Property news, lower rates & other cool updates! - February 2020 👪
We have property predictions, data on how the first home buyers scheme is tracking, and who has the best home loan interest rates in February’s Black & White Finance update. Let’s get started!
Mirror mirror on the wall, are property prices set to…?
With record-low interest rates and no shortage of buyers in sight, it’s unlikely property prices are going to decline. In fact, the opposite is true with some economists predicting housing prices could rise by 8% by years end and a further 4% in 2021.
High demand and lower supply are the main drivers to this prediction with the massive influx of first home buyers flooding the market following the government’s First Home Buyers Scheme success.
Just how successful is the first home buyers scheme?
Preliminary figures from the National Housing Finance and Investment Corporation have shown that first home buyers aren’t shying away from getting involved with the scheme.
NHFIC data shows that the average income for applicants is well below the threshold in getting to the pre-approval stage.
NHFIC also confirmed that 60% of applicants were single.
The data also suggests first home buyers are naturally gravitating to areas in Western and Southern Australia.
Interesting interest rates!
In addition to the Reserve Bank of Australia keeping a firm grasp on the standard cash rate of 0.75% earlier this month, major lenders are also slashing their fixed rates in a bid to compete for new lending.
CBA cut fixed rates by up to 0.50% and now ANZ has also followed suit, cutting their own rates up to 0.86%. It’s definitely interesting to see how much these rates have come down and we’re now keeping a watchful eye on how the other lenders will react.
Clearance rates rising like they’re going out of style!
It’s been interesting to watch what has happened over the last few weeks with property stock levels rising. Economists and we at Black & White Finance included were eager to see if the clearance rates were able to maintain their high 80% clearance range.
The data from the weekend showed that the demand is meeting the extra supply – 84%. This shows significant strength for the market and an overall indication of its health.
This data (available from realestate.com.au) also indicates that 1340 homes were bought as private sales as of Mon 24th Feb.
If anything, this further cements the notion that the market is on an upward trend with no sign of stopping anytime soon.
Final Thoughts
We’ve covered quite a bit in this month's blog.
There are many positives to take away, with the proven effectiveness of the first home owners schemes, coupled with reduced fixed and variable interest rates, now could be as good a time as any to chat to us at Black and White Finance about how to take full advantage of the current circumstances.
The only thing is who can say how long this will last though?
If economists are to be believed, low interest rates and this growth trajectory (for Sydney at least) is on the path to last for some time.
See you in next month's blog!
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