RBA rate cut good news on the surface, but can’t be relied on to provide relief: Leanne Pilkington
The housing market has been flat for quite some time and was in dire need of an injection. Therefore this interest rate cut is positive news on the surface.
The way that government and regulatory bodies have allowed the market to slide to its current stagnate state can only be described as neglectful. Hopefully, today’s decision represents recognition that buyers, mortgage holders and the many industries down the supply chain that rely on a strong housing market are all in need of support.
The RBA’s decision to lower rates, a decision traditionally well received by mortgagees, can no longer be relied upon to provide relief.
Since the major banks have clearly demonstrated their unwillingness to be guided by the Reserve Bank, mortgage holders can be forgiven for wondering what all the fuss is about.
Should any bank fail to pass on the rate cut in full, and choose to face the public backlash instead, it would represent a direct snub to mortgagees, particularly those in the mortgage belt suburbs.
It would also again call into question the effectiveness and relevance of the Reserve Bank.
Leanne Pilkington is general manager of Laing + Simmons
