Australian property industry body Master Builders Australia (MBA) has urged the Reserve Bank of Australia (RBA) to make further cuts to the interest rate after housing approvals fell in December.
The latest figures from the Australian Bureau of Statistics (ABS) show dwelling approvals falling by a quarter on a year-on-year basis, according to the MBA.
Chief economist Peter Jones argued this means further rate cuts are necessary to turn the property market around and stimulate Australia's economy.
"Master Builders urges the banks to pass on any forthcoming rate cuts despite their concerns regarding cost of funds associated with European sovereign debt problems," added Mr Jones.
He explained this data upheld the latest MBA survey, which showed potential job losses and a cut in profits for the building sector unless more reductions are made. Last month the organisation warned demand for new homes continued to be flat despite a mild improvement in sales of established properties.
Posted by Ravin Chatlani
