Tariffs to boost property market?

Tariffs to boost property market?

Well, if the tariffs will dampen the consumer sentiment, then demand for goods and services will fall. This means the economy will slow down. No more multiplier effects to the economy since lower demand means lower production. In other words, less workers are needed. Thus, fewer people may have enough money to keep buying things they like. Businesses would think twice about marketing, about expanding or even about employing more people. Uncertainty is the order of the day. What would the central banks do…?

Lower Interest Rates to boost the economy… and property market

Article in realestate.com.au Ray White economist Nerida Conisbee said that Trump’s tariffs has raised the prosppect of more interest rate cuts in addition to the last cash rate cut announced by the Reserve Bank in February.

“Economic upheaval has dramatically altered interest rate expectations,” Ms Conisbee said.

“As of 8 April, markets anticipate an almost certain 0.5 per cent cut at the next RBA meeting on 20 May.

“Such reductions would benefit mortgage holders significantly and will almost certainly direct more money into the housing market, supporting both housing supply and price growth.” Do read more here: Article in realestate.com.au

Then again, this may also happen in the property market

When every country strives to protect themselves, trade slows down. It’s just too expensive to export and without exporting, there’s no importing too. No one buys anything. Everyone is feeling pessimistic. When we cannot foresee the future, we do not buy any big item, especially a property which is hundreds of thousands of ringgit or dollars or even more, depending on which city we are talking about.

Transactions would slow down and that’s definitely going to affect the property market too. People just remain where they are. If they are renting, they continue to rent. If they already have a home, they stop thinking about an upgrade. This will happen even if the rates are lowered because confidence has to be there before anyone decides to buy / invest. Which one will happen? We will know as soon as the dust settles since right now everyone is shouting at one another.

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