When it comes to interest rates, it’s hard to know which way they’re headed. Last week, mortgage holders got some good news when the Reserve Bank kept interests rates on hold at 4.75 per cent for another month.
With the slow housing market and global economic uncertainty, we’ve been wondering if we’d get a rate cut. But rates have been on hold for nearly a year now since the last increase.
While a hold is good, a cut would be better. More people are interested in buying when mortgage rates are low. It would seem that the slow housing issue could easily be cured with a little chop in interest rates.
On the flip side, even small increases hurt. Each 0.25 per cent interest rate rise adds another $60 to the monthly cost of an average Australian mortgage. With everything else going up, up, up, most homeowners are in no position to fit in a mortgage rate increase.
I know I’ll keep my eye on the action from here in the real estate trenches. If I can answer any questions for you about the local housing market, please give me a call.