RBA Rate Cut Spurs Property Market Surge

1

This latest cut has spurred a surge in property market activity, as evidenced by preliminary auction results over the weekend, showing that 75.0% of homes taken to auction were sold. This figure represents a 3.4% increase from the previous week and marks the highest rate since early April last year.

The rise in auction clearance rates was noted across all capital cities. Melbourne achieved a preliminary clearance rate of 75.5%, a 4.6% increase from the previous week and the highest figure since late July. Sydney also recorded a high clearance rate at 75.0%, marking its strongest performance since mid-July.

According to Cotality's daily dwelling values index, property values, particularly in Sydney, are witnessing an upward trend. Market analysts predict a further three 0.25% rate cuts by mid-2026, which would lower the cash rate to 2.85%.

The potential reduction in rates, alongside the Albanese government's initiative that allows first-home buyers to secure properties with a 5% deposit starting 1 January 2026, is anticipated to amplify buyer demand and push property prices higher.

Published:Monday, 18th Aug 2025
Source: Paige Estritori

Share this news item:

Finance News

Clear

Pressures Mount as Australian Wage Growth Slows

28 Aug 2025: Paige Estritori

Australian real wages have hit a challenging plateau, currently trailing 6.1% below their mid-2022 'covid-bubble' heights. The Reserve Bank of Australia's (RBA) recent Statement of Monetary Policy provides little solace, projecting that real wages will stay 5.5% beneath their peak by the close of 2027. This comes amidst SEEK's latest advertised salaries index, which paints a picture of slowing wage growth. - read more

Unexpected Inflation Surge Puts RBA Rate Cut on Hold

28 Aug 2025: Paige Estritori

The latest inflation figures from the Australian Bureau of Statistics have disrupted expectations for a rate cut by the Reserve Bank of Australia (RBA) in September. July's monthly CPI inflation escalated to an annual rate of 2.8%, rising significantly from June's 1.9% and outstripping forecasts from multiple market analysts. This unexpected inflationary surge is mainly attributed to a dramatic 13.0% hike in electricity prices and robust travel costs. - read more

Home Loan Scheme Could Drive Up Prices, Warns Insurance Body

27 Aug 2025: Paige Estritori

A new federal scheme, designed to lower the demand for lenders’ mortgage insurance (LMI), may inadvertently escalate home prices and hinder lower-income earners' ability to purchase property, according to concerns raised by Australian insurers. The Home Guarantee Scheme, set to expand in October, offers first-time buyers the opportunity to bypass the usually required LMI if they have managed a deposit of just 5%. - read more

Labor Speeds Up Mortgage Guarantee Extension

26 Aug 2025: Paige Estritori

The Australian federal government has announced an earlier implementation of its expanded program guaranteeing low-deposit loans for first-time home buyers, set for October. This program aims to eliminate the need for lenders' mortgage insurance (LMI) by allowing first-home purchasers with just a 5% deposit to enter the market. Previously planned for next year, the revamped policy also removes income caps and raises property price limits. - read more

Australian Household Spending Set to Surge with Rate and Tax Relief

25 Aug 2025: Paige Estritori

A significant financial shift is on the horizon for Australian households. After years of stringent budgeting, new data suggests a revitalisation in household spending, thanks to recent interest rate cuts and tax relief measures introduced last July. - read more