It has been 29 consecutive months since there was a change in the RBA cash rate. This is right back in August 2016 and today the RBA once again decided to keep rates on hold.

Analysts are now predicting that the RBA will lower rates in the later part of 2019 with some predicting 2 rates cuts. This will be great news for investors looking to enter into the property market making it easier to hold property.

Why have interest rates remained on hold again? Let’s look at the economy in greater detail.


The overall global economy is in good shape. Share markets have risen which is being supported by growth in overall corporate earnings. In most economies unemployment is low and wages are growing. Inflation in most countries is low with oil prices decreasing. China has slowed over recent years but Chinese authorities are easing financing conditions in order to boost growth again.


The over-regulation of banks has led to a slowdown in the construction industry across Sydney and Melbourne while other states remain robust. Although property values are declining in both Sydney and Melbourne price growth can been see in other capitals around Australia namely Hobart and Brisbane.
The labour market in Australia remains strong with low unemployment (4.9%) and strong job growth. There is a skills shortage is some places across Australian and this leads to wage growth. This continued improvement in the labour market means Australia is safe from any type of recession as it is impossible to have a recession with job and wage growth.

Availability of credit is still an issue but now that the Royal Commission is done and APRA has no imposed regulations, banks are starting to ease credit policy. This has been seen with some of the majors lowering interest rates and extending interest only periods to investors in order to gather market share.

Inflation is still low and very sitting stable. It is anticipated to increase over the next few years with wage growth but at present it is low and stable. Petrol prices lowering are helping keep this low.

Overall Australia’s economy is in very good shape and slowly getting better. With the decline in housing values across Sydney and Melbourne it may just feel as though things are depressed.

We have an interesting 2019 in front of us. With predictions that interest rates will drop further. It may be an even better time to get into property than first thought.