Home owners have breathed another sigh of relief as the Reserve Bank of Australia decided to leave the cash rate on hold at the historically low rate of 2%.
For the tenth consecutive month, the Reserve Bank once again took a conservative approach for March, opting to monitor domestic and global markets before making a change to monetary policy.
Declines in global markets are being felt here in Australia, but not to the extent of other countries. Our commodity exports remain strong, which has protected Australia from the full effects of the global economic fallout. This is in contrast to other resource exporters such as Russia and Brazil, which are in the midst of a recession.
Is there another cut on the horizon?
The Reserve Bank is waiting to assess the full impact of these conditions before deciding whether to change the cash rate. It is not yet convinced that a drop in rates will have a significant impact and many experts predict that any further rate cuts won’t come until the middle of the year.
Domestically, the unemployment rate is on the Reserve Bank's radar and the Board will also monitor wages growth in the coming months.
What the March decision means for home owners
Despite the doom and gloom from around the world, now is a good time to have a home loan. Housing prices are steady and so are interest rates. And while there is talk of a housing bubble in Sydney and Melbourne, Brisbane is set to become the next investor hotspot with moderate growth predicted for the next few years.
There is plenty of competition from lenders, giving home owners more bargaining power at the moment. So whether you are looking to purchase your first home or refinance, be prepared to do your homework and seek out the best deal.
The Brisbane property market stats you need to know
- Official cash rate: 2%
- Brisbane median house sale price (January): $595,000
- Brisbane median unit sale price (January): $450,000
- Auction clearance rate: 55%
- Best available variable interest rate: 3.99%
- Best available fixed interest rate: 3.99%