Investment markets were subdued in January with the All-Ordinaries index closing the month 0.3% higher at 6,870.9 points. The Australian Dollar retreated marginally, with 1 Australian Dollar buying 76.5 US cents.
The Reserve Bank of Australia (RBA) did not meet in January. The RBA board will meet again on Tuesday this week, with no change expected to the Cash Rate (which remains at a historic low of 0.10% per annum).
Global share markets were generally flat in the month of January, with the United States Dow Jones index falling by 2.0%, the London FTSE falling by 0.8%, the Japan Nikkei 225 gaining by 0.8% and the Hong Kong Hang Seng Index gaining by 3.9% for the month.
Recent data from CoreLogic indicates that broad-based Australian property market values have recovered from impact of COVID-19 as noted in the charts below.
As indicated above, all listed capital cities experienced a short period of negative quarterly property price growth during 2020. However, the combination of low interest rates, a robust effort to control the spread of COVID-19, and government stimulus measures, has resulted in the quarterly property price growth figures turning positive again.
With interest rates likely to remain low for the foreseeable future, and with mooted changes to stamp duty for New South Wales (alleviating the need to pay a lump-sum at the time of property purchase), it is likely in my view that broad-based property market values will be supported over the short-to-medium term.
For more information, please contact Ryan Love on 1300 856 338.
This article is general information only and is not intended to be a recommendation. We strongly recommend you seek advice from your financial adviser as to whether this information is appropriate to your needs, financial situation and investment objectives.