Rate hold may boost property market

Century 21 believes that the decision by the Reserve Bank of Australia (RBA) to hold interest rates at 2.75 per cent will encourage many people to purchase or refinance property as rates remain at historic lows.

"Century 21 believes that the RBA's decision to keep interest rates on hold is prudent in light of current domestic economic conditions," said Chairman and Owner of Century 21 Australasia, Charles Tarbey.

"With interest rates set to remain at historic lows for the time being, Australia's lending environment should encourage many people to buy or refinance property over the coming months.

"However, whether there will be further rate cuts in 2013 is difficult to predict due to the recent momentum in U.S equities markets and a period of relative stability in Europe."

As part of its decision, the Reserve Bank reasoned that it was appropriate to leave the cash rate unchanged as current financial conditions would contribute to a strengthening of growth over time, consistent with achieving the inflation target.

The Reserve Bank's decision follows the recent release of RP Data-Rismark's Hedonic Home Value Index results, which showed that median home values In Australia's capital cities fell 1.2 per cent in May.

"Despite declines in house prices in May, Australia's residential property market has undergone some relatively positive developments in 2013, with capital city dwelling values rising 1.1 per cent over the first five months of the year and auction clearance rates moving above 70 per cent in many areas across the nation," concluded Charles Tarbey.

Century 21 encourages prospective buyers that are looking to purchase real estate to ensure they have obtained the appropriate professional property and finance advice before doing so.


Disclaimer: The opinions posted within this blog are those of the writer and do not necessarily reflect the views of CENTURY 21 Australia, others employed by CENTURY 21 Australia or the organisations with which the network is affiliated. The author takes full responsibility for his opinions and does not hold CENTURY 21 or any third party responsible for anything in the posted content. The author freely admits that his views may not be the same as those of his colleagues, or third parties associated with the CENTURY 21 Australia network.