It appears as though the grass really is greener on the other side…of the apparent cash rate peak. Over the previous month, we have seen an uptick in purchase home loan enquiries and pre-approval conversions. It seems as though buyer confidence has returned, largely on the back of interest rate stability and faith in short-term home loan affordability.
PropTrack in its recent Market Outlook for August 2023, stated that “throughout the first half of this year, sales volumes have consistently been higher than they were over the second half of last year” This has correlated with national property price growth to 2.3% over the first six month of 2023. PropTrack also advise that the number of buyer enquiries per listing have bounced back, “with sales volumes rebounding and the volume of stock remaining low, there has been a recent rebound in the number of enquiries per listing”. This is good news for sellers seeking a good return on their property, and may encourage more sellers back on the market, which is ultimately encouraging to prospective buyers.
In terms of interest rates, the biggest issue we may now face is how long it takes to see inflation return to the 2-3% band, which in turn will see the eventual fall in interest rates back to what we seemingly became comfortable with. Some believe that the effect of the fixed rate cliff may be more exaggerated than originally predicted. The opposite side of the coin stress to remain cautionary, as it might be too early to tell.
The best thing buyers can do is to be prepared with your broker, as a quicker timeline to full approval will ultimately present stronger to a vendor and their real estate agent. If property listings increase, buyers will sprint in with offers, and being off the pace may be the difference between winning a bid or not.
For existing home loan customers, we will again stress the importance of reviewing your rate and loan…especially if you haven’t assessed your options over the past 6-12 months. New business owner-occupied variable principal and interest rates are currently placed in the high 5% range, with investment variable principal and interest rates slightly above that. New business fixed rates are a little uglier than that…
Let’s chat, whether it be buying, selling, or considering your interest rate. We are happy to help in any way.
