Lower interest rate highlights first home buying opportunities

Those considering a real estate purchase in Victoria may be driven into action by a recent announcement from the Reserve Bank of Australia (RBA).

RBA governor Glenn Stevens revealed yesterday (June 5) that the board was reacting to a sluggish global economy, weakened commodity prices and a subdued housing industry among other things, with its lowering of the official cash rate by 25 basis points to 3.5 per cent.

Effective today, the new rate has been welcomed by industry stakeholders such as the Housing Industry Association (HIA) and the Alcock Brown-Neaves (ABN) Group.

HIA senior economist Andrew Harvey said the decision will go a long way toward consumer confidence in Australia, while Victorian managing director of the ABN Group Aidan Hooper stated that buying conditions were now quite favourable throughout the state.

"First home buyer affordability in and around Melbourne over the next three weeks will be the best it has been for a long time," Mr Hooper said.

"Not only will the fall in official interest rates to 3.5 per cent lower mortgage repayments, but the chance to qualify for a $13,000 first home bonus, as well as the additional $6,500 regional bonus finish on June 30," added Mr Hooper.