Australian Capital Home Prices to Exceed $1M by 2028
Home prices in Australia’s capital cities are projected to exceed $1 million by early 2028. This significant increase is driven by a combination of factors, including housing shortages and growing demand in key urban areas. KPMG’s recent forecasts signal a challenging landscape for potential homebuyers.
Forecast for Home Price Increases
KPMG has estimated that, nationally, home prices will rise by an average of 7.7% in 2026, with similar growth expected for the following year. Major cities like Perth and Brisbane are predicted to experience even larger increases. The expected median price for homes in these capitals will reflect a substantial financial burden for many families.
Projected Median Prices by City
| City | 2026 Median Price | 2028 Predicted Price | Price Increase |
|---|---|---|---|
| Sydney | $1.62 million | $1.81 million | $192,000 |
| Brisbane | $1.15 million | $1.39 million | $240,000 |
| Melbourne | $1.01 million | $1.16 million | $148,000 |
| Perth | $1 million | $1.20 million | $187,000 |
| Adelaide | $1.00 million | $1.08 million | $114,000 |
| Hobart | – | $825,000 | – |
Market Dynamics Driving Prices
Dr. Brendan Rynne, KPMG’s chief economist, indicated that the strong demand for housing surpasses supply, which is expected to fall short by around 30% over the next two years. This gap between growth in population and the pace of housing construction has resulted in a competitive real estate market.
City-Specific Insights
- Sydney: Expected to see a rise to $1.81 million, reflecting ongoing supply shortages.
- Brisbane: Projected median price to reach approximately $1.39 million, potentially making it Australia’s least affordable capital.
- Melbourne: Growing demand may elevate median prices by $148,000, bringing them to $1.16 million.
- Perth: Continued population growth is driving prices up, with an expected median price of $1.20 million.
- Adelaide: Rising unit prices due to affordability concerns, may see median house prices reach $1.08 million.
- Hobart: Gradual increases are expected, with median prices reaching $825,000 by 2028.
Conclusion
The landscape of Australian home prices is set for a dramatic transformation over the next few years. As demand continues to outpace supply, prospective buyers will face increased competition and significantly higher prices. Homeownership in major cities is steadily moving out of reach for many families, especially with the looming threshold of one million dollars becoming a norm.
