Is Now the Wrong Time to Buy Property… or the Perfect Time?

Over the past few weeks, I’ve had several clients ask me the same question. “Rich, with everything going on in the world right now, is it a good time to buy property right now? 

It’s a fair question. The headlines are full of reasons to hesitate. But when you step back and look at the fundamentals of the Australian property market, a different story begins to emerge.

Global headlines are unsettling. Inflation is still stubborn. Interest rates may rise again. And there is ongoing speculation about potential changes to capital gains tax in the upcoming federal budget in May.

When you combine all of that with already stretched household budgets, it’s no surprise that many buyers are wondering whether it might be better to “wait and see”.

But history tells us something interesting about property markets.

The best buying windows rarely appear when everyone feels confident. They tend to emerge when uncertainty causes other buyers to step back.

Let’s unpack the fears that are circulating right now and look at what they actually mean for property buyers.

Fear #1: Global Instability and the Iran Conflict

Geopolitical events can shake financial markets and dominate the news cycle. Wars and global tensions create the sense that the world is entering a period of instability.

However, Australian residential property has historically proven remarkably resilient through global shocks.

Think about the events we’ve already lived through:

•  The Global Financial Crisis

• The European debt crisis

• COVID lockdowns and global supply disruption

• Wars in Ukraine and the Middle East

Through each of these periods, property markets paused briefly, but long-term trends continued upward.

Housing demand is fundamentally driven by population growth, household formation, and supply shortages, not geopolitical headlines.

Australia continues to grow rapidly, and people still need somewhere to live.

Fear #2: Oil Prices and Inflation

Rising oil prices can push inflation higher and place pressure on central banks to keep interest rates elevated.

But inflation has an intriguing relationship with property.

Property is one of the few asset classes that tends to benefit from inflation over the long term.

When construction costs rise, the cost of building new homes increases. That naturally pushes up the value of existing properties.

We are already seeing this effect across Australia. Property ownership is one of the best hedges against rising inflation.

Construction costs remain high, development feasibility is tight, and fewer new projects are getting approved. That means the pipeline of future housing supply continues to shrink.

Less new supply eventually translates into stronger prices for existing homes.

Fear #3: Cost of Living Pressure

There is no doubt that households are feeling the pressure of higher living costs.

But this pressure is also having a less obvious effect on the property market.

Many potential buyers are stepping back temporarily. Some are delaying decisions until they feel more financially comfortable.

That reduced buyer activity creates a quieter market environment.

And quieter markets are often where skilled buyers can negotiate the best deals.

Less competition means:

• Vendors are more realistic

• Negotiations are easier

• Buyers have more time to assess opportunities

In contrast, when confidence returns, competition quickly intensifies again.

Fear #4: Interest Rates May Rise Again

Interest rates have already increased once this year, and there is speculation that we could see one or two more rises if inflation remains sticky.

But it is important to remember two things.

First, markets are forward-looking. Much of the interest rate expectation is already reflected in buyer behaviour.

Second, interest rate cycles always turn.

If inflation continues to moderate over the next 12 to 18 months, the next phase is eventually rate cuts.

By the time those cuts arrive, buyer confidence tends to return quickly, and prices often accelerate.

The market fundamentals are in your favour these days. There is a clear undersupply of housing at present, with simply not enough homes to meet demand, and population growth continues to

Push housing needs higher today. Rental markets are strong as well, showing that even in a higher rate environment, rents will continue to rise and property will continue to hold its value. These factors create opportunities for buyers who are ready to jump in now rather than waiting for the ‘perfect’ moment that may never come.

Fear #5: Possible Changes to Capital Gains Tax

Another concern for some buyers is the discussion around proposed changes to capital gains tax (CGT) from the current 50 per cent discount to around 30 or 40 per cent.

A key question is whether any change would be retrospective or only apply to new investments. Historically, the Australian government tends to “grandfather” tax changes, meaning existing properties keep the rules that applied when they were purchased. If that happens, investors who purchase property now, before any policy change takes effect, would still likely receive the current CGT treatment.

Even if a broader change occurred, the impact on long-term property returns would usually be a modest adjustment rather than a major shift. CGT only applies when a property is sold, and many investors hold property for many years. Even if the discount were reduced (for example, from 50% to 33%), the overall gain from long-term price growth and rental income would still outweigh the tax change.

Long term investors who hold quality assets for extended periods are far less affected by short term policy changes.

The real driver of wealth in property has always been time in the market, not timing the market.

Fear #6: “What If I Buy at the Peak?”

This is perhaps the most common concern I hear from buyers.

But peaks are usually only visible in hindsight.

Property markets move in long cycles, not perfect peaks and troughs. Over a five-, ten-, or twenty-year horizon, short term entry points matter far less than owning the right asset in the right location.

And the structural forces supporting Australian property remain very strong.

1. Chronic Housing Undersupply

Australia simply does not build enough homes to meet demand.

Population growth continues to exceed housing completions, and planning constraints make rapid supply increases extremely difficult.

That structural imbalance supports long term price growth. Read more in the major report I published in January - Australian Property Market Outlook 2026–2031 – The Great Supply Crunch Coming.

2. Strong Population Growth

Australia is one of the fastest growing developed nations.

Migration at 250,000 to 300,000+ pa continues to drive housing demand, particularly in major capital cities.

Every new household formed requires accommodation.

3. Tight Rental Markets

Vacancy rates across most Australian cities remain extremely low.

Rents are rising in many markets, so renting longer may end up costing more than buying now. Waiting can also mean missing the chance to benefit from long-term capital growth, which starts accumulating from the moment you enter the market.

For example, someone who bought a home in Sydney in 2016 for $1,000,000 would see it worth $1,760,000 by 2026, generating a capital gain of $760,000. Over the same period, the total rent paid for a similar property would be around $333,000. Even after factoring in rent, the net gain from buying would be over $427,000, showing the real advantage of entering the market rather than waiting.

4. Demographic Wealth Transfer

A significant portion of national wealth sits with Australians over 50, many of whom are equity-rich homeowners repositioning for retirement.

These buyers are less sensitive to interest rates and continue to support housing demand.

5. Reduced Construction Pipeline

High building costs, labour shortages, and development feasibility challenges are reducing future housing supply.

The shortage being created today will influence prices over the next decade.

The Real Opportunity

When uncertainty rises, many buyers step aside in fear.

But the underlying drivers of housing demand do not disappear.

They simply continue building pressure beneath the surface.

This is why experienced buyers often act during periods of hesitation rather than waiting for the market to feel comfortable again.

Because by the time everything feels certain, competition has usually returned and prices have already moved.

Right now, we are seeing:

• Less competition at inspections

• More negotiable vendors

• Increased access to off-market opportunities

• Greater ability to secure quality assets without bidding wars

Those conditions rarely last forever.

Final Thoughts

No one can control geopolitical events, inflation trends, or government policy decisions.

But investors can control the quality of the assets they purchase and the timeframe over which they hold them.

The long-term story for Australian property remains underpinned by strong population growth, persistent supply shortages, and the enduring appeal of well-located housing.

See the Cotality chart below, showing the long-term trajectory of median property prices, with median property prices rising over the last 30 years, despite all kinds of external factors!

Uncertainty may dominate the headlines.

But for well-prepared buyers, it can also quietly create the best buying conditions.

Give us a call on 1300 655 615 to start a conversation about your next property purchase, or click here to send us your enquiry today.

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