Housing market confidence booms as cash rate cut to historic-low
Consumer sentiment is surging and confidence in the housing market is booming as the RBA announce a historic Melbourne Cup cash rate cut. Let’s look at why households and businesses are becoming increasingly optimistic.
Ahh, spring. It’s fair to say we love it around here.
Not only do we usually see an uptick in property market activity (houses always look much nicer in spring), but this year – in particular – we’re seeing consumers more upbeat about what lies ahead.
This can be seen in the latest Westpac-Melbourne Institute Index of Consumer Sentiment survey, which saw consumer sentiment increase by 11.9% to 105.0 in October (up from 93.8 in September).
“This is an extraordinary result,” says Westpac’s chief economist Bill Evans.
“The index has now lifted by 32% over the last two months to the highest level since July 2018.”
Confidence in the housing market is also high
One of the biggest takeaways from the latest consumer sentiment survey is that more and more people believe now is a good time to purchase property.
“Confidence in the housing market has boomed,” explains Mr Evans.
“The ‘time to buy a dwelling’ index increased 10.6% to its highest level since September 2019.”
House price expectation sentiments also rose strongly, up 31.5% to 117.3 (from 89.2), with all states registering impressive recoveries.
Why is consumer sentiment soaring?
While leaving the doom and gloom of a COVID winter behind and entering spring sure doesn’t hurt, it’s not the only reason for the uptick in consumer sentiment.
This latest survey came right off the back of the federal government’s October Federal Budget, which allocated a record amount of spending and support measures to businesses and households.
Today’s decision to cut the cash rate to the historic-low of 0.10% will come as welcome news to homeowners who will look forward to lower mortgage rates and cautious optimism surrounding household spending.
How’s your outlook at the moment?
So, how about you? Have things on the financial and property front started to look a little rosier recently?
If so, feel free to get in touch with us today. We’d love to run you through some of the financing options that may be available to you in the current financial landscape.
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