Rate cut to help mar­ket ac­tiv­ity

The Riverine Herald - Local Real Estate - - LOCALREALESTATE.COM.AU -

The de­ci­sion by the Re­serve Bank of Aus­tralia to cut the of­fi­cial cash rate to 3 per cent last week will en­cour­age prospec­tive buy­ers to make prop­erty pur­chases be­fore Christ­mas and dur­ing the hol­i­day sea­son, ac­cord­ing to Cen­tury 21 Real Es­tate agency. ‘‘The Re­serve Bank (last week) acted to re­duce the of­fi­cial cash rate by 25 ba­sis points, bring­ing in­ter­est rates to their low­est lev­els since Septem­ber 2009,’’ Cen­tury 21 Rich River Real Es­tate di­rec­tor An­drew Lochhead said. ‘‘Should the banks pass on the cut, this de­ci­sion should be an ex­cel­lent shot in the arm for the res­i­den­tial prop­erty mar­ket and the econ­omy at large as we move into the new year.’’ As part of its de­ci­sion, the Re­serve Bank men­tioned sub­dued in­vest­ment out­side the re­sources sec­tor and the role that fur­ther eas­ing in the stance of mon­e­tary pol­icy would play in fos­ter­ing sus­tain­able growth in de­mand and in­fla­tion out­comes. With the spring sell­ing sea­son now over, De­cem­ber will likely be a key pe­riod for real es­tate with many buy­ers and sellers aim­ing to have rel­e­vant in­spec­tions com­pleted and prop­erty trans­ac­tions fi­nalised be­fore the end of the year. ‘‘For those prospec­tive prop­erty buy­ers who have been in a po­si­tion to make a pur­chase this year but have re­frained from do­ing so, this rate re­duc­tion could be the fi­nal en­cour­age­ment needed to act on a suit­able pur­chase,’’ Mr Lochhead said. ‘‘This rate cut will also likely help to ease the fi­nan­cial pres­sures felt by many Aus­tralian prop­erty own­ers and mort­gage hold­ers, par­tic­u­larly be­fore the of­ten ex­pen­sive Christ­mas pe­riod.’’

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