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As Victoria ease out of lockdown with extreme caution, the outlook and sentiment is somewhat confused and contradictory. Whilst house prices in Melbourne have softened by average of around 5% in the last quarter, many affordable pockets around greater Melbourne have surged in demand and pricing, due to its relative affordability. (more…)

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After an unchanged official cash rate since 2016, the RBA has just announced a rate cut of 25 basis points.

What does this mean for you? The answer is, it is good news for most. Whether you are a business, real-estate agent, exporters or property owners, the rate cut will put extra cash savings back into your pocket. Although with a rate drop it may improve housing affordability, it will not make a huge difference as prices has already been on a down-wards trend.

Whilst the rate drop may stabilise the real-estate economy, it still makes selling in the immediate future grim due to how much prices have dropped already in the last 24 months. The extra cash savings however will produce a nice buffer and extra budget to action more of those renovations that are months or years overdue. What better time to do renovations than when:

– You have extra cash savings from your existing mortgage due to the rate cut
– Contractors have a lot more availability due to the current housing down-turn
– House prices are slowly stabilising however are still in a dipped state

As with every change, there are always losers. In this case, the savers who has cash in a savings account will be feeling the rate cut in a negative way. Property prices stabilising may also spell trouble for First Home Buyers in terms of affordability especially in major cities like Melbourne and Sydney where current prices are already out of reach of many.