Solution finder
I'm looking to Buy or build my first home and and have just started researching
edit

Cash rate cool for much of summer

Australia’s largest independently-owned mortgage broker, Mortgage Choice is delighted with the Reserve Bank’s decision to keep the cash rate cool at 4.75% for the first couple of summer months.


December 07, 2010

Australia's largest independently-owned mortgage broker, Mortgage Choice is delighted with the Reserve Bank's decision to keep the cash rate cool at 4.75% for the first couple of summer months.

With many borrowers still re-jigging their budget in response to last month's interest rate increases, this will bring a relief filled break of at least two months for those with variable rate home loans. That is, as long as lenders don't move their rates independently.

The RBA doesn't officially meet again to discuss the cash rate until Tuesday 1 February 2011.

According to Mortgage Choice's recent 2010 Consumer Sentiment Survey, 9% of Australian mortgage holders are already considering selling their property due to the November rate rise. Another 4% would be in the same position had a 0.25 percentage point rise occurred this month.

Company spokesperson Kristy Sheppard said, "The RBA's decision will result in a large collective sigh of relief from millions of people across the country. Around one third of Australians have a mortgage and the vast majority of them are at the mercy of variable rate movements."

"Retailers will also be pleased, seeing as stores experienced a 1.1% drop in sales during October after only a 0.1% rise during September. Steadied interest rates will hopefully see small business owners and their families having a more enjoyable Christmas too.

"A stable cash rate should encourage borrowers to relax more over the festive season and treat themselves and their families while keeping in mind probable rate landscape changes in 2011. They now have a good two months of sunshine in which to take stock of their cashflow situation and perhaps seek out a home loan health check.

"There should be plenty of time to get an action plan in place before the next cash rate move. Talk currently points to a decent pause before a possible second quarter rate rise and perhaps another before 2011 is out. Still, the earlier borrowers start the better off they'll be financially.

"With 31% of our 2010 Consumer Sentiment Survey respondents saying the housing affordability issue was underrated and 49% saying it was about right, we hope that a few months of rate rise reprieve will reduce some of the often misplaced fear involved with buying property."

 

For further information or to arrange an interview, please contact:

Belinda Williamson
Mortgage Choice  
(02) 8907 0472             
belinda.williamson@mortgagechoice.com.au

With many borrowers still re-jigging their budget in response to last month's interest rate increases, this will bring a relief filled break of at least two months for those with variable rate home loans. That is, as long as lenders don't move their rates independently.

The RBA doesn't officially meet again to discuss the cash rate until Tuesday 1 February 2011.

According to Mortgage Choice's recent 2010 Consumer Sentiment Survey, 9% of Australian mortgage holders are already considering selling their property due to the November rate rise. Another 4% would be in the same position had a 0.25 percentage point rise occurred this month.

Company spokesperson Kristy Sheppard said, "The RBA's decision will result in a large collective sigh of relief from millions of people across the country. Around one third of Australians have a mortgage and the vast majority of them are at the mercy of variable rate movements."

"Retailers will also be pleased, seeing as stores experienced a 1.1% drop in sales during October after only a 0.1% rise during September. Steadied interest rates will hopefully see small business owners and their families having a more enjoyable Christmas too.

"A stable cash rate should encourage borrowers to relax more over the festive season and treat themselves and their families while keeping in mind probable rate landscape changes in 2011. They now have a good two months of sunshine in which to take stock of their cashflow situation and perhaps seek out a home loan health check.

"There should be plenty of time to get an action plan in place before the next cash rate move. Talk currently points to a decent pause before a possible second quarter rate rise and perhaps another before 2011 is out. Still, the earlier borrowers start the better off they'll be financially.

"With 31% of our 2010 Consumer Sentiment Survey respondents saying the housing affordability issue was underrated and 49% saying it was about right, we hope that a few months of rate rise reprieve will reduce some of the often misplaced fear involved with buying property."

 

For further information or to arrange an interview, please contact:

Belinda Williamson
Mortgage Choice  
(02) 8907 0472             
belinda.williamson@mortgagechoice.com.au


Other articles you might like



More articles

Sign up for media releases and more

Subscribe and stay informed with Mortgage Choice news and industry insights.