Experts Want Interest Rate Cuts For Australian Real Estate

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Prices of property in Australia continue to show modest
price falls making it the perfect time to snap up a bargain in the
country.  The number of home loans
approved in Australia is also falling which has led experts to call for a cut
to the nation’s high interest rates.

Keep reading to learn more about how an interest rate cut
could help stabilise the property market in Australia.

Fall in home loan
approvals based on high interest rates

The Australian Bureau of Statistics recently reported that
the number of home loans approved in February 2012 fell 2.5 per cent compared
to the previous month.  This comes after
a 1.2 per cent fall in January.

Experts believe that cuts to the interest rates in late 2011
have not helped the housing market and that further rate reductions are
necessary to boost the sector.  The
Reserve Bank of Australia cut interest rates by 0.25 per cent in both November
and December to the current level of 4.25 per cent.

RBC Capital Markets senior economist Su-Ling Ong said “Rate
cuts to date appear to have had only a modest impact, suggesting that overall
lending rates remain too high.”

Sky News reports
that ‘Westpac senior economist Andrew Hanlan said the weak home loan figure for
February was due largely to a 9.4 per cent drop home loan approvals in New
South Wales and a 1.1 per cent fall in Queensland.’

Mr Hanlan also called for a further interest rate cut in May
2012.  He added: “Certainly the Reserve
Bank would have been hoping to get some traction in the housing sector, but
that just hasn’t happened to date and it looks unlikely to now.

“The housing sector certainly does need extra support and we
would expect them (the RBA) to act immediately.”

If rates are cut it could provide a boost to Australia’s
property market which is likely to result in stabilising or rising prices.  Now could therefore be the perfect time to
buy.

Buying selling or investing in Australian real estate use Homesgofast.com