Weekly Market Update with Ian from Extra Realty
Hello, everyone. Ian here with your latest insights into the property market as we near the end of 2024.
A key question on many minds is whether the RBA will cut the cash rate soon. Chances of a rate cut as early as December or early next year seem slim. With rising cost-of-living pressures squeezing household budgets, a rate cut could provide welcome relief for mortgage holders, especially as we approach the holiday season.
However, not everyone is as optimistic about an early rate cut. Economist Dr. Andrew Wilson recently suggested that we might not see any reductions until 2025. According to Dr Wilson, the RBA remains cautious, ensuring inflation is thoroughly controlled before making any moves. A premature cut could risk reigniting inflation, so while a rate reduction might eventually boost buyer demand, it’s a matter of patience.
Affordability is another pressing issue. Did you know that property prices have increased three times faster than wages over the last four decades? Currently, the national median house price sits above $800,000, with averages in capital cities exceeding $1 million, making homeownership feel increasingly out of reach.
Adding to these challenges, Australia’s population is projected to grow by 330,000 people each year. At the same time, the construction industry is experiencing slowdowns due to rising costs and supply chain issues, delaying projects and tightening supply further as new developments are postponed.
Despite these hurdles, there are still promising opportunities, especially if you’re considering a new-build property or SMSF investment. Careful planning and the right advice can offer significant value in today’s market.
If you have any questions or would like guidance on your property journey, I’m here to help. Thanks for tuning in, and I look forward to updating you next week!