Australia’s latest interest rate hike has many people asking: Is now a good time to buy, sell, or move house?
In March 2026, the Reserve Bank raised the official cash rate by another 0.25%, bringing the cash rate to 4.10%, just one month after it was raised to 3.85%. A strong jobs market and solid economic growth have kept inflation stubbornly high, and disruptions to global energy markets in the Middle East haven't helped. The RBA is responding by making borrowing more expensive.
And it may not stop there. All four major banks are expecting another 0.25% hike in May, which would bring the cash rate to 4.35%. If you're weighing up whether to buy, sell or move, that's worth factoring into your thinking.
Rising rates don’t automatically mean you can’t move. But they do affect your borrowing power, loan repayments, and overall confidence — whether you’re looking to move in Sydney, Melbourne or other major cities.
In this article, we break down how higher interest rates affect buyers, sellers, and movers, and whether it’s a good time to move.
Disclaimer: This article provides general information only and does not constitute financial advice. Speak with a qualified financial professional about your individual circumstances.
What do rising interest rates mean?
When the Reserve Bank raises the cash rate, lenders typically raise variable home loan rates in response. And if your interest rate goes up, your repayments go up too. Even a small change can affect what you can afford.
For example, a 0.25% increase may look like:
- $1 million loan → repayments may rise by around $160/month
- $600,000 loan over 25 years → repayments may rise by roughly $91/month
- Borrowing power may drop by around $24,000 (for an average single-income earner).
*Actual amounts will vary depending on your lender and loan type.
Higher rates influence both buyers and existing homeowners:
- Buyers: Their reduced borrowing power may mean delaying a purchase, opting for smaller homes, or looking in different suburbs.
- Homeowners: Higher mortgage repayments may mean rethinking upgrades, downsizing, or moving plans.
Overall, people tend to take more careful property decisions.
Is now a good time to buy a house in Australia?
It can be a good time to buy. The March 2026 hike might reduce your borrowing power and increase your monthly home loan repayments. But it might also slow the "frenzy" of 2025. With less buyer competition, you might have more room to negotiate price and more time to look for the best home.
You could still consider buying if you:
- Need to move for work, family, or lifestyle reasons
- Have saved enough deposit and can still comfortably manage repayments
- Want to take advantage of slower market competition
However, it’s hard to tell how people will react.
The latest Mortgage Choice Home Loan Report found that 42% of consumers still plan to buy in 2026. Meanwhile, in our conversations with several Sydney first home buyers, some are pausing their home search until rates stabilise.
The key takeaway: If you still want to buy, you should analyse your budget carefully, compare loan options, and be realistic about what you can afford monthly.
Is it a good time to rent in Australia?
Renting might be a bit tougher with the rise in interest rates. Some landlords might raise rent to cover higher mortgage costs. Plus, the vacancy rate in major cities ranges from 0.4–1.7%, so competition is high.
That said, renting can give you flexibility if you’re waiting for rates or property prices to stabilise before buying. Whether it’s the right choice depends on your financial situation and comfort with risk.
Should I sell my home now?
Selling might become more challenging as there will be fewer buyers in the market and less borrowing power. But, some sellers are taking advantage of less competition and listing now.
Selling may be a smart option if you:
- Want to downsize or move to a home with a more affordable mortgage.
- You need to move for work or family sooner rather than later
- You want to take advantage of less competition and attract more serious buyers.
But if you do plan to sell, you might find:
- Slower price growth: With two rate rises already and possibly a third on the way, property prices are expected to grow more slowly than predicted at the start of the year.
- Longer selling times: Properties might take longer to sell. You might have to price more fairly to avoid delays.
- More selective buyers: Buyers are likely to focus more on value and property condition.
Remember: If you plan to buy another property after selling, the higher rates may also affect your borrowing power.
Should I move house now or wait?
Whether to move now or hold off depends as much on your circumstances and goals as it does on interest rates.
When waiting might make sense:
- Getting a loan or lease right now seems out of reach or tricky.
- You want more time to save a bigger deposit or lower your repayments.
- You’d feel more comfortable with property prices or interest rates being a bit steadier.
When moving now might make sense:
- You need to move for non-financial needs (e.g. job, family, lifestyle).
- You’ve reviewed your budget and are comfortable with higher costs.
- You’re ready to handle all the practical steps of buying, selling or renting.
Tip: If you’re planning a move, professional local removalists can make the process faster, easier, and far less stressful.
Quick decision guide: Move now or wait?
| Situation | Suggested approach |
|---|---|
| You want to downsize or lower your mortgage/lease costs | Move |
| You’re a first-home buyer and can’t borrow much | Don't move |
| You want more options and room to negotiate | Move |
| You want to avoid higher repayments or need to save more | Don't move |
| You need to move and are okay with managing higher cost or uncertainty | Move |
| *This is a general guide only. Your finances and comfort levels will determine what’s right for you. | |
What you need to know if you’re moving now
Whether buying, selling, or moving, here are some tips to help navigate the current market:
- Be realistic: Borrowing and repayments matter, but focus on affordability, not speculation.
- Practical moves are common: Many Australians value functionality over upgrades.
- Downsizing or staged moves: Smaller relocations, temporary storage, or moving in phases are popular strategies.
- Personal priorities drive timing: Job, family, or lifestyle needs often outweigh financial factors.
Remember: These points are general observations about moving behaviour in Australia. They are not financial advice.
Frequently asked questions
Is it a good time to buy a house with interest rates rising?
It can be, depending on your budget. Higher interest rates mean higher monthly repayments and lower borrowing power. But this can also reduce the competition from buyers, giving you more room to negotiate.
How do interest rate hikes affect first-home buyers?
Higher interest rates usually reduce the amount you can borrow. First-home buyers might need to adjust their budget or timeline.
How do interest rate hikes affect existing homeowners?
Homeowners on variable loans may see monthly repayments rise. For example, a 0.25% rate increase on a $600,000 loan over 25 years could add around $91/month. You may need to rethink your plans to upgrade, and consider downsizing or delaying moves.
Should I wait to move house because of higher interest rates?
Waiting can make sense if your budget is tight or you need to save more. But if you have a stable income and are okay with taking on a bit more risk, moving now is still possible.
Will interest rate hikes affect property prices?
Higher rates often slow demand, which can reduce price growth. With two rate rises already in 2026, growth forecasts are likely to come in lower than the 5–7% predicted at the start of the year. But local markets vary and it’s hard to predict. There may be opportunities for buyers and sellers who plan strategically.
