Below trend growth to continue
NAB’s Chief Economist, Alan Oster provides a pre-budget overview of the Australian housing market and the outlook for interest rates. Join us on Wednesday 15 May for a full budget breakdown.
“I think the good news on house prices is, they look like they’ve stabilised and are turning up. Certainly clearance rates are much better and our expectations are that you could probably, across Australia, look forward to an increase of 3 to 5% in house prices. It’s no where near as strong as it used to be but at least it’s moving in the north direction.
On interest rates, we’ve always expected the reserve would probably have to cut by 50 basis points, they’ve delivered 25 of it. I think where they are now, is sitting back waiting to see if there is any better impact in terms of business investment in what they have done. And our view would be with unemployment going up, you are probably going to get another rate cut, I suspect by about November this year before we see it.
So please join us on Wednesday morning, when we’ll actually be able to tell you what exactly was in the budget and what it means for you.”
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