Rate cut adds to recovery impetus

By Terry Ryder, 3rd October 2012

The latest interest rate cut adds further impetus to the many factors pointing to a recovery in big city markets around Australia.

The 25 basis points cut by the Reserve Bank board yesterday, following reductions in May and June, means that the official interest rate is at its second lowest level in the past 25 years (the only lower point was in 2009 when multiple cuts were made in response to the GFC).

This, combined with recent falls in prices in our major cities, helps create further improvements to affordability.

The market has been responding this year, with growing signs of rents and prices beginning to rise again. RP Data figures indicate most of the capital cities recorded increases in their home value indexes in September.

Other positive indicators are the significant rise in loan approvals to home-buyers, the reduction in stock for sale, the improvement in auction clearance rates and the rise in confidence by real estate consumers.

These factors are described in detail in the new October edition of The Ryder Report, the 100-page market analysis published quarterly by hotspotting.com.au. (http://www.hotspotting.com.au/report/44-the-ryder-report)

Terry Ryder

Terry is the owner and creator of hotspotting.com.au, which provides information to property investors on how to identify emerging markets before they’re common knowledge.

Related Report