“Not yet” .. that’s the decision by the RBA, following last week’s rate hold at 4.35% – which came as somewhat of a surprise after the U.S. Federal Reserve cut their cash rate by half a percentage point.
There were hopes that would finally prompt at least a 0.25% reduction by our central bank too but alas, it was a ‘steady as she goes’ approach by new governor, Michelle Bullock, for an eleventh straight month.
Most economists are now tipping a rate cut in February, and indeed, there’s a state election in Queensland, this month to be decided, which also throws uncertainty into the market.
So what does this mean for Gold Coast buyers and sellers?
Ray White Burleigh Group CEO Tiger Malan says there’s most definitely demand in the local market, but the ‘rate cut waiting game’ is leaving both groups unsure as to what to do, in the short term.
“Rates will eventually start with a three, there’s no doubt about that, the question is, when,” he says.
“You can hold your breath for that cut – it won’t be too long now – but buyers and sellers alike would like some surety – it goes both ways.
“The RBA’s decision to keep rates on hold through Christmas takes in a lot of factors, but it’s left the whole real estate sector feeling ambivalent.
“I’m being facetious here, but a rate increase would’ve at least given some sort of price direction for the market on the Coast, and the confidence by either buyers or sellers to make a move.
“Let’s see what 2025 brings.”
The latest data from CoreLogic shows the September quarter has been rather kind for the Gold Coast unit market, with the median price now $807,000 – an increase of 12.3% since the start of the year.
The housing market has only grown 12.1% by comparison.
“A rate cut will turbocharge that, again,” Malan says.
“Units are obviously in hot demand, at the moment – perhaps that’s a sign that detached dwellings are slightly overpriced and that’s forcing buyers to readjust their housing expectations, certainly first home buyers.
“That said, there’s still a lack of (unit) stock out there, and that’s what’s fuelling that growth – there probably needs to be a ‘hurry up’ on some of these high rise projects.
“When it comes to houses, if a buyer makes a strong, genuine offer in this market, I’d say the seller would be a good chance of accepting it as they’re already seeing strong growth on this time last year.”
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