Key takeaways
While the RBA isn’t reducing rates yet, the real story is that rates have stopped rising. That shift from uncertainty to stability is what’s supporting buyer and investor confidence. People can plan again, and they are.
RBA acknowledges the limitations of the new monthly CPI series and is taking a cautious, wait-and-see approach. This reduces the risk of knee-jerk rate hikes and gives the market breathing room.
Unemployment remains very low by historical standards, and households with jobs don’t default.
Solid employment is shoring up confidence, serviceability, rental demand, and overall housing activity, a major reason the property market has stayed resilient.
Borrowers and investors have recalibrated budgets, reshaped cash flows, and accepted the new rate environment. With the fear of “another surprise rate rise” fading, the market is functioning more normally again.
Auctions reveal behaviour, not opinion, and buyers are still turning up, bidding, and transacting.
Remarkably, activity hasn’t tapered off heading into year-end, signalling deeper, more persistent demand than many commentators expected.
If you’ve been following the headlines lately, you’d be forgiven for feeling a bit confused.
Interest rates are on hold… inflation seems to be creeping up again… and yet property prices keep rising, and our auction markets are holding up better than most people expected.
Rather than reacting to noise or opinion, in this week’s Property Insiders chat, Dr Andrew Wilson and I unpack what the numbers are really telling us and, more importantly, what they’re not telling us about where the property markets are heading next.
Interest rates: steady, not spiralling
Yes, the Reserve Bank did not drop interest rates in December and is unlikely to for some time.
Watch this week's Property insider video as Dr. Andrew Wilson explains why he doesn't think the Reserve Bank will raise interest rates any time soon.
He also explains what matters more for property markets is direction and stability in rates.
The Reserve Bank has now held rates steady for several months. That signals a very different environment from one where rates are rising aggressively and unpredictably.
The RBA itself has acknowledged uncertainty around inflation data, particularly with the new monthly CPI series. In other words, they’re watching carefully rather than reacting hastily.
For property markets, this matters because stability allows buyers and investors to adapt. And they have adapted.
Borrowers have adjusted their budgets. Investors have recalibrated cash flows.
And importantly, confidence is no longer being undermined by the fear of the next rate rise around the corner.
The labour market: the quiet backbone of housing demand
One of the most underappreciated supports for the property market right now is the labour market.
Unemployment remains low by historical standards at 4.3% nationally.
- Also read:This week’s Australian Property Market Update – Latest Data, State by State December 16th 2025
- Also read:Everything you need to know about the state of Australia’s property markets in 20 charts – December 2025
- Also read:National Weekly Auction Report – December 13th 2025 | More Robust End-Of-Year Auction Results
- Also read:National Vacancy Rate Rises to 1.3% as Rental Conditions Ease Slightly | SQM Research
- Also read:Latest Property Price Forecasts Revealed. Australian Property Market Outlook 2026: Where To For Prices With Further Rate Cuts Unlikely.
Participation rates are down a little but still high at 66.9%.
And while there have been some month-to-month fluctuations in job numbers, the broader picture remains one of resilience.
This is critical as we explained in this week's Property Insider chat – please watch the video.
People don’t default on mortgages en masse because interest rates rise.
They default when they lose their jobs. And that simply isn’t happening.
A strong labour market underpins household confidence, mortgage serviceability, rental demand, and buyer willingness to transact.
This is one of the reasons property markets have proven far more resilient than many expected.
Auctions tell you what buyers are actually doing
One of the best real-time indicators of market sentiment isn’t what commentators say. It’s what buyers do when they have to commit publicly and financially.
Auction results across our capital cities remain robust over the weekend.
Auctions strip away talk and reveal intent. And intent remains strong in many parts of the country.
Traditionally, auction activity and buyer urgency fade as the year winds down.
This year, that hasn’t really happened.
