Rate hold decision not significant as long as easing bias remains: Brian White

Ray White chairman Brian White says the decision to leave the cash rate on hold in November will not have a significant impact on the housing market, so long as an easing bias remains.

White says property remains a great investment over a decent span of time.

“I expect to see an easing of rates which will continue to buoy the confidence of investors and owner- occupiers resulting in a good steady market in 2013.”

“When the community believes rates will decline, activity picks up before the event actually happens,” White tells Property Observer on the back of Ray White achieving its best monthly sales result in a year in October.

White says borrowers have a “clear anticipation” of future downward movement in rates which is the reason there has been an increase in open for inspections and activity in the housing market.

Looking at the performance of the Ray White group over October with sales reaching $2.6 billion, White says Auckland was the standout Australasian market outperformed the rest of the New Zealand market “by a huge margin”.

In Australia, White says capital city markets continue to outperform relative to other parts of the country.

“There is not that much difference between these markets, there is good strength across all of them.”

White says Melbourne and Sydney were for a long time the standouts but Brisbane and Perth have rallied while Adelaide has remained “consistent”

White notes that property investors are increasingly using their self-managed super funds to make investments.

SMSF investors are a huge percentage of investors. They are looking at property because they have control. They can rattle the letter box and knock on the door compares with derivatives and other financial instruments that people don’t understand.”

“A number of investors went into mining regions, but this will change. They will come back to more consistent investment in the cities,

White says property remains a great investment over a decent span of time.

“I expect to see an easing of rates which will continue to buoy the confidence of investors and owner- occupiers resulting in a good steady market in 2013.”