The Reserve Bank of Australia's (RBA's) rate cuts have finally had an impact on consumer confidence and could boost the Australian property market over the coming months, Westpac has claimed.
According to the banking group, households are responding well to the cuts, which now comprise a total of 125 basis points between November last year and July 2012.
Its consumer sentiment index recorded a jump of 3.7 per cent from 95.6 in June to 99.1 in July, a 6.8 per cent increase on a year-on-year basis, reports Property Observer.
However, Westpac chief economist Bill Evans warned that interest rates could still be too high.
"This result is far from convincing and should not be interpreted that we can expect confidence to steadily return to more normal levels over the months ahead," he added.
The latest report from ANZ suggested that property prices look likely to stabilise over the coming months, rising by up to five per cent over the next two-and-a-half years.
Posted by Craig Francis
