Interest rates are unlikely to change until November at the earliest - which is good news for the property market.
Tim Lawless, senior research analyst at RP Data, said that an extended period of interest rate stability is in store.
"All the fundamentals apart from inflation are looking subdued," he told Broker News. "There may be some increase in consumer goods over the next few months, which could spur the RBA to act after the next CPI data is released in October. However, that means that's there's very little chance of an increase before the Monetary Policy Board's November meeting."
This will provide some welcome certainty to the housing market, added Lawless - particularly for owner-occupiers.
"The renewed certainty over rates may even translate to a small bounce in first home buyers," he commented. "However, price growth is still likely to be relatively flat for the next six months at least, and we're likely to see the balance of the market swing back towards buyers."
Mortgage Choice spokesperson Kristy Sheppard agreed an extended period of rate stability would be good news for borrowers.
"This will be a great relief for anyone repaying a variable interest loan or approaching the end of their fixed rate term, just as it will be for those who are looking forward to jumping into the market during spring. A rate rise would surely have discouraged many people from acting on their property plans, be that selling up or purchasing. Now, there is another reason to move ahead with confidence."
MFAA chief executive Phil Naylor injected a note of caution, however, suggesting that now is a good time for borrowers to carry out a mortgage health check ahead of possible future rate rises.
“To keep in line with the strong employment market and to curb inflation pressures, the RBA may need to consider raising interest rates later in the year," said Naylor. "Consumers should make the most of today’s decision to double check their existing home loan is still the most appropriate for their individual circumstances and needs. This is best done by working with a mortgage broker."
With interest rates at their lowest for more than 50 years, there are some great rates available. The best thing to do is to compare rates from all the lenders. Let us help take the leg work out of doing this - Compare Home Loans now
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