At 2.5%, Australia’s official cash rate is at an all-time low.
This means auction clearance rates have been through the roof, leading to growth that even one of Australia’s most prominent real estate figures is worried about.
According to the Australian Financial Review, McGrath Estate Agents boss John McGrath said this at a conference:
“I haven’t seen it this hot since the last real estate boom,” he said, telling a mortgage brokers’ conference clearance rates had rising above 80% in the past three months.
“If there is pressure to keep growing at this level – which I don’t suspect we will – quarter after quarter after quarter, we’d probably end up in trouble because we just can’t grow this rapidly.”
According to The Australian, Commonwealth Bank boss Ian Narev, who was speaking at the same conference, said he was confidant the country’s central bank knew what it was doing.
“I am absolutely confident that all direct and indirect consequences of the property market that may flow from change in the interest rates are absolutely thought through by the governor and his board.
“I don’t lose a moment of sleep thinking about that,” he said.
Read more here.
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