With property prices still rising, how should the RBA respond?
Interest rate rises would ordinarily push property prices down, but real estate and rents are still going up, adding to inflation and giving the RBA more food for thought as it ponders its next move.
House prices and rents are up, the government is grabbing more stamp duty than ever and inflation is driving the RBA into a corner. (Image source: Shutterstock.com)
Despite the earlier predictions of many, and to the dismay of borrowers, the end of the rate rise cycle has not yet arrived.
In early August, the Reserve Bank will once again weigh up persistent inflationary pressure and in doing so, it must also assess the high cost of housing.
This means giving due consideration as to why that cost is so high and what further rate rises
will do to this cost in the future.The latest CoreLogic Home Value Inde…
