Corporate News

The Reserve Bank’s latest interest rate hold is regressive, a double whammy for home buyers and counter-productive to addressing Australia’s housing crisis, Villawood Properties‘ Rory Costelloe has told The Urban Developer.

“I just think it’s head in the sand. People can’t afford to buy a house and we’re falling further behind our housing targets. It’s regressive for the bank to hold the rates,” Costelloe told The Urban Developer.

Costelloe said maintaining higher rates continued to price out potential buyers.

“People are still relying on either higher income and bank of mum and dad to get into these houses, because they just can’t afford it,” he said.

The rate hold creates a double whammy for homebuyers who must also still navigate home loan buffer rates of 3 per cent, Costelloe said.

He said that if the RBA could not lower interest rates, banking regulators should consider reducing the buffer requirement.

“I think it would be quite useful that they should bring it back to 2.5 per cent. That’s a very non-inflationary way to increase people’s repayment capacity,” he said.

Read the full story: https://www.theurbandeveloper.com/articles/rba-rate-hold-july-industry-reacts