The Market Disconnect.

12 May

What's Really Happening in This Market | Billy Jaz

Billy Jaz · McGrath Palm Beach · Market Update · May 2026

The market has shifted. That's not bad news — it just requires a different approach. Here's a straight read on what's actually happening and what it means for buyers and sellers right now.

3–4 Avg groups per inspection (was 10–30)

$38 Weekly saving from govt affordability policy

60–90 Days until official data reflects reality

Buyers have adjusted. Sellers are catching up.

Open home attendance has dropped from an expected 10 to 30 groups down to an average of 3 or 4. Over the past 8 to 9 weeks buyers have been taking longer to decide, visiting more properties and feeling less urgency. That's a shift — not a collapse.

The properties that are still selling well are the ones that deserve to. Premium location, quality build, honest pricing and a strong campaign. The market hasn't stopped being selective — it's just become more so.

The market hasn't stopped. It's become selective. That's a different thing entirely.

Open Home Attendance — Then vs Now

8–9 weeks ago

10–30

Right now

3–4

The affordability paradox.

The government's changes to capital gains tax and negative gearing are designed to make housing more accessible for first home buyers. The intention is right — but the numbers tell a more complicated story.

Policy Reality Check

What the affordability policy actually delivers

Price before policy $950K Entry level apartment

Price after 10% drop $850K Best case scenario

Actual weekly saving $38 After rate rise from 5.65% to 6.4%

Even in the most optimistic scenario — a 10% price drop offset by rising interest rates — the buyer ends up $38 a week better off. That doesn't meaningfully change behaviour or affordability perception. The policy is visible but the financial impact is minimal.

What actually happens next.

The unintended consequences of the May 12 budget may work against its own goals. Here's the likely chain reaction:

Fewer investors Changes to negative gearing and capital gains tax reduce investor appetite

Fewer rentals Less investment means less rental stock available in the market

Rents go up Higher demand for a shrinking rental pool pushes rents higher

Cheaper to buy than rent Rising rents push more renters into the buyer market

Property prices go up More buyers competing for available stock puts upward pressure on prices

The budget was designed to make housing more affordable. The flow-on effects may do the opposite.

What this means for buyers and sellers.

For Buyers

More leverage than you've had in months.

Less competition at inspections. Slower decision cycles. Sellers more willing to negotiate. If your finance is sorted and you're ready to move, the conditions right now are genuinely in your favour.

For Sellers

Honest pricing is the strategy.

Properties anchored to peak market pricing are sitting. The agents validating inflated valuations to win listings aren't helping their clients. Honest pricing, strong presentation and a quality campaign still achieves strong results.

The data will catch up.

Current low-price transactions are settling now. Within 60 to 90 days the official data will reflect what buyers already know and what the on-the-ground evidence is showing. That's not a reason to panic — it's a reason to make decisions based on current reality rather than waiting for confirmation.

60–90 Days until official data catches up

The market has already moved. The data is just catching up. Act on current reality — not yesterday's numbers.

Navigate this with clarity. Not emotion. The right advice makes all the difference in a transitional market.

Let's talk honestly