AAA<\/p>\n
Property owners in a handful of high-density neighbourhoods are selling at a loss as a wave of supply puts pressure on values.<\/p>\n
It comes as a new forecast predicts house prices could fall as much as 7 per cent in Sydney and 8 per cent in Melbourne over the next 12 months.<\/p>\n
![\"The](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2026\/06\/dcb3c7ac8e8e87c2b2a1d27b749533cb464b2b7a.jpeg\")
The property market is under pressure.Sitthixay Ditthavong<\/p>\n
Home owners overall are unlikely to lose money on a sale. Among the owners who sold during the March quarter, 96 per cent made a profit, the highest share since December 2025, the latest Pain and Gain Report from property research house Cotality found.<\/p>\n
The median gain was a record $377,000. This reflects the increase in value experienced by long-term home owners when it came time to sell, not the current market weakness amid higher interest rates this year and changes to the tax treatment of negative gearing and capital gains in the recent federal budget.<\/p>\n
These record levels of profit may not last across all areas, Cotality head of research Gerard Burg warned.<\/p>\n
Related Article \u201cThere\u2019s a much less clear path to profitability going forward. As we are going into this downturn, we are expecting housing values to decline nationally,\u201d he said, adding the downturn might continue over the next nine to 12 months, having already begun in Sydney and Melbourne.<\/p>\n \u201cThe decline in values over that period does mean the opportunity for a profit is smaller than it was late last year at the peak of the cycle.\u201d<\/p>\n He attributed the downturn to constraints on affordability and mortgage serviceability, three rate hikes from the Reserve Bank, the impact of the Iran war on the cost of living and sentiment, and the budget.<\/p>\n \u201cThey\u2019ve all come together from the demand side to weaken the market overall. It\u2019s really hard to pin down how much is being driven by individual factors – I get the feeling rates are the most important factor but that\u2019s a general sense.\u201d<\/p>\n Not all home sellers made a profit last quarter and the losses were concentrated in neighbourhoods where large-scale high-rise unit developments have been delivered.<\/p>\n In the Melbourne City Council area, 45.1 per cent of all sales lost money in the March quarter. It was followed by Stonnington at 30.2 per cent, Port Phillip at 23.3 per cent and Yarra at 22.8 per cent.<\/p>\n<\/p>\n In Sydney, 21.6 per cent of sales in the Strathfield LGA lost money, 21.2 per cent in Parramatta and 19.9 per cent in Ryde.<\/p>\n Burg attributed the results to \u201clarge-scale unit development within the area, which added a lot of supply in that lumpy fashion.\u201d<\/p>\n<\/p>\n He said in the Melbourne CBD, 49 per cent of unit resales were loss-making, which he described as \u201cvery weak conditions\u201d, although he said the amounts lost were relatively small in terms of dollar value.<\/p>\n Economists broadly expect recent property price falls to continue. Domain\u2019s Forecast Report FY2027 released on Thursday tipped Sydney house prices to fall between 3 per cent and 7 per cent to June 2027, and Melbourne to fall between 4 per cent and 8 per cent.<\/p>\n At the lower end, Sydney\u2019s median house price could fall $122,000 to $1.62 million and Melbourne could fall $84,000 to $966,000.<\/p>\n Chief residential economist for Domain, Nicola Powell, said the slowdown in Melbourne and Sydney began before the budget.<\/p>\n \u201cTax changes like this, they impact the margins. We\u2019re not expecting those changes to have a marked impact on price,\u201d she said, pointing instead to the three consecutive rate hikes earlier this year.<\/p>\n \u201cThe market was already tilting to favour buyers, particularly in Sydney and Melbourne. I think the structural changes have just been the icing on the cake.\u201d<\/p>\n The Domain research expects moderate growth to continue in Brisbane (3 to 7 per cent), Perth (5 to 9 per cent) and Adelaide (4 to 8 per cent), but even that would be a significant slowdown compared to the past few years.<\/p>\n \u201cThis is a market that is slamming the brakes down,\u201d Powell said, noting a lack of supply in the mid-tier capitals was softening the impact of rate hikes but not completely dulling it.<\/p>\n Related Article \u201cOver 2024 and 2025, these [mid-tier cities] were running at double digits, over 20 per cent in some cases. Now we\u2019re looking at single-digit growth.\u201d<\/p>\n Domain forecasts a slower fall for units in Melbourne and Sydney as first-home buyers drive demand for affordable homes. Units in both cities are likely to move in a range of -3 per cent to +1 per cent, the report predicts.<\/p>\n The forecasts are broadly in line with major banks. NAB expects property price falls of 6 per cent in Sydney and 7 per cent in Melbourne this year, while Westpac tips a 3 per cent fall in Sydney and a 4 per cent fall in Melbourne.<\/p>\n Save<\/p>\n You have reached your maximum number of saved items.<\/p>\n Remove items from your saved list<\/a> to add more.<\/p>\n![\"Home](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2026\/06\/47715f14ea4c41172791c6f8a31a3775a87d00e7.jpeg\")
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<\/a><\/p>\n![\"Elizabeth](\"https:\/\/www.newsbeep.com\/uk\/wp-content\/uploads\/2026\/06\/7b851c417d189a0af91b8e82d460bae6c0e27460.png\")
Elizabeth Redman<\/a> is the national property editor at The Age and The Sydney Morning Herald.Connect via X<\/a> or email<\/a>.From our partners<\/p>\n","protected":false},"excerpt":{"rendered":"Save You have reached your maximum number of saved items. Remove items from your saved list to add…\n","protected":false},"author":2,"featured_media":656607,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[84,1294,56,54,55],"class_list":["post-656606","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/656606","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=656606"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/656606\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/656607"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=656606"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=656606"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=656606"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}