Welcome to our
September Newsletter
Spring has officially arrived, and so has one of the busiest seasons in the property market.
This season, home values continue to decline across the country, as cash rate hikes, tax rule changes, and geopolitical tensions continue to make waves across Australia. According to Cotality, 93% of capital city suburbs recorded price drops over the winter, meaning there could be new opportunities to discover.
As buyer demand softens, properties are sitting on the market longer and supply is growing. Across most capital cities, there are more homes on the market than there were a year ago, despite fewer new listings coming to market.
If you’re looking to purchase, getting pre-approved on your finance will help you feel more ready to jump in with an offer or bid with confidence.
Interest rate news
Economists widely expect the Reserve Bank of Australia (RBA) to hike the cash rate this month, while some believe the central bank may hold out until November.
Inflation is continuing to ease, with the annual rate falling from 3.8% in June to 3.5% in July. However, the RBA’s preferred measure of underlying inflation remained unchanged at 3.6%, which is still above its target range of 2 to 3%.
At the same time, household spending rose more than expected in July, suggesting consumer demand remains resilient despite higher borrowing costs.
With the possibility of further rate rises ahead, it could be a good opportunity to review your mortgage and make sure you’re still on a competitive rate. Get in touch and we’ll compare options across the market for you.
The next cash rate decision will be announced on 29 September.
Home Value Movements
Australia’s property prices continued to fall in August, down 0.9% according to Cotality. Values are now 3.6% lower than the peak in March.
Sydney, Melbourne and Canberra saw the biggest declines, while all other capitals except Darwin experienced price falls.
The proportion of capital city suburbs recording a drop in home values more than doubled through winter, rising from 45.8% in autumn to 93%, highlighting a much broader weakening in housing conditions.
Cotality research director Tim Lawless said the latest figures showed the downturn was no longer confined to select markets or higher value segments.
“What started as a more concentrated easing across higher value segments has now become a much more generalised softening, with the vast majority of capital city suburbs recording some level of decline,” he said.
“Sydney continues to lead the downturn. The combination of a sharp drop in demand and higher than average advertised stock levels is weighing more heavily on Australia’s largest housing market.”
Home Value Index
Ready to Buy?
As the weather warms up, we’re likely to see listings heat up too. With prices coming down, now is the time to get your finance in order, so that you can strike quickly if you find a great property.
Get in touch today.
Additional sources:
Cotality Daily Home Value Index: Monthly Values
https://www.corelogic.com.au/our-data/auction-results
https://www.realestate.com.au/auction-results
Spring listings are returning, but will buyers have more choice?
Spring is traditionally the busiest time of the year in the property world. More sellers tend to list their properties during this season, when gardens are looking their best and pleasant weather makes weekend open homes and moving house easier.
Many families also like to purchase in spring so that they can settle into their new home before Christmas and the new school year begins.
However, this year’s spring property buying season is shaping up to look quite different from previous years. Here are the key trends that buyers should know about.
This spring arrives against a backdrop of softer housing market conditions. Properties are taking longer to sell and national home values have dropped for several consecutive months.
Serviceability constraints, high mortgage rates, reduced borrowing capacity and cost-of-living pressures continue to weigh on buyer sentiment.
Economists are widely expecting the Reserve Bank of Australia (RBA) to increase the cash rate again in September or November, which will further affect borrowing power.
While these conditions have made many buyers more cautious, they may also create opportunities. With homes spending longer on the market and competition easing in some areas, buyers this spring could find themselves in a stronger position to negotiate on price and contract terms.
Fewer new listings
As buyer demand softened over winter, homes took longer to sell and the number of properties available for purchase continued to build.
Across most capital cities, advertised stock is now sitting well above both last year’s levels and the five-year average. In the four weeks to 30 August, for example, total listings across the capitals were 24% higher than a year earlier and 8% above the five-year average.
Interestingly, while there are more properties available overall, the number of newly advertised homes declined towards the end of winter. New listings were 6% lower than a year ago and 8% below the five-year average.
As a result, experts expect the usual spring surge in new properties may be more subdued this year, with some vendors choosing to wait for market conditions to improve before selling.
Investors remain cautious
Following multiple cash rate increases and Federal Government changes to negative gearing and capital gains tax settings, many investors are reassessing their property plans.
Early signs suggest some are choosing to sit on the sidelines. Australian Bureau of Statistics data shows the total value of new home loans fell 5.4% in the June quarter, driven largely by an 8.6% decline in investor lending.
As a result, investors may play a smaller role in this year’s spring market, potentially reducing competition for owner-occupiers in some areas.
So, what does this mean for aspiring homeowners?
Conditions this spring may be more favourable for buyers than they have been in recent years.
With more properties available, less competition from investors and homes taking longer to sell, buyers may have more opportunity to compare their options and negotiate with sellers.
Rather than feeling pressured to make a quick decision, many buyers could have more time to do their research, attend inspections and find a property that suits their needs and budget.
While affordability challenges remain, those who understand their borrowing capacity and are prepared to act when the right opportunity arises may be well placed to take advantage of changing market conditions.
Want to chat through your finance needs?
If you’re planning to buy this spring, talk to us about your borrowing options. We can explain your borrowing capacity and any steps you should take to prepare before you start your property search.
Get in touch today.
Understanding equity and how it can unlock value in your home
Many homeowners have a rough idea of what their property is worth, but fewer understand how the equity they’ve built up could support future financial goals.
Whether you’re considering renovations, upgrading, purchasing an investment property or simply exploring your options, understanding equity can be an important starting point.
Let’s take a closer look at how equity works and why it matters.
What is equity?
Equity is the difference between your property’s current market value, and your home loan balance. If your home is worth $900,000 and you owe $300,000, your total equity is $600,000. When you pay down your mortgage or your home increases in value, your equity increases.
While equity is often discussed as a single figure, not all of it may be accessible. As a general rule, lenders will typically allow borrowers to access up to 80% of a property’s value, less any outstanding mortgage balance. This is commonly referred to as usable equity.
Borrowing above 80% of a property’s value may incur Lenders Mortgage Insurance (LMI), which can add to the overall cost of borrowing.
How can you use equity?
For many homeowners, equity is more than just a number on paper. Depending on your circumstances, it could provide greater financial flexibility and help support a range of future goals.
Some people use equity to fund home improvements, such as a new kitchen, bathroom or outdoor entertaining area. Others use it to help purchase an investment property, invest in shares, cover education expenses or finance a major purchase such as a vehicle or boat.
In some cases, homeowners may also choose to use equity to consolidate existing debts. This typically involves increasing a home loan and using the funds to repay higher-interest debts, such as credit cards or personal loans, leaving a single regular repayment to manage.
However, debt consolidation isn’t suitable for everyone and comes with risks that should be carefully considered. Before accessing equity or making any borrowing decisions, it’s important to understand the costs, risks and long-term implications, and discuss your options with a qualified finance professional.
How does it work?
There are several ways homeowners can access equity. Some of the most common options include:
Top-up loan: This involves increasing your existing home loan and accessing additional funds as a lump sum, which can then be used for an approved purpose.
Separate loan split: Rather than increasing your current loan, you may be able to establish a separate loan account secured against your property’s equity. This can help keep borrowed funds for different purposes separate.
Refinancing: Refinancing involves replacing your current home loan with a new one. Depending on your equity position, this may allow you to borrow additional funds while also providing an opportunity to review your interest rate, loan features and overall lending arrangements.
Line of credit: A line of credit allows you to access funds as needed, up to an approved limit. Instead of receiving a lump sum upfront, you can draw on the facility over time and generally only pay interest on the amount used.
Key considerations
Using your home equity will generally increase both your total debt and your regular repayments, so it’s important to understand the impact on your budget before proceeding.
The right approach will depend on your goals and borrowing capacity. A mortgage broker can help you understand your options, estimate your repayments and assess whether accessing equity aligns with your objectives.
It’s also important to consider the risks. Interest rates may change over time, which could affect future repayment amounts. Because your property is used as security for the loan, failing to meet your repayments could put your home at risk.
That said, equity can be a valuable financial resource. Depending on your circumstances, it may provide a way to fund renovations, purchase an investment property, consolidate debt or achieve other financial goals without relying solely on savings.
How has the property market downturn affected equity?
Property prices and equity are closely linked. When property values rise, homeowners often build equity more quickly. When values fall, the amount of equity available may be reduced, particularly for those who purchased recently or borrowed a large proportion of a property’s value.
While national home values have declined in recent months, the impact on equity will vary from homeowner to homeowner. Those who have owned their property for several years and made regular mortgage repayments may still have substantial equity, even if market conditions have softened.
However, recent buyers who entered the market with smaller deposits may be more affected. In some cases, falling property values can lead to negative equity, where a property’s market value is less than the outstanding loan balance.
If you’re considering accessing equity, it’s important to understand your current position and how changing market conditions may affect your options. A mortgage broker can help assess how much usable equity may be available and whether accessing it aligns with your financial goals.
Next steps
Curious about how much equity you may have available? Get in touch for a review of your current position and a discussion about your future plans.
We’ll check the current market value of your home and give you an idea of your usable equity. Your chosen bank will likely want a valuation of your property, then we’ll run through your finance options and paperwork requirements.
Releasing your equity and making it work for you could help you achieve your financial goals, so it’s worth exploring.
Reach out today.
Why rental yields are back in focus
It’s been a challenging few months for property investors. Changes to negative gearing and the capital gains tax (CGT) discount have fundamentally shifted the landscape for investors and prompted many to rethink their purchasing plans.
From 1 July 2027, negative gearing for residential property investments will be limited to new builds, while the 50 per cent CGT discount will be replaced with cost-base indexation and a 30 per cent minimum tax rate on capital gains. Against this backdrop, new investor loans fell by 8.6% in the June quarter, with their value declining 10.2%.
At the same time, property values have softened across many Australian markets. Tax changes, geopolitical uncertainty, and interest rate hikes have weighed on sentiment. National house prices are now forecast to decline by 1.1% in 2026, while unit prices are expected to increase by 2.2%.
But property investors aren’t looking at prices in isolation. Rental demand remains strong and vacancy rates are low in many parts of the country, supporting rental returns even as capital growth slows.
Successful property investing is about understanding the full picture, including rental demand, cash flow, supply, and tax considerations.
And with the market changing, many investors are pivoting their strategies accordingly.
Rental market conditions remain strong
While conditions have softened for buyers and property prices have eased, Australia’s rental market remains under pressure.
Despite moderating population growth and migration, Australia’s rental market conditions remain tight. National vacancy rates are low, at 1.3% as of July 2026, and total rental listings are 16.7% below the five-year average.
In practical terms, renters are still competing for a limited pool of properties in many parts of the country. This has helped keep upward pressure on rents, even as broader housing market conditions have weakened.
According to KPMG, rental growth is expected to track above its long-term average through the remainder of 2026, underpinned by supply shortages.
For investors, this means rental returns could continue to provide support at a time when capital growth has slowed. For prospective buyers weighing up whether to rent or purchase, persistently high rents might also remain an important consideration.
What about gross rental yields?
Gross rental yield is a measure that investors consider when deciding whether to buy a property. It’s a percentage that shows the property’s annual rental income, compared to its purchase cost or value (whereas net rental yield factors in expenses associated with owning the property).
With rents increasing and home values declining, gross rental yields are trending higher. National gross rental yields reached 3.79% in August, the highest level since September 2019, according to Cotality. Yields are significantly higher in some of the smaller capital cities, reaching 6.3% in Darwin and 4.4% in Hobart, for example.
This reflects a broader shift in the market. As capital growth slows and rental demand remains strong, many investors are placing greater emphasis on rental income and cash flow when assessing property opportunities. For some, stronger yields could help offset some of the challenges created by higher borrowing costs and changing tax settings.
What all this means for investors
Given the current market conditions and changes to tax settings, many investors are placing greater emphasis on rental yield, rather than focussing solely on capital growth.
Loss-making established investment properties no longer have the same tax advantages they once did, while investors who accept short-term negative cash flow in the hope of long-term capital growth may ultimately face a higher CGT bill.
These changing priorities could influence the types of properties investors choose to buy. Areas where rents remain strong relative to property values, including some regional markets and more affordable outer-suburban locations, may attract increased attention. Units and apartments may also appeal to yield-focused investors, as they often offer stronger rental returns relative to their purchase price than detached houses.
For investors entering the market this spring, understanding both the income and growth potential of a property could be more important than ever.
Like to chat through your finance options?
Whether you’re considering your first investment property or reviewing your portfolio, we can help you understand the finance options available to support your goals.
Get in touch and let’s chat through your needs.