The Reserve Bank has lowered the cash rate by 0.25% to 3.85%.
Banks are passing this on in full.
What Should You Do?
When rates rise, the banks increase your repayments – this has caused many people financial stress.
When rates fall, however, banks typically leave your repayments unchanged. That means if you want your repayments to go down, you need to call your bank and request the reduction.
Keeping your repayments the same can be a smart move, as it helps you pay down your loan faster. But if you’d prefer some financial breathing room, simply call your lender and ask for the lower repayment.
What Will the Reserve Bank Do Next?
The global economy is facing uncertainty, particularly as U.S. tariffs signal a potential economic reset. Both consumers and businesses are reviewing their future decisions.
Domestically, inflation is back within the Reserve Bank’s target range of 2–3%.
The election is over, and we now have a stable government for the next three years. That means:
- Government spending levels will likely remain steady.
- Population growth will likely continue at a strong pace.
- Housing shortages are expected to persist.
The most likely prediction is that the Reserve Bank will let the June quarter inflation results come in – so August will be the next “live” meeting.
There are many factors in play, but one thing is now certain: the direction of rate movements is downward.
What Else Is Driving the Market?
- Lower rates mean increased borrowing capacity, which boosts demand.
- Government support—such as the First Home Buyer 5% deposit scheme—is encouraging more buyers to enter the market, increasing demand.
- Ongoing population growth will continue to add pressure to housing demand.
- The supply side of housing has no immediate response – restricting supply.
The Bottom Line
With demand rising, supply constrained, and borrowing power increasing, house prices are expected to keep climbing.
That much you can plan on with a high degree of certainty.
With interest rates trending down and property prices on the rise, now is the perfect time to enter the market. Whether you’re a first-time buyer, upgrading, or investing we’re here to help you take advantage of the current conditions.
Contact me today to explore your options and secure your future.
If you’d like advice tailored to your own personal circumstances, please call or email me anytime… It’s what I’m here for.
Alan Heath – Trusted Mortgage Broker in Brisbane, Sydney, Adelaide