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C&G’s Guide to the March RBA Cash Rate Decision
For the 31st consecutive month, the Reserve Bank of Australia has held the cash rate tightly at its all-time-low of 1.5%. In today’s blog, C&G unpack what this means for real estate, the national economy, and the future of our cash rate.
Governor Philip Lowe announced on Tuesday that the cash rate would remain on hold for another month, bringing the all-time-low rate reign to a staggering 31 month stint.
The board noted that it expects to see 3% growth in the economy in 2019 at the hands of a strong labour market, but wage growth and worrying value shifts in the property market remain a concern.
Many economists predict a rate cut at some point this year, further strengthened by the fact that consensus forecasted GDP data is expected to demonstrate a shortfall in growth against the RBA’s expected 2.75% for 2018.
Out-of-cycle rate increases from banks is stimulating speculation of a future rate move, and a drop in retail activity suggests that high household debt could already be contributing to the overall economy.
Real estate values in the previously booming Eastern capital cities are certainly contributing to a cooling in the market, though one bedroom apartments remain in fierce demand among first time buyers priced out of larger purchases, and investors looking to get in on the market downturn.
More locally in Bayside, Chisholm & Gamon’s expert sales team are reporting positive activity in the market. While the property market is certainly changing, quality homes are still transacting well and auction demand remains evident. While a tougher market does complicate things for both buyers and vendors, our experienced team are on hand to ease your concerns and help you move forward with your property plans. Many of our agents have worked through market cycles before, and understand the strategies that can help you achieve your goals this year.