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Recent interest rate rises have had uneven effects across Melbourne, with Cotality data showing some established areas were more sensitive to higher borrowing costs than others during the May 2022 to January 2025 tightening cycle.

The relevance of these shifts is most acute at a local level, where property assets are commonly relied upon as lending security, insurance cover or as part of balance sheet decisions tied to specific councils and suburbs. Parts of Melbourne’s east and north, for example, recorded measurable value declines over the period, including Darebin–South, where values fell 7.9%, and Manningham–East, down 6.0%. In Melbourne’s north-east, Nillumbik–Kinglake and Whitehorse–East also experienced value softening over the cycle, with values easing by 5.1%, highlighting how higher rates can translate into pricing pressure even in well-established, owner-occupier markets.

Cotality research director Tim Lawless said households are now more sensitive to interest rate changes due to near-record debt levels. When borrowing capacity adjusts, value outcomes can shift quickly, reinforcing the need for asset-specific analysis rather than reliance on broader market averages when assessing equity positions, insurance exposure or potential recovery outcomes.

#propertyvaluations #Melbourneproperty #interestrates

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Clear, independent valuation advice is essential when interest rate changes influence asset values and risk settings. To obtain evidence-based assessments that reflect local market sensitivity across Manningham, Whitehorse, Darebin and Nillumbik, call Mason’s Valuation Office on 0417 741 481 or visit https://propertyvaluation.melbourne/about-us/#contact.