While rising prices were the talk of the town not so long ago, the tide has started to turn, with property values beginning to soften – but it’s not all bad news for home owners.

While we’re far from a market collapse, it’s only natural for home owners to be concerned that their valuable asset could be worth slightly less than it was a few months ago.

In fact, national home prices are now 1.8% lower than they were in March, led by falling values in Sydney and Melbourne.

However, there may be an unexpected upside to cooling property prices.

And that’s the possibility that the Reserve Bank of Australia (RBA) may think twice about hiking rates again in the near future.

Here’s what’s happening.

The RBA is watching inflation

The RBA has made no secret of the fact it is aiming for inflation between 2-3%.

The trouble is, we are still a long way from that sweet spot, with inflation currently at 3.8%.

And here’s the thing: “housing” makes up one of the largest single factors contributing to the Consumer Price Index (CPI), which measures inflation.

Now, when it comes to CPI, “housing” doesn’t refer to the sale price or value of existing properties – but those sale prices do have a flow-on effect.

For starters, it’s believed that lower house prices can make home owners feel less financially stable, and in turn, they tend to tighten their belts. And it can have the opposite effect when property prices are running hot.

Additionally, when the property market is doing well, and more homes are being bought, more appliances and furniture are also being purchased – not to mention renovations, extensions and the hiring of tradespeople.

So it makes sense that a fall in property prices may help lower inflation, which could in turn reduce the odds of another rate hike.

This isn’t just a theory.

RBA assistant governor Christopher Kent recently said that softening property market conditions “heavily reduced” the need for further rate rises.

When will home loan rates go down?

We don’t have a crystal ball.

It’s always hard to say with certainty how rates will move in the future.

On one hand, in early August, RBA governor Michele Bullock cautioned that future rate hikes can’t be ruled out if inflation looks like remaining higher for longer.

On the flipside, most of the big banks now expect the next rate move to be down.

The catch?

Even if the banks’ forecasts prove accurate, they aren’t expecting to see the cash rate fall before 2027.

The RBA has also noted that it doesn’t expect inflation to reach its preferred 2-3% target before mid-2027.

For home owners navigating higher rates, that could mean a long wait for any rate relief.

However, you might not have to wait at all

It may be possible to make a rate cut of your own.

Competition among lenders: a strong case for refinancing

Competition in the mortgage market is seeing some lenders offer variable rates below 6%, Canstar reports.

An owner-occupier who took out a home loan five years ago and who has never renegotiated, is likely to be paying around 6.97%.

If that sounds like you, it’s probably time for a home loan review.

Switching to a lower rate loan could see you save on repayments today, without waiting for the RBA to act.

For a quick home loan health check to find out if you’re eligible for a more competitive rate,

Just call us …..

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

As the calendar flips over to July, now’s a good time to give your home loan a once-over. We look at five strategies that could help you save on interest and pay off your mortgage sooner.

With three rate hikes already this year, and a big variation in rates between lenders, it’s worth checking you’re not paying too much interest on your mortgage this new financial year.

The hard part can be knowing how or what to weigh up. Here are 5 things to consider.

1. Review your loan rate

Not sure about the rate you’re paying? You’re not alone.

Over one-in-two home loan borrowers are in the dark about their mortgage rate.

Not knowing this number can be an expensive oversight.

So, grab a copy of your latest loan statement or jump onto your banking app. You’ll usually find your current rate under your account details.

As a guide to how your rate shapes up, the average variable rate now is about 6.45%.

The thing is, there are still some lenders offering home loan rates that start with a ‘5’ or a low ‘6’.

If you’re not happy with the interest rate you’re paying, call us to find out how much you could save by refinancing.

2. Check your loan has the features you need

Loans can come with a variety of features that may help you save on interest, and pay down your mortgage sooner.

However, having access to these features may mean paying a slightly higher interest rate.

If you’re not making use of them all, switching to a lower rate ‘basic’ loan could see you save.

3. Add up the fees you’re paying

While it’s natural to focus on your interest rate, it’s also worth keeping an eye on home loan fees. They can really add up over time.

Around 14% of loans still charge monthly fees, and where they apply, these fees can be as much as $15 a month.

Talk to us if you’re being slugged with a monthly fee. It’s an additional cost you may be able to avoid by moving to a different loan.

4. How does your loan shape up for flexibility?

Home loan flexibility is all about how well your mortgage can adapt to changes in your circumstances or lifestyle.

This can include being able to make extra repayments, and enjoying fee-free redraw if you need to draw the money back out for unexpected bills.

Is your loan flexible enough to be split between a variable rate (to benefit from any rate falls) and a fixed rate (for repayment certainty)?

Or, is your loan portable? This may give you the flexibility to transfer your mortgage from your old home to a new place if you move, letting you avoid the cost of setting up a new loan.

5. Is your lender still showing you love?

Great service doesn’t just mean a quick call to check that everything is going smoothly with your home loan.

It’s also about rewarding your loyalty as a home loan customer. And that doesn’t always happen.

According to Canstar, an owner-occupier who took out a loan five years ago and hasn’t renegotiated since, is likely to be paying a rate of 6.98%.

Yet many lenders are offering variable rates below or just about 6.0%.

Despite the potential for savings, more than half (52%) of Austrslian home loan borrowers have never changed lenders.

If that sounds like you, call us to see if you’re paying a home loan loyalty tax simply by sticking with the same lender.

Head into the new financial year confident about your home loan  

A home loan review shouldn’t take too much time out of your schedule.

Contact us today about a home loan health check. It could help you hit the new financial year running.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

House price growth is slowing but experts say not to expect a crash. We look at what’s changed, and why today’s market may offer good opportunities for homebuyers.

Recent home price data from Cotality may be just what homebuyers have been waiting for.

The latest figures show zero (0%) increase in home prices nationally in May – quite a change from the past 12 months when the trend has largely been upwards.

But the national picture doesn’t tell the full story, and the numbers certainly don’t indicate a market “crash”.

Property values fell in Sydney (down 0.9%) and Melbourne (0.8%), with a barely perceptible price dip of 0.2% in the ACT for May.

Meanwhile home prices continued to grow in the other state/territory capitals and across regional markets.

Yet there are signs the tide could be turning in buyers’ favour.

Why is home price growth slowing?

The property market varies significantly across cities right now, in what Cotality describes as “multi-speed conditions“.

That said, market momentum is slowing – the result of higher interest rates, the cost of living squeeze, which is impacting consumer sentiment, and the Federal Budget’s proposed tax reforms aimed at creating a more “level playing field” between first homebuyers and investors.

While home prices seem to be slowing, AMP chief economist Dr Shane Oliver says “any forecasts for a property price crash are likely to be wide of the mark”.

“A crash would require wide-scale forced selling by homeowners – but without much higher unemployment forcing homeowners to sell this is unlikely as Australians will do whatever they can to keep servicing their mortgage,” Dr Oliver explains.

Is the property ‘super-cycle’ over?

You may have seen media reports questioning whether the so-called ‘property super-cycle’ has come to an end.

This super-cycle refers to the strong period of home price growth seen over the last 30 years.

But not everyone agrees that the current softer conditions are a sign that the market is heading south.

The Commonwealth Bank is still expecting property price growth both this year and next.

REA Group (which owns realestate.com.au) suggests only slightly lower home prices – largely as a result of the tax changes for investors.

Cotality points to the shortfall in housing supply, ongoing population growth, and continuing strength in the job market as reasons why we’re unlikely to see a sharp correction.

Opportunities for homebuyers

The good news is that there are plenty of buying opportunities right now, and they’re up for grabs no matter whether you’re an upgrader or first home buyer,

In Sydney and Melbourne, the advertised supply of homes for sale has risen to above-average levels, providing more choice and better negotiating power for buyers.

Auction clearance rates are down, and that’s seeing sellers increasingly open to pre-auction offers.

On top of all this, the expanded 5% Deposit Scheme is giving first home buyers a real chance to get into the market with a smaller deposit.

With all these shifts in favour of buyers, call us to today to discover the opportunities that may be open to you.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

Reforms to negative gearing and capital gains tax have been unveiled in the latest national budget. Here’s what they could mean for investors, first home buyers and home owners.

The Albanese Government has tabled its budget for 2026-27, and tax reforms for property investors are top of the agenda.

Treasurer Jim Chalmers says these reforms are all about getting more Australians into a first home of their own. But, as with any federal budget, there are winners and losers.

We break down the key aspects of the budget to see how it could affect your property plans.

Negative gearing – limited to newly built homes

Negative gearing has long appealed to many property investors.

It allows investors to offset ongoing property expenses (such as home loan interest and rates) against income (such as rental income and wages). In this way, negative gearing can make owning a rental property tax-friendly, potentially giving investors greater tax advantages than home owners.

But in what the Labor Government describes as a move to “level the playing field”, from 1 July 2027, negative gearing will be restricted to newly built homes.

Investors who buy established homes after 12 May 2026 (budget night) won’t be able to use negative gearing to offset property expenses against other income.

For investors who already own a rental property, negative gearing can continue to be used as normal.

Capital gains tax – back to indexing

The budget also made capital gains tax (CGT) concession changes that will impact sellers.

At present, investors can claim a 50% CGT discount on profits made via property sales, as long as they have owned the place for at least 12 months.

This will change from 1 July 2027. The 50% discount will be scrapped and replaced with a discount based on inflation – a system that was in place pre-1999.

The change will be prospective, meaning gains accrued on existing investments prior to the start date will retain the 50% discount.

In addition, a minimum tax rate of 30% will apply to capital gains on investment property sales. This is meant to align the tax paid on capital gains with the average tax rate paid by workers.

Investors who opt for newly built properties will be able to choose between the 50% CGT discount, or index gains for inflation, with a 30% minimum tax.

Now, let’s break it all down to see what the changes could mean depending on your type of property ownership.

First home buyer

Cotality points out that investor numbers have been rising across the more affordable end of the property market. This has meant increased competition for first home buyers.

By reducing the CGT discount and scrapping negative gearing on purchases of established properties, the government is hoping to take some of the heat out of the investor market. It estimates this may help 75,000 Australians buy a first home.

The government has also committed $2 billion to the infrastructure needed to build new homes. This is expected to see an extra 65,000 homes constructed over the next decade.

Long story short, the government is hoping that first home buyers will benefit from the latest budget reforms. If you’re ready to buy, call us to find out your current borrowing capacity.

Property investor

The latest reforms could see newly constructed homes become more popular among investors.

For some investors, new constructions have always held appeal. The maintenance costs may be lower, and the tax deductions for depreciation may be higher (this is something to speak to your tax adviser about).

Current home owner

While the budget doesn’t directly impact current home owners, Treasury estimates suggest a cooling of investor demand may see home prices grow by around 2% less over the next few years.

That could make now the ideal time to think about upgrading to your next home.

Home values nationally have risen 40.2% over the last five years, giving many home owners plenty of equity to climb the property ladder.

Call us to discuss your property plans

Major changes can bring uncertainty, especially when they involve tax reforms. If you’re an investor, it may be worth speaking with your tax professional.

We’re here to help you find a home loan that allows you to achieve your property goals.

Just call us  !

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

Having loan pre-approval can be a smart move for home buyers. But the recent Reserve Bank cash rate hikes could leave your pre-approval in need of an update.

There’s a lot to love about home loan pre-approval.

It shows how much a bank will let you borrow for a home – that’s your ‘borrowing power’.

Pre-approval also indicates you’re a serious buyer, providing extra bargaining clout in price negotiations.

And while pre-approval typically only lasts for three to six months, that can be sufficient time for many buyers to find their ideal home.

But there’s a catch.

Pre-approval is not a guarantee. Rather, it is a guide of what you can borrow based on circumstances at the time pre-approval was issued.

And the two rate cash rate hikes the Reserve Bank of Australia has implemented this year may have chipped away at your borrowing power.

That can make it worth reviewing your mortgage pre-approval.

Here’s what to weigh up.

Your borrowing power may have altered

Your borrowing power, also known as ‘borrowing capacity’, is a key factor when it comes to buying a home.

It’s the amount a bank is willing to lend for a home loan, and it’s based chiefly on your income and living expenses.

However, interest rates also play a role.

A rise in interest rates will mean higher repayments, and this has the potential to reduce your borrowing power.

As an example, Canstar says a solo home buyer on the average full-time wage ($106,950) will be able to borrow around $12,000 less as a result of the March 2026 rate rise.

Add in the 0.25% February rate hike, and that same home buyer could be looking at a $25,000 cut to their borrowing power.

A couple on the average wage may have seen their combined borrowing power drop by $49,000 since February.

That’s why it’s so important to call us to understand your true borrowing power as it currently stands.

Yes, there are online calculators available. But these may not consider every aspect of your personal situation.

The risk of outdated pre-approval

Taking a ‘she’ll be right’ approach to your loan pre-approval could work against you.

You may find, for example, that after negotiating a great price on a place you’re keen to buy, you struggle to get the home loan you need.

Worst case scenario: you risk being the winning bidder at auction but failing to get finance to complete the purchase – a situation that could mean losing your deposit.

Here too, a call to us can confirm if you are good to go for a home loan before you start putting money on the table for a property purchase.

How to boost your borrowing power

The good news is that there are steps you can take to potentially boost your borrowing power – no matter what interest rates are doing.

Here are a few ideas to get started.

Review household expenses – even a small change in non-essential spending can make a difference.

Lower the limit on your credit card – lenders often base your borrowing power on the assumption your credit card is maxed out. Think about asking your card issuer to trim your credit limit. Or close it altogether.

Clear other debts – a lingering car loan, the remains of student debt, and even an ongoing buy now, pay later balance can impact your borrowing power. Knuckling down to clear the slate could see you rewarded with increased borrowing capacity.

Know that rate matters – the rate you pay isn’t the sole decider of whether a loan is a good match for your needs. But the lower the rate, the more you may be able to borrow.

Talk to us for up-to-date loan pre-approval

Successful home buying doesn’t have to mean borrowing as much as you can.

However, it makes sense to start the ball rolling with a clear idea of your current borrowing power.

Talk to us to know if your loan pre-approval is out of date, or to organise new pre-approval on a loan that’s well-matched to your needs.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.