INSIGHT · COST & QUOTING
In the year to June 2026, house materials rose 3.8%
and builders' house prices 5.9%.
ABS Producer Price Indexes for the June quarter 2026, released 31 July 2026, show the Input to the House construction industry index (materials, six capital cities) up 2.1% in the quarter and 3.8% over the year, and the Output of House construction index, the price builders receive, up 2.0% and 5.9%. The CPI index for new dwelling purchase by owner-occupiers rose 1.8% in the same quarter. They measure different things: materials delivered on site, the builder's price including buyers' grants, and the purchaser's cost excluding them.
Analysed 9 October 2026 · ABS Producer Price Indexes, Australia, June 2026, released 31 July 2026 (Tables 17 and 18) and its methodology · ABS Consumer Price Index, Australia, August 2026, released 30 September 2026 (Table 18, quarterly) · all pages read 9 October 2026.
Key takeaways
- Three indexes for one house: The ABS publishes an input price index for house construction (materials), an output price index for house construction (what builders receive) and, in the CPI, a new dwelling purchase by owner-occupiers index (what purchasers pay out of pocket). In the June quarter 2026 they rose 2.1%, 2.0% and 1.8%.
- The input index is materials only: The ABS states the input index measures changes in prices of products (materials) used in house construction, priced delivered on site. Labour is not in it; the ABS methodology notes that labour costs are excluded from its input PPIs other than the Childcare Services Cost Index.
- Grants separate the output index from the CPI: The output index price includes grants, rebates and subsidies received by the purchaser; the CPI new dwellings index measures the purchaser's out-of-pocket cost, excluding them. The ABS sets out this contrast itself.
- Over five years the three paths differ: From the June quarter 2021 to the June quarter 2026 the input index rose 34.2%, the output index 42.5% and the CPI new dwellings index 44.5% (all our calculation from published index numbers).
- We would store the series ID, not the name: A system-design recommendation: any escalation calculation or feasibility cost line names the index by table and series ID, its city or state, its reference base and the release each value came from.
01
Three indexes,
three things measured.
All three are published by the ABS for the June quarter 2026. Each answers a different question about the price of a house.
PPI figures are published by the ABS, original series, index reference period 2011-12 = 100.0, with GST excluded from all prices. The CPI quarterly change is published in Table 18 of the August 2026 CPI release; the CPI annual change is our calculation from the quarterly index numbers (103.57 against 98.31).
| Index | What the ABS says it measures | Geography | June qtr 2026 | Year to June qtr 2026 |
|---|---|---|---|---|
| Input to the House construction industry (PPI Table 18) | Prices of products (materials) used in house construction, at purchasers' prices, delivered on site | Weighted average of six state capital cities, and each city | +2.1% | +3.8% |
| Output of House construction, class 3011 (PPI Table 17) | The price the producer receives from the purchaser, for owner occupier and investor house construction, including grants, rebates and subsidies | Australia and each state and territory | +2.0% | +5.9% |
| New dwelling purchase by owner-occupiers (CPI Table 18, quarterly) | The out of pocket cost of the purchaser, excluding grants, rebates and subsidies | Weighted average of eight capital cities | +1.8% | +5.4% (our calculation) |
02
Input to house construction,
by capital city.
The input index is published for six state capital cities and their weighted average. There is no Darwin or Canberra input index.
PPI Table 18, original series, 2011-12 = 100.0. 'Capital city' relates to the greater capital city statistical area for each state capital city. The ABS states the index does not explicitly cover alterations, additions, renovations and repairs.
| Capital city | Index, June qtr 2026 | Change in quarter | Change over year |
|---|---|---|---|
| Sydney | 168.4 | +2.3% | +3.5% |
| Melbourne | 169.9 | +2.0% | +3.5% |
| Brisbane | 174.0 | +2.3% | +4.4% |
| Adelaide | 167.8 | +1.9% | +4.4% |
| Perth | 160.9 | +2.0% | +3.9% |
| Hobart | 164.8 | +1.8% | +3.4% |
| Weighted average of six capital cities | 167.8 | +2.1% | +3.8% |
- A fixed basket: The ABS states the products and weights come from a bill of quantities obtained from a quantity surveyor in 2019-20, price updated to June 2020, combined with Building Activity value of work done for houses by capital city.
- The quarter's main contributors: Among the main contributors the ABS lists, Electrical equipment rose 7.4% in the quarter and 12.1% over the year, and Other metal products 2.6% and 4.9% (six capital cities). The ABS attributes the quarter's rise largely to higher raw material, freight and fuel costs.
03
Output of house construction,
state by state.
The output index is the builder's side: the ABS states that, as far as possible, builders' selling prices are reflected in the output indexes. It is compiled from prices for work in each capital city, used to represent the whole state or territory.
PPI Table 17, class 3011 House construction, original series, 2011-12 = 100.0. The ABS describes the 2.0% national rise as the largest since September 2022, and the 5.9% annual rise as the highest since June quarter 2023. Index levels compare each state with its own 2011-12 level, not states with each other.
| State or territory | Index, June qtr 2026 | Change in quarter | Change over year |
|---|---|---|---|
| New South Wales | 193.0 | +2.0% | +4.8% |
| Victoria | 164.7 | +0.7% | +3.7% |
| Queensland | 199.2 | +3.1% | +8.0% |
| South Australia | 179.7 | +3.4% | +8.5% |
| Western Australia | 219.7 | +2.6% | +8.8% |
| Tasmania | 201.3 | +4.7% | +11.5% |
| Northern Territory | 132.6 | +1.4% | +4.6% |
| Australian Capital Territory | 168.3 | +2.9% | +5.0% |
| Australia | 182.6 | +2.0% | +5.9% |
04
Five years,
three different paths.
Because the two PPIs share the 2011-12 = 100.0 reference period, each June 2026 index number reads as the change since 2011-12: 167.8 for materials and 182.6 for the builders' price. Over the five years from the June quarter 2021 the three indexes moved as follows (all our calculation from published index numbers).
| Index | June qtr 2021 | June qtr 2026 | Change (our calculation) |
|---|---|---|---|
| Input to House construction, six capital cities | 125.0 | 167.8 | +34.2% |
| Output of House construction, Australia | 128.1 | 182.6 | +42.5% |
| CPI new dwelling purchase by owner-occupiers, eight capital cities | 71.66 | 103.57 | +44.5% |
- The gap is not a margin: The input index prices only the materials. The output index is the price a builder receives for the house as a whole, including buyers' grants. A difference between the two cannot be read as a change in builders' margins.
- The CPI index has been re-based: The August 2026 CPI release states that the quarterly CPI data has been re-referenced and aligned to the new monthly CPI series. Its index levels are therefore not on the PPIs' 2011-12 base and cannot be compared with them as levels; only their percentage changes are comparable.
05
Which index answers
which question.
Whether a contract uses an index, and which one, is a matter for the contract and the parties' advisers. What the ABS definitions do settle is what each index measures, which is the question a cost clause or a feasibility line is trying to answer.
- Movement in materials prices: The input index measures materials delivered on site, for a fixed house basket, by capital city. Labour and subcontract rates are not in it.
- Movement in what builders charge: The output index measures builders' selling prices for houses, by state, including grants received by the purchaser.
- Movement in what an owner-occupier pays: The CPI new dwellings index measures the purchaser's out-of-pocket cost, net of grants and rebates. Where a grant changes, it can move differently from the output index in the same quarter.
- Whether the number can change: The PPI methodology states index numbers are released as final figures at the time they are first published, and revisions will only occur in exceptional circumstances. The August 2026 CPI release states that the quarterly CPI data has been re-referenced. A clause that stores an index level without its base can be left pointing at a number that no longer appears in the current table.
What we would put in a system
For any quote escalation calculation or feasibility cost line that relies on an ABS index, we would test for four fields.
Where agents help is narrow. A quoting agent can read the ABS tables, propose the index values for the base and adjustment quarters with their series IDs, and draft the escalation calculation, and a person confirms it. No agent decides whether a contract permits an adjustment, which index it refers to, or what amount is payable; those are matters for the contract, the parties and their advisers.
| Field | Why it is load-bearing |
|---|---|
| Index, table and series ID | "The building cost index" could mean three ABS indexes. A series ID such as A2390561L (input, Adelaide) or A2333736R (output, South Australia) does not. |
| City or state | The input index is by capital city and the output index by state, with different values; the June 2026 annual change for Adelaide inputs was 4.4% and for South Australian output 8.5%. |
| Reference base and edition | The PPIs are on 2011-12 = 100.0; the quarterly CPI has been re-referenced. Storing the base and the release date keeps a stored level comparable with a later one. |
| Base quarter and adjustment quarter | An escalation calculation compares two published quarters. Both quarters and both values, with their release dates, make the calculation re-checkable. |
- Quoting: Where a quote's cost basis, validity window and any index reference are recorded.
- Quoting agent: Drafts index-based adjustments from published values for a person to confirm.
- How a quote validity window is calculated: The time a price holds, and what it has to carry.
- The July 2026 award wage increase and quotes: The labour side that the input index does not cover.
Questions worth asking
of your own quotes
For a builder: if a contract refers to a building cost index, does your record name the table, series ID and city?
The input index for Adelaide and the output index for South Australia moved 4.4% and 8.5% over the year to June 2026. A record that says only "ABS index" cannot show which of them was applied.
For a developer: is the construction escalation in your feasibility a materials figure or a builders' price figure?
The two PPIs moved 34.2% and 42.5% over five years to June 2026 (our calculation). Which one a feasibility uses changes its cost line, and the choice should be visible in the model.
For a building-product manufacturer: which component of the input index matches your product?
The ABS publishes component indexes, such as Electrical equipment and Other metal products, for each capital city. A price list that references the all-groups index is referencing a basket that includes many products other than its own.
For a group building in several states: are the indexes in your models by city or by state?
The input index covers six capital cities; the output index covers eight states and territories. A Darwin or Canberra job has no input index of its own.
Questions people ask
about construction cost indexes in Australia
What is the construction cost index in Australia?
The ABS Producer Price Indexes include an Input to the House construction industry index, which measures materials prices for house building in six capital cities, and an Output of House construction index, which measures the price builders receive. In the June quarter 2026 (released 31 July 2026) they stood at 167.8 and 182.6, on a 2011-12 = 100.0 base.
How much have building costs risen in Australia in 2026?
In the year to the June quarter 2026, the ABS input to house construction index (materials, six capital cities) rose 3.8% and the output of house construction index (builders' prices, Australia) rose 5.9%. In the June quarter alone they rose 2.1% and 2.0%.
Does the ABS house construction cost index include labour?
The input to house construction index measures prices of products (materials) used in house construction, and the ABS methodology notes that labour costs are excluded from its input PPIs other than the Childcare Services Cost Index. The output index measures the price a builder receives for the house as a whole.
Which state had the largest rise in house construction prices?
Tasmania (our ranking), where the ABS output of house construction index rose 4.7% in the June quarter 2026 and 11.5% over the year. Victoria had the smallest rise, 0.7% in the quarter and 3.7% over the year (Producer Price Indexes, June 2026).
What is the difference between the PPI house construction index and the CPI new dwellings index?
The ABS states the output of house construction PPI measures the price the producer receives, including grants, rebates and subsidies received by the purchaser, while the CPI new dwellings index measures the purchaser's out-of-pocket cost, excluding them. In the June quarter 2026 they rose 2.0% and 1.8%.
What this analysis
does and does not show.
Evidence note
- What it shows
- Three ABS price indexes for the June quarter 2026, what each measures as the ABS defines it, their city or state values, and how they moved over five years, from Producer Price Indexes, Australia, June 2026 (released 31 July 2026) and Consumer Price Index, Australia, August 2026 (released 30 September 2026). All pages read 9 October 2026.
- Key facts quoted
- Input to House construction, six capital cities: 167.8, +2.1% in the quarter, +3.8% over the year. Output of House construction, Australia: 182.6, +2.0% and +5.9%; Tasmania +4.7% and +11.5%; Victoria +0.7% and +3.7%. CPI new dwelling purchase by owner-occupiers: +1.8% in the quarter. PPI reference period 2011-12 = 100.0; PPI index numbers final when first published; quarterly CPI re-referenced.
- The CPI annual change for the quarter and all five-year changes are our calculation from published index numbers.
- The input index excludes labour and covers six capital cities only. It is not a measure of a builder's total cost.
- No comparison of index levels between states, cities or the CPI is made; levels compare each series with its own base.
- We make no statement about future price movements and no assessment of builders' margins.
- Whether any contract uses an index, and which, is a matter for that contract. Nothing here is legal, financial or contractual advice.
What to watch next
- 28 October 2026: Consumer Price Index, Australia, September 2026. The ABS states that data for the most recent quarter is added to quarterly Tables 17 and 18 in the March, June, September and December monthly publications.
- 30 October 2026: Producer Price Indexes, Australia, September 2026, with the September quarter input and output indexes for house construction.
Bring us one quote
with an escalation clause.
Send us a quote or contract that refers to a cost index, and the calculation you would run under it. We will show you which ABS series it matches, what that series measures and what the record needs to carry for the calculation to be re-checked.
General information about published ABS price indexes. It is not legal, financial or contractual advice, does not interpret any contract, and makes no forecast of prices. Figures are Australian, by city or state, as read on 9 October 2026 from the sources listed; derived figures are labelled.
Sources
Suggested citation: ABS, Producer Price Indexes, Australia, June 2026 (released 31 July 2026) and Consumer Price Index, Australia, August 2026 (released 30 September 2026), as read 9 October 2026. Derived figures: the CPI new dwellings annual change to the June quarter 2026 and the five-year changes from the June quarter 2021, all our calculation from published index numbers.
- ABS - Producer Price Indexes, Australia, June 2026: Released 31 July 2026, 11:30am AEST · read 9 October 2026 · national statistical office - quarterly release
- ABS - PPI Table 17, Output of the Construction industries: Released 31 July 2026 · read 9 October 2026 · time series workbook, class 3011 House construction by state
- ABS - PPI Table 18, Input to the House construction industry: Released 31 July 2026 · read 9 October 2026 · time series workbook, six capital cities
- ABS - Producer Price Indexes, Australia methodology, June 2026: Released 31 July 2026 · read 9 October 2026 · national statistical office - scope, valuation and reference period
- ABS - Consumer Price Index, Australia, August 2026: Released 30 September 2026, 11:30am AEST · read 9 October 2026 · national statistical office - monthly release with quarterly tables
- ABS - CPI Table 18, quarterly, weighted average of eight capital cities: Released 30 September 2026 · read 9 October 2026 · time series workbook, new dwelling purchase by owner-occupiers