Melbourne Housing Market Trends Amid RBA Cash Rate Stability
The RBA has decided to maintain the official cash rate at 4.35% for the fifth consecutive time, navigating mixed economic signals such as persistent inflation and a strong labour market. This cautious approach reflects the need to balance economic stability with growth.
In Melbourne, housing values grew by 0.8% in May, marking 16 consecutive months of growth. Melbourne's market saw significant price increases over the past 12 months, driven by extremely low levels of listings. Property listings are more than 30% below the five-year average, sparking a surge in appraisals as homeowners seek to capitalize on recent price gains.
Looking ahead, the RBA is likely to maintain the current cash rate for the rest of 2024. House prices in Melbourne are expected to rise at a slower pace as listings increase. Anticipated interest rate cuts in early 2025 should bolster borrowing capacity and consumer sentiment, with housing values projected to trend higher due to steady population growth and an ongoing undersupply of new homes.
