President of the Real Estate Institute of Australia (REIA), Ms Pamela Bennett said a rate cut this month would have been positive news for mortgage holders.
“A rate cut would have assisted those who are struggling with a mortgage and would have been the catalyst needed to encourage more first home buyers into the market,” said Ms Bennett.
The REIA is due to release the Deposit Power Housing Affordability Report tomorrow which is unlikely to show a considerable improvement in the level of housing affordability in Australia.
“We have seen a number of reports released this year which show an improvement in housing affordability but the change is not significant,” Ms Bennett continued.
We know that first home buyers are starting to return to the property market as active buyers but the level of activity is still only about half of what it was in 2009.
“A further reduction in interest rates would have assisted in stimulating the lower end of the market and would have made buying a home a more affordable option for young Australians,” said Ms Bennett.
“Although just one component of the solution to housing affordability, lower interest rates are needed to reduce the proportion of income that Australians are spending on loan repayments in an effort to improve the worsening affordability situation,” Ms Bennett concluded.
Source: Real Estate Institute of Australia