Earlier this afternoon the Reserve Bank of Australia (RBA) board decided to leave the cash rate on hold, at a record low of just 1.50% (yet again).
RBA Governor Philip Lowe noted:
- Australia’s economy is benefiting from a rise in commodity prices and improving terms of trade
- Inflation has increased recently and this is expected to continue as economic growth improves
- Wage growth remains slow, with housing debt growing faster than the growth in wages
In relation to housing, the RBA comments were similar to last month’s statement. The May media statement read “conditions in the housing market continue to vary considerably around the country. Prices have been rising briskly in some markets and declining in others. In the eastern capital cities, a considerable additional supply of apartments is scheduled to come on stream over the next couple of years. Rent increases are the slowest for two decades. Growth in housing debt has outpaced the slow growth in household incomes. The recently announced supervisory measures should help address the risks associated with high and rising levels of indebtedness”.
The next RBA board meeting will be on Tuesday the 6th of June.
Attention moves to the federal budget
Today’s RBA decision was widely tipped by analysts. Attention now moves to the federal budget which will be delivered by Treasurer Scott Morrison next Tuesday. While there has been some rumoured budget leaks as to what will be in the budget, most of it has been kept under wraps so far.
First home buyers are hoping the government will announce a range of measures to address housing affordability. Read our latest budget thoughts in yesterday’s FHBA Market Update.
I’m about to be in the market for a home loan
- If you are getting close to buying your first home why not check out this easy to use home loan comparison table to see a range of rates currently on offer?
- Getting ultra close? We recommend you arrange an appointment with an FHBA Lending Adviser who can discuss your circumstances, showcase home loan options you may be eligible for and go through the home loan process with you. For more on FHBA Mortgages please click here.
I’m still saving for a home deposit
Unfortunately the rate of interest on savings accounts are low at the moment (compared to more recent historical times). But when saving for a home deposit, every bit counts. See if you can give your savings a boost by checking out these free & easy to use saving accounts comparison tables!
I want to know more about the RBA decision
To read the full RBA statement from the May board meeting please click here.
First Home Buyers Australia