What does the economic future of new home lending hold?
When people are looking at moving into their new home, whether it's the first move they've ever made or the latest on a long list, funding is the key to making everything work out just the way they want.
That can be affected by the official cash rate (OCR), set each month by the Reserve Bank of Australia (RBA). The OCR is the interest rate at which banks borrow money from the RBA, so they can provide funding to borrowers in order to get into their own homes. The double and single-storey house plans at apg Homes are fantastic ways to enter the property market for first-time buyers, but also for those with experience buying and selling.
However, no matter who is looking to buy, one of the key factors in your decision will be how much you can afford. This can be affected by the OCR, as a lower cash rate could bring about lower mortgage rates from the banks and lenders. They don't have to lower their own interest rates in line with the OCR, though. Has the cash rate affected your mortgage repayments?
But what's in store for the OCR for the remainder of the year, and could it help you to get into a new home yourself?
What's on the RBA's mind?
The OCR is sitting at a record low of 1.75 per cent, and has been at this point since May 2016.
There are a number of factors that work to affect the RBA's decision each month: the global economy, inflation; the list goes on. Essentially, the OCR can help the everyday Australian because it might prompt an interest rate cut from the banks. If that does happen, people are going to benefit from lower monthly repayments and therefore be able to save more money (or have more leftover for those fun nights out). At the moment, the OCR is sitting at a record low of 1.75 per cent, and has been at this point since May 2016.
"The RBA is prepared to lower rates further in 2016 if they deem such action is required," suggested Housing Industry Association Chief Economist Harley Dale in a July 5 media release.
"Political uncertainty at home and abroad has increased the chance of a second cut to the OCR later in the year."
CoreLogic RP Data points out the need for new home building as well, which could lead to more people taking on a mortgage before the end of 2016.
An increase in overseas arrivals to the country has seen higher demand for housing, and while 2015 saw a national record for dwellings completed, the competition in the market is going to be much higher if buyers decide to chase existing properties rather than building new.
To give yourself the best chance of success on the market, and stop that dreadful house hunt before it even begins, contact apg homes today.