The drop in the official interest rate by the Reserve Bank to 1.5 percent will act as a stimulus for more housing through investors and first home buyers as repayments on loans are reduced, says the Urban Taskforce.
“The Sydney market has been slow in the recent times and a stimulus like a lower interest rate should encourage more activity in the housing market,” says Urban Taskforce CEO, Chris Johnson.
According to the Department of Planning & Environment, 33,600 new homes are needed in the Sydney Metropolitan area each year to accommodate growth.
“Housing completions have never reached this target. From April 2015- April 2016, housing completions for the Sydney Metro Area only reached 27,208 so we still have a long way to go to meet this target,” says Mr Johnson.
“This rate cut will help sustain growth and boost confidence in the residential property market. Despite the ongoing lack of housing supply, this interest rate cut will assist first home owners and new buyers entering the property market.”
