Interest Rate Cut Sparks Confidence in an Already Robust Real Estate Market

There’s been plenty of chatter lately about the Reserve Bank of Australia’s recent 0.25% interest rate cut and what it means for the real estate market. While the reduction translates to an average saving of approximately $115 per month—an amount that alone doesn’t dramatically shift market momentum—it sends a far more powerful signal. This second consecutive cut has strengthened buyer confidence, encouraging more Australians to borrow and purchase property.

National housing prices are already on an upward trajectory, climbing by around 5% annually. Cities such as Perth, Adelaide, and Brisbane are leading the charge, with price growth ranging between 7% and 12%. It’s clear that we are currently operating within a healthy and dynamic property market.

As I discussed in a recent article for Australian Property Investor Magazine, many Australians remain uncertain about the best way to manage their savings. However, real estate continues to stand out as the safest investment option. For most Australians, the growth in property value translates to capital gains tax-free income. When compared with other forms of investment, especially in light of the 7–12% gains seen in South East Queensland, real estate remains a standout choice.

Evidence of growing confidence was especially visible at last week’s auctions conducted across the Ray White Group, the largest auction network in the country. An impressive 485 properties went under the hammer, marking a 28.5% increase from the previous week. The preliminary clearance rate hit 71.7%—among the highest seen in the past four to five years, even rivalling results during the pandemic-driven boom. On average, there were 4.4 registered bidders per property, with 3.7 of them actively participating in the bidding.

The RBA has made it clear that further rate cuts are unlikely in the short term. Instead, the bank will closely monitor the evolving global economic landscape. International developments—such as the Trump administration’s tariff policies—have already caused ripples in global stock markets and dented consumer confidence. While there is no immediate plan for a rapid succession of cuts, some forecasters speculate we could see one or two more reductions before Christmas. A few are even more bullish in their predictions.

Regardless of how interest rates evolve, the underlying fundamentals remain solid. Australia continues to face a shortage of properties for sale, while population growth steadily increases demand. This persistent imbalance between supply and demand continues to underpin a strong and resilient property market.

Looking ahead, I’m excited about this week’s Ray White Bell Group Business Meets Sport Lunch. We’ll be hearing from two of the Gold Coast’s leading football coaches—Des Hasler of the Titans and Damien Hardwick of the Suns—who will share their insights on team dynamics and building championship-winning culture. We’ll also continue our Billionaire Series, featuring the incredible journey of a Southport schoolboy who rose to become Australia’s fifth wealthiest individual and one of the world’s leading mining moguls. These stories always offer powerful lessons in leadership and success. The event takes place this Friday, May 30th, at The Star Gold Coast, with all proceeds supporting the Surfers Paradise Surf Life Saving Club.

As we approach the final month of the financial year, it’s remarkable to reflect on how quickly the past year has flown by. I look forward to connecting with you in the next edition, where I’ll be sharing some surprising insights into Australia’s population growth.

Until then, all the best.

Warm regards,
Andrew Bell

Andrew Bell, OAM
Chairman
The Ray White Bell Group