SPRING PROPERTY MARKET TIPPED FOR HOTTEST RUN IN YEARS
Buyer demand, seller confidence and the First Home Guarantee Scheme are setting up a frantic spring, with activity likely to run through Christmas.
2 min
The spring property market is shaping up as the most active in recent memory, according to property experts Two Red Shoes.
Mortgage brokers Rebecca Jarrett-Dalton and Brett Sutton point to a potent mix of pent-up buyer demand, robust seller confidence and the First Home Guarantee Scheme as catalysts for a sustained run.
“We’re seeing an unprecedented level of activity, with high auction numbers already a clear indicator of the market’s trajectory,” said Sutton. “Last week, Sydney saw its second-highest number of auctions for the year. This kind of volume, even before the new First Home Guarantee Scheme (FHGS) changes take effect, signals a powerful market run.”
Rebecca Jarrett-Dalton added a note of caution. “While inquiries are at an all-time high, the big question is whether we will have enough stock to meet this demand. The market is incredibly hot, and this could lead to a highly competitive environment for buyers, with many homes selling for hundreds of thousands above their reserve.”
“With listings not keeping pace with buyer demand, buyers are needing to compromise faster and bid harder.”
Two Red Shoes identifies several spring trends. The First Home Guarantee Scheme is expected to unlock a wave of first-time buyers by enabling eligible purchasers to enter with deposits as low as 5 per cent. The firm notes this supports entry and reduces rent leakage, but it is a demand-side fix that risks pushing prices higher around the relevant caps.
Buyer behaviour is shifting toward flexibility. With competition intense, purchasers are prioritising what they can afford over ideal suburb or land size. Two Red Shoes expects the common first-home target price to rise to between $1 and $1.2 million over the next six months.
Affordable corridors are drawing attention. The team highlights Hawkesbury, Claremont Meadows and growth areas such as Austral, with Glenbrook in the Lower Blue Mountains posting standout results. Preliminary Sydney auction clearance rates are holding above 70 per cent despite increased listings, underscoring the depth of demand.
The heat is not without friction. Reports of gazumping have risen, including instances where contract statements were withheld while agents continued to receive offers, reflecting the pressure on buyers in fast-moving campaigns.
Rates are steady, yet some banks are quietly trimming variable and fixed products. Many borrowers are maintaining higher repayments to accelerate principal reduction. “We’re also seeing a strong trend in rent-vesting, where owner-occupiers are investing in a property with the eventual goal of moving into it,” said Jarrett-Dalton.
“This is a smart strategy for safeguarding one’s future in this competitive market, where all signs point to an exceptionally busy and action-packed season.”
Two Red Shoes expects momentum to carry through the holiday period and into the new year, with competition remaining elevated while stock lags demand.
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New research shows a widening divide across Australia and New Zealand’s property markets, with investors increasingly forced to look beyond traditional strongholds to find real returns.
3 min
By any traditional measure, Australia’s property market should be moving in sync. Instead, it is fragmenting.
New research from MaxCap, led by Head of Research Bruce Wan, paints a picture of a market no longer defined by national trends, but by sharp regional divergence, where performance gaps between cities are widening, and the smartest capital is moving accordingly.
At the top end of the ladder, Perth and southeast Queensland are surging ahead. At the other, Melbourne and Auckland are only just beginning to recover from recent downturns. And sitting squarely in the middle is Sydney, steady but constrained.
The takeaway is clear: the era of relying on headline markets is over.
The rise of the unexpected leaders
Brisbane and the broader southeast Queensland region have emerged as standout performers, driven by population growth, infrastructure investment and a sustained undersupply of housing.
According to the report, housing values in the region have continued to accelerate, supported by long-term tailwinds including the 2032 Olympic Games and a decade of relatively subdued price growth prior.
Perth is telling a similar story, albeit for different reasons. Once heavily tied to commodity cycles, the Western Australian capital is now benefiting from a broader base of economic drivers, including defence spending and sustained resource sector strength.
The result is a housing market that remains one of the strongest in the country, even as price growth begins to ease from its peak.
Sydney holds, but doesn’t lead
For Sydney, the story is more nuanced.
While prices continue to climb and the city remains Australia’s most expensive market, affordability constraints are clearly limiting its pace. Residential growth, while positive, lags behind smaller capitals, and commercial sectors are being held back by softer demand in key industries.
There are, however, signs of momentum building. New infrastructure, including the western Sydney Airport and expanded rail networks, is expected to unlock development opportunities and support future growth, particularly in emerging precincts.
Still, the report positions Sydney firmly in the “middle of the pack”, no longer the automatic frontrunner for investors.
Melbourne’s slow reset
Melbourne, once a consistent performer, has spent recent years recalibrating.
Extended lockdowns, combined with new state property taxes, have weighed heavily on investor sentiment and pricing, particularly across the commercial office sector. Residential values have also underperformed, though for different structural reasons.
Now, there are early signs of recovery.
Improved affordability, population growth and a stabilising economic backdrop are beginning to draw buyers back into the market, with both residential and commercial sectors showing tentative signs of improvement.
Auckland’s turning point
Across the Tasman, Auckland has faced its own challenges, particularly from an outflow of younger workers to Australia, which has dampened demand and stalled price growth.
But here too, the tide appears to be shifting.
A return to positive migration, lower interest rates and policy changes — including the easing of foreign buyer restrictions — are expected to support a gradual recovery, alongside renewed interest from offshore capital.
A market that rewards precision
If there is one unifying theme, it is this: broad-brush strategies no longer work.
MaxCap’s research highlights that the most compelling opportunities are increasingly found outside the traditional powerhouses of Sydney and Melbourne, requiring investors to take a more targeted, locally informed approach.
“Given these persistent performance gaps, there is plentiful scope for alpha returns, just by picking the right locations and market segments,” the report notes.
In other words, success in this market is no longer about being in property — it is about being in the right property, in the right place, at the right time.
And increasingly, that place may not be where you expect.
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