RBA Rates Announcement Oct 2021

05.10.21 | Marc Barlow | News

No change as interest rates stay at 0.1%

Today’s monthly RBA board meeting has opted to maintain interest rates at the extremely low 0.1%.

‘The Bank’s package of policies – including record low interest rates… is providing substantial and ongoing support to the Australian economy,’ the RBA said today.

In a statement of the obvious, the RBA stated: ‘Housing prices are continuing to rise.’ Indeed, there has been month-on-month price growth for all types of dwellings since November 2020, and an annual increase of more than 13 per cent across houses and apartments.

We only need to glance at real estate websites to know that the supply of properties on the market is still a bit down on previous years. Explaining price increases, the RBA noted that demand hasn’t slowed in line with the supply drop: ‘Housing credit growth has picked up due to stronger demand for credit by both owner-occupiers and investors.’

The RBA also reiterated that it will not increase the cash rate until ‘actual inflation is sustainable within the 2-3 per cent target range’. Cash rates have remained at this incredibly low level for almost 12 months, despite the upheavals wrought by a global pandemic.

In fact, the Central Bank is anticipating low rates for some time, noting they don’t anticipate rates rising before 2024. For Melburnians paying off a home loan, it’s encouraging news in these uncertain times.

Likewise, for those eyeing a loan for an investment property, now is a great time.

It’s a perfect storm.

First home buyers, on the other hand, might be feeling like this constant increase in property values will never end. Sit tight, because the government is also concerned about the market running hot, as housing affordability is always on people’s minds as we get closer and closer to a federal election. With the RBA keeping rates low, the government might be contemplating other ‘levers’ to rein in a rampaging market.

Meanwhile, lenders large and small keenly compete on rates. So it may be an opportune time to take stock and review the rates on your current or prospective loan.

Contact us at Mortgage Broker Melbourne and our trusted team can assess your loan options based on your unique financial circumstances.

And remember that during lockdowns, we offer video conferencing for your safety and convenience.