Property

Mortgage broker calls RBA cuts 'too little, too late'

Kevin Farmer

A SURPRISE dip in home loan approvals highlights how the interest rate cuts by the Reserve Bank of Australia (RBA) have proven to be too little and too late to lift the Australian home finance market, according to mortgage broker network 1300HomeLoan.

1300HomeLoan managing director John Kolenda said the ABS housing finance figures for November, 2012, fell 0.5 per cent despite market expectations of a 0.5% rise.

He said the disappointing result came after the RBA kept its cash rate on hold in November before deciding to reduce it 25 basis points to 3% in December.

"The RBA has been messing around with the cash rate for the past few years and for most of that time they have got it wrong," he said.

"I believe the official rate is still half a percentage point above what it should be.

"What was needed during 2012 was bold action by the RBA but what they delivered was too little, too late.

"It will be no surprise to see the RBA board lower rates again when they meet next month and we have some commentators predicting rates could go as low as 2% this year.

"I still think more rate cuts from the RBA will help keep the market active although there are other factors which are also influencing consumers."

Mr Kolenda said the domestic economy has been subdued by lack of confidence and cost of living considerations such as rapidly rising utilities prices, food prices and even insurance.

"Consumers have been battered with gloomy economic news for a few years and they weren't helped by the RBA raising interest rates seven times during 2009/10 after taking the cash rate down to 3% in response to the global financial crisis," he said.

"With continuing concerns over the global economy conditions, the threat of a mining slow down, retailers hurting, no property price growth and with unemployment expected to rise the outlook is poor."

Topics:  1300homeloan, market, rate cuts, rba




UPDATE: Man charged with endangering children in Gympie

The man and two children were travelling in this vehicle.

The two children were missing from Emerald

Men in custody after police swarm house, find missing baby

Police believe the baby girl may be with a 16-year-old and 19-year-old in a green 1995 Mazda 121 with Queensland registration 045GOS, and could be heading to Toowoomba.

The two men and baby girl could be heading to Toowoomba

Debate rages over $65 levy to help resurrect Rattler

Gympie Regional Council's decision to impose an Economic Development Levy to help get the Rattler back on track has come under fire from letter writers to The Gympie Times.

Debate rages in our letters to the editor over the Rattler levy

Latest deals and offers

Tom Hiddleston's Instagram account hacked

Actor Tom Hiddleston

Thor star the latest celebrity targetted by hackers

Charlize Theron's son dresses up as Frozen character

Actor Charlize Theron

Star's son spotted dressed a beloved Frozen character

BOOKS: Food for thought in Caroline Beecham's latest novel

Maggie's Kitchen by Caroline Beecham is published by Allen & Unwin, RRP $29.99.

New novel reminds readers that bravery exists in many forms

TELEVISION: New show is a Survivor, for now

Jonathan LaPaglia hosts the TV series Australian Survivor.

WHAT happens when a new show with a big budget flops?

Rachel Weisz understands celebrity gossip fascination

Actor Rachel Weisz

Weisz says mystery is good for an actor

Gina Rodriguez relished dramatic change for new film

Jane the Virgin lead Gina Rodriguez

TV star shaved her hair for movie role

REVEALED: Pat Rafter's $18m Coast house on the market

Check out the photos of the Coast's most expensive property for sale

The "correction we had to have" in Gladstone's rentals

UPWARD MARCH: The rental vacancy rate in Gladstone has improved for the first time in more than a year, providing a confidence boost in the market.

Vacancy rates improve with signs that things are getting betterF

ISLAND FOR SALE: Cheap Fraser Coast island drops price again

Suna Island in the Great Sandy Strait will be auctioned by Ray White Hervey Bay on Saturday morning.

This is the cheapest island you will find for sale in Australia

How a family home can fit on a 250sq m block

This is what you can build on 250m2.

Here's the floor plan of a home built on 250sq m

$100m plan for Curtis Island 'world class' luxury resort

$100 million resort: Top views at Turtle Street at Curtis Island.

"At the moment we think it meets all the town planning approvals.”

Noosa mayor on "red alert" over planning court decision

Mayor Tony Wellington hands down his first budget.

Mayor upset at lack of say about look and feel of Noosa