After a recent review, the RBA is set to undergo the biggest reform in decades, effective 1 July 2024, with the current board losing its powers to set the cash rate. According to Treasurer Jim Chalmers, the most significant change involves the creation of two boards, one for governance and one for monetary policy, with the latter having dual objectives: monetary stability and employment.
The latest quarter ABS figures show inflation has peaked and is on its way down, justifying the RBA’s decision to halt rate hikes last month. Despite the rate hikes to date, CoreLogic’s data shows clear signs of property prices recovery, with most capitals showing a positive percentage increase this month.
This month has also seen a record-high collapse of builders, according to AFR Economics Editor John Kehoe. Among them, prominent names such as Porter Davis and Lloyd Group, with Maher Corp’s Urban Edge and Eight Homes going into administration and halting the construction of more than 730 homes.
New apartment construction has fallen by 47% since the introduction of increased stamp duty for foreign investors in 2016, further fuelling the housing shortage, according to recent ABC News report citing industry groups. Shadow Home Ownership Minister Jess Wilson says housing shortage is a ‘systemic problem’ and is calling on government to step in with regulatory reforms.
Download and read the full Market Essentials – May 2023 Report.