75% of Australian Homebuyers Would Cut Spending to Own Property — and They're Waiting for a 4.9% Mortgage Rate

Key takeaway: A new survey finds 75 per cent of Australian buyers are willing to cut back spending to buy a home, but most are waiting for mortgage rates to hit 4.9 per cent — a target that may be months away for standard borrowers yet reachable now for self-employed applicants through non-bank Alt Doc lenders.

Three in Four Buyers Are Ready — But Not Moving Yet

New survey data published by Australian Broker on 25 September 2026 reveals that 75 per cent of prospective Australian homebuyers are willing to cut back on discretionary spending to achieve homeownership. Yet the majority are holding their position, waiting for one specific market signal: mortgage rates at or below 4.9 per cent.

This figure sits above the current RBA cash rate of 4.35 per cent (effective August 2026) and reflects the all-in rate borrowers expect once lender margins are added. Australia's annual CPI stands at 3.5 per cent (ABS, July 2026) and unemployment is 4.6 per cent (ABS, August 2026), meaning the economy has not fully cooled and the RBA has maintained a cautious stance heading into its September 29 decision.

The waiting pattern the survey captures reveals something important: demand is there. It is being suppressed by rate expectations, not by a structural unwillingness to own property.

Why 4.9% Is the Psychological Threshold

The 4.9 per cent figure is not arbitrary. It represents the level at which buyers calculate monthly repayments become manageable relative to their income. At Australia's current average weekly full-time earnings of $2,083.70 (ABS, May 2026), a $700,000 mortgage at a rate of around 4.9 per cent over 30 years on a principal and interest basis costs approximately $3,720 per month — roughly 45 per cent of a single full-time income before tax.

For dual-income households, this calculation shifts significantly in favour of action. For single-income households — which describes many self-employed individuals who run their business accounts separately from personal finances — the path to 4.9 per cent can feel distant.

Understanding where the 4.9 per cent figure comes from helps borrowers make a more rational decision: it is a comfortable repayment threshold, not a magical entry signal. Many borrowers can already clear that serviceability bar today, even at current rates, depending on their income structure and deposit size.

The Self-Employed Buyer's Different Equation

For self-employed borrowers, the 4.9 per cent threshold may already be accessible — but through a different route. Non-bank lenders currently offer Alt Doc variable rates from approximately 6 per cent, with more flexible income verification, faster approvals, and access to properties that might be declined by major banks during declining-market LVR reviews.

More importantly, self-employed borrowers waiting for major bank rates to hit 4.9 per cent may be waiting for a number that never applies to them. Major banks assess self-employed income conservatively — often discounting the income figure accepted for serviceability purposes. A non-bank Alt Doc assessment may actually give a self-employed borrower a higher approved loan amount than a major bank would offer at 4.9 per cent, despite the slightly higher interest rate.

"The buyers who are waiting for 4.9% may never reach that number through the major banks. Non-bank Alt Doc products offer a different calculation — one based on demonstrated business income, not conservative payslip equivalence."

What Buyers Should Do Before September 29

The RBA's September 29 decision is the next major inflection point. If the cash rate increases, the 4.9 per cent target moves further away. If it holds or falls, buyer confidence could accelerate quickly — creating competitive conditions for those who have pre-positioned themselves.

Waiting also carries a hidden cost: property prices may rise while you wait, deposit targets shift upward, and competition increases as more buyers enter the market simultaneously. Getting a pre-approval now means you can act quickly when conditions shift.

For self-employed buyers, new migrants, and those with complex income structures, MPFG's Alt Doc and residential products offer a pathway to act ahead of rate movements, rather than reacting after them. MPFG Capital (ACL 553698) has helped borrowers across Melbourne, Sydney, and Brisbane access property finance even when major banks have declined their applications.

FAQ

What mortgage rate should I target as an Australian buyer in late 2026?

Survey data indicates that 4.9 per cent is the threshold at which most prospective buyers plan to act. However, your individual target rate depends on property price, income, deposit, and loan structure. Getting a pre-approval to understand your current borrowing capacity is more useful than waiting for a specific market rate.

Can self-employed buyers get competitive mortgage rates without waiting for RBA to cut?

Non-bank Alt Doc home loan rates start from around 6 per cent, while major banks may advertise lower rates but apply stricter income assessment for self-employed applicants. For some self-employed borrowers, a non-bank product at around 6 per cent may allow a higher loan amount than a bank product at 4.9 per cent, depending on how income is calculated for serviceability.

Should I wait for the RBA to cut rates before applying for a home loan in Australia?

Waiting for a rate cut has a cost: property prices may rise during the wait, deposit targets increase, and competition intensifies once buyers re-enter simultaneously. It is worth getting a pre-approval now so you can act quickly when conditions shift — whether that means rates fall or properties become more accessible.

This article is general information only and does not constitute financial or credit advice. All applications are subject to credit assessment by MPFG Capital (ACL 553698).