A word from Anthony Webb

A word from Anthony Webb

Interest rates have gone up in Australia for the first time in over a decade. The Reserve Bank of Australia (RBA) last week lifted the official cash rate from 0.1 per cent to 0.35 per cent, sparking an economic and cost of living conversation.

Interest rate rises have been anticipated for many months now and should come as no surprise. With additional hikes expected to be announced before the end of the year, many people are questioning what this means for the property market and housing affordability.

However, it’s not all bad news. The new rate of 0.35 per cent is relatively small increase from 0.1 per cent, so I don’t believe it’s going to have a massive impact initially. Vendors may hesitate and hold off listing their properties to see what happens to the market. If that happens, there will be less stock on the market and an increase in demand, meaning properties will likely hold their price.

As rates go up, it will affect the amount buyers can spend, so the most sensible thing buyers should do is speak to a finance broker or bank to find out how much can be borrowed.

Although buyers may be more conservative with their property purchases, it is important to remember property is a long-term investment. If you have the money ready to go and plan on holding onto a property for at least 10 years, buy it. Just ensure you are thoroughly researched and are making the right financial decision for you. This might mean adjusting expectations slightly, but there will still be plenty of opportunity for buyers and sellers despite these interest rate hikes.

If you are unsure of the housing market during this time or would like to discuss an upcoming purchase, give our office a call today!