HOUSING MARKET BOOMING AS RESERVE BANK KEEPS INTEREST RATES ON HOLD

Australia’s housing boom continues as the Reserve Bank of Australia keeps official interest rates at record lows, although fixed mortgage rates are starting to rise.

The RBA board kept the cash rate and other key policy rates on hold at 0.1% after its monthly meeting on Tuesday.

RBA governor Philip Lowe noted lending rates for most borrowers are at record lows.

“Housing markets have strengthened further, with prices rising in all major markets,” Mr Lowe said in a statement after Tuesday’s meeting.

“Housing credit growth has picked up, with strong demand from owner-occupiers, especially first-home buyers. There has also been increased borrowing by investors.

“Given the environment of rising housing prices and low interest rates, the Bank will be monitoring trends in housing borrowing carefully and it is important that lending standards are maintained.”

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