By Graeme Salt
For the rest of the year Australia will have a two-speed property market.
For those with strong incomes and healthy savings, Australia is a land of opportunity with a property market starting to rise.
But for others, trapped by high interest rates, there’s limited opportunity. For them – refinancing or buying will be tough.
According to Corelogic housing values look to have bottomed out, with Sydney now 3.0 per cent higher than the recent trough recorded in January according and CBA now predicts prices will jump 5 per cent this year.
If you’re looking to get into the market – this could be your chance.
However, at the same time, up to 880,000 existing homeowners will need to find hundreds, or even thousands, of dollars more each month when their fixed-rate periods expire this year.
According to NAB close to 40 per cent of their existing home loan customers would struggle to meet the lending criteria of a different bank.
Get ready for six months of bad news as households servicing a $550,000 mortgage will suffer an $891 increase in monthly repayments. And someone with a $1 million mortgage would have to fork out an extra $1,620 each month.
As a result, it’s hard to envisage a really buoyant market for some time.
Until interest rates fall, or credit policies ease, house prices are unlikely to rise significantly.
But the long-term prediction for housing remains rosy. With 400, 000 arriving here from overseas this financial year alone, demand for property remains strong.
The bell has been rung for the bottom of the market – where to next?
If you want to talk to me about your lending needs, I can be contacted on 02 9922 5055 or message me here