Based on the meeting last December 02, 2014, The Board decided to leave the cash rate unchanged at 2.5%. Global economy is continuing at a moderate pace & Australia is one of the countries that has moderate pace. Interest rates really affect the performance of the market.

According to Governor Glenn Stevens, “Interest rates are very low and have continued to edge lower over the past year or so as competition to lend has increased.”

When the economy will boost and interest will drop, definitely it really helps the market to boost especially the Perth’s housing market. However, Australian dollar is falling and help to attract foreign interest. Because of the performance and the higher confidence, it can cause optimism. There is a potential rate cut in the middle next year and could encourage more buyers and investors.

http://www.rba.gov.au/media-releases/2014/mr-14-21.html


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According to a property developer with investments in the city, “Slowing population growth in Perth will allow the home building industry to better keep pace with demand.”

In Residential market, Western Australia remains the strongest despite a slowdown in property market. Mining investment really help the market to sustain the growth but sad to say mining sector weakens.

When some investment won’t sell by the end of this year, probably it would help the market to balance. Affordability barriers may kick in to slow price growth. Unemployment is low, confidence level is quite not good and interest rates won’t change, these are the barriers why the market can’t sustain.

 

When the market will become active in the first quarter and confidence will still be high, I think market will very strong. Interest rate may cut next year and investor activity is likely to continue at high level. If there will be happen next year and it will continue to go well, market encouraged the market to have a good start in 2015.

http://www.propertyobserver.com.au/finding/location/wa/38759-slowing-perth-market-will-allow-supply-to-catch-up-with-demand-developer.html


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