RBA Cuts Rates Again, House Prices Rise: What It Means for Migrants and International Students

The Reserve Bank of Australia (RBA) has cut the cash rate for the third time this year, bringing it down to 3.6%. While this is welcome news for existing mortgage holders — saving around AUD 120 per month on a $750,000 loan — it presents another challenge for first-home buyers and newly arrived migrant families: house prices are expected to rise further, worsening affordability pressures.

According to HSBC, Australian house prices could increase by 4% to 9% in 2026. This means that while borrowing capacity has slightly improved (about AUD 12,000 extra for a single full-time worker, or AUD 24,000 for a dual-income couple), these gains are likely to be cancelled out by rising property prices.

Source: Internet

Challenges for Migrant and Student Families

For skilled migrants, international student families and graduates hoping to remain in Australia, the latest market trends create several practical issues:

1.Greater barriers to first-home ownership

Housing supply has long lagged behind demand. With lower rates stimulating purchases, limited supply is likely to push prices even higher, making it harder for first-time buyers to enter the market.

2.Ongoing rental pressure

Increased competition in the housing market may also drive up rents, putting further strain on student visa holders and Temporary Graduate (subclass 485) visa holders who already face high living costs.

3.Longer asset accumulation timelines

For migrants hoping to build financial stability through property investment, rising entry costs mean it will take longer to reach the security required to support long-term settlement and visa strategies.

Policy and Migration Context

Property ownership in Australia is not just about investment — it often intersects with visa and migration planning:

• Business and investment visas (e.g. 188/188C/132 transitional streams): Real estate is not a primary qualifying investment, but asset composition can affect financial capacity requirements and compliance checks.
• Student and graduate visa holders: Rental costs and overall living expenses directly affect financial evidence for visa renewals, which can influence approval outcomes.
• Skilled migration and employer sponsorship: While mainly based on occupation and work experience, the ability to demonstrate stable settlement in Australia — including managing housing costs — is a practical factor in success.

Riverwood’s Advice: How to Respond

1.Plan entry timing carefully

For those committed to staying in Australia, consider securing property earlier in the easing cycle, before price growth is fully realised.

2.Look to regional areas

While Sydney and Melbourne are expected to see stronger price increases, regional centres such as Adelaide, Hobart and Darwin remain more affordable and come with additional migration incentives.

3.Balance study, visas and housing costs

With rent and tuition fees both rising, families should integrate housing considerations into study and visa planning to avoid financial strain that could compromise visa compliance.

The RBA’s rate cuts may ease mortgage stress in the short term, but over time they risk fuelling further house price growth and worsening affordability. For new migrants, international students and their families, the message is clear: the earlier you plan, the better positioned you are to manage costs and secure long-term stability in Australia.

If you have any questions or would like professional assistance, please feel free to contact us at Riverwood Migration (Email: [email protected]). We are committed to providing transparent, expert migration services to help you achieve your dream of moving to Australia.