The Reserve Bank made the right call last week. Mortgage holders need a chance to  catch their breath and get used to their new repayment obligations.

If inflation continues to ease it will ideally give the new-look RBA the opportunity to  keep rates steady with a view, at some stage in 2024, to potentially offer further relief in  the form of a rate cut.

However, as it stands, the housing market is actually working against this outcome.

Typically, higher interest rates deliver a decrease in prices but the undersupply of  homes and increasing demand is driving renewed growth in values.

Likewise, rents are increasing and an analysis of the bonds held by the Rental Bonds  Board shows that even as thousands of additional people seek rental accommodation,  the number of properties rented is stagnant.

The growing level of unsatisfied demand can only drive rents higher, which serves to  counter other economic efforts to tackle inflation.

Legislation which discourages residential investment and reduces rental supply, like the  absurdly-named Rental Fairness Bill, is making life increasingly difficult for tenants.

For vendors, the recent uptick in listings may keep a lid on price growth but even if  volumes increase further as spring approaches, the fundamentals remain in their favour.

More available properties may temper buyer urgency but the sheer weight of demand  means in most cases, where reasonable price expectations are set, those prices are  being achieved.