RBA Rate Moves Have Limited Effect
The number of people securing home loans across Australia fell by 1.2 per cent in May 2012, compared to the previous month. It’s surprising to economists, particularly given the RBA slashed interest rates at the start of May. The move has had little impact on encouraging people to jump into the mortgage market though. But despite the RBA’s call, it could be the banks that are slowing people down.
Some say that banks not passing on RBA cuts on in full could have an impact on people applying for home loans. Economist Michael Workman said people usually take some time to get organised and do something about applying for home loans when conditions improve. He said a lot of first-time buyers could be waiting for the right moment before they enter the market, and said possible homebuyers could be waiting to see if conditions improve even further.