The rebound in house prices has taken some by surprise
- Written by Tim McKibbin
Highly concerning events around the world could well have a trickle-down effect on our economy and by extension, our housing market.
Just when there appeared to be a consensus that interest rates had peaked and would soon begin to fall, the Middle East conflict and its impact on oil prices in particular could place new upward pressure on inflation.
The Reserve Bank Board has telegraphed its lack of tolerance for inflation lingering above the target range, which puts mortgage holders on notice.
What was an outside chance of an increase in interest rates on Melbourne Cup Day is now considerably more possible.
The cost of housing is playing a big part. The rebound in house prices has taken some by surprise and values continue their gentle rise across many suburban markets.
The high cost of renting is adding to inflationary pressure and the dangerous under supply of rental accommodation will ensure high rents remain entrenched in the years ahead.
We believe it’s time for the Reserve Bank to consider isolating certain categories, including the cost of housing, when making cash rate calls.
Further interest rate rises will place undue pressure on many households at this delicate time.
General uncertainty is likely to impact real estate transactions but for people considering a sale, the reasons to go to market are compelling.
There is still an opportunity to launch a campaign and secure a sale prior to Christmas but time is running out.
Listings have increased in spring but not to the level of years past and competition among buyers for available properties is strong.