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March 2026 Illawarra Market update

National house prices rose by 0.7 per cent in March and 2.1 per cent for the quarter while Sydney and Melbourne slipped backwards, according to latest figures by Cotality. In the Illawarra, all dwelling categories rose between 0.9 and 1.1 per cent for March.

Tim Lawless, Cotality research director, said despite the backsliding of our northern cousin, the Illawarra remained a bright spot in the property market. “We haven’t really seen any demonstrated loss of momentum over the past couple of months,” Mr Lawless said. “It does seem to be a market that is quite resilient at the moment.”

Lawless said the strength of the Illawarra market had to do with its affordability in comparison to Sydney, but warned that international pressures, cost of living and interest rates may put pressure over the coming months.

Mr Lawless said that the Illawarra market was becoming a little more balanced between buyers and sellers with buyers keen to pick up a bargain being able to do so.

The three I’s set to impact Illawarra real estate

Troubles overseas are set to have an impact on affordability in the real estate market as economists tip inflation to force the RBA’s hand on interest rates a further three times this year.

With the three I’s dominating the headlines over the last month – Iran, inflation and interest rates – property experts believe that many buyers and sellers are adopting a wait and see approach.

Head of research at Cotality, Grant Burg says that market has been impacted by affordability constraints after back-to-back interest rate rises plus the added uncertainty about the direction of rates and energy. Burg says, “That hesitancy of not knowing where rates, where energy prices, where incomes might head in the short term, might be discouraging.”

The added cost of interest rate rises and skyrocketing fuel prices will put the RBA and the government in a difficult position when it comes to further rate rises.

Discover Wollongong

Sitting at the heart of the Illawarra, Wollongong continues to cement its position as one of the state’s most liveable coastal cities, balancing lifestyle appeal with economic growth.

Once defined by heavy industry, Wollongong has undergone a steady transition into a more diversified economy, underpinned by education, health and professional services. The presence of the University of Wollongong remains a key driver, supporting both population growth and a strong rental market, particularly in and around the CBD.

Lifestyle remains the city’s strongest drawcard. With pristine beaches at North and City Beaches, combined with the escarpment backdrop, the area continues to attract a mix of Sydney commuters, downsizers and young professionals seeking more space and value.

Affordability, while tightening, is still a relative advantage. Compared to Sydney, Wollongong offers a lower entry point, particularly in the unit market, which has seen consistent demand. The latest figures show unit values lifting, reflecting ongoing interest from both investors and first-home buyers looking to secure a foothold in a coastal market.

Calls for better Wollongong transport

The Property Council of Australia is lobbying the NSW government to create better transport links in Wollongong on the back of increased building activity. The regional director of the Property Council Matthew Wales said that without road upgrades, better freight and transport links to ease congestion.

“The Illawarra region’s growth and economic transition will stall without targeted investment in roads, freight links and public transport,” Mr Wales told Region. “Our region is growing fast and diversifying, but people and freight still get stuck – that’s a productivity hit, and it puts a brake on new housing.”

According to the latest figures by Cotality, Wollongong unit prices rose 1.6 per cent in March with the median value now sitting at $842,975, an increase of 7.5% over the year. The flurry of building activity will put more pressure on roads in and out of the CBD.