Login
ISCOVER
Staff Reporter
New home sales have fallen to their lowest level in over a decade, forcing industry analysts to call for a rate cut at today’s Board meeting.
To continue reading the rest of this article, please log in.
Looking for more benefits? Become a Premium Member.
Create free account to get unlimited news articles and more!
Looking for more benefits? Become a Premium Member.
According to the latest data from the Housing Industry Association, new home sales fell by 9.4 per cent in March 2012.
Detached house sales dropped by 9.7 per cent while multi-unit sales fell by 6.9 per cent.
HIA chief economist Harley Dale said the Reserve Bank of Australia needs to act boldly today and cut the official cash rate by 50 basis points.
"The Bank needs to send a clear signal that it is back on the case of assisting an economy that is clearly weaker than it anticipated in 2012," Mr Dale said.
"Leading housing indictators such as new home sales are pointing to on-going deterioration in already very weak new home building conditions.
"That situation is in turn having a major negative impact on manufacturing and services sectors.
"It is not too late to turn the situation around and prevent new housing from revisiting a GFC low. Interest rate cuts, while no panacea, can provide substantial assistance in restoring confidence and activity.
"Needless to say Australia's banks need to pass all official rate cuts on in full. Their actions to date on interest rates have damaged economic confidence and activity.”
