The Reserve Bank of Australia (RBA) has made its latest cash rate decision and the outlook is looking increasingly positive for buyers considering off-the-plan properties. With inflation tracking downward and home prices continuing to rise, the market presents a strong opportunity for those looking to secure a new home or investment.
The federal budget delivered a surprising yet welcome boost of confidence for future rate cuts. Treasurer Jim Chalmers confirmed that inflation is expected to return to the target band by mid-year—six months earlier than previously anticipated. This development is encouraging for buyers as it increases the likelihood of further rate cuts in 2025.
Despite recent geopolitical tensions, major banks, including Westpac, National Australia Bank and Commonwealth Bank, are expecting up to three more cash rate cuts this year. Even the more conservative ANZ forecasts at least one rate cut in 2025, likely by August. While the RBA remains cautious due to a strong labour market, the downward trend in inflation and easing financial pressures are positive indicators for homebuyers.
The February rate cut, the first in over four years, had already reignited buyer demand, boosting borrowing capacities and market activity. With economic conditions improving, off-the-plan buyers stand to benefit from enhanced affordability and increased confidence in the market.
Recent data from the Australian Bureau of Statistics confirms that both headline and core inflation continue to soften. The Labor government’s extension of energy rebates until the end of the year is expected to dampen headline inflation, but the RBA remains focused on the underlying economic trends. Additionally, household spending remains strong, rising 0.4% annually and 1.5% month-on-month in January 2025, driven by increased spending on health, transport and travel.
These trends strengthen the case for further rate cuts, making home loans more affordable for buyers. For those looking to purchase off-the-plan, this presents an ideal opportunity to secure a property now and take advantage of potentially lower mortgage repayments by the time settlement arrives.
National home prices rose by 0.27% in March, marking a 48% increase over the past five years. February’s rate cut played a pivotal role in boosting buyer confidence, bringing hesitant buyers back into the market.
“Market sentiment has improved and buyers who had delayed purchasing decisions due to sustained higher interest rates are likely re-entering the market,” said REA Group senior economist Eleanor Creagh.
For off-the-plan buyers, these price trends reinforce the value of securing a property at today’s price while benefiting from potential capital growth before settlement.
Melbourne remains a crucial battleground for both major political parties, highlighting the city’s economic and demographic importance. Despite some economic uncertainty, Victoria is still expected to experience significant population growth, with 544,000 new residents forecast by 2029. The state’s relative affordability compared to other capitals is a major drawcard.
However, Victoria’s economy faces challenges, with a projected state debt of $187.8 billion and new property taxes introduced to service it. While federal funding has provided some relief, concerns remain about population growth slowing if net overseas migration declines. Nevertheless, Melbourne is still forecast to experience an increase in net interstate migration in 2025-26 and 2026-27, reinforcing its long-term growth potential.
This affordability, coupled with increasing net migration, creates a prime opportunity for off-the-plan buyers. As population growth drives housing demand, locking in an off-the-plan property now ensures buyers can capitalise on future price increases and rental demand.
With borrowing capacities increasing and market sentiment improving, off-the-plan purchases with Norus offer a compelling opportunity. Buyers can lock in a property at current prices while avoiding immediate mortgage repayments. If interest rates decline further, those settling in the future will benefit from more favourable loan conditions, making homeownership more accessible.
Norus’ off-the-plan developments provide high-quality, future-focused living spaces designed to maximise comfort and investment potential. With projects in sought-after locations like Sandringham, Ivanhoe and Burwood, buyers have a unique opportunity to secure a premium property in a thriving community. As the market shifts in favour of buyers, now is the perfect time to invest in an off-the-plan home for long-term gains.
The latest RBA update signals a promising outlook for off-the-plan buyers. With inflation easing, potential rate cuts ahead and rising property values, now is an opportune time to secure a new home or investment with Norus. Coupled with Melbourne’s projected population growth and affordability advantage, off-the-plan properties offer strong potential for capital appreciation and rental demand. Don’t wait, take advantage of the favourable market conditions and explore your off-the-plan options today.
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