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Rates on Hold

4 Jun 13

The Real Estate Institute of Australia (REIA) says today’s Reserve Bank of Australia (RBA) decision to leave the cash rate on hold was not unexpected.

REIA President, Mr Peter Bushby says, "After last month’s RBA cash rate cut to a historically low 2.75%, we are not surprised with the results of today’s meeting."

"Recent interest rate cuts and improvements in affordability are being converted into more loan commitments and higher auction clearance rates."

"The first quarter of 2013 continued the trend with the proportion of income required to meet loan repayments decreasing 0.5 percentage points to 29.9%."

"This is the best level of housing affordability since the December quarter 2009 and I am pleased that most states and territories recorded improvements."

"Changeover owner-occupiers and investors are already coming back but unfortunately first home buyers are holding off, making up only 14.2% of the owner-occupier market in March 2013."

"Issues such as state governments favouring those first home buyers purchasing new rather than existing dwellings, inefficient state taxes, excessive red tape and land release delays urgently need to be addressed," Mr Bushby concluded.