Mosman's 2026 Market Forecast

2026 - A year of navigating change in a complex Mosman property market.

If there’s one thing we know for certain, it’s that change waits for no one. Since COVID-19, every year has tested buyers, sellers, and investors alike: interest rates rise, living costs soar, global events ripple through local economies, and policy shifts. In this environment, predicting where the property market will go has never been more challenging.

2026 promises more of the same - but it also offers opportunity for those who understand the forces at play. From government-driven planning changes and low supply in sought-after suburbs, to intergenerational spending habits, the market is a complex web of influences. To navigate 2026 successfully, you need to understand the interplay between these forces and think of it as a carefully balanced ecosystem.— and act strategically when opportunity arises.

In the following report, we break down the key macro and micro factors shaping the property market this year, from local LMR disruption to buyer reactivity, providing insight into what’s likely to influence prices, supply, and opportunities in the months ahead.

1. Local LMR disruption

State Government LMR planning changes introduced last year have materially altered local market dynamics. Increasing numbers of owners are banding together to sell to developers, resulting in a growing volume of properties tied up in option agreements. This has reduced available supply. At the same time, uncertainty around future development has prompted some neighbouring owners to sell prematurely, often accepting below-market prices.

2. Interest rates

Interest rates remain one of the most influential drivers of property values. Any further increases are likely to slow activity, as borrowing capacity continues to constrain buyer budgets. This is particularly evident in established areas such as the Lower North Shore, where vendors often choose not to sell rather than adjust expectations. Younger buyers are most affected, although government initiatives such as low-deposit schemes provide some support.

Property markets are typically driven from the bottom up. Increased apartment activity can trigger a flow-on effect, with apartment owners upgrading to townhouses, semis and freestanding homes. For this cycle to gain momentum, however, it relies on motivated, upwardly mobile Millennials. Whether this occurs remains uncertain, as lifestyle and experience spending continues to compete with home ownership.

3. Cost-of-living pressures

Beyond mortgage repayments, broader household expenses play a critical role in market activity. When budgets are tight, mobility declines—regardless of long-term intentions.

4. Baby Boomers

Baby Boomers have been a significant influence over the past 10–15 years. Through both investment activity and downsizing, they have shaped supply and pricing across multiple segments. Having benefited from extended periods of capital growth, this cohort is generally less price sensitive and more pragmatic in negotiations.

5. Upwardly mobile families

By contrast, families who have purchased more recently tend to be highly price sensitive. Transaction costs—particularly stamp duty—often determine whether an upgrade is viable. As a result, properties are frequently listed and then withdrawn if expectations are not met, contributing to persistently low turnover in many established suburbs.

6. Buyer reactivity

Every property market includes a segment of buyers who respond more to headlines than housing data. In Australia, the amplification of global news through social media and 24-hour commentary has increased hesitation during periods of uncertainty. The practical outcome is a quieter market rather than a weaker one. Reduced urgency and lower transaction volumes can mask underlying demand, which often re-emerges once sentiment stabilises.

With so many forces shaping the market, navigating 2026 requires more than luck. It requires experience and a clear strategy.

If you’re considering buying or selling in 2026 contact Adam Vernon on 0430 824 123