## Rising Home Prices Undermine Rate Cuts New data from property analytics company Cotality reveals that Australia’s surging home prices have largely canceled out the advantages of the recent interest rate reductions. While lower mortgage rates typically provide relief to borrowers, rapid property value increases have pushed affordability further out of reach for many buyers. ### Key Findings - Cotality’s research shows that national home prices rose sharply over the past year, particularly in major cities such as Sydney, Melbourne, and Brisbane. - The average cost of entering the housing market now exceeds the benefit created by lower borrowing costs. - Mortgage repayments for new buyers remain high, especially as property prices continue to outpace income growth. ### Market and Policy Implications Economists suggest that although interest rate cuts typically stimulate demand, they can also fuel price surges in tight housing markets. This dynamic has offset the potential benefits for first-home buyers and those seeking affordability improvements. > “Lower rates have not eased the financial strain of owning a home — they’ve been absorbed by higher purchase prices,” said a Cotality spokesperson. Experts warn that without additional measures to address supply shortages, lower interest rates alone will not improve accessibility to home ownership. --- *Author’s summary: Rapid property price growth in Australia has negated the expected relief from interest rate cuts, leaving affordability concerns unresolved.*

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SBS — 2025-11-30