What happened
Pitcher Partners Sydney Private Wealth forecast one more RBA cash rate hike by early 2027 before policy holds. The firm noted mortgage applications fell between 12% and 20% across major banks following federal budget changes curbing negative gearing and raising capital gains tax. Meanwhile, national home prices fell for a sixth consecutive month in September, sitting 3.3% below their March 2026 peak.
Why it matters here
Reduced investor borrowing weakens housing market turnover and puts downward pressure on residential property valuations nationwide. Bank net interest margins will likely tighten as lenders compete aggressively for a shrinking pool of home loans. Conversely, commercial business credit grew 10.6% over the year to July, indicating a divergence between residential mortgage weakness and ongoing business investment.
What to watch
Major bank quarterly trading updates to track mortgage book growth and net interest margin guidance amid slowing residential credit demand.
Source
mpamag.com