Key takeaways:
The RBA held the cash rate at 4.35% on 11 August, its second consecutive hold, with most major banks expecting no change for the rest of 2026.
New home lending fell $5.4 billion in the June quarter, with investor loans recording their largest quarterly drop since 2022 as higher rates and upcoming tax changes weigh on demand.
The national auction clearance rate improved to 51.8%, its second consecutive weekly gain, with Sydney rising to 58.5% and Brisbane remaining well below the other capitals at 29.5%.
Consumer confidence remains near historic lows, with the Westpac–Melbourne Institute index at 83.9 and house price expectations at a three-year low.
The week of 11 August delivered the RBA decision the market had been waiting for, and it brought no surprises.
The cash rate stayed at 4.35% for a second consecutive meeting, leaving variable mortgage holders exactly where they were.
Alongside the rate decision, new ABS data confirmed a significant pullback in home lending, particularly from investors, while auction conditions edged higher nationally for a second straight week.
Here's what changed across the property market in the week leading up to 18 August, and what it could mean if you're buying, refinancing, investing or reviewing your home loan.
1. The RBA held the cash rate at 4.35% for the second consecutive meeting
The Reserve Bank of Australia left the cash rate unchanged at 4.35% at its 11 August meeting, describing the decision as unanimous.
It was the second consecutive hold following three successive increases in February, March and May that lifted the rate from 3.60%.
Governor Michele Bullock confirmed the Board is not ruling out further increases if upside risks to inflation materialise.
Westpac's economics team has reaffirmed it expects the cash rate to remain on hold through the remainder of 2026, with any easing unlikely before mid-2027.
However, Finder's RBA panel found that 44% of economists still expect at least one further increase before year's end, with November the most commonly cited timing.
What this means for you:
A hold means no immediate change to variable repayments, which gives borrowers some certainty for the months ahead.
However, with no rate cuts expected until 2027 at the earliest, waiting for the RBA to move before reviewing your home loan could mean missing out on a more competitive rate in the meantime.
The gap between the lowest available rates and what many existing customers are currently paying has been widening.
If you haven't compared your rate in the past twelve months, it may be worth checking whether a more competitive option is available.
An Aussie Broker can compare your current loan across more than 25 lenders and give you a clear picture of what's available based on your circumstances.
You might also be interested in: What the RBA cash rate decision means for your mortgage repayments
2. New home lending falls $5.4 billion as investors pull back sharply
New ABS data released on 14 August shows the value of total new home loans fell 5.2% in the June quarter, a drop of $5.4 billion, following a 3.4% fall in the prior quarter.
The result reflects the combined impact of three cash rate increases in the first half of 2026 and the federal government's announced changes to negative gearing and the capital gains tax discount.
The sharpest pullback came from investors. The number of new investor loans fell 8.6% in the June quarter, the largest quarterly fall since September 2022, while the value of investor lending dropped 10.2% to $37.1 billion.
NSW, Victoria and Queensland recorded the steepest state-level declines, falling 15.5%, 14.2% and 10.1% respectively.
Treasurer Jim Chalmers described the figures as "an encouraging sign" that the tax changes were already shifting conditions in favour of first-home buyers, even before they formally take effect.
However, independent researcher Cameron Kusher cautioned that investors are not being replaced one-for-one by first-home buyers.
"There's an assumption that if you don't have an investor, you have a first-home buyer. That's not always the case," he told SBS News.
What this means for you:
For first-home buyers, fewer investors in the market can mean less competition for entry-level properties, particularly in Queensland, Victoria and New South Wales where the investor retreat has been most pronounced.
However, the data suggests the gap left by investors is not being fully filled by new owner-occupier buyers either, so conditions in specific suburbs will vary.
For existing investors, the data confirms what many are already experiencing: lending appetite has cooled and lenders are pricing investor loans more carefully.
If you hold investment property and haven't reviewed your loan structure recently, it may be worth checking whether the interest rate you're paying is still competitive.
For owner-occupiers and refinancers, the broader slowdown in new lending means lenders are competing more actively for new business, which may create more room to negotiate or find a competitive offer if you're reviewing your options.
You might also be interested in: What the negative gearing changes mean for property investors
3. National auction clearance rates improve for a second consecutive week
The national weekend auction clearance rate rose to 51.8% in the week ending 15 August, up from 50.3% the previous week and 48.9% the week before. Dr Andrew Wilson of MyHousingMarket described conditions as "steady but still generally subdued."
Results varied across the capitals. Sydney's clearance rate rose to 58.5%, up from 54.4% the prior week, with 561 homes taken to auction.
Melbourne came in at 59.2%, easing back from the 64.2% recorded the previous week, as auction numbers fell from 627 to 570.
Brisbane remained well below the other capitals at 29.5%, up marginally from 26.4% the week before. Adelaide recorded 52.9% and Canberra 58.9%.
Despite the two-week national improvement, the result remains well below the 73.5% recorded during the same week in 2025.
What this means for you:
A national clearance rate below 60% is broadly considered a buyer's market, meaning more properties are passing in and moving to private negotiation after auction.
That can create opportunities to purchase at a price that would not have been achievable at this time last year.
The city picture is uneven, however. Sydney has bounced back to its strongest result in several months, while Melbourne pulled back after last week's strong reading and Brisbane remains very soft.
Conditions within each city also vary considerably at the suburb level, so the city-wide headline can mask quite different local experiences.
If you're planning to buy at auction this spring, understanding recent clearance trends in your specific target suburb will give you a more accurate picture of competition than the national figure alone.
You might also be interested in: What auction clearance rates tell us about the property market
4. Consumer confidence remains near historic lows as house price expectations fall sharply
The Westpac–Melbourne Institute Consumer Sentiment Index rose 4.1% in July to 83.9, a modest improvement from June's 80.6. Despite the gain, the result remains in the bottom 10% of readings across the survey's 50-year history.
House price expectations fell sharply, with the Index of House Price Expectations dropping 8% to 118, a three-year low and the first below-average reading since March 2023.
For the first time since that period, fewer than half of respondents expected prices to rise over the next twelve months, with 29% expecting prices to decline.
Westpac's August Red Book, released this week, described the mood as one of "cumulative exhaustion," noting that renters and non-investors are showing clearer improvement in sentiment than existing property owners.
The August sentiment reading is due out today and will be the first full survey conducted after the RBA's confirmed hold decision.
What this means for you:
Low consumer confidence can create hesitation that doesn't always reflect a buyer's actual financial position. For those with stable income, a solid deposit and pre-approval in place, a subdued market mood can work in their favour.
Fewer competing buyers, more motivated sellers and wider negotiating room are the practical outcomes of a market where confidence is soft. That combination has not been available to buyers for much of the past three years.
For renters weighing whether now is a reasonable time to start exploring a first purchase, conditions are more accessible than they've been at any point since 2022.
A conversation with a broker about your borrowing capacity is a useful first step, even if a purchase is still some months away.
You might also be interested in: From renting to buying: understanding your first steps towards home ownership
Property spotlight
Each week, we feature a suburb and a selection of properties identified by the Aussie Homes Property Analyst team to showcase what's currently available in the market.
This week's spotlight: Point Cook, Victoria
This week, we're featuring an off-market property in Point Cook, an established suburb in Melbourne's western growth corridor, selected for its entry price relative to the broader suburb, above-suburb rental yield and no identified hazard risks from our property-specific checks.
With significant population growth over the past decade and relatively low housing supply, Point Cook continues to attract interest from owner-occupiers and investors.
Property | Indicative price | Expected rent | Gross yield | Snapshot |
|---|---|---|---|---|
$660,000 | $530/week | 4.2% | 3 bed • 1 bath • 2 car |
Looking for an investment property? Browse the latest analysed properties on Aussie Property, or chat with an Aussie Broker or Buyer's Agent to explore options that suit your goals and circumstances.
What to watch in the coming weeks
Several upcoming events could influence market conditions over the next few weeks:
18 August: Westpac–Melbourne Institute Consumer Sentiment Index August reading, the first survey conducted after the confirmed RBA hold
Late August: SQM Research July rental vacancy data
September: Spring selling season begins, typically bringing the largest lift in new listings of the year
30 September: Next RBA cash rate decision
These updates may influence buyer sentiment, borrowing conditions, and property market activity as we move through August.
What could this mean for your next move?
Market conditions continue to evolve as interest rates, buyer demand and housing supply adjust to changing economic conditions.
While some buyers are seeing more opportunities to negotiate, market conditions still vary considerably depending on location and property type.
Whether you're buying your first home, refinancing or reviewing your current loan, understanding how these market changes apply to your own circumstances can help you make more informed decisions.
An Aussie Broker can help you explore your options and understand what's available based on your goals and circumstances.
