Aussies are pushing on with plans to purchase homes despite record prices, slower wage growth and renewed interest rate pressure.
Amid an increasingly complex economic landscape, Mortgage Choice found property seekers are proving resilient and a ready to dig deep this year.
Close to half (42%) of the 1000 consumer surveyed in the latest Mortgage Choice Home Loan Report say they are looking to make their buying plans a reality in 2026.
Despite this, 43% said they would feel more confident to do so if their income increased, property prices stabilised (39%), and more homes were listed for sale in their preferred area, or price range (35%).
“It’s understandable that Australians would be looking to their pay checks and property prices and availability to feel more confident about their purchase plans,” Mortgage Choice chief executive Anthony Waldron said.
Mortgage Choice chief executive Anthony Waldron. Picture: supplied
“In 2025 we saw the cash rate reduce three times before the Reserve Bank hit the brakes and held the rate steady at 3.60%.
“We’ve also seen wage growth slow, and home prices reach new record highs, with national home prices rising nearly 9% over the year.”
Property prices reached a new high in January, with the median price of a home now sitting at $883,000, according to the latest PropTrack Home Price Index.
This marked the 13th consecutive month of growth for Australia’s resilient property market, though less growth is expected this year.
It’s not just high home prices that could be discouraging, however. Almost all borrowers are set to see their mortgage repayments rise this month, following the first cash rate rise in over two years.
While property prices tend to stall as rates rise, New South Wales-based Mortgage Choice broker Kelly Carter said there are pros and cons on both sides.
“I think if you're a purchaser, then you would like property prices to stall… but if you are an existing mortgage holder or an investor, then you would obviously love to build more equity, because that enables us to leverage again in the future.”
The report also highlights home loan trends and the intentions of Australian borrowers and prospective buyers, finding the majority were prepared for the Reserve Bank to tighten monetary policy.
Most borrowers were proactively managing their mortgages following the three rate cuts of 2025, with 60% of those surveyed with a mortgage kept their repayments at a higher level despite the chance to cut repayments.
The Reserve Bank hiked the cash rate this month for the first time since November 2023. Picture: Getty
Just over a quarter (26%) lowered their repayments to free up cash, while 10% were unaware they could change what they paid off.
“Pleasingly, our survey reveals that most borrowers are proactively managing their home loan,” Mr Waldron said.
“We asked respondents with a mortgage how they would manage if their variable rate increased by 25 basis points and 35% said they could handle it easily without changing their spending, while 43% say they could manage but would need to cut back on their discretionary spending.”
Australians are mostly comfortable they can manage their mortgage if there is another rate rise. Picture: Getty
Most lenders assessing a new borrower do so based on an interest rate 3% higher than what is offered, Ms Carter noted, leaving some wiggle room for times like now.
“I think not just paying the minimum repayment is really important – assume that the interest rate is going to be 7% or 8% and just pay extra,” she said.
“So if a rate rise comes, then it's not damaging. You've already got the money there, you're reducing the interest that you're paying on your home loan.”
Aussies also remaining increasingly confident when it comes to taking on debt to get on the property ladder.
Average loan sizes have surged 11% year-on-year, Mortgage Choice found, led predominantly by buyers in South Australia, the Northern Territory and Queensland which have been key home price growth areas in 2025.
The value of loans for purchases also grew close to 30% year-on-year, with buyers most active in New South Wales, Queensland, and the Australian Capital Territory.
This article first appeared on Mortgage Choice and has been republished with permission.
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