THE property market in NSW and Western Victoria for the first half of 2026 had transitioned into a cautious, if stabilise phase, with mixed seasonal conditions and tighter margins driving varied performance across the region, valuers from Herron Todd White reported in a recent July monthly review.

The summaries below for NSW and Western Victoria follow last week’s HTW summaries for property conditions in Queensland and the Northern Territory.

Angus Ross

The New South Wales grazing market has softened throughout the first half of 2026 across many regions as drought conditions increasingly affected large parts of the state, Herron Todd White director Angus Ross reported in HTW’s July market summary.

Reduced pasture availability and tightening water supplies had weighed on producer confidence, particularly throughout western, central and northern New South Wales, he said.

“While isolated higher rainfall districts have remained more resilient, the broader market has became increasingly cautious as seasonal uncertainty built,” Mr Ross said.

The deterioration in seasonal conditions resulted in increased cattle turnoff across the state, with producers actively reducing stocking rates and managing feed shortages ahead of winter.

NSW property demand remained strongest for well-developed grazing enterprises with secure water, reliable carrying capacity and operational scale, he said.

However, buyer activity overall had moderated, with purchasers becoming increasingly selective and focused on properties offering drought resilience, water security and fodder production capability.

Secondary grazing country, lighter carrying capacity land and properties requiring further capital expenditure are generally experiencing longer selling periods and reduced competition.

Following the strong value growth experienced during 2021 to 2023, grazing land values across New South Wales had generally stabilised, Mr Ross said, with softer market conditions emerging in drought affected regions.

While prime holdings continued to attract interest and transact at historically strong levels, benchmark rates per hectare and per DSE had generally plateaued, with purchasers more disciplined in pricing amid seasonal pressures, elevated operating costs and higher interest rates.

“Overall, the New South Wales grazing market remains underpinned by long-term confidence in the agricultural sector, though short-term sentiment is increasingly influenced by widespread drought conditions, elevated livestock turnoff and seasonal uncertainty entering the second half of 2026,” he said.

Western Victoria

HTW valuer Benjamin Mugavin said the Western Victorian rural property market throughout the first half of 2026 had transitioned into a highly cautious and stabilised phase, with mixed seasonal conditions and tighter margins driving varied performance across the region.

Following a multi-year period of historic capital growth, land values in Victoria had generally plateaued in the six months to the end of June, he said.

“Buyers have become increasingly selective and disciplined, responding to macroeconomic headwinds including sustained high interest rates, elevated input costs and shifting global commodity prices.

“While the region avoided the severe drought conditions gripping parts of the country further north, the broad-based market urgency of recent years has been replaced by a clear focus on enterprise scale, asset quality and proven productivity,” Mr Mugavin said.

Performance across individual sectors had been highly segmented, with grazing and dairy assets showing the greatest resilience.

The grazing market had been supported by a steady autumn break in high-rainfall zones and stable livestock prices. This had allowed local producers to manage stocking rates comfortably without the forced destocking seen interstate.

In contrast, the frenetic growth previously seen in the Wimmera and south-west cropping areas has cooled, as softer global grain prices and high fertiliser costs compress growers’ margins and temper aggressive bidding.

“Overall, demand remains strongest for prime, well-developed holdings with secure water, reliable carrying capacity and immediate operational scale,” Mr Mugavin said.

“These blue-chip properties continue to attract competitive interest and transact near benchmark rates per hectare. However, a clear two-tier market has emerged; secondary country, lighter carrying land and properties requiring significant capital expenditure are experiencing noticeably reduced competition and extended selling periods.”

Entering the second half of 2026, the Western Victorian market remained underpinned by long-term structural confidence, though short-term values would be increasingly dictated by strict purchaser discipline and winter seasonal performance.