Authored by the expert who managed and guided the team behind the Australia Property Pack
Everything you need to know before buying real estate is included in our Australia Property Pack
Australia's property market in early 2026 presents a unique challenge for foreign buyers because a temporary ban on purchasing established dwellings is currently in effect until March 2027, meaning your realistic options are limited to new builds and vacant land.
We constantly update this blog post to reflect the latest regulations, market shifts, and neighborhood-level data so you always have accurate information before making your investment decision.
And if you're planning to buy a property in this place, you may want to download our pack covering the real estate market in Australia.
What's the Current Real Estate Market Situation by Area in Australia?
Which areas in Australia have the highest property prices per square meter in 2026?
As of early 2026, the three areas in Australia commanding the highest property prices per square meter are Point Piper and Vaucluse in Sydney's eastern suburbs, followed by Toorak in Melbourne's inner south, where ultra-premium waterfront and heritage properties dominate the market.
In these most expensive neighborhoods, typical prices range from A$18,000 to A$30,000 per square meter for houses in Sydney's harbourside eastern arc, while Melbourne's Toorak and Brighton hover between A$10,000 and A$18,000 per square meter depending on land size and building quality.
Several distinct factors push prices to these levels across Australia's most expensive suburbs:
- Point Piper and Vaucluse (Sydney): extreme scarcity of waterfront land combined with Sydney Harbour views that attract global wealth.
- Toorak (Melbourne): heritage streetscapes, proximity to elite private schools, and tightly held family estates that rarely trade.
- Brighton (Melbourne): beachside lifestyle combined with excellent public transport links and established retail villages.
Which areas in Australia have the most affordable property prices in 2026?
As of early 2026, the most affordable property prices in Australia are found in outer growth corridors like Mount Druitt and St Marys in Sydney's west, Werribee and Craigieburn in Melbourne's fringe, and Logan Central in Brisbane's south, where new housing estates offer entry points well below capital city medians.
In these more affordable suburbs across Australia, typical prices range from A$3,500 to A$6,000 per square meter for houses, and units can fall even lower at A$4,000 to A$7,000 per square meter in areas like Auburn, Sunshine, or Ipswich.
However, buyers in these lower-priced areas of Australia should expect trade-offs such as longer commute times to central business districts in Mount Druitt or Werribee, higher tenant turnover rates in Logan Central or Woodridge, and variable street-by-street quality in rapidly developing estates like Craigieburn or Mickleham where infrastructure is still catching up to population growth.
You can also read our latest analysis regarding housing prices in Australia.
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Australia. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
Which Areas in Australia Offer the Best Rental Yields?
Which neighborhoods in Australia have the highest gross rental yields in 2026?
As of early 2026, the neighborhoods in Australia with the highest gross rental yields include Armadale and Kwinana in Perth (6.5% to 8% for units), Elizabeth and Salisbury in Adelaide (6% to 7.5%), and Logan Central and Woodridge in Brisbane (6% to 7.2%), where affordable purchase prices combine with tight vacancy rates.
Across Australia as a whole, typical gross rental yields for investment properties range from 3% to 4% in premium inner-city areas up to 6% to 8% in outer suburban and regional markets, with units generally yielding 0.5% to 1.5% more than houses in the same location.
These top-yielding neighborhoods in Australia deliver higher returns than other areas because of specific local dynamics:
- Armadale and Kwinana (Perth): low entry prices around A$350,000 to A$450,000 combined with Perth's vacancy rate of just 0.7%.
- Elizabeth and Salisbury (Adelaide): affordable housing stock under A$400,000 in a city with 0.8% vacancy and strong industrial employment.
- Logan Central and Woodridge (Brisbane): sub-A$500,000 prices in a metro area experiencing population inflows and Olympic infrastructure spending.
- Sunshine and St Albans (Melbourne): gentrifying suburbs with 5% to 6.5% unit yields boosted by the Metro Tunnel opening in February 2026.
Finally, please note that we cover the rental yields in Australia here.
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Which Areas in Australia Are Best for Short-Term Vacation Rentals?
Which neighborhoods in Australia perform best on Airbnb in 2026?
As of early 2026, the neighborhoods in Australia that perform best on Airbnb include Surry Hills, Bondi Beach, and Coogee in Sydney, South Brisbane and West End in Queensland, Fitzroy and St Kilda in Melbourne, and Fremantle in Perth, where occupancy rates often exceed 70% and average nightly rates range from A$180 to A$350.
In these top-performing Airbnb neighborhoods across Australia, typical monthly revenue ranges from A$4,500 to A$9,000 for well-managed one to two bedroom apartments, though this varies significantly with seasonality, property quality, and compliance with local short-term rental regulations.
Each of these neighborhoods outperforms others for short-term rentals due to specific demand drivers:
- Surry Hills and Bondi Beach (Sydney): year-round tourism demand, walkable dining and nightlife precincts, and strong corporate travel.
- South Brisbane and West End (Brisbane): proximity to South Bank cultural precinct and hospitals, plus growing event tourism.
- Fitzroy and St Kilda (Melbourne): arts, music, and beach appeal, though Victoria's short stay levy reduces net income.
- Fremantle (Perth): heritage port town atmosphere with cruise ship visitors and strong weekend tourism from Perth metro.
By the way, we also have a blog article detailing whether owning an Airbnb rental is profitable in Australia.
Which tourist areas in Australia are becoming oversaturated with short-term rentals?
The three tourist areas in Australia showing the clearest signs of short-term rental oversaturation are Brisbane's low-density suburban zones (where new local laws will push hundreds of STRs back to long-term by June 2026), inner Melbourne precincts like CBD, Southbank, and Docklands (where the short stay levy squeezes margins), and Sydney's Bondi and inner east (where the NSW STRA framework caps bookings in some zones).
In these oversaturated areas, active short-term rental listings have grown to the point where Melbourne CBD alone has thousands of competing investor apartments, Brisbane's affected suburban zones contain hundreds of properties now facing permit reviews, and Sydney's eastern beaches have listing densities that trigger regulatory caps under the state framework.
The clearest sign these areas in Australia have reached oversaturation is not just high listing counts but active regulatory intervention, with Brisbane City Council explicitly targeting STR conversions through its proposed Short Stay Accommodation Local Law 2025, Victoria's levy creating a direct cost on short-stay income, and NSW's 180-day caps in certain Greater Sydney areas forcing operators to choose between compliance and revenue.
We have made this infographic to give you a quick and clear snapshot of the property market in Australia. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
Which Areas in Australia Are Best for Long-Term Rentals?
Which neighborhoods in Australia have the strongest demand for long-term tenants?
The neighborhoods in Australia with the strongest demand for long-term tenants include Randwick and Westmead in Sydney (hospital and university precincts), Carlton and Parkville in Melbourne (medical and education hubs), Chermside in Brisbane (major suburban employment node), and Victoria Park in Perth (close-in renter demand with lifestyle amenity).
In these high-demand neighborhoods across Australia, typical vacancy rates sit well below 2%, often closer to 1%, meaning well-priced rental properties in areas like Westmead or Chermside lease within one to three weeks of listing, compared to four to six weeks in more balanced markets.
Different tenant profiles drive demand in each of these strong rental markets:
- Randwick and Westmead (Sydney): healthcare workers, medical students, and university staff seeking proximity to major hospitals.
- Carlton and Parkville (Melbourne): postgraduate students, academics, and hospital employees near University of Melbourne.
- Chermside (Brisbane): retail and healthcare employees at Westfield Chermside and Prince Charles Hospital.
- Victoria Park (Perth): young professionals and couples attracted by cafes, restaurants, and easy CBD access.
What makes these neighborhoods especially attractive to long-term tenants in Australia is their combination of reliable public transport (all are on major train or bus corridors), walkable access to employment (reducing car dependence), and established amenity including supermarkets, medical services, and dining options within a short walk.
Finally, please note that we provide a very granular rental analysis in our property pack about Australia.
What are the average long-term monthly rents by neighborhood in Australia in 2026?
As of early 2026, average long-term monthly rents in Australia's main neighborhoods range from around A$1,700 to A$2,600 for one to two bedroom units in outer affordable suburbs up to A$5,000 to A$11,000 for houses in premium inner-city locations, with significant variation between cities and dwelling types.
In the most affordable neighborhoods of Australia, entry-level one to two bedroom apartments typically rent for A$1,600 to A$2,600 per month, with suburbs like Armadale in Perth, Logan Central in Brisbane, and Sunshine in Melbourne sitting at the lower end of this range.
For mid-range apartments in average-priced neighborhoods across Australia, monthly rents generally fall between A$2,400 and A$3,600, covering areas like Parramatta and Westmead in Sydney, Brunswick and Coburg in Melbourne, and Chermside in Brisbane where amenity and transport access balance against price.
At the top end, high-end apartments in Australia's most expensive neighborhoods command monthly rents of A$3,400 to A$5,200 for units in Surry Hills or Darlinghurst in Sydney and South Yarra in Melbourne, while premium three bedroom houses in these areas can exceed A$7,000 to A$11,000 per month.
You may want to check our latest analysis about the rents in Australia here.
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Which Are the Up-and-Coming Areas to Invest in Australia?
Which neighborhoods in Australia are gentrifying and attracting new investors in 2026?
As of early 2026, the neighborhoods in Australia currently gentrifying and attracting new investors include Marrickville and Dulwich Hill in Sydney's inner west, Footscray and Seddon in Melbourne's inner west, Woolloongabba and Stones Corner in Brisbane's inner south, and Bayswater and Maylands in Perth's inner northeast, where lifestyle amenity improvements and transport upgrades are drawing younger buyers priced out of premium suburbs.
These gentrifying neighborhoods in Australia have typically experienced annual price appreciation of 5% to 10% over recent years, with areas like Footscray seeing particularly strong gains as the Metro Tunnel approaches full operation in February 2026 and as young professionals substitute down from more expensive inner-north options.
Which areas in Australia have major infrastructure projects planned that will boost prices?
The areas in Australia with major infrastructure projects expected to boost property prices include suburbs along Melbourne's new Metro Tunnel corridor (Sunshine, Arden, Parkville), Sydney's Metro West line stations (Parramatta, Sydney Olympic Park, Five Dock, Pyrmont), and Western Sydney around the new airport and Bradfield station.
Specific infrastructure projects driving these expectations include the Melbourne Metro Tunnel which began full services in February 2026 connecting Sunbury to Pakenham via five new underground stations, the Sydney Metro West currently under construction with stations at Westmead through to Hunter Street in the CBD, and the Western Sydney International Airport opening in 2026 with an associated metro line to Bradfield station.
Historically in Australia, areas near major infrastructure completions have seen price increases of 10% to 20% in the three to five years following project delivery, though this varies significantly based on how much of the uplift was already priced in during construction and whether new housing supply floods the area simultaneously.
You'll find our latest property market analysis about Australia here.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Australia versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
Which Areas in Australia Should I Avoid as a Property Investor?
Which neighborhoods in Australia with lots of problems I should avoid and why?
The neighborhoods in Australia with significant problems that investors should generally avoid include parts of Mount Druitt, Bidwill, and Tregear in Sydney's far west, sections of Woodridge and Kingston in Brisbane's Logan corridor, and portions of Davoren Park and Elizabeth in Adelaide's northern suburbs, where higher vacancy risk, tenant turnover, and property condition issues require intensive management.
Each of these problem areas presents distinct challenges for property investors:
- Mount Druitt, Bidwill, Tregear (Sydney): higher rates of rental arrears and property damage, street-by-street quality variation.
- Woodridge and Kingston (Brisbane): concentrated social housing creating uneven tenant quality and resale difficulty.
- Davoren Park and Elizabeth (Adelaide): high yields attract investors but tenant risk and maintenance costs erode returns.
- Melbourne CBD, Docklands, Southbank (investor towers): oversupply of similar stock, building quality dispersion, and resale sensitivity.
For any of these neighborhoods in Australia to become viable investment options, they would need sustained infrastructure investment improving transport links and local amenity, diversification of housing stock beyond concentrated social housing, and demonstrated rent collection and resale track records that reduce the management intensity currently required.
Buying a property in the wrong neighborhood is one of the mistakes we cover in our list of risks and pitfalls people face when buying property in Australia.
Which areas in Australia have stagnant or declining property prices as of 2026?
As of early 2026, areas in Australia showing stagnant or declining property prices include parts of Sydney and Melbourne where month-on-month momentum has softened relative to other capitals, with specific suburbs like Millers Point and Darling Point in Sydney recording unit median declines, and Melbourne CBD apartment precincts facing persistent price pressure from competing stock.
These areas in Australia have experienced price stagnation or declines of 2% to 10% over the past year in some pockets, with PropTrack reporting that 124 suburbs nationally saw price falls of up to 55% in specific dwelling categories, though the median declines in most affected areas sit closer to 3% to 8%.
The underlying causes of price stagnation or decline differ by area:
- Millers Point, Darling Point units (Sydney): liquidity-driven volatility in ultra-premium markets where few sales skew medians.
- Melbourne CBD and Docklands apartments: structural oversupply of investor-grade stock with building quality concerns.
- Regional Victoria: recorded the lowest growth among rest-of-state regions at 6% in 2025, lagging other states.
- Hobart: prices still below their 2022 peak as the market consolidates after a sharp pandemic-era run-up.
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Which Areas in Australia Have the Best Long-Term Appreciation Potential?
Which areas in Australia have historically appreciated the most recently?
The areas in Australia that have historically appreciated the most over the past five to ten years include Perth's coastal and close-in suburbs, Brisbane's inner riverside belt, Adelaide's inner ring, and Sydney's eastern suburbs and inner west lifestyle corridors, where supply constraints and strong demand have compounded price growth well above national averages.
These top-performing areas achieved significant appreciation over recent years:
- Perth, Brisbane, Adelaide: compound house value growth approaching 90% over the five years to 2025.
- Darwin: led capital cities in 2025 with 18% annual growth as the market recovered from prior weakness.
- Sydney's eastern suburbs and inner west: consistent outperformance driven by extreme scarcity and global buyer interest.
- Melbourne's inner north and bayside: strong appreciation in tightly held heritage and lifestyle precincts.
The main driver of above-average appreciation in these areas of Australia has been the combination of chronic housing undersupply, strong population growth particularly through interstate and overseas migration, and limited capacity to add new stock in established, amenity-rich locations where zoning and heritage controls restrict development.
By the way, you will find much more detailed trends and forecasts in our pack covering there is to know about buying a property in Australia.
Which neighborhoods in Australia are expected to see price growth in coming years?
The neighborhoods in Australia expected to see the strongest price growth in coming years include Ryde and Meadowbank in Sydney (transport-linked middle ring), Preston and Reservoir in Melbourne (value with infrastructure adjacency), Chermside and Woolloongabba in Brisbane (employment nodes with Olympic-related development), and Bayswater and Victoria Park in Perth (close-in demand with amenity).
Projected growth varies by neighborhood profile and market conditions:
- Ryde, Meadowbank, Parramatta corridor (Sydney): 5% to 7% annual growth forecast as Metro West construction progresses.
- Preston, Reservoir, Sunshine (Melbourne): 5% to 7% expected as Metro Tunnel services begin and affordability drives substitution.
- Chermside, Woolloongabba (Brisbane): 6% to 8% projected with Olympic infrastructure investment and population inflows.
- Victoria Park, Bayswater (Perth): 6% to 9% forecast given Perth's tight 0.7% vacancy and ongoing mining sector strength.
The single most important catalyst expected to drive future price growth in these neighborhoods across Australia is the combination of expanded first-home buyer support (including the 5% deposit scheme) funneling demand into affordable price brackets, infrastructure completions improving accessibility, and persistently tight rental markets signaling underlying demand strength.
We made this infographic to show you how property prices in Australia compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
What Do Locals and Expats Really Think About Different Areas in Australia?
Which areas in Australia do local residents consider the most desirable to live?
The areas in Australia that local residents consider the most desirable to live include Sydney's beach suburbs like Bondi and Coogee plus the harbourside eastern suburbs, Melbourne's inner north lifestyle belt around Fitzroy and Brunswick plus the bayside strip, Brisbane's inner riverside suburbs like New Farm and Teneriffe, and Perth's beach corridor from Cottesloe to Scarborough.
Each of these locally desirable areas has distinct appeal:
- Bondi, Coogee, eastern suburbs (Sydney): beach lifestyle combined with village atmosphere and proximity to the CBD.
- Fitzroy, Brunswick, bayside (Melbourne): arts and cafe culture in the inner north, family-friendly beach access in the bayside.
- New Farm, Teneriffe (Brisbane): riverside dining, heritage warehouses, and walkable urban village feel.
- Cottesloe, Scarborough (Perth): iconic beach lifestyle with sunset views over the Indian Ocean.
These locally preferred areas in Australia are typically populated by established professionals, families with dual incomes prioritizing school zones, and long-term residents who bought before recent price surges, creating tightly held markets where turnover is low.
Local preferences in Australia often differ from what foreign investors target because Australians prioritize school catchments, beach or park proximity, and neighborhood character over CBD proximity or rental yield, while foreign buyers frequently overweight central location and "recognizable" suburb names even when daily life convenience is better elsewhere.
Which neighborhoods in Australia have the best reputation among expat communities?
The neighborhoods in Australia with the best reputation among expat communities include Chatswood and Randwick in Sydney (North Shore hub and university precinct), South Yarra and Carlton in Melbourne (lifestyle and academic access), New Farm and South Brisbane in Brisbane (inner amenity), and Subiaco and Scarborough in Perth (established expat infrastructure).
Expats prefer these neighborhoods over others in Australia for specific practical reasons:
- Chatswood (Sydney): Asian dining and shopping, international school access, and direct train to CBD.
- Randwick (Sydney): university and hospital employment, diverse community, light rail to CBD.
- South Yarra, Carlton (Melbourne): cafe culture, university proximity, established apartment stock for easy relocation.
- Subiaco, Scarborough (Perth): English-speaking professional networks, beach access, and quality housing stock.
The typical expat profile in these popular neighborhoods includes corporate transferees on two to four year assignments prioritizing easy airport access and turnkey apartments, international students and academics near universities, and skilled migrants in healthcare or professional services seeking established community networks.
Which areas in Australia do locals say are overhyped by foreign buyers?
The three areas in Australia that locals commonly say are overhyped by foreign buyers are Melbourne CBD, Docklands, and Southbank apartment towers, generic high-rise precincts in Sydney's inner city, and "name brand" suburbs where foreign buyers pay premiums for recognition rather than livability.
Locals believe these areas are overvalued for specific reasons:
- Melbourne CBD, Docklands, Southbank: oversupply of similar investor-grade apartments with variable building quality and weak resale.
- Sydney inner-city towers: high strata fees, construction quality concerns, and competing stock diluting rental returns.
- "Name brand" premium suburbs: foreign buyers overpay for suburb reputation without understanding street-level variation.
What foreign buyers typically see in these areas that locals do not value as highly is the perceived prestige of a central address and skyline views, while locals prioritize neighborhood character, school catchments, building quality, and long-term livability over CBD proximity or landmark buildings.
By the way, we've written a blog article detailing the experience of buying a property as a foreigner in Australia.
Which areas in Australia are considered boring or undesirable by residents?
The areas in Australia that residents commonly consider boring or undesirable include new outer fringe estates far from established town centers in every capital city, car-dependent suburbs with limited public transport, and areas with weak amenity clusters lacking walkable shops, cafes, and services.
Residents find these areas boring or undesirable for practical lifestyle reasons:
- New outer estates (all capitals): long commutes, limited public transport, and amenity that lags population growth by years.
- Car-dependent middle suburbs: poor walkability makes daily life inconvenient without multiple vehicles.
- Industrial-adjacent areas: noise, truck traffic, and limited retail or dining options reduce lifestyle appeal.
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What sources have we used to write this blog article?
Whether it's in our blog articles or the market analyses included in our property pack about Australia, we always rely on the strongest methodology we can and we don't throw out numbers at random.
We also aim to be fully transparent, so below we've listed the authoritative sources we used, and explained how we used them and the methods behind our estimates.
| Source | Why It's Authoritative | How We Used It |
|---|---|---|
| Australian Taxation Office (ATO) | Official enforcement body for foreign investment rules in Australia. | We used it to confirm the foreign buyer ban dates and exceptions. We also verified which property types foreigners can legally purchase in 2026. |
| Foreign Investment Portal | Federal government's official gateway for foreign investment policy. | We used it to frame what foreign buyers can realistically purchase. We cross-checked policy updates before discussing area recommendations. |
| Cotality (formerly CoreLogic) | Australia's most widely used housing index provider used by banks. | We used it to describe early 2026 market turning points by city. We relied on their data for identifying which markets cooled versus stayed hot. |
| Domain Rental Report | Major property portal with transparent long-running rental data series. | We used it to triangulate rent levels and growth by city and dwelling type. We kept rental analysis consistent with vacancy and yield datasets. |
| SQM Research | Long-standing Australian housing data provider for vacancy and rent. | We used it to identify structurally tight versus normal rental markets. We converted vacancy tightness into yield confidence assessments by suburb. |
| Housing Australia Data Portal | Government portal aggregating major housing indicators with clear methodology. | We used it to ground national and capital city price direction without hype. We sanity-checked private index claims against this official source. |
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