Banks begin to drop rates after RBA cash rate cut
After yesterday's cash rate cut by the Reserve Bank of Australia, both the Real Estate Institute of Australia (REIA) and Master Builders Australia (MBA) have called for banks to lower their rates in kind.
For the benefits to be passed on to first time buyers, home owners and anyone involved in the property industry, banks around Australia will need to react.
Wilhelm Harnisch, MBA's chief executive officer, said: "Banks if nothing else, have a moral obligation to pass on the cuts and play their role to help stimulate the economy."
Some banks have already begun to react to the cut with interest rate decreases of their own.
The National Australia Bank has lowered its variable home loan rate by 0.25 per cent to 6.13 per cent, effective May 13, which they expect will save the average residential property owner $62.50 per month.
ING Direct, St. George Bank and the Bank of Melbourne have all also announced a 0.25 per cent decrease on their interest rates for variable mortgages.
With several banks dropping their rates within a day of the RBA announcement, it is possible that more will follow in the days to come.