Prices, competition, and pressure are climbing — here’s what to know
After a year of steep rental hikes, tight supply, and cautious optimism around rate cuts, momentum in the Australian property market is accelerating fast. And Rodney McLoughlin says we’re only at the beginning of what could become a powerful surge.
First Home Buyer Scheme Fuels Urgency
The recently expanded federal government scheme — which allows first homebuyers to purchase with just a 5% deposit and no mortgage insurance — is driving intense demand. With income caps and place limits removed, more buyers are entering the market, and many are doing so quickly to avoid being priced out.
Rodney McLoughlin points out that this wave of demand is already visible at the lower end of the market, where competition is fierce. In some areas, homes priced under $1 million are attracting significantly more buyer interest than earlier in the year. It’s a clear sign that affordability schemes, even with good intentions, are pulling forward demand and applying immediate upward pressure on prices.
Rental Pain Pushes Tenants Into Buying
Sydney tenants are feeling the strain. The median rent for units has climbed to a record $750 per week, while vacancy rates remain tight at just 0.9%. Many tenants are now choosing to buy, not necessarily because they’re ready, but because renting has become unsustainable.
Rodney McLoughlin notes that this pivot from renter to buyer is accelerating homeownership transitions. But without a significant uplift in housing supply, this trend risks deepening affordability problems rather than solving them.
Construction Delays Risk Undermining Growth
Despite demand surging, new home construction is severely lagging. While there are more than 80,000 homes in planning stages across Western Sydney, only a fraction are under construction. Rodney warns this mismatch is a major issue — particularly with large infrastructure projects like the Western Sydney Airport expected to draw thousands more into the region.
If approvals don’t translate into builds, price inflation will only worsen. Rodney believes targeted reforms must prioritise areas under real population pressure, not just well-connected inner suburbs.
Buyers Are Stretching – And That’s a Risk
Rodney is also seeing a growing trend: buyers are pushing themselves financially to secure homes. Whether it’s fear of missing out or confidence in future price growth, the result is often bidding wars and rising auction results. But Rodney urges caution — stretching too far could become problematic if interest rates rise again or if market momentum stalls.
What’s Next?
Rodney McLoughlin anticipates continued buyer strength into 2026, especially in Sydney and Melbourne. But he warns that unless housing supply catches up, affordability will deteriorate further — both for buyers and renters.
He advises clients to act strategically: understand your borrowing capacity, look for value in less saturated suburbs, and be ready to act fast when the right opportunity comes up.
Real Estate Newsletter
This article is a curated summary of various news stories from the past week, offering insights and updates on the real estate market. 10 October 2025.
Rodney McLoughlin is a trusted real estate professional with deep insights into the Australian property market. For personalized advice and market expertise, reach out to Rodney today.
