Talk of interest rate rises — or cuts — have reentered the chat. But the consensus is not uniform across the market.
While economists, lenders and analysts continue to debate the outlook, many brokers are seeing a different story unfold on the ground. Following the finalisation of the federal budget, many borrowers have returned, looking to take advantage of a market shaped by (slightly) lower house prices and fewer investors.
"There was obviously a lot of doom and gloom in the headlines," Luke Ashby, a finance and mortgage broker at Brisbane-based Emerge Finance, told Australian Broker. "But now I'm seeing clients coming through; inquiries are picking up. It's a lot of first-time homebuyers coming out of the woodwork.
"Now that the dust has settled, people still want to invest; they still want to do stuff and put their money somewhere," Ashby continued. "They're just playing the cards they were dealt and trying to get in while there's still a window. Because they don't know how long that window will last because we've still got a supply issue."
Even so, uncertainty continues to hang over the market. There's still a chance that the Reserve Bank of Australia (RBA) could raise rates again at its upcoming August meeting, thus once again weakening momentum.
In fact, some lenders are betting on it. Westpac came out earlier this month saying the nation's central bank will likely increase come August, with a possible second rate hike in September.
"Our conviction that the RBA will increase the cash rate in August has increased," said Luci Ellis, chief economist at Westpac Group, earlier this month. "The near-term path for the cash rate nonetheless remains on the hawkish side.
"The [RBA] post-meeting communication added language stating that the [monetary policy board] stood ready to hike if needed," Ellis continued. "This drafting decision is unusual for an RBA statement, and was a stronger steer than previously. It suggests that the MPB wanted to hose down recent speculation that they are done hiking rates. Its assessment of the real economy in both the post-meeting communication and the minutes was sanguine, and it is clearly more worried about upside risks to inflation than downside risks."
But Westpac might be the outlier. Commonwealth Bank of Australia (CBA) and ANZ are both expecting a hold, while National Australia Bank (NAB) has previously said that the central bank's next move will be a rate cut. The only question is when.
The RBA raised rates three times so far in 2026, bringing the official cash rate (OCR) to 4.35%. At its latest meeting, the bank held rates, saying it needs more time to assess how the previous three rate hikes are filtering through the economy before making further moves.
Australian Broker decided to do its own research. We went straight to the source, asking market players their thoughts on the current environment, and whether they expect the RBA's next move to be a rate cut, a hold or another hike.
Chief commercial officer at Bluestone Home Loans
"As housing prices soften in parts of the country, buyers and borrowers will no doubt be hoping for at least a hold when the RBA meets next month to help maximise serviceability. At this stage, that looks like the most likely outcome. Although we’re not economists and we’ve all been surprised before, so it will remain driven by the data between now and then. A period of stability on rates would help support confidence, giving borrowers more clarity and helping maintain momentum across the market."
Owner at Melbourne-based Own Home Loans
"The most likely outcome at the next RBA meeting is a hold. Although the decision is finely balanced and a cut certainly can’t be ruled out. The RBA is walking a tightrope between supporting economic growth and ensuring inflation continues to move sustainably within its target range. While inflation has moderated significantly from its peak, the board has consistently shown it’s prepared to take a cautious approach rather than move too quickly.
From what we’re seeing on the ground, borrowers are becoming more confident, enquiry levels are improving and refinancing activity remains strong. However, cost-of-living pressures are still very real for many Australian households, so any future easing cycle would be welcomed by consumers."
Head of commercial and property finance broker at Melbourne-based My Mortgage Freedom
"My expectation is that the RBA will hold the cash rate at its next meeting. The RBA has now fully reversed the rate cuts delivered last year, taking the cash rate back to where it was in December 2024, before the rate reduction cycle began. Given how quickly that reversal has occurred, I think the bank will pause at the upcoming meeting and assess how the higher rates are flowing through households, businesses and the broader economy.
That said, I do believe we may still see one further rate rise later in 2026 if underlying inflation remains persistent. Inflation has eased from its peak. But it is still higher than the RBA would like, while the labour market remains relatively resilient. Global uncertainty and the risk of higher energy prices could also add further inflationary pressure. From what we are seeing as mortgage brokers, buyer confidence remains subdued. Affordability is stretched, borrowing capacity has reduced and many clients are hesitant to make major decisions while there is still uncertainty about where rates are heading."
Director, mortgage and finance broker at Melbourne-based Australian Property Home Loans
"I would not be surprised if they raise rates in August. We have seen that whilst headline inflation is coming down or stabilising, the trimmed mean figures have been increasing, and this is the figure that the RBA is focused on.
If this happens, my main concern is the impact it will have on borrowing capacities and purchasing strategies. I have a large number of first-time homebuyers who are pre-approved and very active in the market. And I took in another large group of new first-time homebuyers this week. The needle is constantly moving for these guys, and it's crucial that they stay on top of their purchasing budgets. We might see confidence take another hit. Although over the last two weeks, I have seen much more activity than during the two weeks after the budget was announced. Either way, mortgage holders need to prepare for another hike, and purchasers need to factor in how that would impact them."
