First day of spring, and the year is more than half gone. So is the housing target. Two years into the promise of 1.2 million new homes by mid 2029, the industry now expects the country to land somewhere between 186,000 and 204,000 homes short, and the panel that tracks it has the target slipping to the end of 2030. NSW may not get there until 2032.
This month’s update covers why that shortfall matters for property and rents, what the RBA did (nothing, again), the Age Pension and deeming rate changes landing on 20 September, and the question Phil and Dan took on for this month’s podcast: can I retire at 60 with $500,000?
The houses aren’t coming
None of this housing news surprised us. It is the same lesson on repeat. Government tips money in, everyone builds at once, costs spike, builders go under, and the supply that was meant to arrive quietly doesn’t.
Approvals are running along fine, which is the bit that gets quoted. It is the starts that have gone missing. Dwelling starts fell 11.2% in the March quarter, with high density down 20.7% (ABS, as at 27 August 2026). You can announce a target. You cannot legislate a builder into existence.
Housing shortfall figures are industry forecasts and are subject to revision, but the direction has been consistent for two years now.
The private credit knock-on worth knowing about
There is a flow-on effect here for retirees and investors. The banks stepped back from development finance years ago and private credit filled the hole. It now funds something like a quarter of residential development debt. That works fine while everything is going up.
Late last month, a large Sydney developer went into administration owing around $3.5 billion, and several funds promptly stopped letting investors take their money out. We generally find that products described as “income funds” get far less scrutiny from investors than shares do, because the word income sounds safe. If something like this has landed in your inbox lately, liquidity, meaning how quickly you can get your money back out, is the thing to ask about.
Prices falling, rents rising. Not a contradiction.
Property values are down. July was the weakest month nationally since 2022, with Sydney off 1.4% and Melbourne down 1.2% over the month. Rents kept climbing anyway, with vacancy rates still near 1.3%, because the homes are still not there.
Falling prices and rising rents at the same time can look strange, but it is a supply story. Fewer homes get built, more people compete to rent the ones that exist, while higher rates and affordability limits keep a lid on what buyers can pay.
Rates and inflation: the RBA sits tight
The RBA held the cash rate at 4.35% in August, its second hold in a row after three rises earlier in the year. Inflation for the 12 months to July came in at 3.5%, down from 3.8% in June, but the trimmed mean (the RBA’s preferred measure of underlying inflation) is stuck at 3.6%, still above the 2 to 3% target band. Data: RBA and ABS, as at 27 August 2026.
The next RBA decision lands on 29 September. Our crystal ball is no better than yours, but a board this worried about underlying inflation is unlikely to be handing out rate cuts any time soon.
20 September: the Age Pension rises, and so do deeming rates
Two changes land on the same day, and they partly pull against each other.
From 20 September 2026, maximum Age Pension payments rise by $36.80 a fortnight for singles and $55.60 a fortnight combined for couples. That takes the maximum single rate to $1,237.70 a fortnight and the couple combined rate to $1,866.00, including supplements.
On the same day, deeming rates rise 0.5 percentage points, taking the lower rate to 1.75% and the upper rate to 3.75%. Deeming is the income Centrelink assumes your financial assets earn, whether they actually earn it or not. Higher deeming rates mean higher assessed income, so for some part pensioners on the income test, the payment rise gets partly eaten by the deeming change.
Figures are current as at the 20 September 2026 indexation, sourced from Services Australia and the Department of Social Services. These figures are set by the Australian Government and are typically updated each March and September. If you are close to a threshold, or you are not sure which test applies to you, our pension and Centrelink page covers how the pieces fit together.
On the podcast: can I retire at 60 with $500,000?
Phil pulled Dan into this one and went after the question people actually type into Google at eleven at night. The one where you want a straight answer and get four hundred blog posts instead.
Phil invents a couple, Mark and Lisa, hands them $500,000 in super, a small mortgage and a plan to spend $80,000 a year, then runs the projection three ways while making Dan guess each outcome before seeing a single number.
How did it land? Retiring at 60 on those numbers, their super was gone by 68. From there it was the Age Pension and not a lot else, and remember there is no Age Pension between 60 and 67. Every cent in that stretch comes from your own savings.
Then Phil ran the same couple working to 65. Same spending, same everything, five extra years. There was still around $1.2 million sitting there at 90. Dan’s reaction is on the tape, and it is pretty much everyone’s reaction.
Please note: All figures, projections and scenarios in this article are approximate and for illustrative purposes only. Mark and Lisa are hypothetical and not based on any real client. The projections rely on assumptions, including a constant 6.5% annual return and 2.5% inflation, that will not hold in practice. Individual outcomes will vary based on personal circumstances, investment returns, fees, and current government policy. This is general information, not personal advice.
The number that quietly does the damage is inflation. $65,000 of living costs today is roughly $136,000 a year by the time you are 90, at 2.5% inflation. Which is why “I don’t want any risk in retirement” and “I don’t want to run out of money” keep pulling against each other. Scott and Phil dug into that exact tension in the episode on why playing it safe in retirement can cost you more, where a conservative portfolio ran out 15 years earlier than a growth portfolio on the same starting balance.
You can hear the full episode on the Wealthlab podcast page. And if you want to see how your own numbers stack up against Mark and Lisa’s, run them through the free Wealthlab super calculator first. It takes two minutes and gives you a clearer picture than any average ever could.
Ten years out, there are more levers
The Mark and Lisa scenario assumes someone walks in the day before they want to retire with nothing done in advance. A decade earlier, the options open up.
One that many couples miss is contribution splitting. The contribution goes into the higher earner’s super for the bigger tax deduction, and up to 85% of it can then be moved across to the spouse afterwards. Some couples use it where one partner’s contribution cap is already used up, and it can help keep a balance under the $500,000 mark that governs catch-up contribution eligibility for longer. It is niche, and it does add up, but the rules have eligibility conditions and timing requirements, so whether it suits your situation depends on individual factors. Speak with a qualified financial adviser before acting, and see your accountant for the tax side.
Phil walked through what catch-up contributions can do in our episode on how the Age Pension really works. In one case study, using them dropped a client’s capital gains tax bill on an investment property from $73,000 to $11,000.
Your ten-minute homework
No need to make any big calls this month. Just check one thing. Search the ASFA Retirement Standard and open the detailed budget behind the headline figure. Line it up against what you actually spend now, then against what you think you will spend once you stop working. Most people find one of those two numbers is wrong.
Dan made the point that keeps landing with people in their fifties. They come in thinking they will probably be fine, and what they actually want is a number rather than a feeling. Sometimes the number is lower than they hoped. The useful part is that at 52 or 55 there is still time to move it.
Phil’s version is blunter. You can have anything you want, you just cannot have everything you want. Good retirement planning is mostly working out which set of trade-offs you can live with, and then having someone tell you honestly when a plan doesn’t stack up. As Phil puts it, it is not our job to set you up to fail.
FAQ
How much does the Age Pension increase on 20 September 2026? Maximum payments rise by $36.80 a fortnight for singles and $55.60 a fortnight combined for couples, taking the maximum single rate to $1,237.70 a fortnight including supplements. Figures are current as at the 20 September 2026 indexation and are updated by the government each March and September.
What are the deeming rates from 20 September 2026? The lower deeming rate rises to 1.75% and the upper rate to 3.75%, both up 0.5 percentage points. Deeming is the income Centrelink assumes your financial assets earn for the income test, regardless of what they actually return.
Why can my Age Pension rise be smaller than the announced increase? Because deeming rates rise on the same day. Higher deeming means higher assessed income, so for some part pensioners assessed under the income test, part of the payment increase is offset by the deeming change.
What is the RBA cash rate right now? The cash rate is 4.35% as at August 2026, after the RBA held for a second consecutive meeting. The next decision is due on 29 September 2026.
Can I get the Age Pension at 60? No. Age Pension age is 67. Anyone retiring at 60 funds the years from 60 to 67 entirely from their own savings, which is one of the biggest pressure points in early retirement projections.
Why are property prices falling while rents keep rising? It is a supply problem. Not enough homes are being built, so renters compete for limited stock and rents climb, while higher interest rates and affordability limits hold back what buyers can pay.
Got a number and an age in your head?
If you would like to see how they line up, book a free chat with the Wealthlab team. No pressure, no jargon. We would rather have the conversation than have you sit on it. Or if you would prefer a general snapshot first, take the free Wealthlab retirement quiz.
