gutless rba, page-25

"I'd be interested to hear opinions on how the next move will affect property and the economy. Whether that be a rise, fall or hold.

I can't see how lowering interests rates will do anything for the economy or property, it may soften the downward spiral but that's about it.

The GFC brought thrift back into fashion, 2011 made it a necessity"


You are probably right. People have the cause and effect confused atm. It isn't a weak economy which is hurting housing, it is weak housing which is hurting the economy. With such a large build up of debt and run up in prices, the inevitable decline of property turnover, and the subsequent decrease in values is feeding into the retail economy through decreased spending, and RP construction and it's associated industries. It is the wealth effect in reverse.

If it continues, the likelihood is a rate cut, the only problem is that we have an economy with high prices (inflation) and low growth. Sky high property values and unprecedented debt to get them there is weighing our economy down atm, as is the high dollar.