We hope you are well and making the most of our busy autumn selling season and the lowest interest rates this century! This month’s newsletter is packed with good news and helpful hints for those in the market to purchase property.
At its May meeting, the Reserve Bank of Australia (RBA) decided to cut rates for the second time this year, bringing the official cash rate to a new record low of just 2.00%! This is amazing news for you if you’re in the market for a mortgage, as it looks set to bring interest rates to their lowest levels ever.
The move has excited a flurry of activity from lenders, as they start to drop home loan interest rates again for the second time this year. With our autumn property market already running hot in most capital cities around the country, these record low interest rates will create even more appealing conditions for home buyers and investors. As a result, we can expect market activity to increase even further as we head into winter.
The question is: can interest rates drop even further?
Market analysts are speculating that even more rate cuts may be on the horizon. The RBA’s move to lower interest rates now is an effort to stimulate economic and employment growth, and lower the Australian dollar to support our export markets. If global factors continue to put upward pressure on the Australian dollar, and business confidence continues to flag, there is speculation that RBA may move to cut rates again later this year, bringing the cash rate below 2.00%.
After the RBA cut rates in February this year, many of our clients and property buyers around the country were quick to capitalise on the opportunity to secure a mortgage at a very low rate. As a result, activity in the property market has increased considerably. For the month of April, the national auction clearance rate for the combined capital cities reached a remarkable 78.8%, well above the same time last year.
Auction clearance rates
For the first week of May, there were 2,419 auctions held around the country with an average clearance rate of 79%. Melbourne held 1,110 auctions with a clearance rate of 81.3%. Sydney had 839 auctions with a clearance rate of 87.3%. Brisbane held 186 auctions with a clearance rate of 49.5%. Adelaide had a strong week with 158 auctions with a 72.5% clearance rate, whereas Perth activity was less strong with just 45 auctions and a clearance rate of just 27.8%.
As you would expect, home values have also been on the increase compared to this time last year with only Darwin showing a slight decline of 1.55%. Sydney home values are up by a massive 14.6% over this time last year, Melbourne up by 6.94%, Brisbane up by 2.54%, Adelaide up by 1.67% and Perth’s home values rose by 0.30%. Even Canberra and Hobart have shown year on year home value increases over 1.0%.
All this is very positive news for you if you are in the market to purchase a property this year
Conditions are also ripe for those looking to refinance. With lenders cutting interest rates and offering amazing deals, there are plenty of great finance options for you to choose from. If you want to find out how the recent rate cut could be of benefit to you, or find out if your current lender has moved on rates, just give us a call on 0437 498 800. We’re here to help you make the most of your opportunities and help you reach your financial goals.
