Is Now a Good Time to Buy Property? You're Asking the Wrong Question

Every time the market wobbles, one search term spikes: “is now a good time to buy property?”

It’s an understandable question. It’s also the wrong one.

Property doesn’t move up in a straight line, and it never has. It moves in cycles: periods of growth followed by periods of correction, followed by growth again. Asking “is now good?” assumes there’s a single right answer for the whole country at any given moment. There isn’t. The better question, the one that actually helps you make a decision, is: where are current conditions creating the strongest opportunities, and for what kind of property?

Here’s why that reframe matters right now.

We’re in a downturn. We’ve been here before, eight times.

Australia has just entered its ninth housing downturn since the mid-1990s, according to a recent Domain cycle report. Sydney is heading into its second consecutive quarter of falling prices, with some forecasts pointing to declines of up to 7% over the coming financial year.

If that sounds alarming, it’s worth putting it in context. Every one of the previous eight downturns has been followed by a recovery, and not just a recovery back to where prices started, but a run to new record highs. On average, those downturns have lasted around eight months and shaved off roughly 2.9% in value. The upswings that followed lasted nearly three years and delivered average growth of around 32%.

Zoom out further and the pattern holds. Over the past 40 years, Australian property values have fallen in only six distinct periods: 1990, 1995, 2008, 2011, 2018 and 2022. Despite that, national values have climbed by more than 900% since 1986. Corrections are a normal feature of this market. They are not evidence that something has gone wrong.

Why downturns happen, and why they end

The causes shift from cycle to cycle, but they tend to fall into a few buckets: rising interest rates that squeeze borrowing capacity, tighter lending standards imposed by regulators, or a broader knock to confidence. The 2017–19 downturn, for example, was driven largely by APRA clamping down on investor and interest-only lending rather than any underlying economic weakness. The most recent one, in 2022, was a function of the fastest rate-hiking cycle in decades.

What ends a downturn is usually just as identifiable: rates ease, credit conditions loosen, confidence returns, and the structural pressures that never went away (population growth, chronic undersupply, limited new construction) start pushing prices up again. The mechanics change. The pattern doesn’t.

“The market” is really several markets

This is where the reframe becomes genuinely useful rather than just reassuring.

Right now, the softness is concentrated in Sydney, where price growth has stalled well behind the other capitals. But the markets we focus on tell a much more varied story once you go one level deeper. Adelaide’s rental vacancy rate is sitting at just 0.6%, the tightest of any capital in the country, and Brisbane continues to be underpinned by strong population growth, tight supply and its run-up to the 2032 Olympics. Meanwhile, growth corridors like Geelong and Toowoomba are benefiting from affordability-driven migration out of Melbourne and Brisbane respectively, giving investors exposure to capital-city fundamentals at a regional entry price.

It’s also worth understanding that a downturn doesn’t hit every property type or market the same way. Units in high-density, investor-dominated pockets typically see sharper price falls and softer rental growth than established houses in low-density, owner-occupier suburbs, where limited stock and genuine buyer demand tend to hold values more firmly.

The same divergence shows up by price point. Properties sitting above the median value for their suburb or city are usually the first to soften, as the pool of buyers who can stretch to that price shrinks when credit tightens. Properties priced at or below the local median, the ones the bulk of owner-occupiers and first-home buyers are competing for, tend to hold up better because that demand doesn’t disappear in a downturn.

Location type matters just as much. Holiday and coastal markets often see a wave of discretionary selling in a downturn, as owners offload lifestyle assets to pay down debt or reduce risk, which can push prices down faster than the fundamentals justify. Suburbs with a high share of owner-occupiers are far less prone to that kind of forced or opportunistic selling and tend to be correspondingly less volatile. The same logic applies at a regional level: markets with a narrower economic base are more exposed to a downturn than capital cities and major regional hubs with diversified employment, infrastructure spending and population growth to fall back on.

None of this is a reason to avoid any particular market. It’s a reason to be precise about what you’re buying and why, because “the market” hides enormous variation in how exposed different property types and locations are to the current cycle.

So the question “is now a good time to buy?” doesn’t really have one answer, even within a single buyer’s shortlist. It depends on which market you’re asking about, what kind of asset you’re considering, and what your investment horizon looks like. A high-density unit market in inner Sydney, a tightly-held Adelaide rental market, and a growth-corridor house in Geelong or Toowoomba are three genuinely different propositions in the same month.

Don’t wait for the bottom: you’ll only see it in hindsight

There’s a temptation, understandably, to try to time the exact low point of a cycle. In practice, this rarely works. By the time it’s obvious a market has bottomed, prices have usually already started moving again, and the buyers who waited for certainty end up paying more, not less, for the privilege of feeling safe.

The more reliable approach is to focus on fundamentals rather than forecasts: population growth, supply constraints, infrastructure investment, and rental demand in the specific location you’re considering. Those factors don’t tell you exactly when a market will turn, but they tell you a great deal about whether it’s likely to hold its value and recover strongly when it does.

Less competition, better terms

A downturn isn’t only about price. With fewer active buyers, less bidding pressure and longer average days on market, vendors are typically more open to negotiating on price, terms and settlement conditions than they are in a hot market. Building and pest inspections, extended settlement periods, and genuine reductions off the original asking price are all more achievable when you’re not competing against five other offers. Investors who buy well in these conditions are often locking in better fundamentals at a better price, ahead of the competition that returns once sentiment shifts.

Focus on the fundamentals, not the noise

The loudest headlines during a downturn are almost always about price, because falling prices make for an easy story. What they leave out is supply. Rental vacancy rates remain near historic lows across most capitals, and new housing construction is still running well below what population growth requires. That combination, tight supply and rising underlying demand, is precisely the setup that has preceded every growth cycle over the past 40 years. It doesn’t tell you exactly when the next upswing starts, but it tells you the ingredients are already in place. Investors who can look past the media narrative and stay focused on vacancy rates, supply pipelines and population growth in their target markets are typically the ones best positioned when conditions turn.

The real question

So, is now a good time to buy property?

Wrong question. The right one is: where, right now, do the fundamentals support long-term growth, and is that opportunity being priced accordingly?

That’s a much harder question to answer from a Google search. It’s also exactly the kind of question a buyer’s agent is built to answer, by looking past the national headlines to the suburb-level data that actually determines whether a purchase will perform.

Thinking about your next move? Get in touch with the team at Sound Property to talk through where the current cycle is creating genuine opportunity.