Hold On for One More Day: RBA Hold Rates at 1.75% For Second Consecutive Month

Today the Reserve Bank of Australia met for their July meeting and satisfied expectations by keeping the cash rate on hold at 1.75%. In this blog, Chisholm & Gamon have explored what their decision means for the immediate future of the property market and the wider economy.

Following the incomplete Federal Election and last month’s dramatic EU referendum outcome, the RBA have followed the predictions of analysts and opted to leave the cash rate unchanged for another month.

Market analysts are anticipating the national cash rate will remain constant until at least August while the board gauges the effects of the rate cut from 2% to 1.75% earlier in the year. Governor Glenn Stevens addressed the level of uncertainty surrounding the global economy following the UK’s decision to leave the EU last week, and indicated that once an economic response was noted from the market, further easing may be allowed should conditions warrant the board to do so.

In terms of the property market, borrowing remains favourable as banks adjust their rates in response to the all-time-low cash rate. Daniel Hustwaite of Aqua Financial Services described rates on home loans and investment loans as “particularly competitive” and that a further rate cut on the horizon could “see more good news for homebuyers for the remainder of the year”. Should another rate cut be on the cards, it would fall just in time for Australia’s booming spring property market. All the more reason to start planning ahead. 

Hustwaite adds that “the winter property market is performing well”, and recommends getting pre-approval on your home loan prior to the market heating up come the spring.

Chisholm & Gamon remain on hand to assist in your property sale or purchase during these periods of uncertainty. Visit our offices in Black Rock, Elwood, Port Melbourne or Mount Martha where our teams will be happy to assist you navigating your property purchase or sale.