Four Million More Aussies
Australia's population is tipped to grow by another four million people over the next decade.
The Centre for Population’s latest population statement predicts there will be 31.5 million Australians by the end of 2035 - 150,000 fewer than previously expected.
According to the statement, population growth will slow to 1.3% in FY2026, mainly due to reduced migration and lower fertility rates.
It says net overseas migration has fallen since its peak in FY2023, with fewer temporary migrants, particularly on student and visitor visas, arriving.
Fertility rates have dropped to a record low of 1.42 children per woman, well below the replacement level of 2.1.
Capital city populations are projected to grow nearly twice as fast as regional populations, with both Sydney and Melbourne expected to exceed 8 million by the 2050s.
In FY2026, Western Australia is expected to have the highest population growth rate of 1.8%, followed by Queensland and Victoria, which are both forecast to grow by 1.5%, ACT, 1.3%, Northern Territory, 1.2%, Sydney, 1.1%, South Australia, 0.8% and Tasmania, 0.1%.
Surge In Unit Approvals
Building approval figures are up, particularly for apartments, according to the latest Australia Bureau of Statistics figures.
The data shows that in the 12 months to November 2025, there was a 3.2% increase in the total number of houses approved and a 55.3% in the total number of units approved.
While strong building approvals are a positive sign, it will be the commencements data, set to be released in late January, that will show whether this is translating into more homes for Australians.
ABS head of construction statistics, Daniel Rossi, says the November data were fairly strong, with an additional 18,406 dwellings approved, with Queensland and Victoria leading the charge.
Master Builders Association chief economist Shane Garrett says while it is good news that approvals are rising, the pace of housing construction remains well short of what is required to meet the Federal Government targets.
Regional Apartment Price Growth
Price growth in Australia’s regional apartment markets is outpacing that in the capital cities.
PropTrack data shows that in 2025, capital city apartment median values grew by 7.7%, while across the combined regions, medians were up by 10.2%.
Apartment markets performed better in Regional NSW than in Sydney (6.9% compared to 5.3%), Regional Victoria over Melbourne (5.2% compared to 3.6%), Regional South Australia over Adelaide (14.6% compared to 13.7%) and Regional Tasmania over Hobart (7.6% compared to 3%).
While growth in Regional Queensland was below that of Brisbane, its apartment market still recorded strong growth of 13.7% compared to 18.3% in the house market.
The median price in regional Australia is $709,000, while units are $638,000, offering a more affordable option to buyers.
According to Cotality data, many regional markets offer higher yields than capital city markets, with higher yields in apartment markets in Regional Queensland, Regional South Australia, Regional Western Australia, and Regional Tasmania.
Regional Western Australia’s apartment market had the highest yield of all major jurisdictions and markets as of January 2026, at 8.2%.
Auction Market 2026
Armed with Federal and State Government buying incentives, first home buyers are tipped to be a strong force in Australia’s auction market this year.
Investors are also expected to be out in force, according to Domain, which is tipping a “robust” auction market in 2026.
Senior economist Joel Bowman says there has been a big pickup in investor lending, and he expects that to lead to active and competitive auction clearance rates in 2026.
This will be on the back of a standout six months across Sydney and Melbourne, where clearance rates consistently hovered in the high 60% to 70% range.
“Strong clearance rates are a pulse check on the market, and when you’ve got clearance rates in that 70% to 80% range, you’re going to see strong price growth,” he says.
While early January is traditionally a quiet time in the auction market, a number of agencies now hold mass auction events toward the end of the month, which are expected to kick start a strong year of auctions.
Still Plenty of Growth
There’s still plenty of growth in the Australian property market, with new data showing that 3,224 markets chalked up double-digit price growth in 2025.
Almost 100 markets achieved growth higher than 30% according to the analysis of PropTrack data.
It was the very affordable markets which recorded the highest levels of growth with many of those top suburbs in regional or remote markets, coming off a very low base, including Western Australia’s Rangeway, which had the biggest increase of 43%, with its median house price up by $120,545 to $402,000.
The rising demand in Darwin continues to drive price growth there with the suburb of Gray achieving the second-highest growth of 40%, bringing its median to $564,000.
The data also shows that medians are continuing to rise in the past quarter, with the highest increases in lifestyle markets.
During the quarter, the Sunshine Beach house market in Queensland chalked up a $527,621 increase in its median, while in Western Australia, the Abbey house market in Busselton was up by $425,240.
