ANZ slams the door on more rate cuts — what this means for homeowners, investors, and Australia’s property markets

For a while there, “the next rate cut” started to feel like a foregone conclusion.

Borrowers were counting on it, buyers were pricing it in, and the media narrative was drifting toward relief.

But now the story is different, with most economists suggesting there won't be another interest rate cut anytime soon.

In a fresh update to its cash-rate outlook, ANZ has now ruled out any further RBA cash rate cuts this cycle; a meaningful shift given it had previously expected one more cut in early 2026.

With ANZ changing its forecast, three of the big four major banks:  CBA, NAB and ANZ, now expect the cash rate to remain on hold through 2026, with no further cuts in this cycle.

That leaves Westpac as the outlier, still forecasting two more cuts: one around May 2026 and another around August 2026.

Of course, the convergence of three majors around “no more cuts” will shape consumer confidence, pricing behaviour, lending strategy and, ultimately, property demand.

Why ANZ has changed its mind

The logic behind ANZ’s shift is pretty straightforward:

• Inflation is “moving in the wrong direction”

• Unemployment has eased back to 4.3%

That combination makes further cuts hard to justify.

When inflation stops declining convincingly and the labour market stays tight, the RBA’s incentive to “support the economy” with lower rates fades quickly.

And it’s not just a case of “no cuts.” The more confronting implication raised in the release is this: some economists are now suggesting the next move could be up rather than down.

Canstar’s Data Insights Director, Sally Tindall, captures the key message in a way borrowers can’t ignore:

“ANZ has joined a growing cohort of economists who now believe we’ve hit the bottom of the cash rate cycle.

While the RBA is unlikely to start hiking rates without plenty of notice, if inflation continues to move in the wrong direction, the next move from the central bank could be up rather than down.”

Borrowers: most say they’re “prepared”… but a third are not

Canstar’s Consumer Pulse data shows:

• 66% of borrowers say they’re prepared for rates to remain on hold in 2026

• 23% say they’re not prepared

• 11% aren’t sure

So one in three borrowers are either under pressure or uncertain, and that matters because household cash flow is still the backbone of housing market sentiment.

But “prepared” is a slippery word. Some people feel prepared because they’ve tightened spending.

Others feel prepared because they assume wages will rise, tax cuts will help, or refinancing will remain easy.

And that’s where risk creeps in: comfort based on assumptions is not the same as financial resilience.

The practical truth: even without RBA cuts, you can still lower your rate

This is the part many borrowers miss.

Even if the RBA keeps the cash rate on hold, your mortgage rate is not set in stone,  especially if you’re on a variable rate and haven’t negotiated in years.

Canstar’s tracking shows there are still sharp deals available, with the lowest variable rates around 4.99% and the lowest fixed rates around 4.64% (for qualifying borrowers and specific loan criteria).

Yes, some banks are lifting fixed rates, but that reinforces the message that lenders are positioning for a world in which funding costs don’t fall further.

Ms Tindall expalins:

“Variable borrowers staring down the barrel of no more cash rate cuts should know they can still take matters into their own hands, whether that’s refinancing to a more competitive lender or haggling with their existing bank.”

The “canary in the coal mine”: term deposits are sending a loud message

If you want a forward-looking clue about where markets think rates are heading, watch term deposits, because banks don’t price term deposits based on hope.

They price them based on:

• competition for funding,

• expected wholesale funding costs,

• and what they think the cash rate will do over the relevant period.

Canstar’s data shows 34 banks increased at least one term deposit rate in November, compared with just six in July.

Now that’s a big shift in a short time

Ms Tindall notes:

• Also read:November Reports More Strong Home Price Growth | Latest stats from Dr. Andrew Wilson
• Also read:Latest Property Price Forecasts Revealed. Australian Property Market Outlook 2026: Where To For Prices With Rate Cuts Delayed.
• Also read:National Weekly Auction Report – November 29th 2025 | Clearance Rates Steady Despite Flood of Auctions to End Spring
• Also read:Investors Are Back, Building Costs Are Rising, Auctions Are Easing – Here’s What This Data Really Means | Property Insiders
• Also read:Adelaide housing market update | November 2025

“Certainly, if term deposit rates are the canary in the coal mine, then further cash rate cuts are unlikely.”

In other words, the “easy money” era is well and truly behind us, and markets are adjusting to a more normal cost of capital.

What this means for property investors

1.  Rate stability can be bullish for property, even if rates are higher than we’d like

Markets like certainty. When buyers believe rates are stable, they stop waiting for the perfect moment and start acting.

When enough people stop waiting, demand for property firms.

2. The next phase rewards quality and strategy, not shortcuts

If further rate cuts aren’t coming to “save” poor deals, the gap widens between:

• investment-grade assets (scarce, desirable, high land value, in strong locations), and

• secondary assets (compromised location, oversupply risk, weak owner-occupier appeal).

This is the cycle where A-grade outperforms, and B/C-grade gets exposed.

3.  Serviceability becomes the filter, and filters change who can buy what

When rates stay higher for longer, borrowing power stays constrained.

That doesn’t kill property markets,  it reshapes them:

• owner-occupier “heartland” markets with deep demand stay resilient,

• compromised stock takes longer to sell,

• while well-located properties with strong appeal continue to attract competition.

4.  Investor psychology matters more than interest rates

When people believe cuts are coming, they feel optimistic and stretch.

When they believe cuts are not coming, they become selective. That’s not bad, it’s healthy.

It pushes investors back toward fundamentals: cash buffers, income resilience, asset quality, and long-term thinking.

What I’d do next (for homeowners and investors)

Here’s the action plan I’d be working through right now:

For homeowners

• Pressure-test your budget at today’s rate for 12–24 months (not “until cuts arrive”).

• Call your lender and ask for a pricing review,  especially if you have a strong repayment history.

• Compare refinance options properly (fees, revert rates, offset structure, cashback traps, serviceability rules).

For property investors

• Assume the current rate environment is the base case and buy only if the deal stacks up under that assumption.

• Build a liquidity buffer (I generally like meaningful buffers, not token amounts, because buffers buy you time and optionality).

• Prioritise investment-grade assets that will appeal to affluent owner-occupiers over time (that’s where the long-term price pressure comes from).

• Review your debt structure: split loans, offsets, deductibility, risk management, and flexibility matter more than squeezing out the last 0.10%.

• Seek advice from an independent property strategist, like the team at Metropole, to help you understand your options. Find out more about this service here and lock in a chat with one of our wealth strategists.

For savers (and I know many investors also hold cash strategically)

Ms Tindall also points to “laddering” term deposits:  spreading money across different terms to keep flexibility while still accessing competitive rates:

“Laddering can be one way to keep your options open… locking in smaller pots of money at different times."

It’s not for everyone, but if you’re holding cash for a future purchase or keeping reserves, it’s worth considering.

The bottom line

If three major banks now expect no further cuts, and term deposit pricing is rising, the message is simple:

Because the investors who do well in this next phase won’t be the ones who guessed the next RBA move.

They’ll be the ones who bought well, managed risk, and stayed patient while others hesitated.