Today, the Reserve Bank of Australia (RBA) surprised economists by holding interest rates at 2.25 per cent.
The RBA's decision will benefit Australia’s residential property market, the Real Estate Institute of Australia (REIA) says.
REIA president Neville Sanders said stability would boost to sentiment.
“Certainly existing home owners will find these stable rates welcome and new entrants to the market will also find that climate of stability important,” Mr Sanders said.
“We do, however, recommend that new borrowers shouldn’t overstretch themselves.”
He said interest rates are at an historic low now, therefore, people should expect rates to go up in future.
Mr Neville said some pockets of Australia’s residential property market were facing greater demand than others, adding to price pressure.
“There’s some pockets of markets, in particular Sydney and also Melbourne… they’re very strong and growth is very high at the moment,” Mr Neville said.
However, in other markets like Australia’s regional areas, growth is more subdued.
The disparity would continue since the price of property in Sydney and Melbourne, where many Australians want to live, was subject to higher demand, Mr Sanders said.
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