RBA interest rate hold for March
The Reserve Bank once again has kept interest rates on hold, with the cash rate sticking at 2.25%, a record low which follows the rate cut of 25 percentage points just last month.
This comes as good news for borrowers including homeowners and property investors who can take advantage of lower mortgage repayments. Many banks and lenders last month passed on these full rate cuts to their customers and it is thought that there might be another rate cut by June this year.
This makes a great time to buy a property, with “auction clearance rates surging to the highest levels we have seen since 2009 and valuation activity across CoreLogic RP Data valuation platforms reaching new record highs based on daily averages over the second half of February,” says RP Data’s Tim Lawless.
Savers on the other hand will not be as pleased with the record low interest rates, especially those trying to save for a deposit for a property. Saving for a deposit will take much longer with lower interest rates, making it even more difficult to get a foothold on the property ladder, especially when housing values are gradually increasing especially in the Sydney and Melbourne markets.
According to the latest RP Data Home Value Index, capital city dwelling values in February rose by 0.3%, whilst in January they rose by 1.3% with Sydney leading the way.
Around the world ““Financial conditions are very accommodative globally, with long-term borrowing rates for several major sovereigns at all-time lows over recent months,” stated Glenn Stevens, the RBA Governor.
Published on 4th of March 2015 by Marty Stanowich