Most buyers aren’t deterred by the recent interest rate rise, with many having factored that into their calculations, according to Owen Wilson, chief executive of REA Group which publishes realestate.com.au.
Wilson says the rate rise was off a very low base and even if more predicted rises occur it will only put the market back to where it was before the pandemic.
“The market has already factored it in, anyone buying at the moment is doing so with a full expectation of these rate rises and we’re still seeing really healthy levels of listings and transactions,” he says.
Wilson says banks have been using 5% as their serviceability interest rate, so anyone who has taken out a loan in recent years has been assessed at having the capacity to meet repayments at a much higher rate.
He believes demand may slow over the year but says that, in light of recent strong activity, this is a healthy outcome.