Interest rates remain steady – what does this mean for property?
The Reserve Bank of Australia (RBA) releases its official cash rate at the beginning of each month. For the first few months of 2019 the RBA has kept cash rates steady at 1.5 per cent. This is an incredibly low rate that it has been maintained since August 2016.
There are many factors that come together when the RBA is deciding on the cash rate, including the housing market among other things. And many experts are predicting that the cash rate, which directly impacts a banks’ interest rate, will be cut in 2019.
Among the noise in the market, PwC’s chief economist Jeremy Thorpe anticipates that the RBA will “hold off as long as possible” before cutting the rate (domain.com.au).
Whether it does or doesn’t happen this year, we consider what this means if you’re a property owner or even in the market to buy.
What does this mean for property owners?
If you’re a property owner, now is a good time to invest in upgrading your property while the incredibly low borrowing costs are set to remain. Hockingstuart’s Glen Iris Director Steve Burke says, “While the market has slowed somewhat, with interest rates remaining stable you can use this time to add market value to your property,” shares Steve. Adding, “If you’re considering selling in the near future and have been putting off renovations or upgrades, you should utilise now as an opportunity.”
What do stable interest rates mean for buyers?
Although lending has tightened, if you’re already in a good position – for instance, have pre-approved loans – this is a good time to lock in a great rate. But do remember to keep your options open. Reach out to the team at hockingstuart to find out more.