By GlobalX.

The Reserve Bank of Australia (RBA) has again held the official cash rate at 0.25% for the seventh consecutive month with the record low rate expected to boost buyer activity this spring selling season.

The RBA’s decision to keep the rate at the same level it’s been at since March welcomes signs of relief for many homeowners and investors in Australia.

GlobalX Group Chief Executive Officer Peter Maloney says that whilst the effects of the coronavirus crisis had put borrowers under pressure, rates were expected to remain at record lows making it cheaper to borrow money and providing welcome relief and certainty for buyers.

“There is no doubt that the economic road to recovery will be challenging, particularly in light of the Victorian stage four lockdowns and impacts on the local economy, but the RBA is maintaining an accommodative approach to its monetary policy,” Mr Maloney said.

“These all-time low interest rates should continue to provide support to Australia’s property market and are likely to act as an incentive for buyers heading into spring, particularly first home buyers.”

“It’s reasonable to expect that new listings will start to increase over the coming months, enabling those wanting to purchase a property to find the right one,” Mr Maloney added.

The latest CoreLogic data reveals that five out of the eight Australian capital cities recorded steady or rising property values throughout August with an average of a 0.4% decline across Sydney and Brisbane; with Melbourne remaining an anomaly to that trend.

“The markets are pointing towards stability with the number of auctions held consistently rising since mid-May and clearance rates holding firm around the decade average of around 63% through August.

“We also know that performance of the housing markets is intrinsically linked to the extent of social distancing policies and border closures which has had a direct impact on labor market conditions and sentiment. What we’re now seeing is a divergence of markets where the virus curve has steepened, and where the virus remains well contained.

“On a regulatory support level, we’ve been fortunate in Australia that the authorities have worked closely together during the pandemic to minimize the economic impact its caused; along with supporting household and business balance sheets,” Mr Maloney said.

“There’s no doubt in the immediate term that the housing market will require continued fiscal government support measures will continue to cushion the blow and proved targeted support for the industry.

“This week’s federal government announcement to extend the existing First Home Loan Deposit scheme to support another 10,000 first-time buyers over 2020-21 is a welcome relief, allowing first homebuyers to purchase newly built homes with only a 5 per cent deposit, with the government guaranteeing up to 15 per cent of the load. The cashback is available for purchases made before December 31.

“The scheme complements the $25,000 cashback announced in June for first homebuyers buying newly built homes, known as HomeBuilder and together, are expected to generate $800m in economic activity and support for the residential construction industry,” Mr Maloney added.