The Reserve Bank of Australia’s decision to leave interest rates unchanged supports the steady growth of the housing market which has seen median house prices in most markets, including Sydney, increase in recent times, according to the Real Estate Institute of NSW (REINSW).
“The prevailing low interest rate environment continues to support buyer demand which, combined with the fundamental shortage of housing stock, is keeping prices buoyant and generating positive results for vendors,” REINSW CEO Tim McKibbin said.
“A strong, steadily growing housing market is vital to the broader economic recovery and at this point in the cycle, low interest rates are a critical factor in this growth.”
CoreLogic figures released today show dwelling values in Sydney increased 0.4% in November, contributing to a 3.7% increase for the past 12 months, despite the pandemic.
Regional markets have responded even more positively, with CoreLogic’s combined regionals index recording a monthly growth rate double that of the combined capitals.
The signs are positive heading into the Christmas period, Mr McKibbin said.
“The Reserve Bank is playing its part by maintaining a steady environment of low interest rates, which is helping the continued, sustainable recovery in house prices,” Mr McKibbin said.
“However, there are other levers for Governments to pull to support a more holistic recovery, and these must be focused on unlocking supply, particularly existing stock, which is constrained by the excessive taxation barriers which discourage people from moving,” he said.