Saturday, March 29, 2014

Solid Activity Predicted for Real Estate SA In 2014

By Colin James

The Reserve Bank of Australia has indicated that the low interest rates for home loans will continue through 2014, which is good news for many householders.

Head of Harcourts for South Australia Greg Moulton says that the indication from the Reserve Bank governor Glenn Stevens that the low cash rate is unlikely to change soon, will end in buoyant real estate sa for 2014. "Maintaining the official cash rate at 2.5% is excellent news for stockholders, house owners and first house purchasers of real-estate SA," announces Mr Moulton.

Moulton continues, "A low official cash rate and relative equilibrium in rates enables purchasers to plan in advance and gives certainty to real estate sa decisions."Moulton goes on to assert that a period of steadiness for 2014 will be a boost for buyer confidence, particularly where South Australia real-estate has not been performing so strongly, and stability will keep up the momentum in other real-estate SA markets that are already performing well. The governor of the Reserve Bank has to act in the best interest of the Australian economy and by leaving the official cash rate unchanged, the Reserve Bank is providing confidence to property sa in the short to medium term.

Moulton says that by indicating that rates will remain low through 2014 also shows the Reserve Bank is supporting solid activity in South Australia, "The SA market is intrinsically connected to the local South Australian economy, and particularly the Adelaide economy, due to home business owners drawing down on capital gain from their home and re-investing it into their business. "

The challenge for the Reserve Bank is to balance the good health of the economy with first home purchasers who are attempting to get a foot in the door of property. Moulton points towards new stats out showing that first home purchasers make up just 9.9% of all mortgages issued in February and claims that first home buyers of property sa are still much on the border of the real estate market, "First house buyers of property are truly having to make some compromises or come up with some innovative paths to access capital. "

Moulton says that the stories for first house buyers in Adelaide is that cost is an issue all over Australia, he says that the other side of the coin for first home buyers of real estate in South Australia is that once they've a foot in the door of the property market, then they are going to be pleased with real-estate price growth.

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