Valley home buyers return | Northern Rivers News | Local News in Northern Rivers

5th September 2008

THIS week's interest rate cut came as a welcome relief for home buyers and already, the results have made an impact on the Valley's property market.

Just a day after the Reserve Bank slashed interest rates by 0.25 per cent, a Ray White auction in Grafton saw four out of six properties sold, with one more under negotiation.

More unusually, all the properties were priced in the middle to higher bracket for the area, with prices ranging from $300,000 to $433,000.

Yesterday, Clarence Valley real estate agents reported an increase in inquiries and buyer activity over the past two weeks and predicted consumer confidence and prices to rise throughout the rest of the year.

Although Ray White principal Adam Sydenham did not attribute Wednesday's positive result solely to the interest rate cut, he said it was clear confidence was returning to the local property market.

"There's a more energy and activity in the market," he said.

"The pendulum is slowly moving back to an even market ... it's not a buyer's or seller's market at the moment."

McKimm's principal Angus McKimm said at only a quarter of a per cent, the interest rate cut had more of a psychological than tangible effect on people looking to buy in the market.

"The residential market was dead as a doornail in July and up until August," he said.

The Reserve Bank has predicted overall economic growth to slow, with monetary policy expected to be less restrictive in coming months.

Mr McKimm said further rate cuts were likely and as such confidence would continue in the busy spring selling season.

This optimism was echoed by the Real Estate Institute of New South Wales. The institute's president, Steve Martin, said the easing of monetary policy helped momentum return to the State's property market. He said two more possible rate cuts before Christmas could provide relief for renters as investors looked to buy.

"It won't completely solve the rental crisis, but it's a step forward," he said.

Federal Member for Page Janelle Saffin said the rate cut could benefit families in the electorate by an average of $43 a month, depending on the size of their mortgage. In Yamba, the upbeat market is expected to generate more sellers, as well as higher prices.

Raine and Horne licensee Denise Jillett said prices would follow an upward trend as a result of more confidence in the market and more sale signs popping up.

LJ Hooker Maclean's Ken Giese said people looking to settle and retire into the area meant the Lower Clarence had a stable market.

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