Australian House Prices Fall 5.2%: Brisbane and Sydney Hit Hardest 2026

Australian house prices have fallen 5.2% from their peak in March, with Brisbane and Sydney experiencing the steepest declines, according to new data from Cotality. The national slowdown has intensified after the Reserve Bank raised interest rates for the fourth time this year, pushing more buyers out of the market and prompting economists to forecast further drops of at least 10%.

Brisbane and Sydney Lead the Downturn

Brisbane’s home prices dropped 1.5% in September, with every suburb in the city recording lower values compared with June. The median Brisbane home is now worth $1.05 million, down $59,000 since May. This sharp reversal follows an 18% surge over the preceding 12 months, highlighting how quickly momentum has shifted.

Sydney median values fell 1.4% in the month and are down 8.6% from their record high in March — equivalent to a $112,000 drop. Only four Sydney suburbs held steady in recent months, underscoring the widespread nature of the decline.

Melbourne and National Trends

Melbourne prices have fallen 7.2%, or $63,000, from November 2025. While a handful of suburbs continue to see price growth, buyer’s agent Joe Trucchio of Property Home Base notes the downturn has swept the city. “We’re fully into the spring buying carnival, and we haven’t seen it pick up the way that it had in previous years,” Trucchio said. “It just takes some time and it takes some good news and right now we’ve had a sequence of bad news.”

Nationally, prices have returned to where they were a year ago, erasing the gains made during the pandemic boom. The Reserve Bank’s latest rate hike on Tuesday has added further pressure, with economists warning that the market could see a total correction of 10% or more.

Key Takeaways for Homeowners and Buyers

• National decline: House prices are down 5.2% from their March peak.
• Brisbane and Sydney hit hardest: Both cities saw significant monthly drops, with every Brisbane suburb falling.
• Interest rates: The RBA’s fourth rate hike this year is pushing more buyers out of the market.
• Forecast: Economists predict at least a 10% total fall from the peak.
• Buyer’s market: Slowing demand could create opportunities for those with financing in place.

Comparing the Major Cities

What’s Next for the Australian Property Market?

With interest rates expected to remain high, borrowing capacity will continue to shrink, putting downward pressure on prices. Economists suggest that the market may not stabilize until there is a clear signal that rate hikes are over. For now, sellers need to adjust expectations, while buyers with pre-approved finance may find more negotiating power.

As spring unfolds, the usual seasonal uptick has failed to materialize, and many are watching to see if the downturn deepens into 2026.

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