August 06, 2024
Anthony Waldron, Mortgage Choice CEO:
“The Reserve Bank’s decision to keep the cash rate on hold will be welcome news to borrowers and buyers alike.
“The RBA’s decision follows the release of the latest quarterly ABS Consumer Price Index, which showed that annual trimmed inflation fell for the sixth consecutive quarter.
“The ongoing stability in home loan interest rates will support buyer and seller confidence heading into the 2024 spring selling season. With less than a month to go, anyone looking to buy should speak to their mortgage broker to get their finances and pre-approvals in order.”
For further information on the housing market, please refer to comments by PropTrack Director Economic Research Cameron Kusher below, which foreshadow a hold scenario:
“The RBA has kept official interest rates on-hold at 4.35% during August’s Monetary Policy Meeting.
“There had been speculation that the RBA may have increased the cash rate at this meeting, however, with the June quarter inflation data being more aligned with expectations, inflationary concerns have been allayed for the time being.
“The rate of growth in home prices has consistently slowed over the past five months and we continue to see the lowest number of annual dwelling approvals in more than a decade. Despite slowing price growth, more properties are being listed for sale and sales volumes remain robust. Stable interest rates are likely to support vendor and purchaser confidence as we head into the busier spring period.
“The labour market remains tight with strong job creation alongside low unemployment and underemployment. Demand for credit and the value of housing finance commitments continues to expand.
“Following the publication of June’s inflation data, the expected timing of a cut has shifted forward to March 2025, noting there is no RBA board meeting next March.
“The job is certainly not done on inflation, it is still too high and rising at too fast of a pace to bring it into the target range. While we should remain cautious to the prospect of interest rates rising if inflation doesn’t slow, economic data from the US published last week showed a significant weakening of the labour market and heightening expectations of an economic slowdown in the US. This could reduce the likelihood of further interest rate rises here and potentially result in rates being cut sooner.”
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