Melbourne set to drop out of the $1 million club as house prices fall
Melbourne's median house price is expected to be in the high $900,000s by the end of the year as rate hikes bite, The Age, The Sydney Morning Herald, Brisbane Times and WA Today reported. The reports said that would take Melbourne out of the $1 million club. The same mastheads reported that the Reserve Bank has lifted interest rates four times this year and that the chances of another move have climbed. One report described the bank as being in a 'nightmare' position ahead of its November meeting. A separate column argued that food inflation is a bigger issue than oil.
Higher rates raise borrowing costs, which reduces how much buyers can pay and pushes prices down. The Reserve Bank has to weigh falling housing demand against inflation that is still being driven by items such as food.
Mortgage holders face repayments that track the cash rate, and buyers may see softer prices but tougher borrowing limits.
The reports on prices suggest the rate rises are working through the housing market, with Melbourne's median house price falling toward the high $900,000s.
The column on food inflation argues that raising rates does little to ease food prices, so the bank is pushing up borrowing costs while the pressure persists.
Confirmed: four rises this year and a forecast fall in Melbourne's median house price. Not confirmed: what the Reserve Bank will do in November. Watch the next inflation data and the bank's meeting.
DailyDrop Australia edition No. 18 · Morning · THU., OCT. 22, 2026