Home buyers should not be disheartened by the recent 0.25% interest rate hike by the Reserve Bank of Australia, according to two of Australia’s leading real estate and mortgage broking industry experts.
Stockdale and Leggo chief executive officer Charlotte Pascoe believes that people exploring the real estate market at the moment are motivated either because they expect further change or they want to upsize and know further rates will impact that decision.
“There will always be people who need to sell, want to sell, and who want or need to buy. And, if you look at the values now compared to three years ago, we are still way ahead, so the market has corrected a little, but property owners are still up overall.”
Now is also the perfect time for investors looking to get into the rental market, says Pascoe.
“For people in a position to invest in property, it is a great opportunity because we know there is a shortage of properties. I’d encourage anyone to look at getting a rental property because there is opportunity, and you will get a renter to move in and pay a good rent,” she adds.
According to Nick Reilly, managing director at inovayt, a leading mortgage broker and specialist finance firm, market confidence remains unaffected by the latest rates hike.
“Initially, there was a real fear that buyer hunger would not be enough to get people to transact, but that hasn’t happened as we are still seeing a lot of pre-approval applications at the moment particularly for those double-income families,” Reilly says.
The two years of Covid also allowed families and businesses to accumulate record savings, he observed. “To people looking to upsize I’d say now is a good time because I’m predicting further rate rises for the new year before it settles towards the end of 2023. If you can afford to move, high-end homes are levelling off, rates are still comparatively low, and the market is motivated. You could well come out ahead.”
“Our key message to our clients is property is a long term thing, understand what that looks like over the next 10 years. Don’t wait for the market to bottom out, get a handle on your own cash flow now and understand what may happen over the next 12 months and potentially upgrade,” Reilly says.
Image: UNSW
