![\"A](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/09\/Perth_night_mid.jpg\")
\u25b2 Perth has been identified as the highest tender price index forecast for Australia\u2019s major markets. Images: Chris Thomson<\/p>\nAustralia\u2019s construction sector is absorbing a fresh wave of input cost inflation rather than passing it through to tender prices, according to Rider Levett Bucknall\u2019s (RLB) Construction Market Update for the September quarter.<\/p>\n
RLB Oceania director of research and development Oliver Nichols said renewed conflict in the Middle East had driven up the cost of diesel, freight, concrete and other petroleum-linked materials, but competitive tendering was preventing most of that hit from reaching clients.<\/p>\n
\u201cThese costs are being absorbed by contractors in most Australian cities, but Perth is bucking the trend with tender prices now forecast to rise more rapidly,\u201d Nichols said.<\/p>\n
Wholesale diesel prices are approaching $2.50 a litre, and concrete suppliers have reinstated surcharges of roughly $7 to $9 per cubic metre after removing them in June, according to RLB.<\/p>\n
National TPI holds, but masks two-speed market<\/p>\n
RLB\u2019s national Tender Price Index (TPI) forecast for 2026 is unchanged at 4.6 per cent.<\/p>\n
But the firm says that figure disguises sharp divergence between cities.<\/p>\n
Perth has been upgraded from 5.6 per cent to 6.5 per cent\u2014now equal-highest among the major markets alongside Townsville, at 7 per cent.\u00a0<\/p>\n
\u25b2 Perth has been identified as the highest tender price index forecast for Australia\u2019s major markets. Images: Chris Thomson<\/p>\n
RLB said the Perth revision reflected the state\u2019s construction sector running at or near peak capacity, across defence, healthcare, renewable energy, manufacturing and residential work.<\/p>\n
Softer market conditions have downgraded Darwin\u2019s forecast from 6.9 per cent to 5.9 per cent, and the Gold Coast from 6 per cent to 5.5 per cent.<\/p>\n
Sydney and Melbourne remain comparatively soft. Subcontractors in Sydney are actively chasing forward work, helping moderate the impact of higher fuel and material costs on tender prices.<\/p>\n
Brisbane window narrows ahead of Games pipeline<\/p>\n
RLB said there was a window of about six months for Brisbane projects under $80 million that were ready to tender now, as contractors sharpen pricing ahead of the city\u2019s Olympic-linked pipeline.<\/p>\n
Once that demand builds, RLB expects the pressure on resources and prices to increase.<\/p>\n
RLB\u2019s forecast TPI growth for Brisbane is 5 per cent for 2026, stepping up to 7 per cent annually from 2027 through to 2029.<\/p>\n
City20252026 (June qtr)2026 (latest)202720282029Adelaide3.5pc5.1pc5.1pc5.5pc5.5pc5pcBrisbane5pc5pc5pc7pc7pc7pcCanberra3.75pc4.7pc4.7pc4.8pc4.3pc4pcDarwin5pc6.9pc5.9pc5.1pc4.6pc4pcGold Coast4.5pc6pc5.5pc7pc7pc7pcMelbourne4pc4pc4pc4.25pc4.5pc4.5pcPerth5.4pc5.6pc6.5pc5.9pc5.5pc5.1pcSydney4.5pc4pc4pc4.5pc5pc4.5pcTownsville6pc7pc7pc7pc7pc7pc
Labour, not fuel, biggest medium-term risk<\/p>\n
Fuel and freight volatility is a short-term shock layered on top of the deeper, slower-moving iceberg: labour shortages, according to RLB.\u00a0<\/p>\n
\u201cConstruction labour markets are already tight, particularly in Queensland, Western Australia and South Australia, where online job advertisements for construction workers remain well above pre-Covid levels,\u201d Nichols said.\u00a0<\/p>\n
Trade and apprenticeship commencements have \u201cincreased only slightly,\u201d he said, while migration was slowing and few visas were being issued to construction workers.<\/p>\n
![\"Apprentice](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/09\/apprentice-steel-worker.jpg\")
\u25b2 Vocational education completions have not materially risen to address workforce labour shortages.\u00a0<\/p>\n
RLB expects competition for labour to intensify as data centre, residential, defence and health projects move through the pipeline alongside the Brisbane 2032 Olympics. And it is going to be expensive.<\/p>\n
Construction enterprise agreement wage growth is already at its highest level since the late 1990s.<\/p>\n
That is against a backdrop of record activity: construction work done hit $328 billion in 2025\u201326, up 4.2 per cent on the prior year, with apartment and townhouse construction climbing 13.2 per cent and non-residential work up 9.3 per cent, driven partly by data centres and health projects.<\/p>\n
Forecast: relief, not reversal<\/p>\n
RLB expects TPI growth to average more than 5 per cent across major markets over the next few years \u2014 well above the 3.3 per cent average recorded between 2014 and 2019.<\/p>\n
\u201cCompetitive tendering is providing some relief from the immediate impact of higher input costs, but it should not be mistaken for a return to a low-cost construction environment,\u201d Nichols said.\u00a0<\/p>\n
\u201cThe underlying fundamentals remain challenging.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Australia\u2019s construction sector is absorbing a fresh wave of input cost inflation rather than passing it through to…\n","protected":false},"author":2,"featured_media":894251,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[64,63,651,17216,11758,40137,5249,16553,2485,463493,99407,647,44,46,337,670,6649],"class_list":["post-894250","post","type-post","status-publish","format-standard","has-post-thumbnail","category-australia","tag-au","tag-australia","tag-brisbane","tag-building-materials","tag-construction","tag-construction-costs","tag-darwin","tag-development","tag-gold-coast","tag-labour-skills","tag-market-dynamics","tag-melbourne","tag-news","tag-perth","tag-research","tag-sydney","tag-townsville"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/894250","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=894250"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/894250\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/894251"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=894250"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=894250"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=894250"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}