed would continue. Our June cash rate explainer covers the decision and what it did to borrowing capacity.
• The May Budget. The removal of negative gearing on established properties and the changes to the capital gains tax discount, now law, hit investor demand immediately; CBA expects new investor lending to run at about half its late-2025 level through 2026. Our summary of the negative gearing and CGT changes sets out the rules.
• Sentiment. Auction clearance rates fell through autumn and winter, listings rose, and the NAB survey's 244 property professionals swung from expecting 2.1% growth over the next twelve months in March to expecting a 2.5% fall in June. Our note on the clearance rate slump has the numbers.
• The starting point. Perth, Brisbane and Adelaide entered 2026 after three years of double-digit growth. A slowdown from 16% to 0% is a large forecast revision and a small change in what a seller experiences.

How to use a forecast if you are selling

Forecasts are useful for direction and dangerous for precision. Three ways to read them that hold up:

1. Read the range, not the point. For Sydney in 2026 the professional range is -2% to -10%. The right conclusion is "falling, by an amount nobody knows", and the right response is a price guide set from the last six weeks of comparable sales, not from a forecast or from last year's peak. Our guide to how much your house is worth shows how to build that number.
2. Watch the revision, not the level. Every forecaster has revised down at each update since March. Until a revision goes the other way, the balance of risk in the forecasts themselves is still to the downside. The next scheduled updates are the NAB quarterly survey in October and the banks' post-RBA notes in November.
3. Separate the timing decision from the price decision. If you are selling to buy in the same city, a falling market cuts both prices and the gap between them barely moves; our guide to selling first or buying first works through it. If you are selling to leave the market, or to downsize, the forecast matters more, and the 2027 numbers say the banks expect the floor within twelve to eighteen months rather than a prolonged slide. Our guide to the best time to sell covers the seasonal pattern that sits underneath the cycle.

Frequently asked questions

Will house prices fall in 2026?

Nationally, the forecasters expect flat to falling: CBA flat, Westpac flat, ANZ -2% to -4%, NAB -5%. Cotality has already recorded a 3.6% fall from the March peak to August. Sydney, Melbourne and Canberra are falling; Brisbane, Perth, Adelaide and Hobart are still up over the year but have turned down over the quarter; Darwin is still rising.

Which capital city is forecast to grow most?

Perth, on every forecast made before winter (CBA +16%, Westpac +13% for 2026; Domain +5% to +9% for houses over FY27), followed by Brisbane and Adelaide. NAB's August view, made after the turn, has all three falling 2% to 4%. For 2027 the forecasts converge on modest growth of 3% to 5% for the three mid-sized capitals.

Are Sydney and Melbourne going to crash?

No forecaster uses that word. The largest published falls are NAB's "about 10%" for 2026 and ANZ's -8.4% and -7.7%, with ANZ's later peak-to-trough figure reported at 10.6% across the capitals. Those are large corrections by Australian standards and would take Sydney back to roughly its early-2024 level. CBA and Westpac expect smaller falls and a recovery in 2027.

When do the banks expect prices to recover?

CBA and Westpac both expect stabilisation and growth in 2027, on the assumption that the cash rate is cut again once inflation allows. ANZ expects 2027 to be a second year of falls and growth to return in 2028. The difference is mostly about when rates are cut.

Should I wait to sell?

That depends on why you are selling and what you are doing next, not on the forecast alone. If you are buying in the same market, waiting changes little. If you are leaving the market, the forecasts say the near-term risk is down and the recovery is a 2027 or 2028 story. Either way, a house priced from current comparable sales sells in any of these scenarios; one priced from last year's peak does not. A local agent's appraisal, checked against our suburb data, is the number to start from.

Sources

• Cotality, Home Value Index, August 2026 results, released 1 September 2026 (city table).
• Commonwealth Bank, Global Economic and Markets Research, 2026 Budget: Updated Housing Outlook, 13 May 2026 (Table 1, annual dwelling price growth by capital), and CBA Newsroom, Housing market faces multiple headwinds as price outlook downgraded, 4 June 2026 (Trent Saunders and Ashwin Clarke, quoted).
• Westpac Economics, Housing Pulse, June 2026, finalised 22 June 2026 (Matthew Hassan; table 9, dwelling price forecasts, quoted comments).
• NAB Economics, NAB Housing Monitor, August 2026, 4 August 2026 (quoted), and NAB Residential Property Survey, Q2 2026 (244 respondents; table 2).
• ANZ Research, June 2026 forecasts as reported by The Urban Developer, ANZ reverses home price forecasts as rate hikes, policy changes bite, 15 June 2026; the later ANZ downgrade (-4.3% in 2026, -3.4% in 2027, 10.6% peak to trough) as reported by Property Update, September 2026. We were unable to read the ANZ release directly; treat those figures as secondary.
• Domain, Forecast FY27: Interest rate pressure drives price falls in Sydney and Melbourne as market fragments, 25 June 2026 (Dr Nicola Powell; house and unit tables).
• All forecasts are the published views of the organisations named, as at the dates shown. Your Property Guide does not forecast prices; our market pages report recorded sales.