A welcome respite, but not a green light to get carried away

Today, the Reserve Bank cut the official cash rate by 25 basis points to 3.85% – the second cut this year. For many borrowers, that means some welcome breathing room. If you’re holding a $750,000 mortgage, that could mean around $114 less per month – assuming the banks pass it on in full (which, let’s face it, is never guaranteed).

The RBA made this move as inflation slides back within its target band of 2-3%. CPI came in at 2.4% annually to March, with the trimmed mean at 2.9%, suggesting the pressure cooker is cooling. That’s a positive signal.

The big banks have been quick to forecast further cuts. CBA, Westpac and ANZ are tipping a cash rate of 3.35% by the end of the year. NAB is even more bullish, seeing it dropping to 2.6% by early 2026.

But here’s the thing: the banks often get these calls wrong. Forecasting rates is a murky business, so it pays to be cautiously optimistic and stay grounded in real-time conditions, not headlines.

So what does this mean for you?

If you’re buying: This cut might stretch your budget a little further, but the fundamentals haven’t shifted dramatically. Buyers are still cautious, selective, and focused on value. Expect more activity in the weeks ahead, but don’t assume prices will suddenly skyrocket. That’s not how confidence works; it builds gradually, not overnight.

If you’re selling: This is your moment to get strategic. A rate cut can increase enquiry levels and stir some competition, but it’s not a green light to raise your price expectations. Buyers are still operating with a value lens, especially in markets where affordability remains tight. The best results will come from well-prepared homes, smart campaigns, and pricing that feels grounded and fair.

Across the board, auction clearance rates have hovered below 50% in many areas this year. Today’s cut should lift sentiment and boost engagement, but only if sellers meet the market and buyers feel aligned with value.

At CobdenHayson, we’re reading the play daily – tracking shifts in sentiment, buyer behaviour, and campaign performance. Today’s move gives us a tailwind, but it’s the way we run with it that makes the difference.

We’ll keep you close to the action. If you’re considering a move, let’s talk strategy while the windows open.