Economic and real estate experts have put forward their opinions on the Reserve Bank of Australia's (RBA's) latest interest rate decision.
The RBA decided to keep the current interest level of three per cent on Tuesday (April 2), making it three straight months without action.
According to the organisation, stabilising global conditions, consistent domestic inflation and indications previous cuts were having a positive effect were all factors in maintaining the status quo.
Shane Garrett, senior economist at the Housing Industry Association (HIA), said inaction from the RBA means banks should step up and take the lead.
"With the RBA's own research indicating a fall in the banks' wholesale lending costs over the past few months, the time for lenders to pass on the full RBA cuts is long overdue," he explained.
"The cautious approach of the RBA to further interest rate reductions means that banks need to act quickly to support activity in the traditional economic sectors."
HSBC chief economist Paul Bloxham also weighed in on the discussion, claiming that the central bank's wait-and-see approach could signal the end of the rate-cutting cycle.
"Tactically, it pays the RBA to appear as though it's likely to cut, particularly given their concerns about the continued high Australian dollar, but a 'dovish bias' does not mean they will necessarily follow through," Mr Bloxham told The Australian.
Peter Bushby, president of the Real Estate Institute of Australia, said the likelihood of people getting cheaper home loans through further rate reductions is looking increasingly slim with each meeting of the RBA's policy committee.
However, he argued that there are a number of other factors that could prevent someone from buying a home in the current property market, including state taxes and land-release delays.
If a reduction had taken place, Mr Bushby claimed, housing affordability would improve by around 2.3 per cent, with a 25 basis points cut from the current level saving the average family around $50 a month on their mortgage.
"The average loan repayment would be $481 per week. This would be $115 per month less
compared to the figure recorded a year ago," he stated.
Last year, the RBA made four cuts to the key cash rate. The most recent was in December, when it dropped 25 basis points.
There were also cuts of 25 basis points in October and June, with a 50 basis points drop in May.
