Interest Rates Hit Record Lows

Earlier in June 2019, the Reserve Bank of Australia (RBA) decided to cut the base rate from 1.5% to 1.25%. This is officially lowest rates in Australia’s history and all indications lead to interest rates dropping another .25% before the end of 2019. 

If the base rate is sitting at 1%, home borrowers and investors will be paying between 3% and 3.5% for their home loan.

Glenn Farah, Partner and Marketing Director, says this “will undoubtable take pressure off Australian households who have mortgages and also transcend into more confidence from homebuyers coming into the market.”

Since the election in May 2019 and the RBA’s interest rate cut, NGFarah have already noticed a bounce back in real estate confidence, indicated by Auction clearance rates.

Glenn goes onto to say that “the secret to this bounce back is the sustainability of it.

“Real Estate is all about confidence and the confidence to know that the right people are in Government - making prudent decisions in relation to creating more jobs, reducing national debt and building infrastructure within the big citifies and the small country towns of Australia.”

Traditionally the winter months of June, July and August are quieter periods in real estate, but it has been widely reported that the winter of 2019 will be a little bit different. In the Eastern and South Eastern suburbs, there is a noticeable shortage of high-quality stock on the market “as most home sellers have been holding off to see what happens post-election” Glenn suspects.

If you are thinking of selling take advantage of the upswing in confidence and the lower stock levels. Ultimately, real estate prices are all about supply and demand as well as confidence.