Weekly Market Update (2 October 2026)

1. Australian Property Market Predictions 2026–2027: Navigating a Market Correction (Source: Australian Property Update)
   Australia’s housing market is entering a period of correction, with national home prices declining over recent months and Sydney and Melbourne leading the downturn. Forecasts from Domain suggest Sydney and Melbourne house prices could fall through the year to June 2027, while Brisbane, Perth and Adelaide are expected to remain comparatively stronger. Major banks have also reduced their 2026 growth forecasts, with Westpac IQ expecting national dwelling prices to be broadly flat for the calendar year. The article emphasises that Australia is increasingly becoming a fragmented property market, meaning performance will vary significantly by city, suburb and property type rather than moving uniformly across the country. 

2. Construction Costs Rise Again, Just as Australia Needs More Homes (Source: Australian Property Update)
   Australia’s housing supply challenge is being made more difficult by a renewed increase in construction costs. After construction-price pressures eased following the major increases experienced during and after the pandemic, new data indicates that cost pressures are accelerating again. Higher costs make it more expensive for builders and developers to deliver new homes, potentially reducing the number of projects that are financially viable. This creates a difficult situation because Australia already needs significantly more housing, while rising construction expenses, labour costs, financing costs and other development constraints make increasing supply harder.

3. RBA Takes Cash Rate to Highest Point in 15 Years (Source: Australian Property Update)
   The Reserve Bank of Australia has increased the cash rate to 4.6%, its highest level since 2011, marking the fourth 25-basis-point increase of 2026. The move reflects continued concerns about inflation remaining too high. Higher interest rates are putting additional pressure on mortgage holders, with Canstar estimating that a typical household with a $700,000 variable-rate mortgage could face roughly another $107 per month in repayments. The RBA has also indicated that inflation risks remain elevated, leaving open the possibility of another rate increase. Higher borrowing costs are therefore expected to continue affecting buyer capacity, housing demand and property prices.

4. Australian Property Market Update – September 29, 2026 (Source: Australian Property Update)
   Australia’s capital-city property market weakened further, with dwelling values falling 1.1% over the month and sitting around 1% below the same period a year earlier. Sydney and Melbourne remain among the weaker markets, although conditions differ significantly across the country. Buyer and seller sentiment has also softened as markets anticipate further interest-rate pressure. The data highlights that Australia should not be viewed as a single property market: different cities, suburbs and property types are experiencing very different conditions, with some areas continuing to perform better despite the broader national slowdown.

5. Australian House Prices Fall for Sixth Straight Month (Source: ABC News)
   Australian home prices fell for the sixth consecutive month in September, with Cotality’s Home Value Index declining 1.1% during the month and sitting 5.2% below its March peak. All capital cities except Darwin recorded declines, with Brisbane down 1.5%, Sydney down 1.4% and Melbourne down 0.7%. The downturn is becoming increasingly broad-based, with 97% of capital-city suburbs recording declining values over the previous three months. Housing turnover has also weakened, with national sales estimated to be 19.1% below a year earlier. Analysts cited higher interest rates, affordability pressures and changes to housing tax incentives as factors behind the decline, while some economists warned that prices could fall substantially further if rates remain high.

6. Housing Market on Track for Its Steepest Downturn in 40 Years (Source: Australian Financial Review)
   Australia’s housing market is showing signs of a potentially significant downturn following four interest-rate increases and changes to property tax concessions. Residential property values fell another 1.1% in September, adding to the declines recorded since the market peaked earlier in the year. The combination of higher borrowing costs, weaker buyer demand and changes affecting property investors is putting further downward pressure on prices. The article highlights that the current cycle could become one of the most significant housing corrections in decades if interest rates remain elevated and affordability continues to deteriorate.

7. Australian Home Prices Fall for Sixth Straight Month, Sales Tumble (Source: Reuters)
   Australian home prices declined for the sixth consecutive month in September, falling 1.1% from August and leaving national values 5.2% below their peak. The decline is occurring alongside a significant slowdown in housing transactions, indicating that both prices and market activity are weakening. Persistent inflation is limiting the prospect of interest-rate relief, while the latest RBA rate increase has added further pressure to mortgage costs and borrowing capacity. The combination of high interest rates, weaker sales activity and reduced affordability has put the Australian housing market on track for one of its sharpest downturns in decades.

8. CoreLogic Auction Results (Week ending 20 September 2026)

        (Total Auction / Clearance Rate)
       – Sydney: 774/ 48.5%
       – Melbourne: 284/ 47.9%
       – Brisbane: 140/32.9%
       – Perth: 21/38.1%
       – Canberra: 81/51.9%
       – Adelaide: 101/ 37.6%
       – Tasmania: 2/ 50
     Combined Capitals: 1403/46%