‘Get in now’: Andrew Winter’s shock rate cut call

Property prices could surge again with a series of anticipated rate cuts set to boost borrowing power and buyer demand.

New analysis from Compare the Market has found buyers with an annual household income of $200,000 could see their borrowing power increase as much as $100,600 if the

cash rate drops 1 per cent over the coming months — and these reductions are passed on in full by the banks.

Andrew Winter, Compare The Market’s property expert. Picture: Suppliedc

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RELATED: Andrew Winter: Last chance to buy before prices rise again

This could lead to bigger offers on houses and units in parts of the country — especially in cities where supply continues to fall short of demand.

Values have held strong in most of the state capitals, despite recent headwinds from

higher interest rates, inflationary pressures and economic uncertainty.

The markets in Brisbane, Adelaide, Perth and Sydney have been extremely resilient, and

that’s largely because there isn’t enough supply to keep up with demand.

These markets have performed well in less-than-ideal conditions. Another round of rate cuts

is likely to add fuel to the fire.

Economists are predicting a 50 basis point cut to the official cash rate when the RBA meets on May 20. Picture: Gaye Gerard.

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Aspiring buyers may be anxious to get a foot in the door now before market

conditions become too competitive.

But the capacity to borrow more money will not make buying a house easier for most people.

The main hurdle for most first-time buyers is raising a deposit which can be extremely

challenging when value growth outpaces wage growth in such an extreme way.

The good news is there are a number of low-deposit and stamp duty incentives open to first

home buyers. Saving 5 per cent is a lot more achievable than saving 20 per cent.

RBA Governor Michele Bullock during a press conference in 2024. Picture: Nikki Short.

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There may be a rush to beat the ‘fear of missing out’ frenzy.

Remember, it’s nearly impossible to strategically time the market. The best time to buy is when you’re ready.

If that time is now, you have a deposit saved, and you like a property, don’t wait to make a move.

It’s still possible to buy a two-bed unit in most states in the $500,000s, but I don’t think that

will be the case for long.

Your first property may not be your dream property, but it’s a start. The security of having

your own front door and a place to call ‘home’ is often invaluable.

ANDREW WINTER’S TIPS FOR BUYERS IN 2025

1. Tap into incentives

If you’re having trouble saving a 20 per cent deposit, you can try tapping into The First Home

Guarantee, which allows first home buyers to buy with as little as 5 per cent towards the purchase price, without having to pay the dreaded Lenders Mortgage Insurance (LMI).

Depending on where you live, there may be initiatives like grants and stamp-duty waivers.

It’s worth getting to know what’s on offer in your state.

2. Stress test your finances

Big debts can make bad times all the more stressful.

Always stress test your mortgage to make sure you can afford the repayments if things go a

bit pair shaped. If you or your partner lose your job, or need to take a career break to start a

family, you want a loan that’s a manageable size.

3. Compare rates

You might have been with the same bank for years but that doesn’t mean they’re the right

place to start your home loan journey.

Shop around and see what lenders can offer you the cheapest rates. A good broker will be

able to help you navigate the process and negotiate with the banks on your behalf.