Welcome to our August Newsletter
In many areas, conditions are becoming more favourable for buyers. Home values have eased, properties are taking longer to sell and auction activity is subdued, giving buyers more opportunity to negotiate.
A recent KPMG report suggests housing conditions may remain subdued through the rest of 2026, forecasting a 1.1% decline in national house prices before a projected recovery in 2027. Unit markets are expected to prove more resilient, with prices forecast to continue rising over the next two years.
Property investors are also navigating an evolving regulatory landscape. From 10 August, changes to SMSF borrowing rules will add a third clause to the definition on an acquirable asset. This means that only property that meets the definition of business real property is able to be financed through a loan within an SMSF.
Existing arrangements on property contracts that were signed prior to 10 August 2026 will remain grandfathered, although there is some uncertainty as to how many lenders and loan products will remain in the space once the changes are in place. Furthermore, residential property will still be able to be purchased outright using cash reserves of the SMSF only.
For those looking to buy this spring, having your finance in order is paramount. Chat to us now about organising pre-approval on your home loan. That way, you’ll be ready to jump in when you find your dream home or investment property.
As widely expected, the Reserve Bank of Australia (RBA) has left the cash rate on hold at 4.35% at its latest meeting.
Australia’s annual headline inflation rose 3.8% in the 12 months to June, down from 4% in the 12 months to May, while underlying inflation held steady at 3.6%.
The softer-than-expected inflation data has many economists saying the cash rate may have peaked for the time being.
Several economists now expect the RBA to leave the cash rate unchanged for the remainder of 2026; however, the timing and direction of the next move remain uncertain.
If you’ve been with the same lender for some time, a home loan review can help you understand whether your current loan still aligns with your circumstances and objectives.
ASIC has also recently highlighted offset account errors that have affected some borrowers. There are a couple of ways you can check that your offset account is linked correctly, depending on your lender:
If you’re still unsure how you can check your offset account, your broker can help confirm that it is operating as intended.
Get in touch if you’d like to review your current loan structure and ensure it’s still aligned with your circumstances.
The next cash rate decision will be announced on 29 September.
Australia’s property prices fell 0.7% in July, marking the sharpest monthly decline since December 2022, according to Cotality.
Sydney and Melbourne continue to lead the falls, with prices dropping 1.4% and 1.2% last month.
The downturn has also spread to previously resilient capitals like Brisbane and Adelaide, where prices dropped 0.6% and 0.2% respectively in July.
“There’s been a really rapid deterioration in conditions in Brisbane, which I think has probably been the most surprising trend that we’ve seen over the last couple of months,” Cotality’s head of research Gerard Burg said.
“The shift is really evident in the total stock available for sale [in Brisbane]. Going back to February, it was around 25 per cent below the five-year average. It’s now sitting up around 6 per cent above that average level.”
Mr Burg said while property values would likely continue softening across the country, he expected more vendors to start pulling back from the market.
“When vendors look out at the market, they are seeing these challenging conditions and they’re probably thinking that they’ve missed the opportunity to sell at the market peak,” he said.
“If they have that choice to wait, they’re going to wait for the next cycle, once conditions improve, to put their home on the market.”
Meanwhile, regional markets saw prices fall 0.2% in July, the first decline in Cotality’s Combined Regional Index since January 2023.
| All dwellings | Auctions | Clearance Rate | Private Sale | Monthly home values change |
|---|---|---|---|---|
| VIC | 558 | 57% | 1131 | ▼ – 1.2% |
| NSW | 472 | 42% | 1251 | ▼ – 1.4% |
| ACT | 34 | 47% | 109 | ▼ – 1.0% |
| QLD | 187 | 26% | 758 | ▼ – 0.6% |
| WA | 16 | — | 365 | ▲ 0.1% |
| NT | 10 | 40% | 13 | ▲ 0.8% |
| TAS | 0 | — | 128 | ▲ 0.1% |
| SA | 82 | 43% | 207 | ▼ – 0.2% |
While market conditions continue to evolve, buyers who are prepared and ready to act could be well positioned when opportunity comes along.
The busy spring buying season is fast approaching, and this year we’re likely to see plenty of motivated sellers. Taking the time to review your finance options beforehand can help you understand your borrowing capacity and be ready to act when the right property comes onto the market. Get in touch to discuss your finance needs.
