Markets continue to debate the Reserve Bank of Australia’s (RBA) next move. But brokers on the ground say there is more shaping market activity than interest rate expectations alone.
Experiences vary across the market, with some brokers reporting a slowdown in momentum, while others are seeing continued strength among segments, such as upgraders and first-time homebuyers. For many, the current conditions reflect a broader mix of market dynamics, including buyer behaviour and the search for value.
"I don't know if the momentum is really rate-driven. I think it's just market-driven," Adam Bradley, founder and director at Brisbane-based Emerge Finance, told Australian Broker. "We've actually seen quite an increase in inquiry in the last week or two for those owner occupiers that are trying to take advantage of a softer market. Everyone wants a deal.
"Obviously, the investor market has taken a bit of a hit since the budget changes," he continued. "But a lot of first-time homebuyers who we work with, they're concerned about competition at open homes, and vying for properties, and they're concerned about prices. So we've been talking to clients saying, 'well, you finally have no competition and the prices have softened to maybe January or February prices, or even prior to that. So it's a pretty good time to get in because you don't have as much competition.'
"And we're also seeing quite an increase in upgraders because they might have been looking at renovating or doing some improvements to their home, but the cost of doing that at the moment is exorbitant," Bradley said. "So they're thinking, "Oh, I might go and have a look at some property because there's more on the market to see. Is it better for me just to upgrade rather than go through the rigmarole of doing a renovation on my existing one?'"
Adele Andrews, director and mortgage broker at Melbourne-based Australian Property Home Loans, said in her business borrowers have been more cautious.
"But not necessarily because of interest rates," she said. "I think the budget spooked everyone, whether it be investors or owner occupiers. I mean, there is a lack of confidence in the market. There's still a bit of activity. But it's definitely not as buoyant as it was 12 months ago. And I think rate hikes will probably add an element of removing confidence.
"But I'm still seeing a strong appetite for first-time homebuyers," she added. "Funnily enough, that market remains very hot."
At Melbourne-based Blank Financial, "momentum has definitely died down," said Bernard Desmond, founder and chief executive officer of the brokerage.
"We're seeing a lag in the number of inquiries that are coming through," he explained. "It's not the same level of inquiries as you would have had before the uncertainties of all the rate rises. Customers and buyers are not in any rush now. Unlike previously, when they had a fear of missing out. But now people are quite happy to wait and see how it all plays out.
"It's quite a reactive market," the broker added. "Inquiries are down. So as brokers, we have to be proactive in finding clients. We're really focusing our energies on looking after our existing customers as a result."
Still, with RBA Chief Economist Sarah Hunter speaking in a fireside chat at the Regional Australia Institute summit in Canberra on Monday, speculation over the central bank’s next move has once taken center stage.
Hunter told an audience in Canberra that ongoing inflationary pressures nationwide and the conflict in the Middle East make Australia's economic situation "challenging."
Australia's Big Four banks are already anticipating another interest rate hike before year's end, although the timing varies. National Australia Bank (NAB) is forecasting a rate hike in September, while Westpac, ANZ and Commonwealth Bank of Australia (CBA) have placed their bets on November.
Against a cost-of-living crisis, persistent inflationary pressures and continued global uncertainty, another rate hike would add further strain to mortgage holders and investors already facing heightened financial pressure. The nation's central bank has already raised the official cash rate (OCR) three times in 2026, lifting interest rates to their current level of 4.35%.
But Bradley pointed out that: "the banks only changed their tune in the last day or two. So I don't think the market's really had enough time to reflect."
