Real estate folks are anticipating a surge in auctions this weekend as sellers try to make a quick buck off an expected interest rate cut coming up. New data from property firm Cotality shows that there were a whopping 1835 auctions held last weekend in Australian capital cities. Although it was the highest number since before Easter, it was still down by about 300 compared to the same time last year. But hold on to your hats because experts are predicting a massive increase in auctions this weekend, thanks to the potential cut in interest rates.
The number of scheduled auctions is set to skyrocket this Saturday, with potential home buyers getting more borrowing power if the expected cash rate cut goes through. Cotality research analyst Caitlin Fono mentioned, “It looks like many vendors are waiting to see what the RBA decides on interest rates this week.” With the cash rate likely to drop tomorrow, the volume of scheduled auctions across the combined capitals is expected to shoot up to around 2360 this week – a 29% leap from last week, and it’s only going to rise even more next week, hitting around 2700 auctions. The Reserve Bank’s monetary policy board is currently in a two-day meeting to determine interest rates, and a 25-basis-point cut to 3.85% is on the horizon.
Experts believe that if the interest rate does get cut, house prices will see an increase for the remainder of the year. The market is calculating a 96% chance of a rate cut tomorrow, a bit lower than the sure-fire 100% bet from last week. Economists are of the opinion that an announcement of a cut will lead to a rise in house prices throughout the year. AMP deputy chief economist Diana Mousina stated, “Australian home prices are likely on the rise due to lower interest rates, but it’s expected to be a modest increase with US tariff concerns holding back buyers. This poses a short-term threat of prices reversing and affordability continuing to be a challenge. We anticipate home prices to go up by around 3% this year.” RBA Governor Michele Bullock is set to reveal her board’s interest rates decision at 2:30 pm (AEST) tomorrow.
Maybe it’s just me, but it seems like the real estate market is in for some exciting times ahead. With the expected interest rate cut, sellers are gearing up to cash in, and buyers might find themselves with more buying power. It’s all up in the air until the RBA makes its decision, but one thing’s for sure – the housing market is in for a shake-up. So, buckle up, folks, and let’s see how this all plays out in the coming days.