Brighter Buying

Expert tips another #2 interest rate cuts

by Kate Watt, Marketing Manager 1 August 2019

The Reserve Bank of Australia will cut interest rates twice more by the middle of next year, according to Westpac Chief Economist Bill Evans.

He forecasts one more cut in the last quarter of 2019 and another in early 2020, reports Property Update.

This follows two successive rate cuts in June and July already this year.

Does that mean you save more on your mortgage repayments? If you have a variable rate home loan, then probably, yes you will.

But it becomes harder for banks to pass on rate cuts in full the closer rates move to zero so some borrowers may be disappointed.

But don’t get stuck in a pity party for too long. Buyers are enjoying some of the most favourable lending conditions we’ve ever seen.

As we reported last month the twin rate cuts in June and July mean you can shop around for a home loan in the low 3 per cent range.

And the Australian Prudential Regulation Authority (APRA), our national banking regulator, has announced it will no longer require banks to assess home loan applications using a minimum 7 per cent interest rate buffer. This means banks can more favourably assess your ability to afford your repayments. In other words, you can borrow more.

To top this off, Brissie property is set to rise in value in the coming years, but right now we’re still seeing very affordable buying.

So if you have a deposit and know your budget, you can go house shopping with confidence.

Ready, set, shop: view our current listings for sale or talk to us about selling.