ABC News Daily What new lending rules mean for property prices
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Dec 2, 2025 In this discussion, Ian Verrender, ABC's chief business correspondent and senior economics commentator, dives into Australia’s red-hot housing market. He reveals how skyrocketing property prices are forcing the financial regulator to clamp down on risky lending practices. Ian analyzes the impact of interest rates on affordability, the effects of the 5% deposit scheme on home values, and APRA's new lending limits aimed at investors. He also addresses the social implications of high prices, including generational inequality and parental support in home buying.
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Prices Rising But Growth Is Shifting
- Australian house prices keep rising nationally but the pace is easing in Sydney and Melbourne.
- Buyers shift to cheaper markets like Brisbane, Perth and Adelaide as affordability limits are hit.
Rate Cuts Can Inflate Demand
- Interest rate cuts improve repayments for existing homeowners but encourage buyers to borrow more.
- When many buyers borrow extra, that increased demand quickly erodes any affordability gains.
RBA Balances Inflation And Jobs
- The RBA balances inflation and employment when setting rates, with recent inflation partly driven by one-off factors.
- A firmer economy and rising property values may keep rate pressure alive despite temporary CPI moves.