Cash rate rises to 4.60 per cent in the middle of Brisbane's spring

In this article

Written by

Kooky

Builder of Shaka, the payment router that pays every agent their commission on closing date.

About Kooky and Shaka →

The Reserve Bank of Australia raised the cash rate target by 25 basis points to 4.60 per cent on Tuesday 29 September. The decision of the Monetary Policy Board was unanimous, according to the Bank's statement published the same day. The ABC reported it as the fourth increase of 2026, taking the rate to its highest level since late 2011.

The decision lands in the fifth week of the spring selling season, in a Brisbane auction market where fewer than half of the homes offered have been selling under the hammer. It is too early for any auction figure to show an effect. What can be set out today is what the Board said about housing, and where Queensland's auction numbers stood on the eve of the announcement.

What the Board said about housing

The statement gives inflation as the reason for the move. It says inflation remains elevated and that some of the upside risks identified in August are materialising. It lists them: global energy prices well above what was assumed in August, as the conflict in the Middle East continues; faster growth in the prices of technology goods; capacity pressures at home; and firms reporting cost pressures that they are passing on or plan to pass on. Recent inflation readings, the Board adds, were higher than it expected.

Housing appears in one sentence, in the part of the statement that deals with activity. The Board says there are signs that growth in consumer spending is easing gradually, "although housing prices have fallen in most capital cities and new housing loans have declined noticeably". The statement does not single out any city, and it does not mention auctions.

The same passage notes that economic growth slowed but was stronger than expected in the June quarter, that the labour market is easing broadly as anticipated, and that business investment and business borrowing remain strong. In other words, the Board saw the housing market cooling and raised the rate regardless, because its concern was prices across the whole economy.

It adds that there continue to be heightened uncertainties about the outlook for domestic economic activity and inflation. On what comes next, the Commonwealth Bank's summary of the decision, published on 30 September, reports the Board as saying it will do what it considers necessary to bring inflation back to target, including increasing the cash rate further if needed. That is a statement of readiness, not a schedule, and no path for future decisions should be read into it.

A full percentage point in 2026

The Commonwealth Bank's summary puts the year's increases at 100 basis points in total. The three before this one had taken the cash rate to 4.35 per cent, the level Cotality cited in its auction commentary of 23 September.

The Reserve Bank's published meeting schedule shows how the decision fits the calendar. The Board met on 28 and 29 September, its sixth meeting of eight this year. It meets again on 2 and 3 November and on 7 and 8 December. Both of those meetings fall inside the spring and early summer selling period, so the last auctions of the year will be held with two more decisions either made or pending.

For the auction market, the first three increases are already in the numbers. Cotality's finalised figures for the week ending 20 September put the combined capitals clearance rate at 49.1 per cent, against 71.6 per cent in the same week of 2025, and counted 15 of the previous 17 weeks below 50 per cent. Whatever the fourth increase does will be added to a market that had already adjusted a long way.

Where Brisbane auctions stood before the decision

Cotality's weekly releases give a clear picture of the four weeks leading up to the announcement. The first three rows below are final results. The fourth is the preliminary reading published on Monday 28 September, the day before the Board's decision.

Two points stand out. Brisbane's final rate has not reached 40 per cent in any of those weeks; Cotality counted the week ending 20 September as the 17th in a row below that mark. And the comparison with last year was already wide before this week's increase: in the same September week of 2025, Cotality says, Brisbane's clearance rate was 61.9 per cent.

The fourth row needs the most care. It rests on 94 collected results from 144 auctions, of which 40 were sales, and Brisbane's first count has finalised lower in two of the past three weeks. Cotality also noted on 28 September that the city's preliminary rate had been under 50 per cent in 18 of the past 19 weeks.

The coastal markets were in a similar position. The Gold Coast's final rate for the week ending 20 September was 31.3 per cent, from 48 auctions, and the Sunshine Coast's was 31.8 per cent. Their first counts for the week ending 27 September were higher, at 48.3 per cent on the Gold Coast and 60.0 per cent on the Sunshine Coast, but the Sunshine Coast figure is drawn from only ten results.

Nationally, the preliminary figure for the week ending 27 September was 50.3 per cent across 1,428 auctions, which Cotality called a ten-week low. Melbourne, on its Grand Final long weekend, recorded 48.8 per cent, its lowest early result since early September 2021.

Borrowing capacity and bidding

Cotality drew the connection between rates and auctions before this decision was made. In its release of 23 September, the firm noted that the three increases already made in 2026 had reduced borrowing capacity. It also reported that pass-ins made up 69.6 per cent of unsuccessful capital city auctions in the week ending 20 September, 652 homes against 285 withdrawn, which it said may indicate that buyers and vendors are apart on price.

A fourth increase works in the same direction for anyone bidding with a loan. Lenders decide how and when to pass a cash rate change on to their customers, so the effect on an individual buyer depends on the lender and the loan.

That is why the timing matters more at auction than in a private sale. A buyer negotiating by private treaty can make an offer subject to finance and wait for the lender's answer. A bidder cannot, so the limit has to be settled before the auction starts. A limit worked out before 29 September may not be the limit that applies on auction day.

For sellers, nothing about the method changes. The reserve is still theirs to set, the auctioneer cannot disclose it, and a price that meets the bidders in the room on the day remains the only thing a clearance rate measures. The same government guidance notes that a home that fails to sell at auction can still be sold by negotiation afterwards.

What to watch in the next releases

The first full weekend of auctions after the decision is also a long weekend in Queensland, with the King's Birthday holiday on Monday 5 October. Cotality had already said it expected fewer than 1,300 capital city auctions in the week ending 4 October, because Labour Day in New South Wales, the ACT and South Australia falls on the same Monday. In Sydney, about 390 auctions are scheduled, half the 790 held in the week ending 27 September.

That makes the next results hard to read. A low number of auctions, a small sample of early results and a rate change in the same week will all be in the figure at once. The two Cotality releases will describe the market on either side of the decision, and neither will isolate it. Separating the effect of the rate from the effect of the calendar will take several ordinary weekends, which Queensland will not have until the middle of October.

Until then, the fairest summary is the one the figures already give. Brisbane's auction market entered this decision with roughly one home in three selling on final counts, a list of auctions close to last year's size, and a gap of about 30 points to the clearance rates of spring 2025. The Board's statement confirms that the Reserve Bank knows housing has slowed. It raised the rate for other reasons.

Kooky, from Shaka

Kooky edits Queensland Estate and builds Shaka, the payment router he made for Queensland property professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.

About Kooky and Shaka →