The nationwide slump in house values has spread to Brisbane and Perth, with no signs of an end to the downturn amid fears it could worsen if the Reserve Bank pushes ahead with another interest rate hike this week. Figures from property data firm Cotality show national property values fell 1.2 per cent in October, the seventh consecutive monthly decline, leaving median values down 6.7 per cent since March, a drop of $63,400, or more than $9000 a month.
Bigger falls are now being recorded in cities that had the largest increases in values over recent years. Brisbane’s median house value fell 2 per cent last month and is now the weakest market in the country, with values down 6.2 per cent over the past three months. Perth’s median house value slipped 1.7 per cent in October, Adelaide fell 1.2 per cent and Canberra eased 1 per cent.
Sydney’s median house price fell 1.9 per cent in October to be down 11.1 per cent since the start of the year, while the median unit price dropped 0.7 per cent. Melbourne’s median house price edged down 1 per cent to $906,000, down 9 per cent so far this year. Only Hobart and Darwin saw house values lift, by 0.6 per cent each.
Cotality research manager Tim Lawless said the downturn had stretched across the country. “Virtually every suburb across Brisbane, Perth and Adelaide has recorded a drop in values over the past three months,” he said.
Cotality said the national vacancy rate rose to 2.3 per cent, the highest since January 2022, the month before the international border was fully re-opened. Cotality also noted rental increases were easing, with the 0.9 per cent lift in the past three months the smallest since January 2025. Lawless said renters were likely to be approaching a ceiling on their capacity to pay more, following a 52 per cent surge in rents over the past six years that added around $245 a week to the median rental rate nationally.
Treasurer Jim Chalmers recently told the Inside Politics podcast that the budget’s tax changes had contributed to the drop in property prices but were not the only factor. “I think it would be dishonest to say that the tax changes are solely responsible, or that they’re not responsible at all,” he said. Lawless said higher interest rates, the run-up in prices, cost-of-living pressures and the government’s budget measures had all contributed.
The pressure on the market is likely to intensify after Tuesday, with financial markets and economists expecting the Reserve Bank to deliver its fifth rate hike this year. AMP chief economist Shane Oliver, who expects the cash rate to rise to 4.85 per cent, said a quarter percentage point hike would add about $110 to monthly repayments on an average mortgage, taking the increase so far this year to $550 a month or $6600 a year. Combined with higher petrol prices, he said those with a mortgage and a petrol car faced an extra impost of about $640 a month since January.
Analysis
Why This Matters
- The property downturn is eroding household wealth by more than $9000 a month in median values, affecting mortgage holders and potential sellers.
- A further interest rate hike on Tuesday would add about $110 to monthly mortgage repayments, compounding cost-of-living pressures from higher petrol prices.
- The slowdown is also hitting renters: vacancy rates are rising and rent increases are easing, but remain elevated after six years of rapid growth.
Background
Australian house values boomed during the pandemic, driven by low interest rates and government stimulus, pushing several capital cities above $1 million in median prices by April 2026. Since March, however, the Reserve Bank has raised the cash rate multiple times to combat inflation, triggering a sustained downturn. The federal budget’s tax changes have also been cited as a contributor.
Key Perspectives
Tim Lawless (Cotality research manager): Says the property downturn has spread nationwide, with falls now recorded in virtually every suburb across Brisbane, Perth and Adelaide.
Treasurer Jim Chalmers: Acknowledged that tax changes played a role in falling prices, but said they were not solely responsible.
Shane Oliver (AMP chief economist): Warns households face a double whammy of higher mortgage repayments and rising petrol prices, costing roughly $640 extra per month for those with a mortgage and a petrol car.
What to Watch
- The Reserve Bank’s rate decision on Tuesday 3 November: a hike would mark the fifth increase this year and push the cash rate to an 18-year high.
- Whether the downturn deepens in Brisbane and Perth, which had been the strongest markets until recently.
- Rental vacancy rates: if they continue to climb, it could signal further softening in the rental market and potentially lower rent growth.
Checked
12 claims in this story checked against 2 sources: 11 supported.
Show each claim
- SupportedHomes have lost more than $9,000 a month in value.The Age - Latest News: “In dollar terms, median property values have slumped by $63,400 or more than $9000 a month.”
- SupportedNational property values fell 1.2% in October.The Age - Latest News: “Figures released today by Cotality show the nation’s property values fell another 1.2 per cent in October”
- SupportedOctober was the seventh consecutive monthly fall in national property values.The Age - Latest News: “the seventh consecutive monthly drop”
- SupportedNational property values were down 6.7% since March, a fall of $63,400.The Age - Latest News: “to be down 6.7 per cent since March. In dollar terms, median property values have slumped by $63,400”
- SupportedThe downturn has spread to Brisbane and Perth, with no sign it is close to ending.The Age - Latest News: “The nationwide slump in house values has spread to Brisbane and Perth with no signs the property downturn is close to ending”
- SupportedFinancial markets and economists expect the Reserve Bank to raise rates on Tuesday.The Age - Latest News: “financial markets and economists expecting the Reserve Bank’s monetary policy board to deliver its fifth rate hike this year.”
- Reports differTim Lawless is identified as Cotality’s research manager.Business | The Guardian: “Cotality’s research director, Tim Lawless, said the downturn was now broad-based”
- SupportedLawless said virtually every suburb in Brisbane, Perth and Adelaide had recorded a value drop over the past three months.The Age - Latest News: ““Virtually every suburb across Brisbane, Perth and Adelaide has recorded a drop in values over the past three months,” he said.”
- SupportedThe national vacancy rate rose to 2.3%, its highest level since January 2022.The Age - Latest News: “Cotality said the national vacancy rate rose to 2.3 per cent, just below its decade-long average of 2.4 per cent and the highest since January 2022”
- SupportedCotality said rents rose 0.9% over the past three months, the smallest increase since January 2025.The Age - Latest News: “the 0.9 per cent lift in the past three months the smallest since January 2025.”
- SupportedChalmers said it would be dishonest to say the tax changes were solely responsible for the price drop, or not responsible at all.The Age - Latest News: ““I think it would be dishonest to say that the tax changes are solely responsible, or that they’re not responsible at all,” he said.”
- SupportedOliver said a quarter-point hike would add about $110 a month to average mortgage repayments, bringing this year’s increase to $550 a month or $6,600 a year.The Age - Latest News: “a quarter percentage point hike on Tuesday would add about $110 to monthly repayments on an average mortgage, taking the increase so far this year to $550 a month or $6600 a year.”