RBA Slashes Cash Rate by 0.25%, Boosting Property Market

The Reserve Bank of Australia (RBA) has cut its cash rate by 0.25%, bringing it to 3.85%. This is the first time the rate has been below 4% since 2023.

Mortgage holders with a $600,000 loan can expect their monthly repayments to drop by $91 if banks pass on the cut in full, according to comparison site Canstar.

For those in regional Australia with a loan for a median-priced dwelling of $538,698, minimum loan repayments would come down by $82 a month.

Nerida Conisbee, Chief Economist at Ray White, said the cut will direct additional money into the housing market, providing borrowers with increased capacity.

Mathew Tiller, Head of Research at LJ Hooker, added that the RBA can be comfortable reducing the cash rate after a long period of trying to control inflation. He believes this is good news for the property market, increasing borrowing capacity and improving serviceability.