The Tamworth real estate market is set for a massive boom, after the Reserve Bank’s announcement that it would cut interest rates by one percentage point.
The announcement comes as great news to Tamworth residents, with prospective home buyers as well as those paying existing home loans set to save large amounts of money.
PRD Nationwide principal Rob Philp said the announcement was important for the Tamworth region, the real estate market of which was set to strengthen.
“It’s excellent and it really will consolidate the market,” Mr Philp said.
“We can expect to see more and more people being brought into the market as a result.”
The fourth drop in interest rates in three months will see a major increase in affordability for home owners, with those having borrowed a typical $200,000 loan set to save $128 monthly.
“We’re seeing repayments become similar to rent, so buying is now much more attractive when compared to renting,” he said.
Despite increased local market activity in the wake of previous rate cuts, Mr Philp says he expects the latest cut to bring about the most change.
“We will probably see investors come back into the market,” he said.
“There will be flow-on effects too, and I think we’ll see people having the confidence to sell their first homes and upgrade.”
Mr Philp said the strength of the Tamworth real estate market shouldn’t come as a surprise, despite the global financial crisis and threats of recession.
“In Tamworth we are perfectly set up, we have good infrastructure and a vibrant centre, and things like the Equine Centre and the new shopping centres provide plenty of opportunities,” he said.
“It’s a great place to be in hard times.”
LJ Hooker principal Richie Thornton said he believed the latest cut would have a real impact on the market.
“It’s clear that to go down by one per cent, they (Reserve Bank) really understand how much relief is needed to get the market moving again. We just need to reach that level of comfort where everything is sustainable,” he said.