Yesterday’s interest rate increase by The Reserve Bank carries with it some hardship for the outer residential suburbs around Australia.
Curbing inflation is clearly the RBA’s main aim. And from their additional comments yesterday, we now have confirmation that Australia is effectively seen as being shielded from the turmoil in the US.
Retail sales may stall — particularly if fuel and food prices remain high. And this will have a flow-on effect for Retail rents and sales activity.
If Retail sales do falter, you will then probably start to see softening in activity for Warehouse properties … about six months later.
However, a long-term study by BIS Shraprel has shown that the Office market would appear to bear no relationship to movements in interest rates.