What 2026 Could Mean for the Illawarra & Shoalhaven Property Market

After a strong rebound last year, the property market is expected to continue to remain strong throughout 2026. For the Illawarra and Shoalhaven, the focus is shifting firmly toward affordable housing and value.

While premium coastal pockets have seen strong price growth, many buyers are now looking to suburbs where home ownership is still achievable. This is especially true for first home buyers using government incentives like the 5% deposit scheme, which is helping drive demand in suburbs that sit under price caps. Along with the stamp duty waivers for first home owners, there are plenty of good incentives for those entering the market.

Where Demand Is Heading

In both regions, we’re seeing increased interest in:

• More affordable suburbs and growth corridors

• Townhouses, villas and apartments over large detached homes, particularly close to transport infrastructure 

• Well-connected regional centres offering lifestyle and employment

As prices rise in popular areas, buyers are quickly turning their attention to neighboring suburbs that still offer value, creating pockets of steady growth rather than broad market surges.

What This Means for Investors and Renters

Rental markets across the Illawarra and Shoalhaven remain strong, with demand continuing to outstrip supply. Limited new construction means rents are likely to rise again in 2026, particularly in well-located suburbs close to employment opportunities, schools and transport.

The Bottom Line

2026 is shaping up to be a year of measured growth, not market-wide spikes. For buyers and investors, the best opportunities are likely to be found in affordable, well-positioned suburbs where demand remains strong and supply is limited.

Understanding where value exists locally will be key to making the right move in the year ahead.