 Low rates help housing industry
Housing industry experts have welcomed the decision to leave official interest rates on hold.
Yesterday, the Reserve Bank of Australia did what most industry experts predicted and left official interest rates on hold at 3 per cent.
The Housing Industry Association (HIA) calls the move a “sensible” one, believing the fall in mortgage rates has underpinned new home development.
“It will be important to keep interest rates stable over 2009/10 to support activity and confidence as a tentative housing recovery runs into the headwind of rising unemployment,” Dr Ron Silberberg, HIA managing director, said.
“The industry outlook is by no means assured,” he said. “Ordinary home buyers could be excused for becoming confused by the constant speculation about busts, bubbles and booms,” Silberberg said.
The cash rate has been at the 49-year low of 3 per cent since April when it was cut by 25 basis points.
Speculation over increasing rates will hinder early efforts at a housing recovery, says Mr Silberberg. He believes more time is needed before rates can rise.
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