By Guest Blogger, Daniel Gold, Finance Broker
Long Property
I get it… the media headlines are scary, interest rates are going up, and some experts are predicting a 10-15 per cent fall in house prices!
So, delaying your next property purchase, or at least pausing your search for six months, makes sense, right?
I actually have a number of clients very keen to buy now. Here are some of their reasons…
By waiting, the loan they qualify for might get reduced
They’re not up against much competition at the moment
Buying conditions in many areas have become favourable
Rents are rising at their fastest rate in three decades. This means the yields for investors are rising, and for home buyers sitting out of the market means they will end up paying more rent
For everything working against the property market at the moment, there’s some good news too. Wages are rising and Australia's unemployment rate has dropped below 4 per cent for the first time since the mid-1970s.
Households accumulated c $240 billion in savings during the pandemic, and on average borrowers are ahead on their mortgage repayments by about two years [1]. The economy has strength, and most consumers have a healthy balance sheet (or are ahead on mortgage repayments).
It’s not easy finding a great property. But for those who do, if they’re not overstretching, and if they’ve got a longer-term view, then I can definitely see the sense in transacting while the market takes a breather.
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[1] Households have prepared for incoming rate rises: RBA, Money Management, 4 May 2022
Daniel Gold is an investment savvy finance broker specialising in residential real estate. He is a rising star in the industry and for the past several years has been recognised by Mortgage Professional Australia as being one of the top mortgage brokers Australia. Visit www.longproperty.com.au
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