Brisbane prices surge 17 per cent as supply crunch drives sustained growth

For investors seeking durability rather than drama, Brisbane continues to make a compelling case.

Perth may be setting the national growth pace, but Brisbane is delivering something equally significant: sustained, broad-based momentum supported by structural supply shortages, tight rental conditions and accelerating annual gains.

According to Cotality’s Home Value Index to 28 February 2026, Brisbane dwelling values rose 1.6 per cent for the month, matching January’s result. Annual growth accelerated to 17.3 per cent, up from 15.7 per cent. The median dwelling value now sits at $1,080,538, compared with $1,054,555 a month earlier.

Over five years, values have risen 86.1 per cent, a structural shift in demand across southeast Queensland that has endured well beyond the pandemic cycle. While Sydney and Melbourne have stalled, Brisbane continues to record consistent monthly gains that compound meaningfully over time.

Nationally, conditions are increasingly fragmented.

Sydney and Melbourne recorded flat monthly outcomes and have slipped into negative rolling quarterly territory. In contrast, Brisbane (1.6 per cent), Adelaide (1.3 per cent), Hobart (1.2 per cent) and Perth (2.3 per cent) all exceeded the combined capitals’ 0.6 per cent monthly rise. On an annual basis, only Perth (22.0 per cent) and Darwin (19.4 per cent) surpassed Brisbane’s 17.3 per cent result.

Buyer composition is shifting

A notable structural change is emerging in buyer composition.

ABS data shows loans to first-home buyers rose 6.8 per cent from the September to December quarter of 2025 and are 9.1 per cent higher than December 2024, the strongest outcome in two years. Volumes are now at their highest level since March 2022.

Queensland, NSW, Western Australia and the ACT led the gains. The Federal Government’s 5 per cent deposit guarantee and Help to Buy initiative are reducing deposit barriers and expanding the range of accessible properties for entry-level buyers.

This dynamic is influencing price segmentation. Growth below scheme price caps is materially stronger than above them, a trend clearly evident in Brisbane’s stratified data. Competition is concentrated in the lower and middle quartiles, reinforcing upward pressure in more affordable suburbs.

Supply remains the primary driver

Supply constraints continue to underpin Brisbane’s resilience.

According to SQM Research, new listings in January were 15.3 per cent lower than a year earlier, while total listings fell 22.8 per cent year-on-year, in one of the largest declines among capital cities. Overall stock levels sit 31 per cent below the five-year average.

This chronic shortage limits buyer choice and supports vendor leverage. Auction clearance rates averaged 70.4 per cent through February, comfortably above the level typically associated with rising prices.

Importantly, February’s RBA cash rate increase to 3.85 per cent — the first rise since November 2023 — did little to dampen auction momentum. For now, the imbalance between supply and demand is outweighing the near-term drag from higher borrowing costs.

Dwelling values keep rising

Brisbane’s median dwelling value reached $1,080,538 in February. Quarterly growth of 4.8 per cent eased marginally from January’s 5.1 per cent, but the annual result of 17.3 per cent marks a clear acceleration.

Cotality’s stratified index for the three months to January shows the lowest 25 per cent of dwellings rose 6.5 per cent, the middle 50 per cent gained 5.5 per cent and the highest 25 per cent rose 4.0 per cent. While growth has moderated fractionally across all segments, the pattern remains consistent: the lower end continues to outperform.

First home buyers and investors operating below the $1 million price point are driving this divergence.

PropTrack confirmed 0.7 per cent dwelling growth for February, reinforcing the strength evident in Cotality’s data.

House market performance

The median house value in Greater Brisbane rose to $1,175,981 in February, up from $1,149,589 in January. Monthly growth held at 1.5 per cent, while quarterly growth eased slightly to 4.6 per cent. Annual house growth accelerated to 16.7 per cent.

For context, Sydney’s annual house growth sits at 6.8 per cent and Melbourne’s at 5.5 per cent, underscoring Brisbane’s continued outperformance relative to the two largest capitals.

Gross yields remain steady at 3.2 per cent. Including rental income, the total annual return on a Brisbane house over the past 12 months is approximately 20.2 per cent, which is a result that continues to attract both local and interstate investors.

PropTrack reported 0.6 per cent house growth in February, suggesting stable momentum rather than overheating.

Unit market momentum

Brisbane’s unit sector remains the standout performer.

The median unit value reached $844,844 in February, up from $824,764 in January. Monthly growth lifted to 2.1 per cent, while annual growth reached 20.1 per cent.

Multiple tailwinds are converging. Worsening affordability is pushing buyers into the attached dwelling segment, investor demand remains supported by a 4.0 per cent gross yield and rental conditions continue to favour income-focused property holders.

Total annual returns for Brisbane units, including rental income, are estimated at approximately 25.3 per cent and are among the strongest of any capital city.

PropTrack recorded 0.9 per cent unit growth for February.

Rental market tightness

Brisbane’s rental market remains firmly under pressure.

The vacancy rate in Greater Brisbane held at 1.0 per cent in January, well below the 3 per cent level typically associated with balance. Annual house rent growth stands at 6.3 per cent and unit rent growth at 6.8 per cent, both continuing to compound affordability challenges for tenants.

Gross yields remain stable at 3.2 per cent for houses and 4.0 per cent for units. Despite yields sitting below long-run averages, investor appetite remains elevated. Investors account for 41.1 per cent of housing finance commitments in Queensland, compared with a decade average of approximately 33 per cent.

Nationally, the rental index rose 0.7 per cent in February, the strongest monthly result since October 2024. While building approvals have lifted modestly, construction timelines of 12 to 24 months mean meaningful new supply is unlikely before 2027.

Headwinds to monitor

Three risks warrant close observation.

First, escalating geopolitical tensions in the Persian Gulf region may weigh on global confidence and consumer sentiment.

Second, political uncertainty surrounding potential reforms to negative gearing and capital gains tax concessions ahead of the May 2026 Federal Budget could influence investor behaviour. Given investors comprise more than 40 per cent of Queensland housing finance commitments, sustained hesitation from this cohort could moderate competition.

Third, further interest rate increases remain possible following February’s move to 3.85 per cent. Higher borrowing costs will erode purchasing power and may temper short-term confidence.

2026 property outlook

Brisbane is no longer the fastest-growing capital but it remains one of the most structurally supported.

Supply is deeply constrained, vacancy rates are tight, first-home buyers are re-entering and investor participation remains strong.

The fundamental imbalance between housing supply and demand continues to favour gradual upward pressure on values, even if growth moderates from recent peaks.

In a fragmented national market, Brisbane’s appeal lies in its durability. The trajectory may not be linear, but the underlying drivers remain firmly in place.