With rising interest rates, a diverging property market, and ongoing economic uncertainty, many homeowners and investors are inclined to reassess their options.
The housing market across the country has split into different speeds. Perth’s property prices continue to sprint skyward, and Brisbane, Adelaide and Hobart are also posting solid gains.
Meanwhile, Sydney and Melbourne have seen prices flatten, as higher interest rates and weaker buyer sentiment take hold.
So what does it all mean for you? Let’s break it down.
Interest rate news
Inflation is starting to ease slightly, with the Consumer Price Index (CPI) rising 3.7% over the past year to February, down a touch from January.
At the same time, underlying inflation (as represented by the trimmed mean) remains steady at 3.3%.
Following the Reserve Bank of Australia’s (RBA) decision to increase the cash rate to 4.10% at its March meeting, many lenders passed on the 0.25% increase in full. It marked the second consecutive cash rate hike of the year.
There’s now widespread talk of more cash rate increases to come, as the global energy shock in the Middle East threatens to push Australia’s inflation towards 5%. Some economists are even anticipating three more interest rate hikes in May, June and August, bringing the cash rate to a level not seen since the global financial crisis (GFC).
If the RBA does increase the cash rate again in May, the 75 basis point increase since the start of the year would add roughly $239 a month to repayments on a $500,000 home loan, or $478 a month on a $1 million loan.
Treasurer Jim Chalmers has acknowledged the pressures faced by Australians grappling with higher fuel prices and cost of living pressures, and noted savings will be delivered in the May budget.
The next cash rate decision will be announced on 5 May.
Home value movements
Dwelling values across the nation rose 0.7% in March, and 2.1% over the first quarter of 2026. Overall, the pace of gains is easing, dropping from a 2.8% increase in the final quarter of 2025.
Perth’s property prices surged 7.3% over the first quarter of 2026, while Melbourne saw values drop -0.9% from their November high, and Sydney’s prices fell -0.4%.
The mid-sized capitals and Darwin are recording growth of 1.2% or more on a month-by-month basis, while Sydney and Melbourne experience declines.
“Since the end of November 2025, Melbourne values have retreated by -0.9% and the Sydney market is down -0.4%,” said Cotality research director Tim Lawless.
“The softer trend in values coincides with falling auction clearance rates and a pickup in advertised supply, providing buyers with more choice and less urgency at the negotiation table.”
In Perth, home values are accelerating in the face of higher interest rates and lower sentiment.
“In dollar terms, the 7.3% rise in Perth home values over the quarter has added approximately $69,000 to the median dwelling value,” Mr Lawless said.
“Clearly this pace of growth is unsustainable, but continues to be supported by low supply, with advertised stock levels tracking about 40% below the five-year average for this time of the year.”
Meanwhile, regional markets are proving resilient, with values rising 1.1% over the month and 3.3% over the quarter.
Home Value Index
| All dwellings | Auctions | Clearance Rate | Private Sale | Monthly home values change |
|---|---|---|---|---|
| VIC | 929 | 45% | 1379 | ▼ – 0.2% |
| NSW | 1223 | 53% | 1850 | ▼ – 0.1% |
| ACT | 129 | 58% | 100 | ▲ 0.4% |
| QLD | 244 | 58% | 1093 | ▲ 1.8% |
| WA | 13 | 54% | 537 | ▲ 2.5% |
| NT | 2 | 100% | 21 | ▲ 1.7% |
| TAS | 0 | — | 174 | ▲ 0.8% |
| SA | 155 | 77% | 252 | ▲ 1.2% |
* Monthly Home Values figures as of 31 March 2026
* Australian auction results, clearance rates and recent sales for the week ending 12 April 2026
* The clearance rate is preliminary and current as of 1:00 pm AEST, 15 April 2026
What does this mean for you?
There’s no one-size-fits-all answer in a market like this. If you’re buying, the right strategy may depend on where you’re looking and how future rate changes could affect your budget.
If you already have a home loan, it may be worth reviewing whether your current rate is still suitable, especially with the possibility of more increases ahead.
Meanwhile, if you’re considering investing, differences between markets may mean factors like location and timing play an important role.
Need help reviewing your options?
Whether you’re planning to buy, refinance, or simply want a home loan health check after the recent rate rises, we’re here to help.
We can compare lenders, review your current loan, and help you understand your options so you can make confident decisions in a changing market.
Get in touch today.
