Financial markets expect the Reserve Bank of Australia (RBA) to slash interest rates four more times this year, with the cash rate expected to fall to 3.10% by the end of 2025. Lower interest rates will increase borrowing capacity and buyer demand, lifting prices. House prices will also rise significantly when Labor’s 5% deposits for all first-time purchasers come into effect on January 1, 2026. Labor’s policy will boost borrowing capacity and attract more first-time home buyers into the market, increasing overall buyer demand and prices. Australian renters are also facing bleak conditions.
