Australia-Wide Investment Pulse: July 2026
Reading time 10 minutes
by Parker Hadley
- June made the investment market look less like a neat slowdown and more like a proper confidence test. The RBA held the cash rate at 4.35 per cent, but only after three rises earlier in 2026, so the pressure on borrowing capacity is already there.
- National values are now going backwards on both Cotality and PropTrack, with Sydney and Melbourne doing the heaviest lifting down and regional markets still holding up better than the capitals.
- Rental conditions are still tight. SQM has national vacancy at 1.2 per cent and national asking rents up 7.8 per cent over the year. Useful support, yes. A permission slip to buy anything with a roof, absolutely not.
- For Parker Hadley clients, July is a month for sharper briefs and cleaner numbers. There is more choice in parts of the market, but it is not suddenly bargain season. The asset still needs to make sense if rates stay higher and the tax changes actually land.
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The national picture in one table
| Signal | July read | Why investors should care |
| Cash rate | The RBA left the cash rate target unchanged at 4.35 per cent on 16 June, after three earlier increases in 2026. | Borrowing power is still under pressure. A pause is not the same thing as easy money. |
| National values | Cotality says national dwelling values fell 0.4 per cent in June, the largest monthly fall since December 2022. | The downturn is no longer just a Sydney and Melbourne talking point. |
| Capital cities | Cotality says capital city values fell 1.3 per cent over the June quarter, led by Sydney at minus 3.2 per cent and Melbourne at minus 2.6 per cent. | More choice is appearing, but the best assets are not automatically cheap. |
| PropTrack read | PropTrack has national prices down 0.3 per cent in June, with capital cities down 0.4 per cent and regional markets holding steady at a record high. | The market is fragmenting. Investors need to read suburb and asset quality, not just city headlines. |
| Vacancy and rents | SQM says national vacancy held at 1.2 per cent in May and national asking rents were 7.8 per cent higher over the year. | Rental pressure still supports investors, but it does not rescue bad selection. |
| Investor lending | ABS says new investor loan commitments fell 5.3 per cent by number and 3.0 per cent by value in the March quarter. The June quarter release is not due until August. | Active investors should treat old borrowing numbers as stale until checked again. |
| New supply | ABS says total dwelling approvals fell 1.1 per cent in May to 17,019, with private sector dwellings excluding houses down 10.4 per cent. | The supply story still supports long-term rental pressure, but it does not make every new build a good investment. |
| Policy backdrop | The May Budget tax changes are still flowing through behaviour, especially around established investment property, new builds and lender serviceability. | Do not let a tax setting choose the property for you. |
What changed in June
June was quieter than May politically, but more revealing in the actual data. The RBA did not hike again on 16 June, leaving the cash rate at 4.35 per cent, but the Board also made it clear inflation is still too high and another increase is not off the table. That is not exactly a confetti cannon for property investors.
At the same time, the market started showing where the pressure is landing. Cotality has national dwelling values down 0.4 per cent in June, the biggest monthly fall since December 2022. PropTrack has national prices down 0.3 per cent, the third monthly fall in a row. So yes, the market is softer. No, that does not mean everything is suddenly cheap.
Then there is the rental market, still doing its usual trick of tempting investors into lazy thinking. SQM has national vacancy holding at 1.2 per cent and national asking rents up 7.8 per cent over the year. Rents support the holding story, but they do not fix bad strata, poor resale demand, weak floorplans or buying at the wrong price.
The supply side is not exactly rushing to help either. ABS dwelling approvals fell again in May, with apartment and townhouse approvals down sharply. That matters for the long-term rental story, but again, it is not a reason to buy a mediocre asset because the macro setting sounds supportive.
The national read: softer does not mean simpler
There is a bit more truth in the market now. That is useful, even if it is uncomfortable.
The lazy version is to say prices are falling, so buyers should wait for bargains. The equally lazy version is to say rents are tight, so investors should keep buying. Both miss the point.
The better read is that the heat is coming out of the market at different speeds. Sydney and Melbourne are clearly softer. Brisbane, Adelaide and Perth still look strong over the year, but the monthly momentum has cooled. Regional markets are still holding up better than the capitals, but regional Australia is not one neat investment thesis. It is hundreds of local markets, some sensible, some stretched, and some only attractive until you look properly at the asset.
For investors, this is the sort of market where discipline starts to matter more. Good properties can still have competition. Weak properties can sit, get repriced or both. That is exactly why the brief needs to be boringly clear before anyone starts scrolling listings at midnight and calling it research.
If you have not already read it, this is also a good month to revisit our note on negative gearing, borrowing power and lender behaviour. The tax settings matter, but the more immediate issue for many buyers is whether the numbers still work when the lender actually assesses the deal.
Markets on our radar
The point of this section is not to tell you to buy wherever the latest headline sounds hottest. It is to show how we are reading the month in the markets Sydney investors are most likely to ask us about.
| Market | July read | What we like | What we are careful of |
| Brisbane | Still supported, but not bulletproof. Cotality has Brisbane up 0.3 per cent in June, while PropTrack has it down 0.2 per cent. SQM vacancy is still tight at 0.9 per cent, with combined rents up 9.1 per cent over the year. | Owner-occupier-grade houses and townhouses in inner-to-middle ring pockets where transport, schools, tenant depth and resale demand are obvious. | Flood risk, overpaying after a huge run, and assuming strong rent growth can bail out an average buy. |
| Adelaide | Momentum is cooling. Cotality has Adelaide flat in June, while PropTrack has it down 0.2 per cent. SQM vacancy is very tight at 0.7 per cent. | Established family homes and practical townhouses where local owner-occupier demand is real and the supply story is not endless. | Buying weak fringe stock because it still looks cheap compared with Sydney, Melbourne or Brisbane. |
| Melbourne | Softer and more interesting, but still not simple. Cotality has Melbourne down 1.0 per cent in June and 2.6 per cent for the quarter. PropTrack has Melbourne down 1.1 per cent over the year. | Selective value where good owner-occupier-grade assets are being marked down because confidence is thin, not because the property itself is broken. | Oversupplied apartments, land tax drag, weak rental yields and buying simply because a price fall made you feel clever. |
| Perth | Still strong over the year, but the easy momentum story is less clean. Cotality has Perth up 0.7 per cent in June, while PropTrack has it down 0.5 per cent. SQM vacancy is still only 0.7 per cent. | Scarce, practical assets with a broad local buyer pool and rents that are strong without being heroic. | Chasing last year’s growth, ignoring local employment risk and treating tight vacancy as a substitute for asset quality. |
| Geelong | A market to be selective in, not romantic about. It sits inside a softer Victorian story, which can create opportunity, but only when the asset and location are doing real work. | Established family homes and townhouses in proven pockets close to transport, hospitals, schools and everyday services. | Generic estate stock, weak differentiation and buying Geelong as a concept rather than a specific suburb and asset. |
| Sunshine Coast | Still attractive, still expensive, still easy to over-romanticise. Regional and lifestyle markets are holding up better than many capitals, but that does not mean every beachy postcode makes sense. | Scarcer owner-occupier-friendly assets where the tenant and resale story are both obvious. | Lifestyle premium without rental logic, insurance complacency, low yields and confusing a nice weekend away with an investment strategy. |
What we would actually do with this month
- Re-check borrowing power before you fall in love with anything
A borrowing conversation from April or May is not good enough. Rates, lender settings, serviceability and confidence have all moved. Your usable budget may have moved too. - Watch price behaviour, not just price falls
A weaker guide is useful. A property passing in is useful. A vendor changing expectations is useful. But none of that tells you whether the asset is worth owning. Cheaper is not the same as better. - Keep rent assumptions boring
With rents still rising nationally, it is tempting to use an optimistic rent to make a deal work. We would rather use a conservative rent and be pleasantly surprised than build the whole plan around the top of the rental range. - Make new builds prove themselves
Some new builds will make sense, especially if the policy settings tilt demand that way. But new is a filter, not a strategy. The property still needs scarcity, tenant demand, resale appeal and sensible ongoing costs. - Be clear about the future buyer
The easiest investment properties to hold are usually the easiest to explain. If the future owner-occupier buyer is obvious, the tenant profile is broad and the maintenance story is sensible, you are probably looking in the right lane.
Three rules for July
- More stock is not the same thing as better stock.
- Falling prices do not make weak assets clever.
- Tight rents are a buffer, not a strategy.
What we are not doing
- We are not calling every price fall a bargain.
- We are not treating every tight rental market as investor-friendly.
- We are not panic-buying new stock because the tax settings may look better.
- We are not assuming Brisbane, Adelaide or Perth can keep carrying lazy asset selection forever.
- We are not writing off Melbourne just because the headline number looks ugly.
- We are not changing a good investment brief into a tax brief.
Kevin’s take
The thing I like about this market is that it is making investors tell the truth. It is less fun than the boom version, obviously, but it is healthier. If your numbers only worked when rates were lower, every rental estimate was heroic and the tax settings were doing you a favour, they probably did not work in the first place.
For me, July is not a panic month. It is a discipline month. There may be opportunities, especially where softer conditions are giving buyers a bit more space. But the goal is not to win an argument with the market. The goal is to buy something you can hold comfortably and defend rationally.
Better stock, better buffers, less clever nonsense. That is the brief.
Thinking about investing?
See how we help investors shape the strategy, choose the right market and buy well Australia-wide.
