It’s the news homeowners across the nation love hearing. The Reserve Bank of Australia (RBA) has slashed the cash rate 0.25 percentage points, bringing it down to 3.85 per cent. The announcement comes after inflation continued to drop in the March quarter.
Read today’s official statement on the RBA’s website.
The latest figures from the Australian Bureau of Statistics showed the Consumer Price Index (CPI) rose 2.4 per cent over the 12 months to the March quarter.
Meanwhile, underlying inflation fell to 2.9 per cent for the March quarter, down from 3.3 per cent in the December quarter. That’s the lowest it’s been since December 2021.
The latest inflation data left many economists almost certain of more interest rate relief to come, with some even anticipating we could see a 50-basis point cut to 3.6 per cent in May. But the RBA went with a 25-basis point cut instead.
“We’ve come a long way, and it hasn’t been easy, but we have made good progress on bringing inflation down and keeping unemployment low,” RBA Governor Michele Bullock recently said.
“This is a good position for the economy to be in as we approach a period of uncertainty.”
“The Board will continue to look at the data to assess if the economy and inflation continue to evolve as expected.”
If you have a home loan and you haven’t reviewed it in a while, now is the time to get in touch. We can check whether your lender has passed on the interest rate cut and explain what that means for you.
For aspiring homeowners, it’s a great time to be contemplating a property purchase, with interest rates coming down.
There have also been some exciting housing announcements as part of the federal election, such as the expansion of the government’s Help to Buy scheme. Under the scheme, eligible home buyers can purchase a property with a deposit of as little as 2 per cent, without having to pay Lenders Mortgage Insurance (LMI), with the government contributing 30 to 40 per cent equity towards the purchase.
Labor also pledged to expand the existing First Home Guarantee, so that first-time buyers can purchase a home with a 5 per cent deposit from 2026, without copping LMI.
To chat through whether you qualify, get in touch today.
