RBA Cash Rate | September 2026
The Reserve Bank of Australia has raised the cash rate target by 25 basis points to 4.60% at its September 2026 meeting, the fourth increase this year, as inflation remains too high.
Recent inflation outcomes have been stronger than expected. The Board noted that upside risks to inflation have materialised, including a broadening of the conflict in the Middle East, elevated global energy prices, AI-related demand driving technology price growth, and ongoing capacity pressures in the domestic economy.
Labour market conditions have eased broadly as expected, and leading indicators remain broadly stable. The Board said it will continue to do what it considers necessary to bring inflation sustainably back to target, including increasing the cash rate further if needed.
Australian Housing Market Loses Momentum
National Trends
- Australia’s national dwelling values fell 3.1% in the three months to August 2026, including a 0.9% decline in August, with annual growth slowing to 2.7%.
- Combined capital city values fell 3.7% over the quarter, while combined regional values declined a more modest 1.2% and remain 7.7% higher over the year.
- The downturn is being led by the upper end of the market, with upper quartile house values in Sydney and Melbourne down more than 10% from their peaks, while more affordable segments are proving more resilient.
Capital City Highlights
- Darwin was the only capital city to record growth over the quarter, rising 0.9%, with values up 14.6% over the year and sitting at a record high.
- Perth remains the strongest annual performer, up 15.6% over the year, though values fell 3.2% over the quarter.
- Brisbane eased 2.7% over the quarter, but values are still 10.8% higher than a year ago.
- Adelaide recorded a milder decline of 1.6% for the quarter, with annual growth holding at 8.6%.
- Hobart was largely steady, down just 0.2% over the quarter and up 8.1% annually.
- Canberra fell 2.8% over the quarter, with values now 0.4% lower than a year ago.
- Sydney recorded the sharpest quarterly fall of all capitals, down 4.7%, with values now 4.6% lower over the year.
- Melbourne continued to soften, falling 3.9% for the quarter and 4.7% over the year.
Sales, Listings & Market Activity
Sales Activity & Lending
- Cotality estimates 527,173 sales nationally over the 12 months to August 2026, with volumes down 2.7% on the previous year.
- Sales in the combined capitals fell 5.2% over the year, while regional markets held up better, rising 1.8%.
- Investor lending fell sharply in the June 2026 quarter, down 10.2%, with the investor share of new lending (excluding refinancing) easing to 38.0% nationally after rising above 40% earlier in the year.
- Despite the pullback, investors still make up a larger than average share of lending in most states, led by the NT (43.4%) and NSW (42.0%).
Listings & Time on Market
- The flow of new listings is 3.1% lower than a year ago and 6.4% below the five-year average.
- Total listings have risen to just over 139,100 in the four weeks ending 6 September 2026, up 18.1% annually and 2.2% above the five-year average.
- The national median days on market is 39 days, up from 28 days a year ago, while the national median vendor discount has widened to 4.0%, from around 3.1% at the start of the year.
- The four-week average auction clearance rate was 49.5% at the end of August, holding below 50% since early June.
Rental Market Trends
- National rents increased by 5.7% over the year to August 2026, a slight easing from 5.9% in earlier months.
- Rental growth is closely aligned across the combined capitals (5.7%) and combined regionals (5.8%), with Darwin (11.4%) recording the strongest growth.
- National gross rental yields have risen to 3.8%, the highest since September 2019, with regional yields (4.3%) remaining stronger than capitals (3.6%).
What It Means for Borrowers and Buyers
The RBA raised the cash rate to 4.60% in September 2026, the fourth increase this year, following a pause in June. Borrowers on variable rates may see higher repayments if lenders pass on the increase, though timing and amounts vary by lender.
Tighter conditions are now clearly flowing through to the housing market. Values are falling across most capital cities, total listings have climbed above last year’s levels, and properties are taking longer to sell.
For buyers, rising stock levels, longer selling times and wider vendor discounts may create more room to negotiate. With borrowing power under greater pressure, it is worth having your pre-approval and lending position reviewed before making an offer.
Key Highlights from the Cotality Monthly Housing Chart Pack - September 2026
- Values declining: National dwelling values fell 3.1% over the quarter, with annual growth slowing to 2.7%.
- Premium segment weakest: Upper quartile homes are leading the downturn, particularly in Sydney and Melbourne, while affordable segments are holding up better.
- Supply rising: Total listings are 18.1% higher than a year ago and 2.2% above the five-year average.
- Slower selling conditions: Homes are taking a median of 39 days to sell, and auction clearance rates remain below 50%.
- Rents and yields: National rents increased 5.7% annually, while gross rental yields have risen to 3.8%, with stronger yields in regional markets (4.3%) than in capital cities (3.6%).
Looking Ahead
The RBA lifted the cash rate to 4.60% in September 2026 and signalled it may raise further if inflation does not ease. Energy prices, global supply disruptions and domestic capacity pressures remain the key risks the Board is watching.
The housing market is adjusting to tighter financial conditions. National values are falling over the quarter, led by Sydney and Melbourne, although Perth, Darwin, Brisbane and Adelaide remain well ahead of a year ago.
With listings rising and selling times lengthening, conditions are gradually shifting in favour of buyers. At the same time, rising rents and higher rental yields continue to support investor returns.
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