The Reserve Bank’s (RBA) announcement in early August that the official cash rate would once again remain unchanged at 2.5% marks a full year since the last adjustment. While commentators are broadly in agreement that the next move will be upwards, it currently appears unlikely to occur before the first half of 2015.
Despite the lack of an official change, the battle between the lenders for new customers heated up in July, with the major lenders outside of ANZ slashing their rates on five year fixed rate loans to record lows of under 5%. Financial analysts are now predicting variable rates may soon be the next to be targeted, with consumers to benefit from a decrease in the off-shore cost of funding.
Meanwhile in the local property market, the Melbourne auction market has proven itself to be remarkably resilient throughout winter, with APM reporting clearance rates consistently averaging above 70% since the Queen’s Birthday Weekend. Closer to home, our core market area including Carnegie, Murrumbeena, Glen Huntly, Hughesdale, Ormond & Malvern East saw clearance rates remain steady at 76% and we are proud to reveal Ray White Carnegie achieved a 95% clearance rateof all properties taken to auction.
In terms of values, after experiencing the traditional slow start to winter, Melbourne recorded the highest price growth of any capital city. The latest report from researcher RP Data showed Melbourne prices grew by 3.7% over July, ending 1.8% higher for the quarter. Growth in Melbourne house prices is now at 11% over the past 12 months, with RP Data chief economist Tim Lawless saying the market is being driven by investors.
These recent results are in contradiction to the usual mid-year slowdown. With volumes already building throughout early August, it appears the spring selling season may well be starting early this year, presenting good opportunities for buyers and sellers alike.