For the first time in 15 years — and only the second time on record — median house prices fell in every Australian capital city in the same quarter. Domain's September Quarter 2026 House Price Report puts numbers on a downturn that has gone national, and it matters differently if you are buying, selling or refinancing.
The short version
- House prices fell in all eight capitals in the September quarter — the first simultaneous fall in 15 years (Domain).
- Combined capital house prices dropped 4.7% ($59,870) to about $1.23 million; units fell 3.5% to $702,858.
- Steepest house falls: Perth −7.4% (−$88,664), Brisbane −5.4% (−$66,001), Sydney −4.7% (−$82,420). Adelaide fell about 3% to $1,095,429.
- Domain's Dr Nicola Powell says Australia is in a buyer's market, with more stock and more room to negotiate — but she does not see confidence turning until rate cuts, or clear talk of them, later next year.
- Cash rate remains 4.60%. GetABetterRate recorded no home-loan rate changes from its panel of 40+ lenders on 22 October. Next big dates: CPI Wednesday 28 October; RBA Tuesday 3 November.
The national picture
Domain's September quarter figures, covered by Domain's Lisa Marie Corso and summarised by The Urban Developer on 22 October, show the multi-speed capital-city market pausing. Across the combined capitals, house prices fell 4.7% — $59,870 — over the quarter to about $1.23 million. That is Domain's steepest quarterly housing decline on record for the combined capitals series.
Units were not spared. Combined capital unit prices fell 3.5% to $702,858 — the sharpest quarterly unit decline in seven-and-a-half years, according to The Urban Developer citing Domain. It was the second consecutive quarter of falling prices for both houses and units, and annual growth in combined capital house prices turned negative for the first time in more than three years.
That pattern matters for borrowers because it is not just Sydney and Melbourne softening. Domain chief residential economist Dr Nicola Powell told Domain the downturn that began in some cities has "broadened geographically, and it has deepened." Speaking to AAP, she added that homes are taking longer to sell, there is greater scope to negotiate, and sellers are having to be more realistic about price expectations.
Where medians landed: June to September 2026
Domain's city table (June 2026 → September 2026 median house prices) is the cleanest way to see how far each capital moved over the quarter:
| Capital | Sep 2026 median | $ change | % change (where stated) |
|---|---|---|---|
| Sydney | $1,661,167 | −$82,420 | −4.7% |
| Melbourne | $1,014,335 | −$34,192 | −3.3% |
| Brisbane | $1,152,122 | −$66,001 | −5.4% |
| Adelaide | $1,095,429 | −$33,967 | about −3% |
| Perth | $1,115,227 | −$88,664 | −7.4% |
| Canberra | $1,025,084 | −$27,768 | — |
| Hobart | $790,155 | −$24,674 | — |
| Darwin | $752,478 | −$20,066 | — |
Source: Domain House Price Report, September quarter 2026 (June vs September medians). Percentage changes as reported by Domain / The Urban Developer.
Perth had the steepest capital fall this quarter: −7.4% (−$88,664) to $1,115,227, about 8% ($96,956) below its March peak. Perth units also fell a record 6.5% over the quarter (The Urban Developer). Brisbane registered its first quarterly decline in almost four years, ending a 14-quarter growth run, with houses down 5.4% (−$66,001) to $1,152,122. Sydney fell 4.7% (−$82,420) to $1,661,167 — its largest quarterly fall in four years and a third straight quarterly decline. Adelaide eased about 3% (−$33,967) to $1,095,429, matching its steepest quarterly house-price fall on record in Domain's series. Melbourne dropped 3.3% (−$34,192) to $1,014,335, approaching the $1 million mark it crossed in June 2021 and sitting 6.7% below its December 2025 peak.
Why it's happening
Powell points to higher interest rates, persistent cost-of-living pressures and changes to housing investment tax settings weighing on sentiment and borrowing power. Reduced borrowing capacity is stifling sales even as more stock comes onto the market. "We are in a buyer's market and many of our capital cities have got the highest levels of supply that they've seen in a number of years," she told AAP. For buyers with secure finances and the capacity to transact, that creates opportunities that have been hard to find in recent years — but she does not see confidence turning until an interest-rate cut, or clear talk of cuts, with that prospect "in the latter part of next year."
PRD Real Estate chief economist Dr Diaswati Mardiasmo told Domain that simultaneous falls across all capitals are unusual for Australia's multi-speed market and typically follow a shock large enough to hit every city the same way. Multiple rate rises, living-cost pressure and policy changes have lined up this year. That is colour on why the cycle looks national — not a forecast of how deep or how long the correction runs.
What it means if you're buying
Softer prices and more stock help on the purchase price and on negotiation. Higher rates and serviceability buffers still cut how much you can borrow. Get a fresh assessment on today's rates and today's lending criteria — not last quarter's pre-approval. A Melbourne buyer told AAP their bank's lending calculation was revised after the September rate rise, leaving a home-loan offer $100,000 lower than the first quote. That is one couple's story, not a national figure, but it is a useful reminder that borrowing power moves with rates even when asking prices are falling.
Do not try to call the bottom. Domain's facts describe the quarter just finished. Named forecasters see further falls possible into 2027. Buy when the repayment and deposit work for you and you can still handle another 0.25 percentage point rise in rates.
What it means if you're selling
Every capital is softer over the September quarter on Domain's medians. Overpricing in a buyer's market usually means longer days on market and deeper discounts. Price for today's conditions, not last year's peak. Our 15 October Cotality piece covered sales volumes, days on market and vendor discounting — a different dataset that still points the same way on negotiating power.
What it means if you're refinancing or topping up
Watch the valuation. A lower bank valuation can lift your loan-to-value ratio (LVR), change your rate tier, or tip you over 80% into lenders mortgage insurance territory. Ask what value the lender is likely to use before you lodge. If you recently bought with a small deposit, most owners still have an equity cushion on the scenarios the Reserve Bank has published — keep repayments current and use an offset if you have one. We covered the Board's household discussion in our 14 October minutes piece.
Investors: Domain and AAP flag investment tax changes as one driver of weaker demand. We do not give tax advice — talk to your accountant about how any changes apply to you.
Domain vs Cotality — don't mix the two
On 15 October we wrote up Cotality's October chart pack: September sales about −20.9%, 41 days on market, stock +19.1%, vendor discount 4.4%, with national values softer on a monthly and quarterly basis. That piece was about transaction conditions. Today's Domain report is about quarterly median house (and unit) prices. Darwin can still look different month-to-month on Cotality while falling on Domain's quarterly medians. Never put the two side by side in one sentence without naming the source. Use Domain for this quarter's city medians; use the 15 October article for sales, stock and days on market.
Our 5 October Cotality Home Value Index used a different product again (dwellings, monthly). Adelaide's Domain house median today is $1,095,429; Cotality's dwelling measure around that earlier piece was much lower. Different providers, different products — label them if you compare.
Looking ahead (forecasts, not ours)
API valuers, cited in our 15 October article, have talked about an 8–11% peak-to-trough range before a late-2027 recovery. Morgan Stanley economists, via AAP, see the market possibly bottoming in the second half of 2027, with a peak-to-trough fall as deep as 15%. Those are named forecasts from named sources — not Loanworth's view, and not a promise of how far prices will go. Attribute them; do not treat either as a fact.
On rates overnight: GetABetterRate recorded no home-loan rate changes from its panel of more than 40 lenders on 22 October. The cash rate remains 4.60% after the September increase. Governor Michele Bullock speaks at a University of New England graduation on Friday 23 October (no policy discussion). September-quarter CPI is due Wednesday 28 October at 11:30am AEDT (11:00am Adelaide time). The next Monetary Policy Board decision is Tuesday 3 November at 2:30pm AEDT (2:00pm Adelaide time).
Key dates
- Friday 23 October: Governor Michele Bullock speaks at a University of New England graduation ceremony (no policy discussion).
- Wednesday 28 October, 11:30am AEDT (11:00am Adelaide time): September-quarter Consumer Price Index.
- Tuesday 3 November, 2:30pm AEDT (2:00pm Adelaide time): Reserve Bank Monetary Policy Decision.
Related reading
- Spring has stalled: Cotality on sales, stock and days on market (15 October)
- Home values fall for a sixth straight month (Cotality HVI) (5 October)
- Spring auction clearance rates (11 October)
- Variable rate floor competition at 5.89% (21 October)
- Unemployment at a five-year high — what it means for November rates (16 October)
Buying, selling or refinancing while prices are moving?
Book a no-obligation chat and we'll work through the numbers with you — purchase price, borrowing power, valuation risk and timing around the next Reserve Bank decision. We'll start with general information, and if you want personal recommendations we'll do a proper fact-find first. There's no cost and no pressure.
Sources: Domain, Lisa Marie Corso, “Australia's steepest quarterly housing decline on record…”, covering Domain House Price Report September quarter 2026 (all-capitals fall first in 15 years / second on record; combined capitals houses −4.7% / −$59,870; city June→Sep table; Perth −7.4% / −$88,664 and −8% from March peak; Brisbane −5.4% ending 14-quarter growth; Sydney −4.7%; Dr Nicola Powell quotes; PRD Dr Diaswati Mardiasmo colour). The Urban Developer, Lindsay Saunders, 22 October 2026 (combined capitals ~$1.23m; units −3.5% to $702,858, sharpest in 7.5 years; second straight quarterly fall; annual growth negative; Perth units −6.5%; Adelaide ~3% / steepest on record; Melbourne −3.3% and −6.7% from Dec 2025 peak). AAP, “Home buyers gain foothold as downturn runs into spring” (Powell buyer's-market and confidence timing quotes; Morgan Stanley H2 2027 / up to 15% peak-to-trough forecast; Melbourne buyer anecdote). GetABetterRate, “Today's Home Loan Rate Changes”, 22 October 2026 (no changes from panel of 40+ lenders). Reserve Bank of Australia Coming Up calendar (Bullock 23 October; Monetary Policy Decision 3 November 2:30pm AEDT). ABS / prior verified copies for CPI timing Wednesday 28 October 11:30am AEDT. Cotality figures from our 15 October and 5 October articles (linked, not re-proved).
General information only, not credit advice. It doesn't take your objectives, financial situation or needs into account.
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