Interest Rates Are Rising Again. Should Property Buyers Be Worried?

By Byron Rose | Director, Rose & Jones
Published: 1 October 2026 | Market Update

Interest rates are back in the headlines following the Reserve Bank’s latest decision. While higher rates can affect borrowing power, they can also create opportunities for informed buyers who understand the market and have a clear strategy.

The Reserve Bank of Australia (RBA) has lifted the cash rate by a further 0.25%, taking it to 4.60%, its highest level since 2011. According to Domain, the latest increase means the average borrower with a mortgage of around $736,000 could soon be paying approximately $427 more per month, or more than $5,000 per year, compared to the start of 2026. [domain.com.au]

While the headlines focus on higher repayments and reduced borrowing capacity, periods of uncertainty can often create opportunities for well-prepared buyers.

Property analysts expect the latest increase to keep buyer activity subdued as affordability pressures continue to impact the market. However, a quieter market isn’t necessarily a bad market. [savings.com.au], [domain.com.au]

While some areas of Sydney have experienced softer conditions, quality homes across many Eastern Suburbs locations continue to attract strong buyer demand due to limited supply, strong lifestyle appeal and long-term owner-occupier demand.

When fewer buyers are competing:

• Vendors are often more realistic.
• Negotiations can become more balanced.
• Buyers have more time to complete due diligence.
• Competition for quality properties can ease.

According to Rose & Jones Director Byron Rose, experience becomes particularly valuable during periods like this.

“Over the past 28-plus years, we’ve seen multiple interest rate cycles, economic ups and downs, and changing buyer sentiment. While every market is different, certain patterns tend to repeat themselves. The key is understanding what stage of the cycle we’re in and adapting your strategy accordingly.”

Focus on the Right Property, Not Perfect Timing

When markets become uncertain, many buyers ask:

• Should I buy now?
• Should I wait six months?
• Will prices fall?

While understandable, these are often the wrong questions.

The better question is:

“Am I buying the right property?”

In our experience, buyers rarely regret purchasing a quality property in a tightly held location. What they often regret is missing an opportunity because they were waiting for the perfect moment.

Property cycles come and go. Quality assets tend to endure.

Why Experience Matters

At Rose & Jones, we’ve spent more than 28 years exclusively representing buyers through changing market conditions, interest rate cycles and economic uncertainty.

That experience extends beyond understanding property values. It includes recognising market patterns, understanding buyer and seller behaviour, and knowing where opportunities are likely to emerge when conditions shift.

As Byron Rose explains:

“Interest rates are important, but they’re only one piece of the puzzle. What matters most is whether you’re purchasing the right property, in the right location, at the right price and with the right strategy.”

Where a Buyers Agent Adds Value

Markets like today’s are often where a buyers agent can provide the greatest benefit.

Our role is not to predict interest rates. It’s to help clients make informed decisions based on experience, evidence and local market knowledge.

That includes:

• Identifying quality opportunities, including off-market properties.
• Providing objective advice.
• Conducting thorough due diligence.
• Understanding market value.
• Negotiating from a position of experience.

After more than 28 years advising buyers throughout Sydney’s Eastern Suburbs and beyond, we understand how markets typically behave during periods of uncertainty and how buyers can position themselves to take advantage of emerging opportunities.

The Bottom Line

Interest rates influence affordability and borrowing power, but they are only one factor in the property equation.

For buyers with a clear strategy and a long-term outlook, opportunities still exist.

As Byron Rose notes:

“The buyers who achieve the best results aren’t necessarily the ones who perfectly time the market. They’re the ones who understand their objectives, have a clear strategy and are prepared to act when the right opportunity presents itself.”

Thinking about buying in Sydney’s Eastern Suburbs?

Interest rates may influence the market, but they don’t change the fundamentals of successful property buying.

With more than 28 years of experience representing buyers, Rose & Jones can help you navigate changing market conditions and identify the right opportunity.

Call Rose & Jones on (02) 9327 6944 or visit our website to arrange a confidential discussion about your property goals and the opportunities available in today’s market.

FAQs

Q: Should I buy property when interest rates are rising?

A: Rising interest rates can reduce borrowing capacity, but they can also create opportunities through reduced competition and improved negotiating conditions.

Q: How do interest rates affect property prices?

A: Higher interest rates generally reduce borrowing power and can soften demand, although the impact varies between locations and property types.

Q: What does a buyers agent do during uncertain market conditions?

A: A buyers agent assists clients with research, due diligence, negotiation and identifying opportunities, helping buyers make informed decisions based on market conditions.

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Data sources:

1. RBA interest rate decision LIVE: September 2026 cash rate announcement, Domain. The RBA increased the cash rate by 25 basis points to 4.60%, the highest level since 2011, and noted ongoing inflationary concerns. [domain.com.au]
2. LIVE RBA September Cash Rate Decision, Savings.com.au. Higher interest rates are expected to reduce borrowing capacity and keep housing demand and transaction activity subdued. [savings.com.au]

Figures accurate as at 30 September 2026.