No in­crease needed

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

The March 2011 quar­ter Con­sumer Price In­dex (CPI) for the hous­ing group, in­creased 1.3 per cent, com­pared to the all groups in­crease of 1.6 per cent. These fig­ures in­creased 4.8 per cent and 3.3 per cent re­spec­tively in the 12-month pe­riod. While the hous­ing group is up from the 0.6 per cent level of the pre­vi­ous quar­ter, the an­nual rate of in­crease is the low­est since the Septem­ber quar­ter of 2007. Con­tribut­ing to the an­nual in­crease of 4.8 per cent for the hous­ing group, were sub­stan­tial in­creases in the price of util­i­ties — 11.7 per cent for elec­tric­ity, 12.8 per cent for wa­ter and sew­er­age and 6.2 per cent for prop­erty rates and charges. Rents in­creased by 4.5 per cent for the year on a weighted av­er­age eight cap­i­tal city ba­sis and the cost of house pur­chase in­creased 2.6 per cent. Real Es­tate In­sti­tute of Aus­tralia (REIA) pres­i­dent David Airey said the Re­serve Bank of Aus­tralia (RBA) con­sumer prices mea­sures of weighted me­dian and trimmed me­dian are 2.2 per cent and 2.3 per cent re­spec­tively for the year – well within their tar­get zone of 2-3 per cent. ‘‘De­spite the March quar­ter CPI be­ing the high­est since the June quar­ter 2006, in­fla­tion is un­der con­trol, with a slow-down in the an­nual rate of in­crease on the two RBA mea­sures over the last year,’’ he said. ‘‘The March fig­ures in­clude in­creases of 16 per cent for veg­eta­bles and 14.5 per cent for fruit, which are to be ex­pected as one-off oc­cur­rences, fol­low­ing this year’s flood­ing and cy­clones in Queens­land and Vic­to­ria. ‘‘The mes­sage for the RBA is clear; rates do not need to be in­creased next week. In­creas­ing rates will only cause greater mort­gage stress for home own­ers and dis­cour­age buy­ers.’’

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