Governor Philip Lowe of the RBA has announced they will be holding back on raising interest rates. Maintaining the historically low 0.1 per cent for the foreseeable future. This came as a surprise to many considering recent house pricing growth and improved unemployment figures for last month.
We spoke with No1 Property Guide Founder, Darren Walters, to see what he thought about maintaining the current interest rate.
The decision to hold off increasing the interest rate is a great outcome for potential home buyers in Australia. But it doesn’t change the fact that strict lending criteria and unreasonable deposit requirements prevent renters from getting into the property market sooner.”
House prices around Australia have skyrocketed over recent months. But, with the average cost of a home increasing nation-wide, Darren Walters pointed out that:
keeping the interest rates low—while great for getting an affordable home loan—has forced house prices to rise to a point I don’t think anyone could have predicted.”
Governor Philip Lowe pointed out that recent CPI data showed inflation remained subdued in most parts of the Australian economy. Despite strong growth in the property market and the employment sector. While it may hit above 3% temporarily in June, due to the reversal of some COVID-19 reductions, the current inflation is predicted to sit around 1½ per cent in 2021. And will only rise to 2 per cent around mid-2023.
No1 Property Guide founder, Darren Walters, commented on the expected delay in inflation saying,
With interest rates looking to be held at 0.1% until 2024 at the earliest, it’s the perfect time for renters to get their own homes at a great rate. A fixed-rate home loan using the current low interest rates can put you in a strong financial position for the next few years.”
A lower interest rate increases what lenders are willing to let buyers borrow. But there are still hoops to jump through to meet the lender’s borrowing criteria. As a result, meeting these criteria is what often stops renters from being able to access the property market.
Pleased about the interest rate news. Darren is ecstatic he’ll be able to provide more renters an opportunity to escape the rental nightmare.
My system is designed to help those who can’t get the 20% deposit most banks and lenders demand to buy a home. Holding the interest rates at this record low gives me more opportunities to help renters escape the rental nightmare and get into their own home sooner.”
Interest rates are likely to stay at record lows for the next 3 years. So, there’s never been a better time to enter the property market and escape the rental nightmare. But entering the market without a deposit or large savings can be basically impossible using traditional banks or lenders.
But that’s where Darren’s 20+ years’ experience in the property industry, and dealing with banking and lending policies comes in. By using his no or low deposit new home system Darren can help renters into the property market. Even when they do not have a deposit.
Complete your pre-qualification today to take advantage of these record low interest rates and into your own home sooner. After that, No1 Property Guide’s New Home Specialists will work with you to discover all your factual new home options.