A generation of buyers has never seen RBA raise rates – and that’s likely to continue for a while yet

first_imgNew homeowners in the past seven years have never seen a rate hike.A GENERATION of homebuyers has never experienced a rate hike, and their luck is likely to continue for a while yet, according to latest predictions.RateCity money editor Sally Tindall said it had now been a whopping seven years since the Reserve Bank last raised interest rates with 21 of 23 indicators suggesting that to continue to be the case come Tuesday’s monetary policy meeting.“It’s incredible to think there is a now a large number of first home buyers who’ve never experienced a rate hike. Seven years is a long time between increases,” she said.The RBA is expected to keep the cash rate at 1.5 per cent when it meets on Tuesday. Picture: AAP Image/Dean Lewins.RateCity analysis of 23 leading economic indicators found that 21 of them pointed to the RBA leaving the official cash rate at a record low of 1.5 per cent, where it has been since August last year.“Lower than expected inflation figures and wage growth stalling at just 1.9 per cent provide an argument for the Reserve to cut rates, but that’s unlikely.“The RBA will also be concerned Australia’s household debt-to-income level increased from 19.0 per cent to a record 193.7 per cent in the last quarter – a worrying trend that leaves them in a difficult position.”More from newsParks and wildlife the new lust-haves post coronavirus23 hours agoNoosa’s best beachfront penthouse is about to hit the market23 hours agoWHAT A MILLION-DOLLAR MAKEOVER GETS YOU IN BRISBANEHOUSE SOLD FOR LESS THAN COST OF UNITFIVE WAYS TO PUT YOUR EQUITY TO WORK FOR YOURBA has expressed concern over the household debt-to-income ratio hitting a record 193.7 per cent. Picture: Getty Images.“If they hike rates, they will risk sending thousands of Australians into financial hardship. Conversely, if they lower rates, it will encourage others to take on more debt. In short, its hands are tied until wages growth, and the broader economy, strengthen.“Until then, homeowners can rest easy in the knowledge that their mortgage repayments won’t be increasing anytime soon.”The RBA board meets for the monthly monetary policy meeting on Tuesday with their decision on whether or not to move on rates to be announced at 1pm.Unemployment fell from 5.6 to 5.5 per cent last month but significantly more movement was needed to trigger a rate rise.FOLLOW SOPHIE FOSTER ON FACEBOOKFREE: GET THE COURIER-MAIL’S REAL ESTATE NEWS DIRECT TO INBOXlast_img read more