'Little to no evidence' interest rate hikes are causing rent rises, no quick fix for housing crisis, RBA saysThirteen increases have pushed the cash rate up from 0.1 to 4.35 per cent in the last two years, which has been cited as a factor in weekly rents growing at a rapid pace.
There is no evidence to suggest landlords are directly passing on the rate hikes to their tenants, according to the RBA. "However, our preliminary analysis suggests that market conditions explain most of the movement in market rents, and there is little to no evidence of direct pass-through to rents from higher interest costs in the short term.
"The impact of the imbalance between new supply and new demand for dwellings can be seen in both the rental market and the established housing market," she said."And in the established housing market prices have risen significantly in recent years – demand versus supply fundamentals appear to be alive and kicking."In the rental market, our assessment is that the level of demand relative to the stock of properties available is the key driver for market rents...