“We are in a climate of uncertainty regarding the short term economic outlook, while the significant negative impact of last November’s rate hikes has yet to fully emerge,” said HIA Chief Economist, Dr Harley Dale.
“The housing industry suffered a substantial hit to confidence as a result of the November 2010 rate hikes and small business lending rates are already inappropriately restrictive,” Harley Dale said.
“At this time we need an economic environment that is supportive of investment in Australia’s housing stock. We have an increased need for home-building due to affordability issues in the private market, a severe shortage of accommodation in the public housing market, and increasing fiscal restraint when it comes to housing programs, as highlighted by the Federal Government’s recent capping of the NRAS scheme,” said Harley Dale.
“Against this backdrop the Reserve Bank should be removing some of the uncertainty from the domestic economic picture by clearly signalling a sustained period of stable interest rates,” added Harley Dale.