Australian house prices have risen for the fourth consecutive month, driven by the Reserve Bank of Australia’s (RBA) interest rate cuts and expectations of further reductions later this year.
According to real estate consultancy Cotality, the home price index increased by 0.5% in May, with all major cities recording gains.The benchmark markets of Sydney and Melbourne saw price increases of 0.5% and 0.4%, respectively.
Research director Tim Lawless commented, “The sustained momentum we have seen in almost all markets is undoubtedly driven by interest rate cuts, whether they have already occurred or are anticipated in the coming months.”
With interest rates falling again in May, housing values are expected to be further positively affected in June and for the remainder of the year.
Financial market pricing indicates that the RBA is likely to cut interest rates three more times this year, reducing the cash rate from the current 3.85% to 3.1%.
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