Your bank repriced for this market. Your agent didn’t.

Something happened in the last eight weeks that most people filed under banking news rather than property news. The banks started cutting fixed rates.

I spent 15 years as a licensed agent and called over 2,000 auctions before starting Unreserved. I’ve watched a few markets turn. What’s different this time is that the banks read it first, and they did something about their own pricing within eight weeks.

What twenty-one lenders just told you

Since 1 June, 21 lenders have cut at least one fixed home loan rate. NAB dropped its short-term fixed rates by up to 20 basis points on 23 July, taking its lowest two-year rate to 6.34%, and abandoned its forecast for another RBA hike. AMP cut fixed rates by up to 50 basis points, the equivalent of two cash rate cuts. Macquarie went hardest in June, trimming some fixed products by as much as 1.15 percentage points. ANZ moved with them. Eighteen lenders have cut variable rates since the May hike, and the sharpest advertised variable is now 5.69%.

A fixed rate is a bet. When a lender locks a borrower in for two years, it is publishing its own forecast in the only format that costs it money to get wrong. Twenty-one of them now think 4.35% is the top.

It is not unanimous, and the split matters. Eleven lenders have hiked at least one fixed rate over the same period. Westpac is the lone big four holdout, nudging some fixed rates higher and still forecasting RBA increases in August and September. CBA and ANZ expect a hold, then cuts starting in 2027. NAB became the first major bank to formally call the peak.

“The majority of lenders have been moving fixed rates lower since the start of June, suggesting the market believes the cash rate has either peaked or is very close to it,” said Sally Tindall, data insights director at Canstar.

For a seller, the practical translation is narrow but real: your buyers’ borrowing capacity has probably stopped shrinking. Three hikes and 75 basis points since January took a bite out of what every buyer at your open home can borrow. That process looks close to done. It does not mean rates are about to fall, and no major bank is forecasting a cut before 2027. It means the thing that has been quietly shrinking your buyer pool every eight weeks has likely run its course.

Why they cut, which is the part that matters

The banks did not discount out of generosity. They discounted because a hole opened in the pipeline.

NAB disclosed on 30 July that home loan applications fell 15% in the June quarter. The rest of the industry data says the same thing. Westpac reported investor applications down 20% in the three weeks to 10 June. Equifax put June home loan demand 14% below the same month last year. Loan Market, which aggregates thousands of brokers, has lodgements down 26% by number since early February and 23% by value, with investor applications down 35%.

Macquarie’s analysts described the response in one line: mortgage competition is already increasing with all major banks cutting key mortgage rates.

Fewer borrowers, same cost base. So lenders compete on price for the ones left.

That is what a functioning market looks like when demand falls. Volume drops, price follows, the cost of the service comes down for the customer. It took the banks about eight weeks. Hold that thought.

The market the banks are pricing for

The lenders are reacting to something real. Cotality’s national Home Value Index fell 0.4% in June, the biggest single-month fall since December 2022. Australian home values peaked in March.

The headline national figure hides two very different markets. Sydney, Melbourne and Canberra are falling. The mid-sized capitals didn’t fall, but they stopped running: Brisbane rose 0.3% in June after averaging 1.9% a month through the March quarter, and Perth rose 0.7% after averaging 2.5%.

The mid-sized capitals didn’t crash, they stopped running. Brisbane rose 0.3% in June after averaging 1.9% a month through the March quarter. Perth rose 0.7% after averaging 2.5%. Regional Australia is holding up better, up 0.3% in June and 1.1% for the quarter, though the pace is slowing there too. Regional WA is the standout at 3.7% for the quarter. Regional Victoria went backwards.

And the index itself got revised down. Cotality’s May figure for Perth was cut by 88 basis points and Brisbane by 53 in the June update. The market was weaker in May than anyone knew in May. If your appraisal was written in autumn, it was built on numbers that no longer exist.

Sales volumes collapsed in step with the loan applications

Capital city home sales over the three months to June are estimated 16.2% below the same period last year and 14.5% below the five-year average.

Stock piled up. Across the capitals in the 28 days to 26 July there were 21,455 new listings and 81,877 total listings. New listings were up just 3.6% year on year. Total listings were up 20.1%. Brisbane total stock is up 31.3%, Perth 27.5%, Adelaide 23.0%, Melbourne 19.5%. Sellers aren’t flooding the market. Buyers stopped clearing it, so it accumulates.

And the auction market is saying it loudest

In the week ending 26 July the combined capitals held 1,421 auctions and cleared 52.4%, up from a recent low of 47.4% in late June. On the surface that reads like a recovery. It isn’t. Volumes were 16.9% below the same week in 2025. Sydney held 433 auctions, down 27.5% year on year. Brisbane cleared 30.5%, the second-worst preliminary result recorded this year.

Then there’s the number that tells you what’s really happening in vendors’ living rooms. In Sydney last week, 29.8% of scheduled auctions were withdrawn before auction day. Nationally the withdrawal rate was 17.4%, and it had been sitting at 24% in late June. Through 2025 the average was 11.8%.

Roughly one in three Sydney vendors who committed to an auction campaign pulled the plug before the hammer. They paid for the campaign anyway. Of the Sydney auctions that did produce a sale, 63.4% sold before auction day. Two-thirds of the successful ones never got an auction either. They got an auction invoice.

A clearance rate holding in the low 50s while a quarter of the stock quietly leaves the market isn’t stability. It’s a market clearing by attrition.

Morgan Stanley’s Richard Wiles told clients the negative gearing and capital gains changes are “the most significant in 40 years” for mortgage growth, and expects no growth in investor loans over the next financial year. The Federal Budget removed negative gearing on purchases of existing housing from 1 July 2027 and imposed a 30% tax on capital gains, which has taken a large slice of investor demand out of the established market.

The one price that didn’t move

So: loan applications fell 15%, and within eight weeks 21 lenders cut their price.

Capital city sales volumes fell 16.2% over the same window.

The standard commission rate moved by nothing at all.

Not a basis point. Not in Sydney where the median home gave back $41,838 last quarter, not in Melbourne, not anywhere. Commission is charged as a percentage of the sale price and it does not care which direction the market is moving.

Read the Adelaide line again. A full quarter of capital growth on the median home is $12,138. The commission cheque is $23,647. Three months of the market working in your favour doesn’t cover half the fee. Brisbane and Perth tell the same story.

In Sydney and Melbourne, the market and the fee are pulling in the same direction, and it’s away from you. Add a typical $8,000 to $15,000 vendor-paid marketing campaign, which you pay whether the property sells or gets withdrawn, and the median Sydney seller writes cheques worth close to $45,000 on a home that lost $41,838 of value over the same three months.

Nobody designed this fee structure for a falling market. It was built in a rising one, when 2.5% of a growing number felt like a rounding error. It isn’t a rounding error now.

Your lender looked at a 15% fall in volume and cut its price in eight weeks. Ask why the party taking the largest single cheque out of your sale is the only one in the transaction still charging March prices.

What the rate story means for your timing

Three practical consequences, in order of how much they should change what you do.

The buyer pool has a floor under it now. Loan Market’s Shay Waraker says applications stopped falling in July and have held steady since. Borrowing capacity has stopped contracting. That doesn’t lift your price, but it means the buyer who inspects in September can probably borrow what the buyer in July could, which has not been true at any point this year.

Waiting for rate cuts is not a strategy. No major bank forecasts a cut before 2027, and CBA’s call is May and August of that year. Meanwhile total listings are up 20.1% and climbing. If you hold out for cheaper money, you’ll be selling into a bigger pile of competing stock with buyers who are no better off. Being early to a growing pile of listings beats being late to it.

Fixed-rate competition helps buyers, not vendors’ price expectations. A sharper mortgage rate improves what your buyer can service. It does not restore what your home was worth in March. Price off comparable sales from the last 90 days, not off an autumn appraisal.

Rents, yields and the 6.4% problem

National rents rose 1.6% in the June quarter and 5.9% over the year, taking the median dwelling rent to $705 a week. Vacancy sits at 1.6% nationally against a decade average of 2.5%. Adelaide is at 1.0%. Rental listings nationally are 16.7% below the five-year average.

Capital city rents have risen 41.7%, or $217 a week, in five years. By March 2026 about a third of the median household’s income was going to rent, up from 27% in 2021.

Because rents rose while values fell, gross yields lifted to 3.7% nationally, up from about 3.5% at the end of 2025. That still sits well below the roughly 6.4% variable rate on new investor loans, and even the sharpest new fixed rates near 6.34% don’t close a gap that wide. Cotality estimated in May that only 0.8% of Australian suburbs could support a cash flow positive purchase on a 20% deposit.

So if you were thinking of renting the place out and waiting for a better market, check the arithmetic first. The rate cuts are real, but they are not big enough to make holding pay for itself. In most of the country the yield doesn’t cover the debt.

Why new supply won’t change the maths

Cordell identified 1,190 new construction projects nationally in June, up 3.3% for the month but 2.4% down over the year. Only 161 projects moved into construction, and the 12 months to June ran 12.4% below the prior year.

By state over the past year, Queensland was up 14.0%, WA up 8.4%, Tasmania up 5.2% and SA up 4.6%. Victoria fell 17.3% and NSW 7.9%.

New housing is not arriving fast enough to change the medium-term picture. That’s why the most likely path from here is a slow drift lower rather than a sharp national correction. Tight labour markets, thin new supply and population growth put a floor under it. But the balance of risk has clearly shifted, and the banks moved first because they could see it in their own application data before it showed up in anyone’s index.

What I’d tell a seller this week

The banks repriced. The fee structure didn’t. Three things matter more than they did in March.

Price off comparable sales, not off a pitch

Inflated appraisals win listings. Eight weeks later “the market” takes the blame and you take the price reduction. In a quarter where Sydney gave back 3.2%, an appraisal written in autumn is a work of fiction. Start from what has actually sold near you in the last 90 days.

Don’t pay for theatre

In a market where nearly a third of Sydney auction campaigns get withdrawn and two-thirds of the successful ones sell before auction day, ask what the auction is actually buying you. If the answer is a deadline you could have set yourself, that’s an expensive deadline.

Make the fee fixed

Unreserved charges a flat fee instead of a commission, and we’re licensed across VIC, NSW, QLD, SA and WA, so your listing reaches realestate.com.au and Domain the same way an agency listing does. In a flat or falling market the difference between a known cost and a percentage of an unknown one is the difference between a decision and a hope.

Twenty-one lenders looked at this market and cut their price for the customer. That is what competition does when volume falls. The only reason commission hasn’t followed is that, until recently, sellers had nowhere else to go.

FAQs about the 2026 property market

Are interest rates about to fall in 2026?

Most lenders are now betting the cash rate has peaked at 4.35%, but that is not the same as a cut. Since 1 June, 21 lenders have cut at least one fixed rate while 11 have hiked one. NAB abandoned its forecast for a further increase in July, CBA and ANZ expect the RBA to hold before cutting in 2027, and Westpac is still forecasting two more hikes. Fixed rate cuts signal the top of the cycle rather than the start of a downward one.

Why are banks cutting fixed rates while house prices fall?

Because loan demand collapsed. NAB reported home loan applications down 15% in the June quarter, Equifax put June demand 14% below last year, and Loan Market has broker lodgements down 26% since early February. With fewer borrowers to write loans for, lenders compete harder on price for the ones left. For a seller, the practical effect is that buyer borrowing capacity has stopped shrinking, which steadies the buyer pool without lifting prices.

Should I wait for interest rates to fall before selling?

No major bank forecasts an RBA cut before 2027, and CBA’s current call is May and August of that year. Total capital city listings are already up 20.1% year on year. Waiting means selling later into a larger pile of competing stock, to buyers whose borrowing capacity is unlikely to be materially better. The fixed rate cuts already made have steadied buyer capacity now, which is the part that helps you.

Are Australian house prices falling in 2026?

Nationally, yes. Values fell 0.4% in June, the largest monthly fall since December 2022, and are down 0.7% over the June quarter. The picture is not uniform. Sydney fell 3.2% and Melbourne 2.6% over the quarter, while Brisbane, Adelaide, Perth, Hobart and Darwin still recorded gains, though far slower than earlier in the year.

Is now a bad time to sell my house?

It’s a harder market than March, but stock is accumulating rather than flooding. Total capital city listings are up 20.1% year on year while new listings are up only 3.6%, which means buyers have slowed rather than sellers rushing in. If you intend to sell within the next year, being early to a growing pile of listings generally beats being late to it.

Why are clearance rates still near 50% if the market is falling?

Because a large share of stock is leaving the market before it gets tested. Nearly 30% of scheduled Sydney auctions were withdrawn in the week ending 26 July, and the national withdrawal rate hit 24% in late June against a 2025 average of 11.8%. Clearance rates measure what sold out of what was auctioned, so withdrawals flatter the headline.

How much commission do agents charge in Australia?

Typically between 1.8% and 3.5% of the sale price, plus a separate vendor-paid marketing campaign that commonly runs $5,000 to $15,000. On the median capital city home of $1,024,840, a 2.5% commission is $25,621. A flat fee doesn’t move with the sale price.

Should I rent my home out instead of selling?

Check the numbers first. National gross yields were 3.7% in June while new investor loans averaged around 6.4%. Cotality estimated only 0.8% of Australian suburbs could support a cash flow positive purchase on a 20% deposit. Speak to your accountant about your own position.

The bottom line

Buyers regained the upper hand this quarter. More stock, longer selling times and softer auction results have handed them choice and time, and both of those come out of the seller’s price. You can’t control that. Twenty-one lenders repriced for this market inside eight weeks. The commission rate didn’t move at all. You can’t control what buyers are willing to pay, but you can control how much of what’s left you hand over on the way through. Start with a free AI valuation built on real comparable sales, or run the numbers yourself with the commission calculator.