First Time Buyers Cheer Rate Cut

April 2- The Reserve Bank surprised the market last week with the 0.5% decrease in the repo rate, and this move has been cheered by first time buyers hoping to purchase a home this year.

Due to the decrease, the construction of affordable housing should pick up speed, allowing more first time buyers than ever to buy their dream homes.

Hilton Rogoff, the Director of Duro Pressings, which provides a wide range of products to the affordable housing sector commented on the rate cut and said that it represented good news for first time buyers.

"By easing the cost of borrowing - albeit slightly - the Reserve Bank's rate reduction opens the door for thousands of first time home buyers and other mortgage applicants who previously fell just short of the qualifying threshold," said Rogoff.

The director said that in his opinion, it should not take long for the knock on effects to be felt in the affordable homes market by way of job renewal and "upticks in mortgages granted" and new building plan applications.

"Hopefully, the largely unexpected rate cut will signal the beginning of a post recession economic revival by persuading the big banks to east - at least slightly, for now - their onerous criteria on granting bond finance and other forms of consumer debt," said Rogoff.

Rogoff concluded that the positive impact of these steps on the building industry and its labour force could be huge.

The repo rate was cut to 6.5% against consensus estimates, the first cut since August 2009.

4/2/2010 11:30:21 AM