The cash rate is currently at 3.60% after the Reserve Bank of Australia changed its policy to an easing one in 2025. What Does This Mean for Perth?

• The cash rate is currently at 3.60% after the Reserve Bank of Australia changed its policy to an easing one in 2025. That shift is already having an impact on borrowing capacity, buyer confidence, and housing demand, as has the following hold at 3.6% at recent board meetings.  
• Compared to the rest of the country, Perth’s market has experienced more rapid growth. There is a shortage of listed stock, auction activity and clearance rates have increased, and several forecasting firms predict more price increases in Western Australia.
• In many suburban areas, there are still plenty of options for sellers. The current climate provides investors and buyers with increased borrowing capacity as well as fresh competition for scarce stock.  
• Bargoti Real Estate ought to be preparing for a market that includes increased buyer activity, slower local price rise, and ongoing rental constraints.

Following the central Bank’s September meeting, the official cash rate will remain at 3.6% due to headline inflation data revealed last week, which was higher than anticipated.

• The most significant annual inflation rate in 13 months was reached in August, when the monthly Consumer Price Index (CPI) increased to 3%.
• Both local and foreign factors have raised doubts about the prospects for inflation and domestic economic growth.
• Although the September decision was anticipated, buyers may be more cautious this spring as affordability pressures persist and fewer interest rate reductions are possible.
• As it awaits the inflation report for the September quarter, the Bank is continuing to exercise caution and rely on statistics. They will have a better understanding of the inflation trajectory before making a decision.
• The RBA has made it apparent that while deciding on the cash rate, it is considering the long term. Given the most recent economic data on unemployment and inflation, it was anticipated that the cash rate would remain unchanged.

Why the RBA decision matters for Perth property

In general, lower cash rates increase serviceability for potential buyers and lessen stress for variable-rate borrowers by lowering mortgage interest expenses (or at least the upward pressure).

• The cash rate was reduced to 3.6% by the RBA in 2025, and the Bank has maintained that level while evaluating new inflation statistics.
• Bank funding and credit availability are enhanced by looser financial circumstances, which frequently result in banks providing more affordable house loan packages or easing serviceability evaluations over time.
• Early indications of better credit availability after cuts are noted in the RBA commentary.As yield spreads improve and funding becomes less expensive, falling or steady rates may increase investor appetite.
• This can accelerate price movement in undersupplied categories in places like Perth, where demand has already increased in 2025.
• Easing and “data dependence” are being balanced by the RBA, which is keeping the rate at 3.6% to see if inflation keeps moving in the direction of its goal.   
• If inflation continues to rise, rate cuts might be put on hold; if it declines, more easing is probably in store, which might prolong the housing rally.
• Although Perth has its own supply and demand drivers (such as migration associated with mining, state legislation, and land-supply initiatives), local markets are equally susceptible to changes in the national economy.

In the short to medium run, the current mix—RBA easing plus constrained local supply—tends to support higher prices and better auction results.

Recent market research & headline data (picked sources)

The most significant recent data points and reports for Perth are included here; each one helps to shape the story that follows.

• Following cuts in 2025 and subsequent board holds while inflation data is analysed, the RBA cash rate is currently at 3.6%. Although it depends on data, the RBA has hinted at the likelihood of additional easing.
• According to national indices (PropTrack, CoreLogic, and Cotality), property values in several capitals continued to rise in 2025, with some months seeing faster growth. YoY growth is positive nationwide, according to PropTrack and CoreLogic statistics.
• According to recent market updates, Perth real estate values have been increasing and are “strong and accelerating.” Local analysts attribute this trend to supply and demand constraints.  
• According to the local summary, forecast houses (Westpac, NAB, and ANZ) predict mid-single-digit growth in Perth in 2025.
• Nationally, auction clearing rates have increased again; in Western Australia, clearance and private-sale activity have regained their vitality, as seen by an improvement in transactions and clearance rates during Q3 and Q4 of 2025.  
• Early October 2025 sales volumes and transaction counts are shown in REIWA weekly snapshots as varying yet active.

Housing market boosted by previous cuts

The RBA’s three rate cuts in the past six months have already helped the housing market gain traction this year, and demand will continue to be supported by the government’s extension of its first-home buyer guarantee program.

• Earlier rate decreases this year have reduced mortgage repayments for homeowners, thereby increasing confidence and borrowing capacity. Demand has been growing into the spring selling season, contributing to a coordinated uptick in the housing market.
• Compared to the sluggish conditions seen in late 2024, it represents a turnaround. This rebound is based on renewed buyer sentiment that was bolstered by the previous rate reduction.
• According to the most recent PropTrack Home Price Index, August saw a 0.5% increase in national home prices, marking the eighth consecutive month of rise. Only a few weeks ago, the increase drove home values to a new all-time high.  
• The Home Guarantee Scheme’s October extension, this year’s string of interest rate reductions, and improving sentiment are all anticipated to maintain upward pressure on home prices in the months to come, even though affordability challenges still exist.
• The government would guarantee a portion of a first-time homebuyer’s loan under the enlarged property Guarantee Scheme, allowing them to buy a property with a deposit as little as 5% and avoid paying Lenders’ Mortgage Insurance.
• The arrangement’s lack of income limitations for qualified first-time homebuyers has sparked concerns that competition for available properties may intensify, pushing up prices even more. Previously, the program was inaccessible to first-time homebuyers with higher incomes.
• Lack of new supply is making things more competitive; according to the most recent PropTrack Listings Report, both new listings and overall listings are lower than they were a year ago.
• In August, there were 8% fewer houses for sale nationwide, resulting in a 12% decrease in new listings compared to the same month last year. Although the rate may differ from city to city, the housing market is expected to continue to rise throughout the spring.
•  In the run-up to its next meeting on November 4, all eyes will be on the upcoming quarterly inflation figures as the RBA attempts to control how inflationary pressures in Australia are acting against the cash rate.

At the September board meeting, the RBA decided to take a cautious approach and maintain the cash rate at 3.6%, following a 75 basis point reduction in interest rates since February.

• After the monthly inflation index suggested considerable “upside” risk to the inflation trend, particularly from housing expenses, the outcome was largely anticipated.  
• However, rather than making too many assumptions based on the partials of the monthly inflation index, the RBA is probably going to wait for the “full” quarterly inflation update, which is scheduled to be released on October 29 (one week before the November board meeting).
• Another factor influencing the RBA Board’s decision was the ongoing tight labour market conditions, where the unemployment rate remained at 4.2% in August.
• However, labour markets are projected to soften as job growth slows gradually and vacancies trend down. This will relieve some of the pressure on wage growth and reduce the need for the RBA to hold rates steady.
• The RBA also discussed rising property prices. According to Cotality’s daily Home Value Index, housing markets nationwide have experienced a positive inflection since the first rate decrease in February, with values rising 4.7% since the cycle’s first cut on February 18.
• Every capital city and the remainder of the state have seen increases, which have reversed a downward trend in housing values that was largely apparent before February.
• Mortgage rates have contributed to the general increase in home values, but other variables are also at play, particularly on the supply side.
• With the overall advertised supply of homes for sale down 14.7% from the same period last year and nearly 20% below the previous five-year average for this time of year, the number of homes for sale in September was hanging around historic lows.  
• Every capital city has housing conditions that are below average in terms of the supply of available dwellings. Meanwhile, there is still a high demand for homes.  
• Volumes of home sales are tracking 2.7% higher than a year ago and 4.2% higher than the previous five-year average, according to preliminary data.
• The key to understanding the upward trend in house values lies in the discrepancy between supply and apparent demand for housing.
• Rates are currently on hold, but another rate cut is likely in the months ahead. On November 3rd and 4th, the RBA will hold its next meeting. As a key component of their decision-making, the board will benefit from the September quarter CPI figures during this meeting.

• Higher borrowing capacity and serviceability evaluations, as well as improved consumer attitude, are likely to boost home demand further if interest rates are further lowered.
• Another cause of increased demand for homes is the enlarged Home Guarantee Scheme, which will go into effect on October 1 and has higher price caps and no restrictions on income or location.
• We anticipate increased competition for the limited available stocks as first-time homebuyers capitalise on the stimulus, which will heighten market pressure on prices, especially near the upper limit of the price caps.

Perth market deep dive — supply, demand and pricing

One of the more robust mainland capitals this year has been Perth. Due to low market stock and increased buyer activity, monthly indices and real estate analysts predict steady month-over-month rises in the number of properties for sale in 2025. Perth is expected to grow by mid-single digits annually in 2025, according to bank and broker projections quoted in market summaries (Westpac ~+4.0%, NAB ~+4.7%, ANZ slightly higher in certain writeups).

This supports the finding that, despite improving demand, local supply is still limited.

• Within the next three to nine months, sellers of well-maintained freestanding homes in inner-ring and family suburb areas should expect to see significant results.
• Quality inner-city or coastal apartments with limited future supply are likely to outperform generic products, while units in oversupplied precincts may lag.
• Perth’s supply is becoming more limited due to several factors. Advertised postings were below average compared to historical standards.
• Infrastructure lead times and growing construction prices limit the development of new homes and the release of land (which maintains existing houses desirable).
• Although they may change segmental demand, policy changes (such as WA government subsidies or stamp duty regulations for first-time homebuyers) may not immediately boost marketable stock.
• Owner-occupier confidence has increased as a result of improved financing capacity following rate reductions; previously marginalised individuals are now re-entering the market.
• Although credit policy and serviceability checks will restrict some activity, investor returns seem more appealing as rents remain firm and capital-growth expectations rise.
• FHB demand in a few suburbs is being supported by state budget measures in WA, such as grants aimed at specific price bands and stamp duty relief.

The rental market in Perth has been tight for the majority of 2025, with low vacancy rates and rising rents, especially in inner corridors and family-friendly areas. This stimulates investor queries and strengthens the rationale for buying high-quality stock to rent.

Auction markets & clearance rates — what the numbers say

• Auction clearing rates are a sentiment indicator that is updated in real time. Preliminary clearance rates increased in the capitals earlier in 2025 and have occasionally risen to multi-month highs.
• Although not necessarily as volume-heavy as Melbourne or Sydney, WA’s results demonstrate that buyers are active and that auctions are producing favourable results in a large number of precincts.
• According to REIWA weekly snapshots, the number of active transactions in October 2025 fluctuated from week to week.
• Premium pricing can be unlocked through an auction or tender process in areas where competition is evident (many inspections, intense inquiry).
• Think of using a staged campaign (promotion + private treaty with a short closing window) to create scarcity in suburbs with shallow buyer pools.

Who wins and who loses in the short term (3–12 months)

• Sellers of family homes in well-established suburbs that are close to schools and transport. Units in desirable coastal or amenity-rich locations (limited future availability). Subdivision and land dealers are often located close to infrastructural corridors where construction is still restricted.
• Owner-occupier attractiveness is low in oversupplied apartment complexes with a large new-build pipeline. If individual lenders’ rates deviate from the headline RBA trajectory, highly leveraged owners on fixed-rate loans that reset at higher margins might still be pressured.
• In a market that is becoming more competitive, buyers who want low pricing and wait may encounter more fierce competition.

Risk factors & what could change the outlook

• The RBA may halt further easing or even tighten if underlying inflation unexpectedly accelerates again; this would slow down price momentum.
• Even if the RBA relaxes (for example, by raising serviceability buffers), banks may tighten their policies, which would limit borrower capacity.
• Gains would be moderated by a policy that considerably increases tradable stock or by an abrupt surge in new completions.
• A significant external shock, such as changes in commodity prices or a downturn in global growth, may have an impact on employment, migration, and housing demand.

Market scenarios (3-12 months) — probabilities & signs to watch

1. Base case (60%): RBA is still reliant on data; later in 2025–2026, more small decreases might be made. Perth’s prices are still rising in the mid-single digits, and vendors benefit from the good auction results due to limited supply. Watch the following indicators: vacancy rates, REIWA transaction counts, and advertised stock levels.
2. Benefit (20%): Perth’s high-single-digit growth is driven by faster easing, better lending, ongoing migration, and infrastructure announcements; bidding competition heats up. Keep an eye out for declining days-on-market and rising clearance rates.
3. Negative (20%): Lenders tighten; RBA pauses or reverses; inflation remains stubborn. Perth modifies or cools down. Be cautious of declining auction clearance rates and increasing mortgage delinquencies.

FAQ — common client questions answered

Q: If the RBA is easing, will mortgage rates drop straight away?

A: Not necessarily. The RBA sets the cash rate, but lenders’ mortgage rates reflect funding costs, competition, and risk pricing. Cuts increase the chance of lower rates, but changes by lenders can lag or vary.

Q: Is now a good time to sell?

A: If you have a well-presented property in a high-demand pocket, yes — tight supply and active buyers are working in favour of sellers. Tailor the sales method to the market signals.

Q: Should investors buy now, given rising prices?

A: Investors should weigh rental yields, vacancy risk and long-term capital prospects. In Perth’s tight rental market and constrained supply, quality assets with strong rental demand remain attractive. Do stress-test assumptions for different rate scenarios.

Conclusion

The Perth real estate market is poised for a stable yet hopeful period as a result of the Reserve Bank of Australia’s decision to keep the cash rate at 3.6%. Perth continues to outperform many other cities, driven by constrained supply, population growth, and resilient demand, as credit conditions stabilise and buyer confidence increases. This presents an excellent opportunity for sellers to capitalise on the high level of buyer interest and the lack of competition. Acting strategically is crucial for investors and buyers, who should prioritise long-term potential, find value-driven suburbs, and obtain financing as soon as possible.   

Perth’s property journey through 2025 will be defined by adaptability, informed decision-making, and the ability to seize opportunities at the right moment. With the RBA’s steady hand and Bargoti’s local market intelligence, the path ahead offers both stability and growth for those ready to make their next real estate move in Western Australia.

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