Source: Quest Community Papers
Today’s interest rate drop could fuel a first home buyer surge early next year and pump the lifeblood back into the anaemic industry, REIQ CEO Dan Molloy says.
“I generally think first home buyers hold the key to stimulating the market … and I think we are seeing the signs of first home owner interest picking up,” he said.
“A rates drop further renews that faith.”
In the past few months he said the property price slump had also helped to build that faith, which economic fears had shaken over the last 12 months.
“First home owners peaked at about 28 per cent two years ago before they dropped.
“I think (the rates drop) will indicate a slightly quicker return to confidence in the new year.”
Today, the Reserve Bank of Australia (RBA) cut the official cash interest rate from 4.75 per cent to 4.5 per cent.
Loan Market chief operating officer Dean Rushton said the cut should save someone with an average mortgage of $300,000 around $50 a month.
“The extra savings will help many families struggling with the increased cost of living and should result in retailers enjoying a better Christmas than they may have envisaged a few months ago,” he said.