Australia’s residential property market is heading for a renewed surge, with home prices expected to rise around 8 percent in 2025 and nearly 7 percent in 2026, according to a fresh poll of property analysts.

The forecast marks a substantial upgrade from prior estimates, driven by persistent supply constraints and a rebound in buyer demand.

The poll of 15 analysts, conducted between November 13 and 26, finds that falling interest rates and strong demand are fueling renewed growth.

The national median home price reached a record A$872,538 in October.

With the central bank cutting its cash rate, and rates now at a more-than two-year low of roughly 3.60 percent, market watchers say buyer confidence has surged — and many are acting quickly to avoid missing out.

Major cities are broadly expected to benefit from the trend.

Analysts predict home prices in Sydney, Melbourne, Adelaide, Brisbane and Perth will rise between 5 percent and 7 percent next year.

One real estate adviser notes that the shortage of entry-level homes remains acute — insufficient to meet demand from immigrants and first-time buyers — which is boosting competition and prices, especially in the first half of 2026.

For first-time buyers, the outlook offers little relief.

Most respondents to the poll believe that affordability will worsen over the coming year.

High deposit requirements, weak wage growth, tight borrowing limits and a dearth of affordable dwellings are cited as the biggest barriers.

While the government has pledged to build 1.2 million new homes by 2030, many economists express doubt that the target will sufficiently ameliorate shortages in the short term, judging by current construction constraints and labour shortages.

With demand expected to remain robust and supply constrained, the Australian housing market looks set to extend its recent rally — delivering further gains for existing homeowners while making entry ever more challenging for new buyers.