The Reserve Bank of Australia announced last week the outcome of its third board meeting of the year.
The latest housing market statistics are likely to have caused the Reserve Bank some additional deliberation. While headline growth is very high, it is Australia’s two largest cities, Sydney and Melbourne, that are responsible for driving such high capital gains, with the rate of value appreciation across the Australian housing market unsustainably strong over the short term.
The economy is seeing benefit from the increased level of both developer and buyer confidence which the RBA is likely to see as a positive outcome from the currently exuberant housing market conditions.
OBT Director and Financial Planning Principal Rodney Turner agrees that if value growth continues along the current trajectory, the RBA may be forced to take control of the level of exuberance via higher interest rates.
“Proper wealth advice is about building and protecting your wealth, and about securing the lifestyle you want now and in retirement, which is why it is imperative to integrate this latest development into a long term wealth planning strategy.”
If you would like to talk with a qualified professional as to how this may impact your wealth and retirement planning, call OBT’s friendly Financial Planning team in Gatton on 5462 2277.