“Banks and other lenders need to pass today’s rate cut on in full without delay,” Master Builders Chief Economist Shane Garrett said.
The Reserve Bank has announced that its key official cash rate is to be reduced by 25 basis points in order to support the economy through the coronavirus challenge.
“Economic growth had already been too low before the coronavirus issue took hold, with confidence and domestic demand struggling,” Shane Garrett said.
“New home building is one of the activities to have been adversely affected by the economic slowdown. The reduction in new dwelling starts over the past few years has been very sizeable,” he said.
“There had been signs of a recovery in high-density home building during the second half of 2019,” Shane Garrett said.
“However, figures out earlier today show that apartment/unit approvals plunged during January having dropped by 35% during the month,” he said.
“The unprecedented headwinds faced by the economy and our building industry mean that the onus is on banks and lenders to fully pass on today’s interest rate cut to mortgage borrowers and small businesses without delay,” Shane Garrett said.