If you are an investor weighing up your next purchase, you are probably hearing two opposite things. One camp says wait until early next year and see where the market settles. The other says this is exactly the time to buy, because vendors are finally negotiating. Both camps have a point. This article sets out what the data actually says, the pros and cons of each path, and how to decide which one suits your situation.
What the market looks like right now
Conditions have tilted towards buyers in 2026. The Reserve Bank has lifted the cash rate four times this year to 4.60%, the highest level since 2011, and the market is widely expecting another move at the 3 November meeting. Cotality’s Home Value Index shows Sydney values down about 7% over the past year, and national values have now fallen for six months in a row. Listings are up, homes are taking longer to sell, and Herron Todd White reports vendor discounting at its widest in over three years, with median time on market stretching from 27 to 44 days. In plain terms: sellers are more flexible than they have been for a long time.
The case for buying now
Negotiating power. With more stock on the market and longer selling times, buyers are in a stronger position than they have been in years. Stale listings that have sat for 60 days or more are where the most room tends to be, because the vendor’s price expectations have had time to meet reality. How much a vendor will move depends on the listing, not the headline average.
Less competition. Fewer buyers means fewer bidding wars, more time to do due diligence, and the ability to make offers with conditions such as finance and building inspections that would be ignored in a hot market.
Choice. Higher listing volumes mean you can be selective about the property, rather than settling for whatever you can win.
Cash flow starts earlier. Every month you wait is a month of rent and equity growth you do not have. Over a long hold, time in the market has historically mattered more than perfect entry timing.
Pre-approval and structure can be sorted now. You can have your finance position, lender order and structure locked in so you are ready to move when the right property appears.
The case for waiting until early 2027
Prices may still be falling. Cotality’s research director has said a further 10 to 15 per cent decline across the coming months is a reasonable estimate, and the market is still in a downward cycle. Buying today does not guarantee you are buying at the bottom.
Rates may not have peaked. Another hike is widely expected, which reduces borrowing capacity and lifts repayments. If rates peak and begin to ease, serviceability improves and more buyers return.
Forecasts are mixed. Domain’s FY27 forecast has Sydney and Melbourne houses falling over the year to June 2027, while ANZ Research has pencilled in a modest recovery for Sydney in 2027. Experts disagree, which is itself a reason to be cautious about any all-in call on timing.
Cash buffers. If you are stretched, waiting to build a larger buffer for repayments and costs is a legitimate and sensible choice.
More clarity on policy. The Budget tax changes are still being implemented, and waiting gives you time to take advice on how they apply to you.
What happens when the market turns
Most investors who say they are waiting for the market to pick up are really waiting for confidence to return. The risk is that confidence returns for everyone at once. When rates peak and prices stabilise, buyers who have been sitting on the sidelines tend to come back together, listings get absorbed, auction clearance rates lift and the room to negotiate narrows quickly. That is when the stock you could have bought at a discount starts attracting multiple offers. Nobody can call the exact bottom, and the investors who tend to do best are those who are prepared and decisive during the quiet period rather than reactive during the busy one.
A caution on aggressive offers: this is a buyers’ market, but it is not a free-for-all. A very low offer can work on a stale, overpriced listing with a motivated vendor. On a well-priced property in a strong pocket it usually just ends the conversation. Offer with evidence (comparable sales, days on market, building condition), not just a number.
The tax changes every investor needs to understand
The May 2026 Federal Budget changed the rules for investors, and it directly affects the timing decision. As announced, negative gearing for properties bought after 7.30pm on 12 May 2026 is restricted so that losses on established homes can no longer be deducted against your other income, with new builds treated differently. From 1 July 2027 the 50% capital gains tax discount is replaced with cost base indexation and a 30% minimum tax on real gains, with the old discount continuing to apply to gains accrued before that date. CommBank estimates the combined effect will leave house prices a little under 3% lower than they otherwise would have been. These measures are proposed policy and the detail can change, so the practical point is this: the type of property you buy (new build versus established) may now matter as much as when you buy it. Speak with your accountant before you commit.
Two markets, not one
There is no single Australian market. Sydney and Melbourne have led the correction, while Perth, Adelaide and Brisbane have been stronger, and units have generally held up better than houses. Your timing decision should be made at suburb and property level, not on a national headline.
How to decide: five questions to ask yourself
1. Can I comfortably service the loan if rates rise further? (Test it with a buffer, not the best case.)
2. Do I have a cash buffer beyond the deposit and costs?
3. Am I buying for a 10 year plus hold, or do I need a short-term gain?
4. Is this specific property priced on evidence, and has it been on the market long enough to give me real leverage?
5. Does the tax treatment of this purchase (new versus established) still stack up after the Budget changes?
If the answers are yes, buying in a soft market can be a strong strategic move. If any answer is no, waiting, or restructuring first, is not a failure. It is part of a plan.
Where a broker fits in
Whether you buy now or wait, the work that gives you an edge happens before you make an offer: understanding your true borrowing capacity under current lender policy, choosing the right lender order so you do not hit a ceiling at two or three properties, and structuring your loans so you can move quickly when the right opportunity appears. With access to 50+ lenders and over 1,500 deals settled, ES Finance helps investors build that position, and we stay in touch long after settlement. Jignesh Joshi is a Chartered Accountant with more than 10 years in lending.
Sources: Cotality Home Value Index, October 2026; Herron Todd White, Australian Property Month in Review, August 2026; Reserve Bank of Australia cash rate decisions; Domain FY27 Housing Market Forecast; ANZ Research property forecasts; Federal Budget 2026-27 negative gearing and CGT factsheets; CommBank 2026 Budget housing outlook.
General information only. It does not consider your objectives, financial situation or needs. Speak with a licensed adviser and your accountant before acting. See our Disclaimer.
