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Tomorrow (18 February), the Reserve Bank of Australia (RBA) will hand down its first cash rate call of 2025.
Many experts believe we may finally see a cut for the first time since November 2020.
Brokers should expect increased activity from borrowers if this cut comes to fruition.
Three brokers from Aussie Home Loans shared what they’re doing to prepare for a rate cut.
Shaun Brodison, Aussie Bunbury, Western Australia
“A rate cut might be the difference between getting the house that you want or having to settle for something less. Every time the interest rates have gone up, our customers have seen their borrowing capacity reduce,” he said.
“In WA, we have been caught in a cycle of property price increases, at the same time as interest rates have been increasing. So many of our customers are just below the level of what they need to borrow to get the house they want. A rate decrease will give many of them the chance to be able to get into the property market.”
William Sanchez, Aussie Newtown, NSW
“The positive news around interest rates is definitely contributing to a surge in first home buyer enquiries in the Inner West. My customers are excited with the potential rate cut on the horizon, as their servicing position would be positively improved and that opens up more options in a competitive market,” Sanchez said.
“Given that the average purchase price in the Inner West has increased significantly over time, my focus in on helping customers to explore all lender options with the intention to find them the strongest possible servicing position.”
Matthew Rose, Aussie Prospect, South Australia
“My advice to buyers is to get their finances in order now – don’t wait for a rate cut to start the process. Reduce debts, boost savings and secure a pre-approval early, so you’re ready to act if market activity picks up,” he said.
“With buying demand likely to rise, being prepared could make all the difference in securing a property before competition heats up. A common myth I hear is that banks always pass on the full rate cut, but that’s not necessarily the case. Lenders adjust rates at their discretion, and the savings don’t always flow through in full – or immediately.”
Rose concluded: “My advice to borrowers is to stay informed, compare options and not assume their current lender will offer the best deal. A rate cut can be a great time to review your loan and see if you can negotiate a better rate or refinance to save more.”
