Official cash rate remains unchanged
February 5, 2014 / Written by Rich Harvey
Buying a house in Australia remains an affordable option following the Reserve Bank of Australia's (RBA) decision to leave the official cash rate unchanged at 2.5 per cent.
The February 4 announcement from the RBA board means ultra-low interest rates will remain obtainable into the foreseeable future - great news for anyone considering property investment in Australia.
"In Australia, information becoming available over the summer suggests slightly firmer consumer demand and foreshadows a solid expansion in housing construction," said RBA Governor Glenn Stevens in his statement regarding the cash rate announcement.
"Some indicators of business conditions and confidence have shown improvement. Monetary policy remains accommodative. Interest rates are very low and savers continue to look for higher returns in response to low rates on safe instruments."
Mr Stevens went on to point out that dwelling prices have also increased steadily over the past several months.
The combination of low interest rates and rising property values spells great news for buying investment property.
Interest rates likely to remain low
While there was much speculation concerning which ways interest rates would move leading up to the RBA announcement, many experts believe that rates will remain at historic lows for quite some time.
Housing Industry Association (HIA) Chief Economist Shane Garrett remarked in a recent press release that with no serious inflationary threat on the horizon, it is likely that low interest rates will "continue to guide the Australian dollar lower on foreign exchange markets," something Mr Garrett argues the country needs as it moves away from reliance on mining investment.
Mr Garrett's sentiment was echoed by Real Estate Institute of New South Wales (REINSW) President Malcolm Gunning, who said in a media release that there are many indications pointing to interest rates remaining steady for most of 2014.