House Price Rises Were Meant to Ease. So What’s Happened?
- Property prices across Australia rose in May 2025 following two Reserve Bank interest rate cuts earlier this year.
- The rate cuts increased borrowing power, encouraging buyers to bid up prices amid a market already strained by supply and demand imbalances.
- While some buyers are priced out, others manage affordability especially with dual incomes or parental financial support, and governments are focusing on long-term housing supply increases.
- Research director Tim Lawless said the market rise is “no doubt being fuelled by rate cuts” and expects this influence to continue through the year.
- The rising prices and supply constraints suggest affordability pressures will persist despite rate cuts, with policy and market distortions complicating the housing landscape.
20 Articles
20 Articles
Interest rate cuts fuel jump in property prices, more still to come
Property prices across Australia rose last month on the back of the Reserve Bank's two interest rate cuts, and are set to keep increasing throughout the year.Cotality's Home Value Index showed prices were up 0.5 per cent nationwide in May to lift the median cost up to $831,288.Darwin experienced the biggest jump, up 1.6 per cent, while properties in Perth rose 0.7 per cent for the month and 13.3 per cent for the last year, followed by Brisbane …
With interest rates on the way down, could house prices boom? Here’s what research suggests
Jenny Evans/Stringer/GettyWith the Reserve Bank of Australia easing monetary policy, interest rates are on the way down. Already this year, mortgage pre-approvals had begun to rise, suggesting many aspiring home buyers are excited by the prospect of cheaper home loans. With further cuts expected before the end of the year, some economists are predicting we could be on the cusp of another house price boom. Lower interest rates enable people to bo…
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