Broker Notes – 13 June 2026

NAB Declares the Cash Rate Has Peaked, and the Next Move Is a Cut

On 9 June, National Australia Bank’s economics team issued a forecast that reset the narrative around Australian interest rates. NAB has abandoned its previous call for a further 25-basis-point hike in August and now believes the cash rate has reached its ceiling for this cycle at 4.35 per cent. The next move, the bank says, is likely to be down.

The timing matters. The RBA’s Monetary Policy Board meets on 16 June, and Westpac remains the only major bank still forecasting another hike. CBA and ANZ had already called a hold. Three of Australia’s four biggest lenders now share the same base case: 4.35 per cent is the peak, and cuts will begin sometime in 2027.

NAB has brought its first expected rate cut forward from the second half of 2027 to the second quarter of 2027, and forecasts the cash rate to close 2027 at 3.6 per cent. “The next move in the cash rate is likely to be down, but the timing is uncertain,” NAB said, pointing to ongoing uncertainty in both the labour market and inflation outlook as reasons not to put a firm date on the first cut.

NAB was also pointed about the broader effect of the federal government’s investor tax changes. The bank described the budget’s negative gearing and capital gains changes as “an exogenous tightening of financial conditions,” meaning they act like an additional interest rate increase on top of the three already delivered. Lenders have already cut maximum loan values for investors by around 20 per cent in response. NAB forecasts investor mortgage credit growth to decline to negative 1.4 per cent by the end of 2027 — a level the bank compared to credit contractions seen during the early 2000s and the Global Financial Crisis.

CBA’s Warning: Some First Home Buyers Face Negative Equity Risk

The Commonwealth Bank of Australia has published updated price and credit forecasts that put specific numbers on the risk facing low-deposit buyers in Sydney and Melbourne. CBA now expects Sydney dwelling prices to fall around 6 per cent through 2026, with Melbourne forecast to drop 7 per cent over the same period.

The numbers become confronting when applied to real borrowers. CBA modelled a first home buyer who used the federal Home Guarantee Scheme to buy a $1.5 million property in Sydney with a 5 per cent deposit. After a year of principal and interest repayments and a 6 per cent price fall, that buyer would finish 2026 with just $2,377 in equity. In Melbourne, a buyer who paid $950,000 with a 5 per cent deposit would be nearly $8,000 underwater by year end — owing more than the property is worth.

CBA senior economist Trent Saunders said the budget tax changes accelerated a slowdown already under way. Investor new loan numbers are forecast to fall from around 60,000 in the December 2025 quarter to approximately 32,000 by the end of 2026. Owner-occupier new loans are expected to slide from around 90,000 to about 70,000 over the same period. Borrowers who are concerned about where their property sits relative to their loan balance may find it worthwhile to speak with their lender or broker about their current position.

CBA was careful to note that the outlook was not permanently bleak. The bank expects lending to recover through 2027 as uncertainty eases and interest rates eventually decline. The recovery, however, depends on how quickly and deeply the RBA begins cutting.

Negative Gearing and CGT Changes Have Passed the Lower House

The first tranche of the federal government’s housing tax legislation formally cleared the House of Representatives on 5 June 2026. The changes, announced on budget night on 12 May, restrict negative gearing on established residential properties and overhaul the capital gains tax discount for most asset classes from 1 July 2027.

Under the legislation now before the Senate, investors who purchase established residential properties from budget night onwards can no longer offset rental losses against wage income. They can still offset losses against other property income. Investors buying new builds retain full access to negative gearing. Properties purchased before 12 May 2026 are grandfathered under the existing rules.

The CGT changes are more far-reaching. From 1 July 2027, the existing 50 per cent discount on capital gains is replaced by a system of cost base indexation combined with a minimum 30 per cent tax on gains. Investors in new residential property can elect to retain the 50 per cent discount. The changes extend beyond residential property to shares, commercial assets, and small business interests. The tax implications of any decision to buy, sell, or restructure an investment portfolio are significant, and a qualified tax professional is the appropriate starting point for understanding how the new rules apply to any individual’s circumstances.

Building Approvals Keep Slipping as Housing Accord Target Falls Further Behind

Total dwelling approvals fell 3.4 per cent in April to 16,710, following a 10.5 per cent drop in March. Private sector house approvals edged down 1 per cent to 10,088 — the third consecutive month above 10,000, a level last sustained in late 2021. Apartment approvals rose 9 per cent in April to 4,108, driven largely by New South Wales.

But the broader picture for the government’s National Housing Accord is stark. Research shows that just 268,445 dwellings were built in the first 18 months of the Accord’s five-year window. At the current pace of around 44,741 completions per quarter, reaching the 1.2 million-home target requires completions to lift by 49 per cent — an additional 7,266 homes per month, every month, for the next three and a half years.

NSW carries the heaviest burden. Despite holding around 31 per cent of Australia’s population, the state accounts for just 26 per cent of completions and sits an estimated 39 per cent behind its population-weighted share of the target. NSW alone accounts for an estimated half of the national monthly shortfall. Victoria and the ACT, by contrast, are tracking broadly in line with their targets.

8 in 10 New Home Loans Are Now Written by Mortgage Brokers

Brokers wrote 81 per cent of all new residential home loans in the March 2026 quarter — the highest figure on record since the MFAA began tracking broker market share. Cotality’s data shows the broker channel settling $124.88 billion in new loans during the quarter, up $25.51 billion on the same period in 2025.

The 81 per cent figure is up from 76.8 per cent a year ago, 74.1 per cent in March 2024, and comfortably above the previous record of 76.7 per cent set in December 2025. Australia now sits alongside the United Kingdom and the Netherlands as one of only three countries where brokers facilitate more than 80 per cent of all new mortgage lending.

MFAA chief executive Anja Pannek attributed the result to the complexity borrowers are navigating in the current environment. “When more than eight in ten new home loans are being facilitated by brokers, it shows the trust consumers are placing in the channel and the value they see in having expert guidance through an increasingly complex lending market,” she said.

Key Takeaways