Q3 Market Update: Spring brings signs of renewal
Andrew McCann - Chief Executive Officer & Jellis Craig Foundation Chair
September 2026As we move through the spring selling season, Melbourne’s residential market is showing encouraging signs. However, growth remains more measured than a typical seasonal upswing.
The market has experienced a renewed sense of optimism, with increased activity throughout the first month of spring. At the same time, volumes are thin, with a 6.9% decrease in properties sold across the broader Melbourne market during the month of September ’26 versus the same time last year. That scarcity is helping to support prices, where we have seen a 6.6% increase in median house price growth versus the June ‘26 quarter.
While much of the commentary around Victoria’s property sector has focused on government intervention and interest-rate pressure, vendors entering the market are finding conditions more favourable than the headlines suggest.
I expect this gradual improvement to continue, with depth returning to the buyer pool, boosting competition for quality properties.
Off-market strategy gains momentum
We have also seen an increase in activity in the off-market space, with some vendors choosing to test demand among buyers already known to our network. In a more balanced market, where there is less price movement in either direction, some owners are looking for greater certainty around the sales process.
An off-market campaign can also reduce some of the costs associated with a traditional campaign, depending on the property and circumstances. With our extensive buyer database and network across Melbourne and regional lifestyle locations, we are better placed than most to strategically manage our customers' off-market campaigns.
Rental demand remains robust
The rental market remains tightly contested, with properties in short supply and solid demand from tenants. First-homebuyers moving into home ownership have absorbed some properties from the rental pool, adding further pressure to available stock, with rental vacancy rates across Melbourne dipping in Q3 ’26 to 2.5% versus 3.1% in Q2 ’26.
Higher borrowing costs and tighter regulations have made property investment more complex. However, the underlying demand for rental housing is robust, and investors who have stayed in the sector are benefiting from higher yields than in previous years.
Greater transparency in property sales
Sales reforms came into effect on 1 October, bringing greater transparency to the way information is communicated to buyers. For auctions and fixed-date sales, vendors are now required to publish a reserve price at least seven days prior to the sale. The previous Statement of Information has also been replaced by the Property Price Statement, with new requirements around property information, comparable sales, and pricing.
Buyers are now also able to access more information about sold properties. Once a sale becomes unconditional, agents will now have to update and publish the Property Price Statement with the final sale price. At Jellis Craig, we have always prioritised open and transparent communication with our clients, and we have been preparing our people and systems for these changes. For our team, the new requirements reinforce an approach we take to every campaign: providing clear, accurate information, backed by expertise and a strong understanding of local conditions.
While there will be some changes to the way campaigns are managed, the factors that influence the outcome of a sale remain much the same - the quality and presentation of the property, where it is positioned, and the level of interest it generates. In a changing regulatory environment, the experience and expertise of the agent will become even more important.
Looking ahead to 2027
Heading into the final months of 2026, the window for sellers is narrowing. A state election is also on the horizon, and history tells us these periods can introduce some short-term caution into the housing sector. The final months of the year also tend to move quickly, and with Christmas fast approaching, there is a relatively short period left for planned sales.
Looking further ahead, I’m genuinely optimistic about 2027. Melbourne has been through a relatively soft period, and I anticipate the cycle will shift into a firmer recovery phase in the new year. Victoria continues to offer compelling value compared with the rest of the country. Beneath the noise around price performance, the underlying strength of the market remains sound, and I expect that longer-term recovery to gain traction through 2027.
Victoria’s Consumer Legislation Amendment Act 2026
Victoria’s property sales rules are changing, with new laws introducing greater transparency around property prices and the way residential properties are marketed for sale.
1. Jellis Craig Data, Number of Properties Sold, Greater Melbourne, 1/07/2026 - 30/09/2026 vs 1/07/2025 - 30/09/2025
2. Jellis Craig Data, Median House Price Growth, Greater Melbourne, 1/07/2026 - 30/09/2026 vs 1/04/2026 - 30/06/2026
3. REIV, Rental Vacancy Rates, Greater Melbourne, 1/07/2026 - 1/07/2026 - 30/09/2026 vs 1/04/2026 - 30/06/2026
