Forget predicting the property market.
Watch these three numbers instead.
Interest rates and house prices dominate the property conversation. But three other numbers can give you a clearer picture of whether buying could be within reach.
Interest rates. House prices. Reserve Bank announcements. Auction results.
If you're thinking about buying a property, it's easy to get caught up in the headlines.
Debating property prices is a favourite Aussie pastime. But the headlines don't necessarily help you understand your own situation. They don't tell you whether you're ready to buy.
Why cheaper doesn’t necessarily mean more affordable
It sounds logical: if property prices fall, buying should become easier. But that's not always how it works in practice.
A cheaper property isn't always easier to buy. If interest rates are higher or your expenses have gone up, your borrowing power may still be lower than it was a few years ago.
What price doesn’t tell you
These days, affordability is about more than just the property's price. Interest rates are higher than they were a few years ago, and many households are feeling cost-of-living pressure.
Interest rates are also only one part of the picture. Many Australians are still dealing with higher everyday costs, from insurance and council rates to fuel and groceries.1
What matters isn't just whether you can buy the property. It's whether the repayments fit comfortably within your budget.
This is something lenders refer to as serviceability.
Put simply, serviceability is a way lenders work out whether you can comfortably afford loan repayments. Lenders will generally consider things like your income, regular expenses and any debts you might have when working out how much you may be able to borrow.
Different lenders can assess the same financial situation differently, which means a 'no' from one lender doesn't necessarily mean your options have run out.
At Pepper Money, we look at your overall financial situation rather than focusing on a single number.
Three numbers worth watching
Interest rates and house prices lead news bulletins, social posts, school pick-ups and knock-off drink conversations. Whether rising or falling, these figures don't give you the complete story.
So if interest rates and house prices don't tell the whole story, what could you focus on instead?
Here are three numbers that may give you a clearer picture of whether buying could be within reach.
1. Your borrowing power
This is an estimate of how much you may be able to borrow. And it’s serviceability that helps determine your borrowing power, as well as the type of loan you’re applying for. Interest rates can also have an impact because lenders generally consider whether you'd still be able to afford repayments if rates increased.
Borrowing power isn't the same for everyone, and it isn't always the same from lender to lender. A ‘no’ from one lender doesn’t necessarily mean a ‘no’ from all.
That's why it's worth understanding all your options. Some lenders have different eligibility requirements and may look at applications differently.
Pepper Money’s lending criteria are different from traditional lenders and may help customers who don't meet standard bank criteria.
Pepper Money borrowing power factors
Understanding your borrowing power, and what influences it, can give you a clearer picture of what you may be able to afford.
Looking for a clearer picture? Check your borrowing power^ with our borrowing power calculator.
2. Your financial breathing room
One of the most important questions isn't:
What's the most I can borrow?
It's:
What can I comfortably afford?
Your financial breathing room is the money left in your budget after paying for your home loan and everyday costs like groceries, power bills, childcare, insurance and other debts. Then there’s what might happen if things change. Would your budget still work if your income changed or if the cost of living keeps increasing? And don’t forget expenses you may have coming up, like an ageing car that needs replacing or home repairs.
RBA data in August 2026 shows scheduled mortgage and consumer credit payments were taking up just under 12% of household disposable income in the June quarter of 2026, close to their 2024 peak.2
The goal isn't necessarily to borrow the maximum amount available. It's to find a loan that still leaves room for the things that matter to you.
Try different loan amounts and repayment scenarios with our home Loan repayment calculator* to see how they could fit into your budget.
3. The level of competition in your local market
National property trends make headlines, but they don't always tell you what's happening in the suburbs where you're looking.
Australia, or even a state or territory, isn't one property market. The local trends in the suburbs where you're looking may be very different from the capital city or national story.
Nationally, in August, home prices fell for a fifth month, marking the largest slide since the pandemic.3
If you're keeping an eye on the market, it's worth looking beyond prices. The number of properties for sale, how quickly they're selling and how competitive auctions are can all give you a better sense of what's happening locally.
Know your numbers
Being knocked back by one lender doesn't always mean buying isn't possible. Understanding why you got a ‘no’ could open up other options.
No matter the market, experience tells us there’s no perfect time to buy property. But there may be a better time for you.
Instead of trying to predict the market, focus on understanding your own numbers. What can you afford? What options are available to you? And does buying feel right for you right now?
One thing hasn't changed: the market doesn't decide when you're ready to buy. Your circumstances do. And everyone's situation is different.
Sources:
1, 2 The RBA's Statement on Monetary Policy August 2026: Financial conditions. https://www.rba.gov.au/publications/smp/2026/aug/financial-conditions.html
3 Cotality 2026: Housing downturn spreads as 93% of capital city suburbs record winter value falls. https://www.cotality.com/au/insights/articles/housing-downturn-spreads-as-93-of-capital-city-suburbs-record-winter-value-falls
Contributor | Vasè Marcevska, Head of Direct Sales – Mortgages and Personal Loans
Vasè has over 16 years of experience in the Banking and Finance sector, specifically within the Third Party and Consumer lending industry. Her expertise now focuses on enhancing our Customer program through a deep understanding of mortgage origination and service excellence across our Financial products.
Published by Pepper Money. Read our Editorial Policy to learn how we create and review content.
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