– During RBA’s emergency meeting held on 19 March 2020, decided to apply another interest rate cut of 25 basis to a new record low of 0.25%, providing two interest cuts in less than 3 weeks.
– The lowest Australia Dollar since October 2002 gives positive effect on property market, but given the current situation, very limited. It may help prevent the market fully back into down trend, but has less momentum to push the price up on the other side.
>> With the COVID-19 becoming a global crisis, in both health and financial sectors, most investors will become more conservative on following investing activities.
>> The plunges of global stock markets also put investors with less bullets they can use on property market.
>> Low dollar value will help on education sector, attracting more overseas students who may rent or buy properties. However current travel ban and potential shutdown of schools and colleges will put a break on their property investing plans.
– When COVID-19 crisis is over, hopefully before next Spring:
>> If only minimum increase on unemployment rate which means most people hold their jobs and incomes, the market will come back to the up trend. With government first home buyer stimulus, the market continues with more first home buyers jumping in.
>> If unfortunately significant portion of employees lost their jobs during this time, the low- and medium-range market will experience a hard time at least by the end of next financial year.
>> High end market normally has minimal connection with unemployment rate. However recent catastrophic plunges happened across all major stock markets globally and damage put on global business and tradings, will all affect how much money those high-end property buyers can use in their purchases.
>> High end property market will be on a case-by-case basis. But still the activity level will be no comparison with what it has before COVID-19 burst.View More RBA Emergency Rate Cut and COVID-19 Impact on Property Market