No rate cut on Melbourne Cup Day

Those who were hoping for that bit of extra home loan rate relief following the Reserve Bank of Australia’s monthly meeting yesterday will have to wait for another chance in December.

The RBA board met yesterday (November 6) and came to the conclusion that holding the rate at 3.25 per cent was the best course of action for the time being.

“At today’s meeting, with prices data slightly higher than expected and recent information on the world economy slightly more positive, the board judged that the stance of monetary policy was appropriate for the time being,” RBA governor Glenn Stevens said in his official statement to the public.

The decision was not well received by president of the Real Estate Institute of Australia (REIA) Pamela Bennett, who was hoping to see a bit of extra relief for mortgage owners.

“A drop of just .25 per cent of the cash rate would have, on average, saved home-owners $102 per month in loan repayments compared to the June quarter,” she said.

“Unfortunately, home-owners won’t be able to enjoy such savings. Buyers’ interest has not yet responded to previous interest rate cuts and a further cut is necessary,” Ms Bennett added.

However, the industry leader did acknowledge that other aspects of the sector need to be addressed and the RBA’s monetary policy is just one of the factors that impact the industry.

In the meantime, there have been increasingly positive signs for the residential market.

Healthy auction clearance rates in Victoria and New South Wales coupled with climbing dwelling values hint towards a recovery that industry leaders are hopeful to see. 

Prospective buyers may wish to speak to a mortgage broker to develop a purchasing strategy and secure their first home loan.