Melbourne Property: Low Stock, High Emotion – Why a 0.25% Rate Cut Might Move the Needle
In This Week’s How's The Market | Edition 113
Melbourne Property: Low Stock, High Emotion – Why a 0.25% Rate Cut Might Move the Needle
A Rare Synthesis of Form, Function, and Environment
Buyers Eye CBD Growth Potential as Studios Vanish from Atlas Tower Listings
Melbourne Property: Low Stock, High Emotion - Why a 0.25% Rate Cut Might Move The Needle
Melbourne’s property market is heading into winter and running on fumes when it comes to stock - and buyers are starting to feel the pressure.
Right now, we’re still seeing incredibly low levels of new listings.
Especially for A-grade properties.
In fact, new listings are down 16% compared to this time last year, with total stock sitting nearly 3% below 2024 levels.
For context, that’s despite increased demand across family-friendly suburbs, blue-chip postcodes, and downsizer hotspots.
If you're looking to buy, chances are you’ve noticed the lack of choice.
But here’s where it gets interesting: we’ve just had another interest rate cut - down 0.25% - and while the monetary impact on borrowing power is relatively small, the emotional impact can’t be ignored.
Back in February, when the RBA dropped rates by 0.25% we felt the uplift in sentiment almost immediately.
More enquiry, more urgency, and more buyers stepping off the sidelines. It didn’t dramatically change what people could afford, but it changed how they felt about making a move.
That shift was noticeable on the ground.
I suspect this rate cut might have the same effect and get a few more people into the mix which could increase competition and that would be the real reason prices go up.
Confidence is the real fuel behind most real estate markets and Melbourne is no exception.
Rate cuts tend to be seen as a signal that we’re on the other side of the tightening cycle.
They help buyers feel more certain, more willing to engage, and more motivated to act before prices rise further.
What does this mean for sellers?
Winter may be one of the best windows to act. With less competition from other vendors and growing buyer confidence, you’ve got a chance to stand out. Waiting until spring might feel “safer,” but you’ll be launching into a more crowded market.
Right now, scarcity is your advantage.
For buyers?
Expect more competition, not less.
A rate cut doesn’t flood the market with new stock overnight - but it does bring more buyers out of the woodwork. And in a market with limited options, that extra demand can drive faster decision-making and stronger prices.
So while the actual dollars from a 0.25% cut might not stretch your budget dramatically, don’t underestimate the power of sentiment. In this environment, confidence is currency.
What The Agents Are Saying
Less than expected stock coming online.
Many agents have told me they don’t have a shortage of buyers.
And they don’t necessarily have a shortage of stock in general but there is a shortage of good quality stock.
One of the ways this is flowing through the market and holding up stock is because many vendors are also buyers.
Because there is a shortage of good quality stock, many vendors have decided that they would prefer to buy with a longer settlement prior to listing their properties online.
They have agents lined up and ready to list, but sometimes 6 months pass and they still haven’t found a property to buy.
This means there is a delay in their property coming online and in general a chain of properties set to come.
The Wow Factor!
47 Murphy Street, South Yarra, Vic 3141
South Yarra is going off at the moment in the upper end market!
This is now multiple weeks in a row that new listings have come online above $20m…
And this one is another show stopper.
This is another property in South Yarra that has a pool on the roof too.
Crazy.
In one of South Yarra's best pockets, this is a 4 storey design of extreme modern luxury.
Insane views, high quality finishes throughout, 5 car basement garage with a turntable plus way more.
Price Guide: $27,000,000 - $29,500,000
In The Media
Melbourne CBD skyscraper sells out studios as buyers rush into $1bn Atlas tower
An interesting read regarding the inner city apartment market.
“Atlas has really resonated with the market. It’s the first supertower to launch in the CBD in about five years and that’s created a lot of pent-up demand,” Mr Storey said.
“We’ve seen other buildings sell in recent years, but nothing of this scale or freshness.
“Buyers, especially younger international buyers in their late 20s want that city lifestyle, they want quality, and they want a product that feels like it belongs.”
“The average age of a CBD resident is 28. Most live in households of under two people, and over 90 per cent are born overseas,” Mr Storey said.
“That’s who we designed for. Not just affordability, but lifestyle and status.
“The studio apartments were a big part of them and they were gone in a flash.”
Final Thoughts
Listings are low and sentiment might just rise putting pressure on prices across Melbourne.
Especially for A-grade stock
If you or someone you know would like assistance to buy this year, book in a call and we can discuss if we can help.
Thanks for reading this far!
We value feedback and if you have any suggestions on what you would like covered in the future please email me at tristan@tomii.com.au
Happy Buying!
Note: This is general advice and does not take into consideration your objectives, situations or needs. Please consider if this advice is suitable for you and your circumstances and speak to a professional before making any financial decisions.
