RBA board reform: Special attention for interest rates or political bin fire?
In This Week’s How's The Market | Edition 94
RBA board reform: Special attention for interest rates or political bin fire?
Breathtaking Dual Living with a Luxe Alfresco
Auction market winding down ahead of the festive season
RBA board reform: Special attention for interest rates or political bin fire?
The Reserve Bank of Australia's board has been split in two, allowing its experts to concentrate more on monetary policy.
The timing of next year's federal election raises more questions about the relief of pressure on operations due to ongoing criticism over cash rate decisions.
More than a week has passed since the Senate approved long-awaited changes to the Reserve Bank Act, ushering in a new era for the central bank's composition and decision-making process.
The development of a dual structure for the board had been put on the political back burner after the bill's provisions did not materialise in July as originally envisaged, thus the passing was unexpected.
The bank's hardline stance on interest rates has been a subject of criticism, leading to the confirmation of a two-member board split starting February.
Australia's 13-year high cash rate of 4.35% is out of line with comparable nations, and with core inflation high, mortgage holders may not expect a reprieve in the short term.
The RBA will have two boards in 2025: one focused on monetary policy and interest rates, and another managing governance.
Governor Michele Bullock remains uncertain about the potential impact of the dual structure on the bank's concerns raised in last year's independent review.
The RBA's independent review last year revealed a need for increased transparency in setting and managing the cash rate.
A large portion of 2024 has been spent as a political football by the current RBA board. The opposition has expressed worries about a politically influenced appointment, while the current Labor Party wants to see more scientific macroeconomic competence based on the study conclusions.
Ms. Bullock suggests that the bank will greatly benefit from improved scrutiny.
What The Agents Are Saying
Agents are well and truly on holiday mode this week.
The vast majority of calls are going to voicemail and many of the agents I am speaking with are already mentally checked out after the tough year it has been for them.
Especially this quarter's recent buyer’s market for a lot of real estate agents.
Many are taking a good break into the later half of January from what I am hearing and some agents are struggling still to clear stock that didn’t sell in previous weeks and even months.
Off-markets are still pumping but will probably take a break between now and the first week or two of January.
The Wow Factor!
This elevated home, boasting light-filled interiors and stunning views, is an ideal choice for families and those seeking an alfresco lifestyle.
The accommodation features sheltered decking, a large Caesarstone kitchen, a solar-heated pool, a luxurious swim spa, and a pool/games room with wet-bar and air-conditioning for entertaining.
The main house features a second living area with alfresco access, two bedrooms, a kids' wing, a master with wardrobing, wet-room style ensuite, family bathroom, and separate WC.
This tranquil location, conveniently located near schooling options, the village and station, and Hastings, serves as the gateway to the Mornington Peninsula's attractions.
Unveil the Beauty of Dual Living Combined with a Luxe Alfresco Space!
Price Guide: $1,980,000 - $2,145,000
In The Media
Auction market winding down ahead of the festive season
Compared to 2,617 last week and 2,884 at this time last year, there are now 2,215 capital city homes up for auction this week.
Since early November, when auction activity fell to 1,972 in the run-up to the Melbourne Cup, we anticipate that this will be the quietest auction week.
Melbourne is set to host 1,003 auctions this week, following 1,236 homes auctioned last week and 1,398 last year.
Sydney is set to experience a decrease in the number of homes under threat this week, from 927 last week and 934 last year.
Brisbane, Adelaide, Canberra, Perth, and Tasmania are the busiest auction markets this week, with Brisbane, Adelaide, and Perth expected to have their busiest auction weeks of the year.
The combined capital cities are set to auction around 850 homes next week, with a few more scheduled in the lead up to Christmas.
Final Thoughts
Restoring trust in the bank's transparency may be greatly aided by a reduction in the governor's single authority.
However, the task of determining the cash rate goal will fall to the newly appointed, specialized, nine-member monetary policy board next year.
If you or someone you know would like assistance to buy this year, book in a call and we can discuss if we can help.
Thanks for reading this far!
We value feedback and if you have any suggestions on what you would like covered in the future please email me at tristan@tomii.com.au
Happy Buying!
Note: This is general advice and does not take into consideration your objectives, situations or needs. Please consider if this advice is suitable for you and your circumstances and speak to a professional before making any financial decisions.
