South Coast Landlord Update | Market Resilience & Rental Strength

As we move through 2026, the South Coast property market continues to demonstrate resilience, particularly across the Illawarra–Shoalhaven region. While some metropolitan markets have cooled, our coastal region remains underpinned by strong lifestyle demand, migration from Sydney and the ACT, and constrained housing supply.

For landlords, the fundamentals remain encouraging.

Stable Price Growth Supporting Asset Performance

House prices across the South Coast have remained stable or slightly positive throughout 2025. The Illawarra recorded approximately 3.2% annual growth, with Shoalhaven and Eurobodalla also posting modest gains.

Well-positioned homes, particularly those under $900,000 and close to beaches, schools and transport, continue to transact quickly. This reinforces buyer confidence in the region and supports long-term asset stability for investors holding property locally.

Rental Market Conditions Remain Tight

The Illawarra–Shoalhaven region continues to experience historically tight rental conditions. Vacancy rates remain well below balanced levels, sitting under 2% overall and below 1% in many suburbs.

This is resulting in:

• Shorter vacancy periods
• Strong tenant competition
• Consistent leasing activity for well-presented properties
• Ongoing support for rental yield performance

While affordability pressures are being monitored, the structural shortage of rental stock continues to underpin demand.

Regional NSW Momentum into 2026

Recent research indicates no major regional NSW markets are forecast to underperform in 2026. Buyer enquiry and sales activity have strengthened compared to last year, reinforcing regional NSW, including the South Coast, as a sustained growth corridor.

Lifestyle migration remains a key driver, with buyers seeking space, affordability and coastal living while maintaining access to infrastructure and employment hubs.

Infrastructure and Population Growth

Population projections for the Illawarra–Shoalhaven region show steady growth through 2030. Continued investment in roads, health and education facilities will further support housing demand and tenant depth, particularly in centres such as Nowra, Ulladulla and Shellharbour.

What This Means for South Coast Landlords

• Rental demand remains strong, supporting income stability
• Capital values remain steady in a mature lifestyle market
• Lifestyle-oriented properties continue to attract quality tenants
• Regional NSW is drawing increasing investor attention

The South Coast remains a fundamentally sound market for property investors, supported by lifestyle appeal, population growth and limited rental supply.

If you would like an updated rental appraisal, advice on maximising your return, or a review of your investment strategy, our team is here to assist.