RBA rate hold may boost first homebuyer activity


Century 21, the largest real estate sales organisation in the Asia Pacific region, believes the Reserve Bank’s decision to leave the cash rate on hold at 2.5 per cent may increase the number of first home buyers entering the property market.


“The Reserve Bank’s decision may encourage first home buyers who have been sitting on the fence to take advantage of the ongoing low interest rate environment,” said Chairman and Owner of Century 21 Australasia, Charles Tarbey.


“Century 21 is still seeing a great deal of entry level stock in many areas, stock which first home buyers would be wise to examine - even if it may not be in the area they’d prefer to live in.


“However, once they’ve purchased a property first home buyers are able to take advantage of a low interest rate environment to build equity in their home and use this equity to move to a more desirable location in the future.”


The Reserve Bank reasoned that it was appropriate to leave the cash rate on hold In light of information that foreshadows a strong expansion in housing construction and improvement from a year ago in some indicators of business conditions and confidence.


“The market is currently transitioning into a negotiating phase, a phase where buyers are unwilling to meet vendor’s price expectations and agents have to bring both parties to the negotiating table,” said Charles Tarbey.


“This will likely result in more opportunities for first home buyers who in the past, may have been put off entering the market due to vendor’s high price expectations,” concluded Charles Tarbey.

Posted by Charles Tarbey on 29/05/2014 at 12:00 AM | Categories:


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