April Newsletter

At its most recent meeting, the Reserve Bank of Australia (RBA) chose to keep the cash rate unchanged. However, following President Donald Trump's broad tariffs on US imports—an action that rattled global markets—a future rate cut by the RBA appears increasingly likely.

In other news, the federal election has been scheduled for 3 May, with both major political parties now having outlined their respective housing policies.

Property prices are climbing across nearly all capital cities. If you're considering purchasing a property this autumn, it’s a smart move to speak with us about getting your finance pre-approved as early as possible.

Interest Rate Update

At its second meeting of 2025, the Reserve Bank of Australia (RBA) held the cash rate steady at 4.1%.

Recent data from the Australian Bureau of Statistics revealed that headline inflation eased to 2.4 per cent in the 12 months to February, falling within the RBA’s target range and slightly down from 2.5 per cent in January. Underlying inflation, measured by the trimmed mean, also edged lower to 2.7 per cent from 2.8 per cent in the previous month.

However, on 2 April, the Trump administration announced broad tariffs on US imports, sending shockwaves through global stock markets and sparking concerns about a potential US recession and swift interest rate cuts.

In the wake of this, financial markets are now anticipating a rate cut from the RBA as early as May, with expectations of at least four cuts throughout the year. This could see the cash rate drop below 3 per cent by year’s end.

There’s even speculation of a larger-than-usual move — a 50-basis point cut — in May.

With interest rate changes on the horizon, it’s a smart time to review your home loan.

Comparing your current rate to what’s available could lead to meaningful savings. Get in touch to discuss your options.

Home Value Movements

National property values continued to climb in March, with CoreLogic reporting a 0.4% increase for the month.

All capital cities — aside from Hobart — posted gains, while regional markets also performed well, recording a 0.5% rise in values over the same period.

“Improved sentiment following the February rate cut is likely the biggest driver of the turnaround in values, along with the cut’s direct influence of a slight improvement in borrowing capacity and mortgage serviceability,” CoreLogic research director Tim Lawless said.

“With the rate-cutting cycle expected to be drawn out, it will be interesting to see if this positive inflection in values can last in the face of affordability constraints.”

Election News and Promises

With the federal election set for 3 May, current and prospective homeowners will be watching closely as both major parties roll out their housing and affordability policies.

Coalition Proposals

If elected, the Coalition plans to introduce a range of housing initiatives, including:

·        A tax deduction for first home buyers on newly built homes, allowing them to claim part of the interest on the first $650,000 of their loan for up to five years (with no cap on property price).

·        Scrapping Labor’s $10 billion Housing Australia Future Fund.

·        Reducing permanent migration and introducing a two-year ban on foreign investors and temporary residents purchasing existing homes.

·        Capping international student numbers.

·        Investing $5 billion in infrastructure to support new housing estates.

·        Allowing first home buyers to access up to $50,000 from their superannuation to buy a home, to be repaid when the property is sold.

·        Instructing APRA to ease lending rules to help more buyers qualify for home loans.

·        Placing a 10-year freeze on updates to the National Construction Code to encourage supply and reduce building costs.

Labor Proposals

Labor, if re-elected, is also putting housing at the forefront:

·        Expanding its existing scheme to allow all first home buyers to purchase with a 5% deposit, without needing to pay lenders’ mortgage insurance.

·        Committing $10 billion to build 100,000 new homes exclusively for first home buyers.

·        Introducing a $1,000 instant tax deduction from 2026–27.

·        Matching the Coalition’s two-year ban on foreign investors and temporary residents purchasing existing homes.

·        Expanding the Help to Buy program, offering up to a 40% government equity contribution to help around 40,000 eligible Australians purchase a home with a smaller deposit and smaller mortgage. Income caps will also be raised to $100,000 for individuals and $160,000 for couples and single parents.

·        Allocating $54 million to grow the prefabricated and modular housing industry to support faster home building.

·        Continuing investment from the Housing Australia Future Fund to support construction of social and affordable housing.

·        Rolling out broader cost-of-living measures, including tax cuts, energy bill relief, and initiatives to reduce the cost of medicines and student debt.

Thinking of Buying?

Whether you're buying your first home, upgrading, investing, or refinancing, we're here to help guide you through your finance options.

Get in touch today to discuss how these policy changes could impact your plans.