Cooling Housing Market and Rising Landlord Divestment Drive Surge in Off-Market Property Sales

The Australian property market is experiencing a significant shift toward off-market transactions as cooling prices and market volatility prompt vendors to seek lower-visibility sales. Melbourne buyers agent Emily Wallace reports a surge in landlords divesting their portfolios due to rising holding costs and regulatory burdens, often selling directly to first-home buyers. This trend is reshaping the real estate landscape by reducing rental stock and challenging traditional agency rent rolls while offering a strategic alternative for sellers wary of public campaign failures.

Melbourne-based buyers agent Emily Wallace reports a significant surge in off-market transactions, noting that 83 percent of her agency’s purchases last month occurred privately, a sharp increase from the 58 percent average seen in 2025. Vendors are increasingly choosing low-visibility sales to avoid public scrutiny and the risk of a failed campaign in a cooling market where prices are beginning to dip. This approach serves as a safety blanket for sellers, allowing them to bypass the high costs of major listing portals—which can reach $5,000 per listing—and avoid committing to a public price online during periods of market turbulence.

The trend is heavily influenced by a wave of landlords selling their investment properties to first-home buyers, driven by rising holding costs and more onerous regulatory requirements in states like Victoria. Data from late 2025 reveals a contraction in the rental market, with 10,274 fewer active residential tenancy bonds recorded across the state. Real estate agencies are feeling the impact of this shift, reporting a massive decline in their rent rolls as properties transition from the rental pool to owner-occupation, effectively diminishing a core part of their ongoing property management business.

On a broader scale, the Real Estate Buyers Agents Association of Australia (REBAA) estimates that roughly one in five Australian properties, or 100,000 homes annually, are now sold off-market. While these transactions offer privacy and reduced marketing expenses, they may result in lower final sale prices for the vendor; PropTrack data indicates that off-market sales typically fetch 4.3 percent less than those listed on major platforms. Despite the potential for lower returns, the prevailing sense of uneasiness and uncertainty in the housing sector is prompting more participants to operate outside traditional listing environments to navigate the changing market conditions.