Record low cuts to interest rates have been welcomed by the Real Estate Institute of Australia and Real Estate Institute of Queensland. The Reserve Bank of Australia have dropped interest rates 25 points to 1.5%.
The latest update brings great news for home owners and first home buyers, with savings of around $100 per month on loans of $500,000, according to REIA President, Neville Sanders.
Sanders states “It is vital that the lenders pass on this rate cut to borrowers in full.”
“As well as improving housing affordability a cut in the cash rate will be very important in boosting consumer and business confidence. With recent downgrades in the economic outlook for Australia it is imperative to have a supportive monetary policy to encourage growth,” said Mr Sanders.
According to the REIQ Chairman Rob Honeycombe, if lenders pass on the cute, the lower rate would improve buying conditions. This would help the Queensland market which last quarter contracted.
“The state’s economy continues to struggle since the resources downturn and we saw the median house price fall almost one per cent in the March quarter.
“With wages growth virtually nil, inflation low and jobless numbers not moving, people need a little help with mortgage repayments and the general cost of living.
“It is our hope that lenders pass on this rate cut in full and give the benefit to home buyers, as the Reserve Bank intends,” he said.