Cost of living · August 2026

Rents and services costs still climbing fast despite overall inflation easing

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Probably worth doing something about

Directly material for renters — Australia’s fastest-growing household category — and for anyone budgeting for services, utilities or new housing construction.

In a nutshell: While headline CPI fell from 4.0% to 3.8% in June 2026, the RBA specifically called out rents, electricity, and new-home construction costs as still rising quickly. These components are keeping the trimmed mean above the 2–3% target at 3.6%, preventing rate cuts. Renters face a market where investor landlords themselves carry higher mortgage costs that are routinely passed through. The RBA’s own assessment is that these pressures may require further demand cooling before they ease.

Spin Unspin

What they’re saying

The RBA is describing structural services inflation that is slower to respond to rate rises than goods prices; this is accurate and suggests relief for renters is further away than the headline CPI fall implies.

The transmission from mortgage rates to rents is real but partial and lagged; landlords’ ability to pass costs on depends on local vacancy rates.

Inflation figures are from the ABS June quarterly release. RBA language is quoted directly from Governor Bullock’s public statements. Rent-growth data at local level varies significantly by city.

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Australia Interest Rate

Do I care?

Check Domain or REA vacancy data for your suburb. High vacancy gives negotiating room; low vacancy does not. Tenancy authorities in each state publish your rights on rent increases.

Services inflation is broad — review supplier contracts now rather than at annual renewal; locking in current prices before further increases can materially reduce cost-base exposure.

Renters facing lease renewals in the next 90 days should research local vacancy rates before accepting a landlord’s first offer — leverage varies considerably by suburb.

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