Australia Home Values Fall for a Sixth Straight Month, Cotality Reports

Australian home values fell for a sixth straight month in September, according to Cotality's Home Value Index, released on October 1, 2026. National dwelling values dropped 1.1% over the month and now sit 5.2% below the record high set in March 2026. Over the past 12 months, values are flat, at 0.0%.

That combination, a steady monthly slide with no annual loss yet, is what makes this correction unusual. Homeowners who bought before the March peak are, on the national index, roughly back where they were a year ago. Buyers who bought near the peak are not.

Brisbane now leads the falls

The sharpest monthly fall in September came from a market that spent two years as the national growth story. Brisbane values fell 1.5% in the month, edging past Sydney's 1.4% drop. Adelaide fell 1.3%, Perth 1.2%, and Canberra 1.1%. Melbourne's 0.7% fall was the mildest among the large capitals.

Sydney still leads the correction in cumulative terms. Values there fell 1.4% in September, are down 7.0% over the year, and sit 8.6% below their February 2026 peak. Cotality research director Tim Lawless said Sydney "continues to lead the housing correction, with values now 8.6% below their February peak," adding that "the decline is marginally deeper than the equivalent stage of the 2022-23 downturn."

Melbourne is 7.2% below its November 2025 high and down 6.2% over the year. Perth, despite its September fall, remains up 10.1% over the year. Darwin was the only capital to rise in September, up 0.4%, and is up 11.9% over the year. Across the combined capitals, values are down 1.8% over the year, while regional markets are up 5.6%.

The national median dwelling value is about $899,236. That figure covers houses and units combined, not houses alone, and it is roughly where it was a year ago.

The downturn is now broad, not local

What changed in September is the breadth of the falls. Some 97% of capital city suburbs recorded value declines over the three months to the end of September, according to Cotality. This is no longer a Sydney story with a few followers. It is a national downturn with only Darwin swimming against the tide.

Sales confirm the caution. National sales volumes over the past three months are 19.1% lower than a year ago. Homes are also taking longer to sell: the median time to sell in the capitals is 39 days, up from 23 days a year ago.

That slower selling is building up stock without a flood of new listings. Across the combined capitals, the flow of new listings added to the market was 9.2% lower than a year ago, but total inventory was tracking 23.1% higher, because properties are sitting unsold for longer. For buyers, that means more choice and less urgency. For sellers, it means pricing realistically from the start matters more than it did a year ago.

Why values are falling

Lawless attributes the downturn to a combination of forces: "The housing downturn reflects a combination of affordability constraints, higher interest rates, elevated living costs and weaker consumer sentiment, all of which have reduced purchasing capacity and dampened buyer demand."

That framing matters because it rules out a single cause. Rates are part of the story, but so is the simple fact that after years of strong growth, fewer buyers can stretch to current prices. Our earlier coverage tracked how mortgage demand collapsed in September, and Brisbane's turn from growth leader to sharpest faller echoes our Brisbane buyers market coverage.

One caution on the data itself: first prints get revised. August's national figure was first reported as a 0.9% fall and was revised to a 1.2% fall in the September release. Treat each monthly print as provisional until the next release revises it.

What Cotality expects next

Cotality's stated outlook is "a gradual drift lower in housing values rather than a material downturn." That is an outlook, not a guarantee, and it is worth reading alongside a second index that disagrees on speed. PropTrack's Home Price Index fell 0.2% nationally in September and sits 3.3% below the same March peak, versus Cotality's 1.1% and 5.2%. The two indices use different models. They agree on direction and disagree on how fast values are falling.

The next data points to watch are the September-quarter CPI on October 28, the October Cotality index in early November, and the Reserve Bank's decision on November 3. This story reports the index only; it makes no call on what the Reserve Bank will do.

What this means if you are buying or selling

For buyers, the practical read is patience with leverage. More stock, longer selling times, and a sixth straight monthly fall all point the same way: there is less penalty for waiting for the right property at the right price than there was a year ago. That does not mean values will keep falling, and Cotality's own outlook says the drift is gradual, not a crash.

For sellers, the 39-day median selling time is the number to plan around. Homes are still selling, but the market no longer forgives ambitious pricing. A price set against recent comparable sales, not against the March peak, is what moves a property in this market.

Frequently Asked Questions

How much did Australian home values fall in September 2026?

National dwelling values fell 1.1% in September 2026, according to Cotality's Home Value Index. It was the sixth consecutive monthly fall, leaving values 5.2% below the March 2026 record high and flat over the past 12 months.

Which capital city fell the most in September 2026?

Brisbane, down 1.5% in the month, ahead of Sydney at 1.4%. Sydney remains the furthest below its peak, at 8.6% under its February 2026 high.

Which capital city rose in September 2026?

Darwin was the only capital to rise, up 0.4% in September and up 11.9% over the year.

How long are homes taking to sell?

The median time to sell in the capitals is 39 days, up from 23 days a year ago, according to Cotality.

Is this a crash?

Cotality's stated outlook is a gradual drift lower rather than a material downturn. The index is 5.2% below its peak, which is a correction, not a crash, but first prints are revised, so each monthly figure should be read as provisional.

When is the next Cotality update?

The October index is due in early November, after the September-quarter CPI on October 28 and ahead of the Reserve Bank decision on November 3.