2-Sense podcast: Market repositions for 2026 rate hikes

2-Sense podcast

This week on the podcast Chris and I discussed the rush of first homebuyer applications overwhelming lenders, smaller block sizes being proposed for Brisbane, and the coming boom in investment in data centres.

We also discussed the rapid repricing in interest rate futures markets. 

Tune in here (or click on the image below):

You can also watch the video version on YouTube here:

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1. Download our property buying guide

Download our free property buying guide here. 

You can also check out a few of our recent property purchases here. 

Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,500 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here. 

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.

Cotality Chart Pack

Monthly Chart Pack

A quick look at a few charts from Cotality's monthly housing market update.

Prices were up by 7½ per cent over the year to November, but seem likely to be softer in the lead up to Xmas. 

After a seasonal surge of auctions in Sydney and Melbourne listings which have temporarily killed momentum in those markets, will obviously start to drop away towards the end of the year. #

Still, total listings remained about -14 per cent lower over the year by the end of November. 

Source: Cotality

Listings were particularly tight in Perth, Darwin, and Brisbane. 

Rental price inflation ticked higher for a 6th consecutive month, with rents up by 5 per cent over the year - the fastest growth in rents being in Darwin, and the slowest in Melbourne. 

Source: Cotality

The total value of new home loan financing reached a record high of $98 billion over the quarter, with first homebuyer lending now likely to lift in response to the government's deposit guarantee scheme.

You can download the full Chart Pack from Cotality here.

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1. Download our property buying guide

Download our free property buying guide here. 

You can also check out a few of our recent property purchases here. 

Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,500 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here. 

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.

4 mini-trends to think about for 2026

4 things to think on

Recent weeks have been characterised by a sharp repricing of interest rate futures, as markets ponder whether inflation risks might be reigniting (and, if so, how significantly).

There was a dribble of markets news today, which might share a few common threads.

Firstly, fixed mortgage rates are already rising in sympathy - a few details below courtesy of the red bank:

Source: Westpac broker channels

Secondly, a gradual weakening of the jobs market should in theory result in slower immigration through 2026, particularly as tighter temporary visa rules begin to bite.

That having been said, today's arrivals and departures figures showed no signs of slowing just yet.

Permanent and long-term arrivals over the year to October hit a new all-time high of 1.144 million, while net permanent and long-term arrivals over the year rose for a 9th month to +476,000.

Thirdly, the initial burst of confidence around new home sales triggered by the government's deposit guarantee may already be popping. 

Private new home sales fell by another -16 per cent in November after a decline in October, suggesting that hopes for a residential construction boom may already be tempering somewhat.

Source: Housing Industry Association

Business confidence has also fallen to the lowest levels since April as market sentiment has shifted. 

And fourthly, a recent rise in underemployment and underutilisation may result in shifts in the characteristics of the Aussie labour force.

The ABS reported today that 36 per cent of people still work from home, either some or all of the time.

Source: ABS, Shane Oliver (AMP)

While this is of course well down from the pandemic highs - when many were effectively forced to work from home - there does seem to have been a recent plateau.

It seems very unlikely that this multi-decade trend will unwind dramatically given the shifts in employer/employee expectations, yet trends in other countries (e.g. Canada) suggest that any sharp rise in unemployment could be accompanied by an equivalent jump in office and workplace attendance.

---

1. Download our property buying guide

Download our free property buying guide here. 

You can also check out a few of our recent property purchases here. 

Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,500 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here. 

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.

Employment drops in far weaker survey

Hiring slows sharply

It was a much weaker than expected Labour Force survey for the month of November 2025, with employment falling by -21,000, and full-time employment dropping by -57,000.

The 3-month average employment gain has slowed to around the +10,000 per month mark.

And the annual change in trend employment slowed to 1.3 per cent, for the slowest ex-pandemic result since late 2017. 

Meanwhile, jobs vacancies surveys have continued to moderate, suggesting further softness in hiring ahead. 

Under-employment rises

Despite this, the seasonally adjusted unemployment rate held firm at 4.3 per cent, as the participation rate fell by 0.2 percentage points to 66.7 per cent.

Weaker participation rates are often a sign of a softening labour market environment (in fact, if the participation rate hadn't weakened this year, the unemployment rate would be nearly 5 per cent already, all else being equal....h/t Callam Pickering, Indeed). 

Both the underemployment and underutilisation rates rose by 0.4 percentage points respectively in November, reflective of the weaker result. 

Finally, as a related point of interest, the Aussie population aged 15 or over grew by some +2.03 per cent over the year to November, confirming a clear reacceleration since March 2025 (when the equivalent growth rate was 1.87 per cent). 

It has been debated much this year as to whether population growth has re-accelerated in 2025. 

Answer: yes it has. 

The wrap

Overall, despite the seasonally adjusted unemployment rate holding the line at 4.3 per cent, this was a much weaker result than expected, which will serve to temper some of the more aggressive market pricing for tighter monetary policy in 2026.

Labour markets remain significantly tighter in some states (e.g. New South Wales, Queensland) than others (e.g. Victoria). 

James Foster ran through the figures in more detail here. 

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1. Download our property buying guide

Download our free property buying guide here. 

You can also check out a few of our recent property purchases here. 

Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,500 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here. 

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.

Jobs data softens a little further

Market pricing on fire

Market pricing has gone a bit nuts over recent days, with OIS pricing now implying a solid 36 per cent chance of a hike at the next Reserve Bank of Australia Board meeting on February 3 (given that there is no meeting in January 2026). 

One thing that would give policymakers some pause for thought would be if the unemployment rate starting running significantly higher, but that hasn't happened to date. 

The Aussie government's Jobs & Skills Australia reported that job advertisements fell by a further -1.3 per cent in November.

They've now retraced from the post-COVID highs of around 300,000 to 204,500, to be -7.2 per cent lower over the year.

The sharpest annual declines were seen in the ACT (-26 per cent), Tasmania (-21 per cent), and Victoria (-10 per cent), but with the other states and territories holding up pretty well. 

Roy Morgan Research reported that combined unemployment and underemployment remained elevated for a 12th consecutive month, to be markedly higher than a year earlier. 

Reported Michele Levine from Roy Morgan:

“The latest Roy Morgan employment estimates for November show overall Australian unemployment and under-employment increasing 54,000 to 3,337,000 (20.9% of the workforce, up 0.2%). Concerningly, overall unemployment and under-employment have been above 3 million for a year."

Later this morning the ABS will release the 'official' labour force survey, with the median market forecast looking for a +20,000 increase in employment, and the unemployment rate creeping only slightly higher to 4.4 per cent, seasonally adjusted. 

October's unemployment rate was 4.34 per cent, so it wouldn't take much to tip things over to 4.4 per cent again. 

---

1. Download our property buying guide

Download our free property buying guide here. 

You can also check out a few of our recent property purchases here. 

Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,500 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here. 

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.

Market repositions for a 2026 hike

Hawkish repricing

I was bored on a flight earlier, and stumbled across some notes and a report from a couple of months back which noted how government policies and expenditure had played a role in resurgent inflation across 9 of the inflation categories, sending the 3-year government bond yield romping higher to 3.6 per cent. 

Roll forward to today, and there arguably haven't been too many signs of improvement, with the 3-year yield rising to around 4.15 per cent by the close of business. 

NDIS rorts continue apace in our part of the world, and presumably in other states besides. 

The latest political expenses scandals in the media are of course in themselves immaterial, yet arguably speak to a general environment of profligacy. 

Yesterday, Treasurer Chalmers reluctantly announced that energy bill rebates would finally be axed in December in a cost of living relief shift, in doing so recognising some of the pressures on the Federal budget.

Unfortunately, this will result in higher headline inflation next year, as the transition to renewables is proving costlier than hoped or claimed. 

In the private sector, the main growth prospects seem to be data centres, and a likely to acceleration in dwelling investment. 

Today, the Reserve Bank of Australia kept the cash rate target on hold as expected at 3.60 per cent, and after an initial sign of relief, markets repriced in a hawkish manner, with OIS pricing rising to above 4 per cent for September 2026. 

While a lot can happen between now and then, a 25 basis points interest rate hike is priced in by June, with the February meeting shaping up as the first 'live' meeting depending upon how the December quarter inflation data looks. 

Source: ASX 

On the other hand, there's a bit of uncertainty about how to interpret the new monthly inflation gauge, and the RBA will presumably be looking for a further acceleration inflation before committing to a hike. 

The unemployment rate is still currently trending higher, while the NAB Survey today didn't appear to provide too much news of concern, with business confidence dropping to the lowest level since April and new orders softening. 

Cost pressures also appeared to be still trending lower on this survey, with final product prices recording only a 0.6 per cent quarterly rate, seemingly suggesting benign price pressures. 

The Aussie dollar is trading back up at 66.4 US cents as markets absorbed the apparent confirmation of the end of the easing cycle. 

---

1. Download our property buying guide

Download our free property buying guide here. 

You can also check out a few of our recent property purchases here. 

Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,500 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here. 

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.

2-Sense podcast: APRA introduces first cooling measures

2-Sense podcast

This week on the podcast, Batesy and I discussed inflation returning to above the target range, the speeding up of residential construction, and whether Australia is becoming a nation of renters. 

We also discussed APRA's first macroprudential measures for housing in this market cycle, and covered some of your questions in the listener Q&A segment.

Tune in here (or click on the image below):

You can also watch the YouTube version here:

---

1. Download our property buying guide

Download our free property buying guide here. 

You can also check out a few of our recent property purchases here. 

Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,500 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here. 

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.

Normal service to resume shortly

Blog latest

Just been taking a few days out at the cricket.

Don't think I've missed an awful lot.

Stock markets in the US are flirting with all-time highs.

Market pricing is beginning to think about the next move in interest rates in Australia being up (and the potential timing thereof). 

Back to the blog forthwith.

GDP per capita slides, but...

GDP per capita stalls

A lightning-quick tun through the national accounts in a two-minute read. 

The Aussie National Accounts recorded a disappointing 0.4 per cent real GDP growth for the September quarter, and 2.1 per cent growth over the year.

Given strong population growth, GDP per capita actually fell back a fraction over the quarter.

The quarterly result was held back by net exports and inventories, but the underlying trend for consumer demand and dwelling investment seems to suggest stronger growth ahead. 

Of course, we've had big population growth and above-target inflation of late.

Nominal GDP was 1.7 per cent higher over the quarter, and some 5.4 per cent higher over the year, at a fresh new high. 

For households, housing interest paid continued to slide as more attractive mortgage rates have become available to borrowers. 

In turn, this allowed the household saving ratio to rise a little. 

James Foster ran through the national accounts in more detail here. 

The wrap

Overall, the headline result was pretty disappointing, but the underlying figures seem to point towards an ongoing recovery, with a hawkish-sound RBA adding to the belief that the next move in interest rates will be up. 

On the plus side it appears that productivity may be improving as supply in the economy normalises, so hopefully this should help inflation to ease back into the target band in 2026.

---

1. Download our property buying guide

Download our free property buying guide here. 

You can also check out a few of our recent property purchases here. 

Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,500 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here. 

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.

ausbiz TV: Pete's property take, a 2026 apartment wave

ausbiz TV

I joined Andrew at ausbiz TV to discuss the latest property news.

Tune in here (or click on the image below):

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1. Download our property buying guide

Download our free property buying guide here. 

You can also check out a few of our recent property purchases here. 

Get in contact with us today if strategic property investment is your thing. 

    2. Subscribe to our Top 10 Podcasts for Investors

Listen in to our podcasts

The Australian Property Podcast is rapidly becoming one of Australia's biggest business podcasts, now with well over 50,000 audio downloads per month, and growing fast.

And our popular Low Rates High Returns Show also remains available on Spotify.

    3. Subscribe for my free daily blog

Subscribe for my free daily blog with more than 4 million hits here. 

You can also catch up with me daily on Twitter here, where I'm far too active daily and have over 15,500 followers. 

By the way, I'm an 8-times published author on finance, investing, and business, so you can check out some of my books here. 

My new book, co-authored with Cate Bakos is available to buy here or on Amazon here - check out our free Buy Right podcast series here. 

4. Work with me privately

For a limited time you can book in a free diagnosis call with me here, so book in a call today.