It's well known that spring is a popular season to when it comes to real estate activity. A recent announcement from the Reserve Bank of Australia (RBA) will certainly add to the spring selling fervour, with Australian property investors closely monitoring lenders' interest rates.
The central bank elected to maintain the official cash rate (OCR) at 2.5 per cent at its latest board meeting on September 2. Such news will be welcomed by those looking to borrow to invest, whether positively or negatively gearing their rental properties.
It's not just the OCR that affects Australians' investment choices. Deciding where to buy is also important, and a number of big infrastructure projects in key cities could help make purchasing decisions that much easier.
Cash rate entices spring buyers
Moving into September, the RBA board decided to maintain the super-low cash rate at the same figure it's been resting on since August last year.
The 2.5 per cent OCR has been a boon to buyers of all stripes, particularly investors who may already have some equity to back up their borrowing demands.
"In Australia, the most recent survey data indicate gradually improving business conditions and some recovery in household sentiment after a weaker period around mid year, suggesting moderate growth in the economy is occurring," stated RBA Governor Glenn Stevens on September 2.
Mr Stevens continued, explaining that wage growth has "declined noticeably", with a period of relatively modest rates anticipated. Coupled with room in the labour market and an expected period of unemployment figures similar to what's presented currently, would-be buyers may turn to renting rather than buying, given somewhat challenging economic conditions.
The good news for investors is the record-low OCR and demonstrable increase in dwelling prices support property investment in the coming months. With more individuals potentially looking to rent, this only adds to the attraction of investing in real estate over other assets.
Melbourne builds up and up
When choosing where to invest, there are plenty of options. However, not all options are equal.
Purchasing property in an area that boasts a vibrant and varied economy that's tipped for ongoing growth is a solid approach. A recent development in eastern Melbourne is just one example of how Victoria's capital is going from strength to strength.
Construction commenced on September 2 for Chadstone's $580 million shopping precinct.
"The joint owners will invest $580 million to deliver this project which will create more than 2,700 direct jobs and 4,300 indirect jobs during construction. A further 3,400 direct and indirect permanent jobs will be created following the opening of the project," stated CFS Retail Property Trust Group Managing Director and Chief Executive Andrew McNaughton.
This is but one example of intensive infrastructure development that's placing Melbourne as a solid destination for investment. Investigate your spring buying opportunities in the Victorian capital today.