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'Further rate cuts needed' for property growth

More interest rate cuts from the Reserve Bank of Australia will be needed if the housing market is to arrest its slump, according to industry experts.

Master Builders Australia (MBA) has claimed that if the property and housing market is to grow, further interest rate cuts from the Reserve Bank of Australia (RBA) will be required.

 

 

The RBA's decision to cut the rate from 4.75 per cent to 4.5 per cent has been widely credited with boosting the property market, but the MBA claims the bank could do more in light of overseas events.

 

 

Earlier this week (November 9th), information released by the Australian Bureau of Statistics showed that housing loan approvals were up 2.2 per cent on the previous month, a greater rise than experts had predicted.

 

 

However, Peter Jones, chief economist of the MBA, said the data showed that demand for new dwellings remains "flat" and that the bank needs to go further to safeguard the property market.

 

 

"A sustained recovery in housing is critical because Australia-wide the residential market is underbuilding and undersupplied", he said.

 

 

Posted by Steve Douglas 

- rates, interest

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