Visitor numbers at open homes are slipping just as the market seems to be finding its feet again. New figures from a major national real estate network show average attendance dropping from 3.7 to 3.3 people per inspection in the week after the latest 25 basis point rate rise, based on more than 8,700 opens and over 34,000 visitors. The pullback is most noticeable in markets such as Darwin, Perth and the Gold Coast-Tweed region but Sydney and Melbourne are also seeing fewer people through the door.
This softening interest comes after a year when cheaper borrowing costs reignited demand. Multiple rate cuts from the central bank had fuelled a jump in home loan applications, with the country's largest mortgage lender reporting its housing loan book expanding by about 7% or $38 billion over 12 months. At the same time a major real estate group has lifted its market share to around 14% nationally, reflecting how busy the sector has been even as buyer confidence now shows early signs of strain.
Behind the scenes the data shows a market that is still strong but starting to rebalance. New mortgage commitments climbed to a record $108 billion in the December quarter and first home buyer loans surged at their fastest pace in five years, rising 15.5% from the previous quarter to $19.3 billion. First home buyer activity even overtook investor loan growth, which still rose 7.9% to $43 billion after almost 19% growth in the prior quarter. Owner occupier loans increased 10.6% to $63.5 billion and the average new mortgage now sits around $638,000 with only one state clearly above that level and all others below.
Looking ahead the housing market appears to be moving into a slower and more selective phase rather than heading for a sharp downturn. One major research firm expects combined capital city prices to rise about 5% in 2026 but also suggests that further rate hikes will likely cool momentum, even as government schemes such as low deposit support and shared equity programs keep first home buyer demand in play. Official statistics indicate loan arrears remain low at roughly 1% with most borrowers ahead on repayments, yet analysts warn that investor lending appears most exposed to higher rates and could lose steam if financial conditions tighten further. With nearly 540,000 properties changing hands in the year to November, around 4.5% more than the year before, it seems sales volumes and price growth may both ease from here as higher borrowing costs gently, rather than dramatically, reshape the market.
