Interest Pain for Vendors, Opening the Door for Savvy Purchasers
The Sydney housing market has charged into 2026 following a powerhouse finish to last year. Driven by the momentum of lower interest rates, improving household incomes, and supportive government policies, we saw first-home buyers reclaim their seat at the table in record numbers.
The numbers speak for themselves: across 2025, Sydney house prices surged by 9% (a cool $150,000 increase), while units held steady with a respectable 5% rise ($39,000).
The Shifting Tide
However, today’s interest rate rise of 0.25% serves as a sharp reality check. This move will undoubtedly "take the wind out of the sails" for new homeowners and those already navigating the tightrope of mortgage repayments.
It wasn't long ago that Treasurer Jim Chalmers assured the nation that "the worst of inflation is behind us," a statement that acted as a green light for many to re-enter the property fray. Yet, with Australia’s inflation rate hitting 3.8% in December, the narrative is shifting. Affordability remains the "elephant in the room" for the government as the cost-of-living crisis continues to squeeze Australian households.
Navigating the Noise
In a world of geopolitical uncertainty and a 24-hour news cycle, the market is currently flooded with contradicting opinions. For many buyers and sellers, this "information overload" breeds anxiety.
We are seeing a unique tug-of-war in the data:
The Bull Case: Australia’s fundamental housing shortage remains a primary driver of value.
The Bear Case: Slowing population growth, an uptick in building approvals, and a "higher-for-longer" rate environment suggest that supply could finally start to catch up, potentially dampening rapid price growth.
The Fox Verdict: Fortune Favours the Decisive
At Fox Auctions, we cut through the white noise. While trying to predict the exact percentage of growth in 2026 is as difficult as predicting the RBA’s next move, one thing is certain: Property prices are on an upward trajectory.
The old adage holds more weight today than ever: If you want to sell, sell. If you want to buy, buy. > "Opportunities in life are never lost; they are simply taken by the people who have the courage to make a decision." - Andy Rooney.
The current volatility isn't a "stop" sign—it's an opening. For vendors, the window to achieve a premium price remains open while stock is still relatively tight. For purchasers, any temporary cooling provides a rare gap to enter the market before the next inevitable climb.
