Australians are taking the opportunity to cut debt
That's according to Canstar, which has reported more than $1.7 billion has been paid off credit card debt in a month in Australia. AMP Bank has also shown a 14 per cent increase borrowers switching from interest-only to principal-and-interest loans.
It's interesting to lay this against this week's offering from CBA's Household Spending Intentions index for July, which analyses the spending intentions of nearly 2.5 million Australian households. It reckons that consumer intentions are back in the black for the first time since early 2019.
This feels at odds with what the RBA is saying at the moment. It's latest meeting minutes demonstrate the Reserve Bank is still waiting to see meaningful impact of the Morrison government's tax cuts on the economy, and that it's worried growing economic risks will force a sooner-than-later reduction of official interest rates below 1 per cent.
Treasurer, Josh Frydenberg is yet to take a bite from this particular apple, though. The staring match between the Morrison government and the RBA over economic stimulus continues, with JoFry announcing it intends to prioritise surplus over stimulus.
The RBA's latest notes warn that house prices are poised to continue rising, despite what the likes of UBS have to say on the matter. While economists from the international bank say the current mini-boom will run out of puff relatively quickly, the RBA says the combination of weak construction and housing investment and the fact people seem to be banking, not spending their money at the moment, suggests further house price growth is on the immediate horizon.
We all know prices are starting from a lower base. It was no surprise to anyone that ABS residential property price figures for June quarter, released yesterday, showed a 0.7 per cent national decrease to bring the 12 month rate of decline to 7.4 per cent. We heard earlier that prices have risen 2 per cent in the past two months; there's still a way to climb before we get back to where prices were even a year ago.
Victorians in particular will potentially be looking at supply-and-demand-driven price increases, according to the Urban Development Institute of Australia. It says Victoria is heading into a significant housing shortage given the rapid decline in new dwelling approvals in the 12 months to July; at current estimates, the state will be short of at least 20,000 homes a year.
Sidoti steps down from ministry for ICAC probe into his property investments
NSW Sports Minister John Sidoti won't be stumping up for new property investments any time soon. He stepped aside from his ministerial role yesterday, only hours after an overblown Berejiklian leadership challenge ended in a fizzer, pending an ICAC investigation into land he purchased near the North West Metro and Western Metro projects.
These purchases have been public knowledge since 2017, but have resurfaced in the wake of the NSW political donations scandal. Apparently the party took a donation from a developer of one of the projects Sidoti invested in, which is prohibited in NSW.
Speaking of developers, construction has resumed on The Orchid apartment project in Arncliffe. Lender, Wingate secured the funding needed to complete the project after construction company, Ralan was stood down last month when it collapsed owing creditors half a billion dollars.