Big Australian Banks Predicts Interest Rate Cuts As Early As This Year
Dilleen Property Group 2023
On the 8th of March 2023, the Reserve Bank of Australia (RBA) increased the official cash rate for the 10th consecutive time from 3.35% to 3.60%, a 0.25% increase from the previous cash rate.
Although this may sound like bad news for many investors, good times are coming ahead as some of the big banks predict that rates will be coming down as early as the end of this year in November and December.
The inflation rate for February stood at 7.8%, this most likely will be the peak for the last quarter of 2022. The Commonwealth Bank (CBA) predicted inflation will come down sooner than expected which will influence interest rates to also start to decrease.
Before the decrease, experts predict the rates should peak once more to 4.1% in May.
The constant rise in interest rates and high inflation have added pressure on Australians. It is especially hard for those who are just getting off fixed-rate loans as they will find their repayments to be double what they used to pay.
Fortunately, from the next few months onwards, homebuyers and property investors should start to feel relief at the prospect that rates will be gradually decreasing. This may be a good opportunity for investors to get into the property market, as long as you stick to the 3 key criteria of purchasing under market value, high rental yield and within an hour’s radius from metropolitan cities, even if the market falls back 10%, your property will still be covered. It is often during times of uncertainty, where there comes the greatest opportunity for investors to take advantage... Think Covid times, everyone was too scared to buy property but it ended up being the biggest boom opportunity and the investors that took action reaped huge benefits.
Conclusion
If you’re interested to learn how interest rates will affect you or you’re looking to obtain finance, you can contact our recommended broker Justin Picker. Furthermore, if you’re looking to build your own property portfolio or need help with starting your property investing journey, feel free to contact us here to learn more about our services and investment strategy.
Disclaimer: This is not intended as legal, financial, or investment advice and should not be construed or relied on as such. Before making any commitment of a legal or financial nature, you should seek advice from a qualified and registered legal practitioner or financial or investment adviser.
