As property prices climb around the country, particularly here in Sydney, that dream of owning real estate in Double Bay can seem to be getting further and further away. However, May has brought good tidings from the Reserve Bank of Australia, as the board decided to slash the cash rate by 25 basis points.
This brings the official cash rate in Australia down to 2 per cent – the lowest it has ever been. There will undoubtedly be many flow-on effects from this, but which will directly impact your search for real estate in the eastern suburbs of Sydney?
In a 5 May response to the news, Real Estate Institute of Australia (REIA) president Neville Sanders expressed great hope for a reduction in home loan interest rates, which would be very favourable for house hunters.
"Since the RBA began downward movements of the official interest rate in late 2011, the proportion of the median family income required to meet monthly loan repayments has decreased 3.3 percentage points from 34.8 per cent to 31.5 per cent," he noted.
This could mean significant increases to the affordability of property with this new cash rate cut, depending on your budget.
A boost to supply
The REIA wasn't the only industry body excited by the RBA cash rate cut. Geordan Murray, economist with the Housing Industry Association (HIA) said in a 5 May media release that this cut bolsters an already strong part of the sector.
"New home building has been amongst the strongest performing sectors in the economy and the low interest rate environment has certainly played a role in boosting industry activity," he stated.
This means the future of real estate in Rushcutters Bay and beyond could have a lot more property options in it. To find out more about what is available, speak to the team at Ray White Double Bay.