REISA Immediate Past President, Mr Robin Turner, said this latest rise would push the official cash interest rate to its highest level in 11 years.
“More homeowners will find it harder to make ends meet, however an interest rate had been mooted for some time so there was a sense of anticipation about today’s decision,” Mr Turner said.
“The last time interest rates were at this level was in November 1996, when the median house price in Adelaide was $106,500. Now the median is at $310,500 and so the rise will inevitably hit people’s hip pockets harder.”
Mr Turner said while South Australia’s current housing market was strong enough to survive an interest rate rise, first homebuyers were most vulnerable.
“First homebuyers in particular will feel the full force of this increase and it may make some buyers thing twice before committing to a purchase.”
“South Australians currently need an average of 31.2% of their income for loan repayments and while this is one of the lowest ratios nationally, any upward pressure on loan repayments can only be detrimental.”