With the housing market showing no signs of abatement, the Reserve Bank of Australia has decided to let things be, keeping official interest rates at the all-time low of 2%. The cuts in February and May this year have made the housing market the talking point at every Australian get-together, with the Sydney and Melbourne markets remaining particularly buoyant.
The RBA is also pleased at the fall of the Australian dollar, taking pressure off the economy by helping Australian export industry. Although overseas holidays are more expensive at the moment, it’s terrific for people coming the other way – Australian tourism is booming, which is fantastic for the economy.
Dollar falling with low interest rates
Shane Oliver, chief economist at AMP Capital, said signs the drop in the Australian dollar has already shown benefits. “The rate of growth of tourist – arrivals, is running well above rate of growth of departures, for the first time since the 1990s,” he said.
The housing construction sector is also benefiting from the nation’s record low interest rates. St George chief economist Hans Kunnen is bullish, stating “we expect economic growth in 2015 of 2.4 per cent, rising to 2.9 per cent in 2016.”
While the Australian Prudential Regulation Authority (APRA) and banks are making moves to ease the pressure on first homebuyers and families wanting to move up the property ladder, it’s a good time to consider making a move.
So with interest rates continuing to remain at record lows now could also be the time to review your current lending requirements, as always, if we can help you in any way, please don’t hesitate give us a call – we’re here to help.