RBA Cuts Interest Rates – What It Means for WA Property

The Reserve Bank of Australia (RBA) has announced a 0.25 percentage point cut to the official cash rate, bringing it down to 3.85%. This marks the first rate change since late 2024 and comes as a response to signs that inflation is finally moderating. While the move is welcomed by mortgage holders and buyers alike, the implications for Western Australia's property market are complex and worth unpacking.

The decision to lower the rate follows encouraging signals that inflation is cooling. Unlike earlier rate cuts, which aimed to stimulate a slowing economy, this latest change reflects the RBA’s confidence in its inflation management strategy. The central bank is now cautiously easing monetary policy to relieve cost-of-living pressures without reigniting inflationary risk.

For WA homeowners and investors, this means slightly lower mortgage repayments – a welcome reprieve after a long period of interest rate hikes. Major banks have already responded, with several announcing cuts to their variable mortgage rates. This could free up some cash for households and improve borrowing capacity, particularly for first home buyers and upgraders.

That said, experts are quick to point out that we’re unlikely to see a rapid return to ultra-low interest rates. Economic conditions remain mixed, with elevated government spending and continued wage growth keeping upward pressure on inflation. In WA, where affordability is still better than in most other states, we may see renewed buyer interest – but it’s unlikely to trigger the kind of rapid price surges seen during the 2021–22 boom.

Ultimately, the RBA’s move is a cautious but positive step for the housing sector. For Perth and the wider WA market, it could translate to increased confidence, greater activity at the lower end of the market, and a bit more breathing room for homeowners juggling repayments.

If you'd like to talk about how this will affect your property plans, don't hesitate to contact the team at Bellcourt on 08 6141 7848.