New Home Prices Were Flat in September as Builders Lifted Discounts to Offset Base Price Rises. They're Still Up 4.7% in a Year, and Hobart Leads at 8.8%.
The ABS's September CPI shows new dwelling prices didn't move in the month, with discounts and promotions cancelling out base price increases as demand slows. Here are the annual figures by capital city, what HIA is seeing in sales, the RBA date to watch and the desk moves for builders.
New home prices have stopped rising, for now
The price of a new home didn't move in September. According to the ABS Consumer Price Index for September 2026, released on Wednesday 28 October, new dwelling prices were unchanged (0.0%) in the month, after a 0.2% rise in August.
The ABS put it down to two forces cancelling each other out: "Some project home builders raised base prices this month, but this was offset by some builders increasing discounts and promotional offers in response to slowing new demand."
Over the year, new dwelling prices were still up 4.7% in the 12 months to September, down from 5.4% in the 12 months to August. The ABS said the annual rise "was driven by project home builders raising base prices to pass through higher labour and materials costs over the year."
The headline CPI rose 4.3% over the year, up from 4.0% in August, and trimmed mean inflation was 3.6%. New dwellings were one of the three main contributors to the 5.2% rise in the housing group, alongside electricity (12.8%) and rents (3.6%).
The annual rate has been cooling since mid-year
The ABS's monthly series (Table 3 of the release) shows the annual rise in new dwelling prices peaked in June and has eased each month since:
| Month (2026) | New dwellings, annual change | Monthly change | | --- | --- | --- | | April | 4.7% | 0.7% | | May | 5.6% | 0.9% | | June | 5.8% | 0.4% | | July | 5.7% | 0.4% | | August | 5.4% | 0.2% | | September | 4.7% | 0.0% |
On the quarterly measure (Table 18), new dwelling prices rose 1.0% in the September quarter, after 1.8% in the June quarter.
Where prices are still climbing fastest
Annual new dwelling price growth to September varied widely across the capitals, according to Table 11 of the release:
| Capital city | New dwellings, annual change to September 2026 | | --- | --- | | Hobart | 8.8% | | Perth | 6.7% | | Darwin | 6.5% | | Brisbane | 6.4% | | Canberra | 5.1% | | Adelaide | 5.0% | | Sydney | 4.9% | | Melbourne | 2.8% |
Melbourne's annual rate has slowed from 3.9% in July to 2.8%, and Brisbane's from 9.1% in June to 6.4%, the same table shows.
Why builders are discounting
The ABS's "slowing new demand" lines up with what builders have been reporting. The HIA's New Home Sales report for August, released on 15 September, found sales fell 10.0% in the month and were 19.3% lower in the three months to August than in the previous quarter. All five states in the survey went backwards, led by Victoria (-27.0%) and Queensland (-20.2%).
"Builders are also reporting weaker traffic through display sites, fewer enquiries and declining preliminary commitments, while cancellation rates are rising," HIA Chief Economist Tim Reardon said at the time. "But today's new home sales are tomorrow's housing commencements."
On Wednesday, HIA Senior Economist Tom Devitt told AAP that falling dwelling prices were giving buyers a rare improvement in affordability. The HIA's Affordability Report showed a 3.6% improvement in the September quarter, but affordability was still 5.4% worse than a year earlier, he said, and would likely worsen again once the downturn ends because the supply shortfall hasn't been fixed.
Next stop: the RBA on Melbourne Cup Day
The Reserve Bank lifted the cash rate to 4.6% on 29 September, its fourth increase this year, and its next decision is due on Tuesday 3 November, realestate.com.au reported. At the time, Master Builders Australia chief executive Denita Wawn said the hike would stop some projects going ahead, and that "the cost of creating new homes far exceeds their likely selling price in many situations."
Higher inflation in September doesn't settle what the RBA will do, but it is the last monthly CPI read the board will see before it meets.
Desk moves for builders
- Know what your discounts are doing. If you're running promotions to hold sales, track the real price you're achieving per contract, not just the list price, so you know your margin.
- Re-check base prices against your costs. The ABS says the annual rise came from builders passing through labour and materials costs. Make sure your current base prices still cover what your trades and suppliers are charging now.
- Look at your city, not the national number. A Hobart or Perth builder is in a different market from a Melbourne one. Use the capital city figures when you talk price with clients.
- Read your price-change clauses. If your contracts index prices or allow for rise and fall, check what they actually allow before you need to use them. The ABS publishes guidance on the use of price indexes in contracts. Get advice if you're unsure.
- Keep buyers' finance in view. With another RBA decision on 3 November, talk to buyers early about their pre-approval and how long it lasts.
- Mark the dates. The October monthly CPI is due on 25 November 2026.
This article reports on official statistics and published reporting. It is not legal, tax or financial advice.
Sources: ABS, Consumer Price Index, Australia, September 2026 (28 October 2026), including Tables 3, 11 and 18; ABS, Use of Price Indexes in Contracts; HIA, New home market cannot absorb more taxes or rate increases (15 September 2026); AAP, Housing a bright spot in otherwise grim inflation print (29 October 2026); realestate.com.au, Stubborn inflation keeps November hike in focus after latest RBA increase (30 September 2026).
