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More rate cuts needed: borrowers

26 JUN 2012 • By Phillip Tarrant • 2 min read • Finance

Generation Y investors an dhome buyers considering a property purchase look likely to stay on the sidelines unless there’s more interest rate relief from the Reserve Bank of Australia, a national survey has found.

 

According to a new poll by Loan Market Group, 50 per cent of Gen Y respondents believe the two consecutive monthly reductions by the RBA hadn’t made any difference to them.

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Another 32 per cent of Gen Y-ers said they had just been boosting their savings but more rate cuts by the RBA were needed.

Loan Market corporate spokesman Paul Smith said the European debt crisis was also weighing heavily on Gen Y consumers.

 
 

“While consumers and home owners are always looking for interest rate relief, the latest round of cuts has yet to influence the cautious and subdued mindset of Australians,” he said.

“Successive RBA actions which reduced the cash rate to 3.5 per cent will certainly be helpful to offset the rising costs of living; however there are larger shifts needed in the economy to boost stalling sectors such as retail and housing.

“The pressure is on the RBA to further reduce the official rate at its next monthly board meeting and then we will see if this is passed on in full by lenders.”

The Loan Market online survey found 15 per cent of respondents said they had been spending more as a result of lower interest rates while 7 per cent said they had been paying more off their mortgages.

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Phillip Tarrant

Phillip Tarrant

AUTHOR

Phillip Tarrant is one of Australia’s leading property commentators, with more than a decade at the forefront of conversations shaping the nation’s property investment market.

As the long-time host of the Smart Property Investment Show and a regular commentator across property, finance and business, Phillip has interviewed thousands of investors, economists, advisers, brokers, agents and industry leaders, giving him a unique perspective on the trends, policies and market forces influencing Australian property.

Beyond property commentary in the media, Phillip is an active property investor himself, with first-hand experience building and managing a diversified property portfolio across multiple markets and cycles. His insights combines this practical investor perspective with deep exposure to the broader property and financial services ecosystem.

Phillip is also CEO and co-founder of Managed, an Australian property payments and technology platform transforming the way property managers, landlords and tenants manage rental payments and property transactions.

Through his writing, podcasts and industry engagements, Phillip focuses on cutting through market noise, challenging conventional thinking and helping investors make more informed, strategic decisions. His commentary regularly explores property markets, lending, taxation, regulation, investment strategy and the changing dynamics of Australia’s housing sector.

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