Cotality's Home Value Index comment

2 Mar

min read

Cotality's Home Value Index comment

02 Mar 2026

min read

The following statement can be attributed to Oliver Hume Chief Economist, Matt Bell.

Today’s Cotality house price results means more of the same for South East Qld, Perth and Adelaide land markets where prices are rising faster than house prices because of low supply and an expensive established market.

But for Melbourne (and to a lesser extent, Sydney), we’re at the point where the lack of any real growth in established housing markets puts more pressure on the land market, which has struggled with a competitive established market for three years now. Without a return to consistent price growth in the housing market, it’s hard to see any real tick up in delivery of new house and land for Melbourne and Sydney.

Cotality’s Home Value Index for February rose 0.6% to get annual national house price growth to 9.9%, but the divergence between the haves and the have-nots is becoming even more stark.

Melbourne and Sydney were flat for the month of February, and have now tipped over into negative price growth over the last quarter. Perth, Brisbane and Adelaide are going the other way, with rising monthly gains and annual price growth now ranging from 11% to 22%.

The only silver lining for Sydney and Melbourne is that the affordable end of the market is performing significantly better than the premium end. Prices in the lowest quartile of the market continue to rise (up 0.2% in February) and these are the ones that compete the most heavily with new house and land packages.

Hopefully, the 33% jump in new home sales reported in January in Victoria is more indicative of the level of activity in the land market we can expect in the rest of the first quarter of 2026.

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