This paper presents reliability, water demand and economic analysis of rainwater harvesting (RWH) systems for eight Australian capital cities (Adelaide, Brisbane, Canberra, Darwin, Hobart, Melbourne, Perth and Sydney). A Python-based tool is developed based on a daily water balance modelling approach, which uses input data such as daily rainfall, roof area, overflow losses, daily water demand and first flush. Ten different tank volumes are considered (1, 3, 5, 10, 15, 20, 30, 50, 75 and 100 m3). It is found that for a large roof area and tank size, the reliability of RWH systems for toilet and laundry use is high, in the range of 80–100%. However, the reliability for irrigation use is highly variable across all the locations. For combined use, Adelaide shows the smallest reliability (38–49%), while Hobart demonstrates the highest reliability (61–77%). Furthermore, economic analysis demonstrates that in a few cases, benefit–cost ratio values greater than one can be achieved for the RWH systems. The findings of this study will help the Australian Federal Government to enhance RWH policy, programs and subsidy levels considering climate-sensitive inputs in the respective cities.