Greetings from Scoutable and welcome to our Quarterly Wrap Up.
I hope you are well.
CASH RATE
At its March meeting, the Reserve Bank of Australia increased the cash rate to 4.1%, up from 3.85 per cent. This is the second rate increase this year (first being in February, by a quarter of a per cent to 3.85 per cent). The Board cited renewed inflation risks in their press release. While inflation has eased since 2022, it picked up in late 2025 due to stronger demand, tight labour markets and higher fuel prices linked to the Middle East conflict. With inflation expectations rising and economic conditions still tight, the Board judged that inflation may remain above target for longer than expected. More information - Statement by the Monetary Policy Board: Monetary Policy Decision – Media Release, 17 March 2026
Westpac warns households to brace for a triple rate hit, forecasting RBA hikes in May, June and August that would lift the cash rate to 4.85%, its highest since 2008. The bank says fuel‑driven inflation from the Middle East conflict is flowing quickly through the economy, with no rate relief expected until 2028. Source: Westpac warning over triple interest rate blow coming for Aussie households – Yahoo Finance
Roy Morgan modelling since the March increase shows 26.6 per cent of mortgage holders are now considered ‘at risk’ of mortgage stress. That number is forecast to rise to 28.8 per cent in April — equivalent to 1.5 million mortgage holders. Roy Morgan CEO, Michele Levine, said that if the RBA raised rates in May by 0.25 per cent to 4.35 per cent, the share of mortgage holders ‘at risk’ would increase to more than 30 per cent. Article link below 'IN THE NEWS' section of the Wrap Up.
MARKET UPDATE
Summary of Cotality's Hedonic Home Value Index, which was released on the 1st April, is given below.
Australia’s housing market recorded modest growth in the first quarter of 2026, with national dwelling values rising 0.7% in March and 2.1% over the quarter, though conditions remain mixed across the capitals.
Sydney values slipped 0.2% over the quarter, with softer auction clearance rates, rising listings and borrowing constraints weighing on higher‑priced properties, while more affordable segments continued to show resilience (up 1.8% in the March quarter, compared to the upper quartile, which has fallen by 1.8%).
Melbourne followed a similar path, with values down 0.6% over the quarter amid increased supply and weaker buyer sentiment, particularly in premium markets.
In contrast, Brisbane continued to outperform, with values up 1.8% in March, 5.1% over the quarter and 19% over the year, supported by interstate migration, tight supply and relative affordability.
The common outcome from the statistics is that lower-priced homes continue to lead market growth, particularly in the house segment, as affordability constraints concentrate demand from first-home buyers, investors and mainstream owner-occupiers at the entry level. Across the combined capital cities, lower-quartile house values rose 1.3% in January, compared with just 0.3% growth in the upper quartile.
Rental conditions stayed tight, with national rents increasing 2.1% over the quarter and 5.7% annually, keeping vacancy rates well below long‑term averages.
Looking ahead, housing conditions are expected to become more cautious and uneven through 2026. Higher interest rates, stretched affordability and ongoing cost‑of‑living pressures are weighing on buyer demand, particularly in higher‑priced markets. Rising listings, softer auction clearance rates and weaker consumer confidence — compounded by geopolitical uncertainty and higher energy costs — point to a continued moderation in price growth. While tight housing supply and a resilient labour market should help limit the risk of a sharp correction, the near‑term balance of risks is tilted to the downside, with market outcomes increasingly shaped by serviceability and affordability constraints.
If you would like to discuss the property market further, please get in touch.
Until next quarter,
Kellie Landrey | Principal Buyers Agent