Commercial Property Market Set to Rebound Through 2026
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Commercial Property Market Set to Rebound Through 2026

Knight Frank’s latest Horizon 2025 update signals renewed confidence in Australian commercial real estate, with signs of recovery accelerating across cities and sectors.

By Jeni O'Dowd
Thu, May 22, 2025 11:33amGrey Clock 2 min

The recovery of Australia’s commercial property sector is expected to gather pace throughout 2025 and into 2026, according to new research released by Knight Frank.

The update to the firm’s Horizon 2025 outlook finds that the sector is “sequentially turning the corner back to growth,” with fundamentals for long-term expansion firmly in place.

While global risks, such as the impact of US-imposed tariffs, still linger, the report notes the worst may be behind the market.

Knight Frank Chief Economist Ben Burston said: “In this respect, property is better placed than other asset classes to withstand the trade war,” adding that volatility in equity and fixed income markets has made property a more attractive option once again.

Following a period of disruption, retail and industrial asset values were the first to recover, with all segments and cities returning to growth by late 2024.

“Office values have also now turned positive in Q1, off the back of improving prospects for core CBD assets despite pockets of over-supply elsewhere,” Burston said.

The report also points to increasing liquidity, with large-scale acquisitions becoming more common and investor confidence returning amid expectations of further interest rate cuts.

“Property markets will respond to the rate-cutting cycle, and the shift in the outlook raises the prospect of yield compression in the second half of the year, starting in the most favoured core markets,” said Burston.

Industrial and logistics assets are leading the charge, with competition intensifying for prime properties in Brisbane and Sydney.

Meanwhile, the living sectors continue to gain ground, with nearly 16,000 new student accommodation and build-to-rent units under construction and more than 20,000 approved for future development.

With asset values now well below replacement cost and market rents lagging, Knight Frank reports a growing pool of investors positioning themselves in core markets to take advantage of cyclical recovery and medium-term rental growth.



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High-end homeowners are choosing to upgrade rather than relocate, investing in bespoke design, premium finishes and long-term lifestyle value.

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RENOVATION REVOLUTION RESHAPES AUSTRALIA’S LUXURY HOMES

High-end homeowners are choosing to upgrade rather than relocate, investing in bespoke design, premium finishes and long-term lifestyle value.

By Jeni O'Dowd
Mon, Feb 16, 2026 3 min

Australia’s prestige homeowners are increasingly choosing to reinvent their existing properties rather than enter an uncertain property market, fuelling what industry insiders are calling a “Renovation Revolution.”

From heritage terraces to coastal retreats, this shift reflects a deeper change in mindset. Homes are no longer viewed as stepping stones, but as long-term assets worthy of thoughtful investment and personalisation.

“Homeowners are approaching renovation with purpose, balancing lifestyle needs, design aspirations, and long-term return on investment,” says Jodie Cramer, CEO of Andersens, a national flooring and interior finishes company.

“Viewed through this lens, renovating often makes more financial sense than moving. Homeowners with built-up equity are confidently premiumising their space, achieving better returns on capital.”

More than half of Australian homeowners were planning renovation or improvement projects within a year, with many considering structural changes such as reconfigured floor plans, extensions, or even additional levels.

Personalisation becomes the ultimate luxury

For affluent homeowners, renovation is no longer driven solely by financial logic. It is about crafting environments that reflect individual lifestyles, values, and aesthetic sensibilities.

“Home upgrades allow families to customise their spaces,” says interior designer Delena Pitman.

“They’re not always looking to move up the property ladder; they want to make where they are feel more like home. Renovations give people the freedom to design functional, comfortable, and visually inspiring spaces.”

This trend aligns with the broader luxury movement toward intentional living, where design choices prioritise comfort, wellbeing, and enduring quality over short-term trends.

Jodie Cramer

Flooring sets the foundation for luxury interiors

Among the most transformative elements in any high-end renovation is flooring, which establishes the visual and tactile foundation of a home’s design.

“Think of flooring as the canvas for your entire home,” Pitman explains. “Once it’s chosen, everything else — furniture, lighting, window treatments, and accessories — becomes easier to select, and the space feels cohesive and intentional.”

Premium materials such as engineered timber, natural stone and luxury vinyl planks are increasingly favoured for their durability and aesthetic appeal, while softer textures like wool carpet add warmth and acoustic comfort to private spaces.

Continuous flooring across open-plan living zones enhances spatial flow, while darker tones such as walnut or charcoal introduce richness and sophistication.

Designing cohesive, layered spaces

Today’s most successful renovations are guided by a holistic design approach, where flooring, cabinetry, lighting and furnishings work in harmony.

“Change the floor, and everything else either harmonises or clashes — it’s the anchor of your interior design,” says Pitman.

“Once the floor is selected, you can choose wall colours to complement or contrast, coordinate cabinetry and countertops, and adjust lighting to provide bright task illumination or soft mood lighting.”

This layered approach allows homeowners to create interiors that feel both elevated and deeply personal.

Renovation as a strategic property investment

Beyond aesthetics, renovation is increasingly viewed as a strategic investment decision. In prime suburbs and lifestyle regions alike, improving an existing home often delivers greater value than purchasing anew.

This approach enables homeowners to preserve location advantages while enhancing liveability, energy efficiency and long-term capital value.

Whether upgrading a waterfront residence, modernising a federation home, or refining a contemporary coastal retreat, the message is clear: in Australia’s luxury property market, the smartest move is often staying exactly where you are — and transforming it into something exceptional

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