Australia’s housing downturn is on track to become the deepest in 40 years as economists warn already sizeable price drops could be only one-third of the way through.

National property values fell 1.1 per cent in September, taking the total decline since the March peak to 5.2 per cent, data firm Cotality revealed on Thursday.

The median dwelling value dropped to $899,236 – essentially back to where it was 12 months earlier.

Brisbane overtook Sydney as the city with the steepest monthly fall, down 1.5 per cent compared to Sydney’s 1.4 per cent.

Sydney home values are 8.6 per cent lower than their February peak.

The downturn was deeper than at the same stage of the 2022/23 price drop, Cotality research director Tim Lawless said.

“This is just a little bit more rapid than what we’re seeing through that previous period of decline, which was one of the largest corrections on record,” he told AAP.

“But it was really short and sharp. I think this one’s quite sharp, clearly, but I’m not sure how short it’s going to be.”

Some economists, such as HSBC’s Paul Bloxham, have forecast prices to decline 13 per cent, from peak to tough.

AMP chief economist Shane Oliver said the slump could be as large a 15 per cent and run until the middle of 2027.

While rising interest rates are having a larger influence on prices, Labor’s tax changes for property investors are clearly having an impact.

“Once the dust finally settles, maybe around the middle of next year, then fresh home buyers will probably be in a situation where housing is more affordable and there’s less competition with investors,” Mr Lawless said. 

“So on that framework … I think the budget would have done what it set out to achieve.”

Treasurer Jim Chalmers said prices were already coming off before the May budget, but the changes would help ensure there were more affordable opportunities in the market for first-home buyers.

“Young people and first-home buyers have been locked out of the housing market for decades, since the mistake was made with the tax changes a quarter of a century ago,” he told reporters on Thursday.

As interest rates climb, the property downturn is widening as well as deepening.

Over the three months to the end of September, 97 per cent of capital city suburbs were down in value, Cotality said.

While the lower quartile of the market was holding up in the early stages of the downturn, pockets of resistance were increasingly disappearing.

But Labor’s expansion of its five per cent deposit scheme was still buttressing demand among first-home buyers at the lower end of the market.

Since it was uncapped one year ago to the day, more than 102,000 first-home buyers had made use of the scheme, Prime Minister Anthony Albanese said.

“This scheme is helping Australians, particularly young Australians, get their foot in the door and achieve the dream of home ownership,” he said.

The tax changes were predicted to push rents up due to a reduction in rental stock.

However, inflation data released by the Australian Bureau of Statistics on Wednesday showed rents have stabilised, rising 3.6 per cent in the 12 months to August – a rate of growth that has been unchanged since May.

A rebound in the rental vacancy rate from a record low 1.5 per cent to two per cent – due to larger household sizes and lower migration levels – was helping take some heat out of the market, Mr Lawless said.

Hypocrisy claims are being levelled at a government agency as it cuts off credit card payments in response to the introduction of a surcharge ban.

Reserve Bank of Australia reforms starting on Thursday mean retailers can no longer charge customers an additional fee for paying by card and must either absorb the cost or build it into their prices.

In response, the Australian Taxation Office says it will stop accepting credit card payment after November 30.

“As a government agency, the ATO has decided it would not be appropriate for the cost of credit card merchant fees to be transferred to the community,” it said in a statement on Thursday. 

The Australian Chamber of Commerce and Industry labelled the successive changes as a “staggering act of hypocrisy”.

“On the one hand, you have government saying to a small business ‘you have to wear this … you have to work out whether you are going to absorb that cost or try to pass it on to your customers’,” chamber chief Andrew McKellar said at federal parliament on Thursday.

“On the other hand, we have the tax office saying that they will not wear it; they will deprive their customers of that facility because they don’t want to have to withdraw the cost of the surcharge.”

The ATO’s announcement was a one-two punch for millions of small businesses that rely on credit cards to manage shrinking cash flow, Mr McKellar said.

But the tax office said the vast majority of taxpayers did not pay their tax with a credit card.

“Approximately 2.3 per cent of tax payments were made with credit cards in 2024/25, with more than 60 per cent of card payments being made by privately owned and wealthy groups and public and multinational businesses,” a spokesperson said.

The ATO said it would continue to support those experiencing financial hardship or other circumstances that made it difficult to meet their obligations.

Prime Minister Anthony Albanese on Wednesday backed the surcharge ban, calling it another example of cost-of-living relief from his government.

“I think when people turn up and tap, be it at a coffee shop or a pub or buying a sandwich for lunch, they expect the price that they see to be the price that they pay,” he said.

Small businesses have criticised the Reserve Bank’s change as another hit to dwindling profit margins.

Nikki Laski, manager of long-standing Melbourne establishment Monarch Cakes, said while the changes seemed like a win for customers, if the small businesses providing those services weren’t around then everybody loses.

“That whole seven cents off your coffee might mean that your favourite coffee shop closes,” she said.

Big businesses including Coles and Woolworths were already absorbing the cost of card fees because they could afford to, Ms Laski said.

Card surcharge fees can cost up to $50,000 per year for cafes and restaurants and $100,0000 for a medium-sized pub, Mr McKellar estimated.

“That’s a huge additional cost that you’re expecting the business to wear,” he said.

To help ease the overall pressure, the RBA has also capped interchange fees, which are paid by the merchant’s bank to the customer’s bank each time a payment is processed.

The Reserve Bank expects the new maximum rate of 0.30 per cent – down from 0.80 per cent – will deliver around $660 million a year in lower payment costs for businesses.

Experts are split on what actual effects the changes will have at the till, according to financial comparison site Finder, but most agreed it would be a net positive for consumers.

Treasurer Jim Chalmers said the Reserve Bank’s surcharge change would save consumers $1.6 billion in card surcharges and save businesses $910 million each year.

A former judge and two global tech experts will lead a royal commission into artificial intelligence after the most “substantial technological shift” in two centuries.

The South Australian government on Thursday revealed the terms of reference for the state inquiry and its pick for chair, economist and former judge Iain Ross.

Premier Peter Malinauskas said it was impossible to put the “AI genie back in the bottle”, conceding the fast-developing technology sometimes scared him.

“If we don’t contemplate … an AI future forcefully, there could be really severe consequences, as well as a big opportunity cost,” he said.

Kate Pounder and Christopher Manning were selected as commissioners for their expertise in technology policy, innovation, computer science and machine learning.

Dr Ross said the inquiry would balance opportunities for enriching lives, improving productivity and lifting economic performance with an approach that mitigated risks and threats.

Professor Manning, a world-renowned AI expert, is the co-founder of Stanford’s Institute for Human-Centred Artificial Intelligence and is a professor in machine learning at the private research university.

He would visit SA in early 2027 and his connections would provide the best possible expertise, Dr Ross said.

Ms Pounder, who was raised in the state, has worked with OpenAI and was the Tech Council of Australia’s inaugural chief executive.

The commission could help people gain clarity about their future and provide support as people “make the most of this fundamental change”, she said.

The evidence-based inquiry aimed to help SA industry be nationally and globally competitive and would study how the technology could be transformative to the economy, the terms of reference said.

It will also examine how SA can leverage the social benefits of AI while safeguarding people and society from risks and challenges.

“There has never been a more substantial technological shift … over the course of the last two centuries and we’re going to treat this seriously,” the premier said.

“Anyone that’s used (AI agents) ChatGPT or Claude has witnessed it themselves – it’s extraordinary what you can do very quickly.

“But … when I think about my kids, I worry about things that aren’t human-centred making judgments for us and what the implications of that could look like.”

Labour market and workplace practices, including the mitigation of impacts on employment, will be examined, as will the education system’s use of AI.

The commissioners will make recommendations about policy, legislative or structural reforms, with regard to the need for practical action in the short to medium term.

They will be required to consider the importance of technological innovation remaining human-centric, and current and potential impacts and opportunities of AI on systemic trust, civics and the democratic process.

The commission will co-ordinate public submissions, community forums, surveys, industry round tables and stakeholder consultations.

Australian Information Industry Association chief executive Elizabeth Whitelock said the inquiry could help establish the conditions for responsible AI adoption that strengthened the economy and improved lives.

“AI should help people do their jobs better, help businesses grow and make essential services easier to access,” she said.

“People need confidence that AI is being used responsibly, with clear accountability and appropriate protections. Businesses also need practical guidance for how it can benefit them.”

The commission is due to report to the government in mid-2027.

Australia’s largest energy retailer views data centres as a major opportunity, its shareholders have heard.

AGL Energy chairman Miles George told the company’s annual general meeting on Thursday the company had three energy hub sites with the combination of attributes data centres were looking for.

“I’m talking about Bayswater, Loy Yang and Torrens Island,” he said, referring to two of the company’s coal-fired plants in NSW and Victoria, and its natural gas-fired power station in South Australia.

Those sites had large areas of available land, water infrastructure and available power, he said.

“The second way that we would benefit from data centres, which we consider to be a really major opportunity is the increased demand, which is in the power system generally,” Mr George said.

That obviously supports a stronger demand for AGL’s operating assets, he added.

In an investor presentation in May, AGL noted data centre expansion was driving a strong demand for electricity, particularly in NSW, Victoria and ACT.

Operational data centres account for about five terawatt hours of energy demand in Australia, which is expected to double once projects under construction are operational and ramp up to full capacity.

If all the data centre projects currently in development in the National Electricity Market come to fruition, that would mean another 25 terawatt hours of forecast demand, AGL said.

That’s a combined forecast of 34 terawatt hours, “which is enormous”, chief executive Damien Nicks told the Macquarie conference during the presentation.

Not all the projects may make it to final construction, but it was still a significant opportunity, he said.

AGL’s AGM wrapped up quickly, with just five shareholders asking questions.

AGL shares were trading on Thursday at $8.04, down 1.5 per cent from Wednesday’s close.

Australia’s leading rare earths miner is acquiring a smaller rival for nearly $1 billion amid surging demand for the metals that are vital to the modern electronics industry.

Lynas Rare Earths is buying Meteoric Resources in an all-scrip transaction that values its takeover target at $968 million, a 68.4 per cent premium to Wednesday’s share price.

Backed by Australia’s richest person, Gina Rinehart, Lynas is the world’s biggest producer of rare earths outside of China and the deal will give it access to Meteoric’s Caldeira project in Brazil, a huge deposit of ionic clay rare earth oxide.

“Caldeira is the right asset for Lynas at the right time, squarely consistent with our Towards 2030 strategy, and we believe it is the best rare earth asset for us to pursue,” Lynas chairman John Humphrey told analysts on a conference call on Thursday.

Rare earth elements have taken an outsized importance in recent years because China has gained control of about 90 per cent of the processing and refining of the minerals, a near-monopoly it has weaponised during its trade war with the United States.

“We have a great deal of confidence in where demand is heading outside China,” Mr Humphrey said.

“The world has moved and shifted as far as where they want their materials to come from, and Lynas stands to benefit from that.”

The 17 elements considered rare earths are vital to the creation of ultra-strong magnets used in speakers, headphones and computer hard drives, and are also used in fibre-optic cables and to colour smartphone screens.

Lynas is the world’s biggest producer of rare earths outside of China thanks to its Mt Weld mine in Western Australia.

Rare earths concentrate mined there is initially processed in Kalgoorlie and then shipped to a 100-hectare Lynas facility in Malaysia for further processing.

Lynas said the initial plan is for the Malaysian plant to also process ore from Caldeira once that mine is operational.

It expects to spend over $US500 million ($720 million) on its construction but is well-placed to fund it with $1.2 billion in cash and short-term deposits on hand.

By midday, Meteoric shares had soared 50 per cent to a nearly two-year high of 25.5 cents, while Lynas shares had slumped 5.5 per cent to $13.065.

Ms Rinehart’s Hancock Prospecting owns 8.2 per cent of Lynas, a stake worth about $1 billion.

People with disabilities need to be assured of what supports they will receive under changes to the NDIS, advocates have urged, as the first round of reforms roll out.

The plan for autistic and developmentally delayed children to roll off the NDIS  and onto a state-run scheme called Thriving Kids began its first phase on Thursday.

States will chip in $4 billion over five years to take youngsters aged eight or below with low-to-moderate needs off the hands of the federal government, which will also contribute $2 billion.

The first changes include launching a website and autism helpline, and kickstarting a transitory rollout period until January 2028 when children migrate to state programs.

People with Disability Australia acting chief executive Megan Spindler-Smith said while there was an outline to what support children moving on to Thriving Kids will receive, there was less clarity for other people with disabilities once further NDIS changes kick in.

“The gaps have always been there for people with disability who have not been eligible for the NDIS. As the NDIS changes, those gaps are only going to widen,” Ms Spindler-Smith said.

“Thriving Kids is a start, but people with disability of all ages need to know what comes next, what support will be there and when they will be able to access it.”

Thriving Kids was announced by NDIS Minister Mark Butler in August 2025 as a way to rein in costs of the disability scheme.

Queensland is the only state that has yet to sign on to Thriving Kids, with  Megan Spindler-Smith saying there was uncertainty as to what supports children would be eligible for.

“Queensland families need clarity. The lack of an agreement between governments cannot be used as an excuse to leave children and families without the supports they need,” Ms Spindler-Smith said.

Advocates say Queensland not signing on might beat a path back to the highly fragmented pre-2013 system which preceded the NDIS.

The disability community was still in the dark about how Thriving Kids would eventually work, Autism Association of Australia chief executive Nicole Rogerson told AAP.

“The remaining question … is how much autism is enough autism to get into the NDIS?” she said.

Deciding which children should go where and what will happen after they turn eight also remains largely a mystery.

“No state or territory has invested in allied health for school-age children,” incoming Royal Australian College of Physicians child health division president Paul Hotton told AAP.

“What’s going to happen to these children? None of (the states) can answer.”

Treasurer Jim Chalmers said while families may have questions for what changes would mean for them, the overhaul would leave the NDIS more sustainable.

“When you are changing programs like this there is a level of concern and there is a level of anxiety. We take that seriously,”  he told reporters in Brisbane.

“We’re confident that we will come up with the best combination of services and care and support for some of our most vulnerable people.”

Dr Hotton said Thriving Kids could theoretically be better for looking after mildly autistic children, but was as yet unlikely to meet its potential. 

“Thriving Kids is needed, NDIS is not working,” he said,

“NDIS never worked because it doesn’t have real good clinical governance oversight … if we’re going to do something for children, there should be a national paediatrician.”

The advocates also flagged Canberra had likely low-balled the cost of administering Thriving Kids, similar to its consistently underestimating the cost of the NDIS.

“What does this look like in 10 to 15 years if we haven’t given those children the best quality early intervention?” Mr Rogerson said.

“The size of the funding envelope that has been agreed – that math just don’t math for me.”

Less than one per cent of borrowers are estimated to be facing negative equity despite soaring interest rates, the Reserve Bank of Australia says. 

Mortgage holders, whacked with a 25 basis point rate hike on Tuesday, are realistically capable of absorbing shocks to the market, the bank’s half-yearly Financial Stability Review said.

Despite a steep six-month price decline, the bank reported most Australians have sufficient cash flow and savings to mitigate downturns.

In fact, housing prices could fall 20 per cent from current levels and only around five per cent of mortgages would fall into negative equity, RBA modelling suggests.

The deepest downturn predictions by mainstream economists, such as HSBC chief economist Paul Bloxham, are around 13 per cent peak to trough.

Modelling based on Australia’s Prudential Regulation Authority and RBA numbers showed arrears rates generally remained low, and lenders have maintained high standards since the regulator instated a three per cent buffer.

The post-pandemic house price run also meant the vast majority of owners have positive equity, the bank said.

”In short, while there are pockets of stress in the household and business sectors, both sectors display a good level of resilience overall,” it said.

Stability risks from businesses have been mitigated by above-average cash buffers, which surged post-pandemic. 

Total insolvencies had fallen to about average over the past year, though they remain elevated among the hospitality, construction and transport sectors.

However, the RBA was not fearful there would be greater system-wide stress. 

”The risks associated from them remain contained, as far as the RBA is concerned,” the report said.

”Banks’ exposure remains limited, as they involve small companies and companies with little bank debt.”

The report comes after the RBA lifted interest rates for a fourth time in 2026 on Tuesday, while separately this week headline inflation rose from 3.5 per cent to a four-month high of 4.0 per cent.

RBA governor Michele Bullock was unapologetic for taking rates to their 15-year high of 4.6 per cent. 

She said the bank had to act on interest rates for the good of all Australians – including those without loans.

”Pay packets don’t go as far as they used to, and that’s why we need to stop this high inflation,” she said.

Outside of Australia’s solid positioning, the bank identified finance infrastructure as a key concern.

Global systems are increasingly interconnected, pushed by rapid technological innovation.

But, within the system, a varying level of preparedness exposes international markets to heightened risks. 

”This can amplify the effects of operational disruptions and propagate widespread financial stress,” the RBA’s report noted. 

Prolonged outages would have dire consequences for payments infrastructure, and the flow and accessibility of money. 

Risks could spawn from technology flaws, bad actors or utilities grids. 

“Operational risk … is an increasingly important consideration for financial stability,” the report, which assesses the health of the market, noted.

Other principal risks to Australia’s financial systems stem from aboard, the report found. 

High sovereign debt internationally, raised asset prices and increased reliance on borrowed cash amongst creditors have the global system on edge.

David Shoebridge has been accused of being from the “angry, militant faction” of the Greens but the new leader says his feelings are justified as Labor continues to shift to the right.

In a line they touted prominently before winning their roles on Wednesday, Senator Shoebridge and his deputy, fellow upper house member Steph Hodgins-May, have vowed to replace Labor, rather than try to reform it.

Environment Minister Murray Watt said the pledge was a sign Senator Shoebridge was “one of the leaders of the angry, militant faction of the Greens Party” and urged him to work collaboratively with the government. 

“We certainly hope that Senator Shoebridge can take a more constructive approach to working with the parliament and working with the government than he’s shown to date,” he told Channel Seven’s Sunrise.

“I really hope for the Greens’ sake that it’s not a return to the bad old days, where they just wanted to block everything.”

But Senator Shoebridge said his attitude was caused by the government leaving Australians in the lurch, both economically and environmentally. 

 “Labor has left the progressive side of politics,” Senator Shoebridge told ABC News Breakfast on Thursday.

“They have been marching to the right initially to meet whatever the coalition put to them. Now, they are marching even further to the right to meet what One Nation has put to them. Meanwhile, people are asking, well, hang on, what’s the federal government is even for,” he said.

The Greens have a big job to do if they have any hope of replacing Labor as a primary political party. They have held a relatively stagnant 13 per cent of primary votes in various polls since the 2022 election.

Asked if he planned to work constructively with the government in the upper house, Senator Shoebridge said it would require a change in the government’s approach to interest rates, taxing large corporations and regulating artificial intelligence.

“We’re in different political parties. We have very different political views of the world,” he said of Prime Minister Anthony Albanese. 

The influence of the UK Greens movement was impossible to miss, Monash University political science lecturer Nathan Fioritti said. 

“This is lifted almost entirely from (UK Greens leader Zack) Polanski’s rhetoric,” Dr Fioritti told AAP.

“Whether a new leader can give new energy to that push and achieve cut through is probably the the challenge.”

Since the federal election in May 2025, One Nation has surged in opinion polls, consistently eclipsing the coalition with first-preference votes in the high 20s.

In the same period, the UK Greens under Mr Polanski have lifted their share from nine per cent to a peak of 18 per cent at local government elections in May – well beyond that of their Australian counterpart.

Dr Fioritti said Australia and the UK faced similar political landscapes featuring a Labor party in office with a large majority and an increasingly disenfranchised voter base turning to minor parties particularly on the far-right.

“This is an opportunity for the Greens to refresh the leadership and prioritise presenting the party as a progressive or left wing alternative to One Nation for those disaffected voters,” he said.

Before the leadership vote, former Greens MP Max Chandler-Mather had urged the party to follow the lead of its UK and New Zealand counterparts and introduce a vote for all party members to determine the leader.

Former deputy Mehreen Faruqi echoed the call in a post to social media in the hours after the leadership announcement.

A US judge has entered an order allowing Paramount to close its acquisition of Warner Bros, ending a ‌months-long holdup, as the company named Mattel’s Ynon Kreiz as co-CEO to help run the combined business.

The deal is worth $US110 billion ($A158 billion).

US District Court Judge Araceli ‌Martínez-Olguín on Wednesday approved a September 21 settlement with a California-led group of 12 states that had sued to block one of the largest media mergers in history, saying it would create a media behemoth capable of driving up film and TV prices.

Under the settlement, the combined company must release at least 30 films a year in US theatres for five years and spend ‌an extra $US300 million ($A432 million) a ‌year on US ⁠production. Falling short of the film quota could force it to sell Miramax.

It ​must also negotiate basic cable deals separately for the two companies’ channels and create a board of journalists to oversee CBS News and CNN.

Groups opposed to the merger objected strongly to the settlement, with some urging the court to reject it.

Martínez-Olguín called the deal a “reasonable factual and legal resolution,” saying objectors’ hopes for the decree “to reach farther – to achieve more – do not rise ⁠to the level of legal violations” warranting rejection.

A spokesperson for the ‌California Department ​of Justice said the settlement “resolves our antitrust concerns…, protects competition and consumer choice, and centres the needs, concerns, and futures of ​California workers”.

A Paramount ‌spokesperson did not immediately respond to a request for comment on the order.

The companies also settled a Writers ​Guild of America antitrust lawsuit, agreeing to pay $US17.5 million ($A25.2 million) to the guild’s health fund and maintain WGA staffing levels at CBS News for five years.

Separately, Paramount said Mattel CEO Ynon Kreiz will ​join on ​October 5 and become co-CEO when the deal ​closes alongside chairman and CEO David Ellison, running day-to-day operations and ‌integration.

Kreiz, Mattel’s CEO since 2018, turned the toymaker’s brands into films, TV shows and games, delivering Barbie, Warner Bros’ highest-grossing film ever.

The hire gives Ellison, whose background is on the creative side, a seasoned operator who steered Mattel through the pandemic and tariffs, as Paramount aims for more than $US6 billion ($A8.6 billion) in savings from the merger.

Before Mattel, he spent much of his career in ​TV and digital media, co-founding Fox Kids Europe and running “Big Brother” producer Endemol.

He later ran YouTube network Maker Studios, ​which he sold to Disney in ⁠2014.

US consumer prices rose slightly less than expected in August, according to the Federal Reserve’s preferred measure of inflation, official data indicates.

The personal consumption expenditures (PCE) price index rose 0.3 per cent from the previous month, following a revised 0.1 per cent increase in July, the Commerce Department said.

Economists had expected a 0.4 per cent rise.

Compared with a year earlier, PCE inflation stood at 3.4 per cent in August, unchanged from a revised 3.4 per cent in July.

Core PCE inflation, which excludes volatile food and energy prices, rose 0.2 per cent month-on-month, slightly below expectations of 0.3 per cent.

Core prices had increased by a revised 0.1 per cent in July.

On an annual basis, core PCE inflation remained unchanged at 3.0 per cent in August.

The PCE price index is closely watched by the Federal Reserve as a key measure of inflation.

Separate figures in the Commerce Department’s report showed personal income rose 0.2 per cent in August after increasing 0.3 per cent in July.

Personal spending, meanwhile, jumped 0.9 per cent after edging up 0.1 per cent in July.