Australia’s home loans are at their lowest level in almost half a century, following the cash rate cut announced by the Reserve Bank last month.
New figures by CoreLogic RP Data show mortgages rates dipped to 4.9% after the cut, a level not seen since 1968.
Auction clearance rates have also reached a six-year high. In 2011, those with $400,000 mortgages were paying about $27,000 a year in interest. Today, those payments have declined to $19,400, giving borrowers a saving of $150 per week.
"Vendors have become more empowered as buyers compete more fiercely for available housing stock," the company’s head of research Tim Lawless said.
Lawless said he predicts more auctions over the coming weeks and for more homes to be available in the property market.
He added that as the housing market runs so hot, the Reserve Bank of Australia and other regulators now face the “challenge of trying to keep a lid on soaring property prices”.