Property values are enjoying a significant bounce-back, buyers are coming back and the cash rate has been slashed yet again.
Here’s what it could mean for you.
Home values are up 1.7% nationally
The last quarter has seen a rebound with home values up 1.7% across Australia. The most exciting results coming out of the nation’s two biggest markets: Sydney and Melbourne.
In the space of just three months, Sydney values have increased by 3.5%, while Melbourne’s property market has seen an uplift of 3.4%.
Why the backflip? On one hand property markets around the country are benefitting from recent low home loan rates and improved access to home loan lending. However, in New South Wales and Victoria we’re also seeing strong economies, high population growth and steady jobs growth, all of which are helping to drive home buyer demand.
The market is also being driven by surging investor demand. Over recent months, property investors made up one-third of demand for new home loans in New South Wales and 26% of demand in Victoria – higher than any other state or territory.
Buyers flock back
Auction clearance rates are taking off as buyers take advantage of more affordable home values and a record-low cash rate to make their move in the market.
In Sydney, the last week of October saw auction clearance rates of 82% compared to 45% this time last year. Melbourne’s auction clearance rate was 76% (50% a year ago).
It’s a pattern repeated virtually around the country, with auction clearance rates charging ahead in Brisbane, Perth, Adelaide, and Canberra. If you’re interested in a property being sold under the hammer speak with your local Aussie Broker.
Interest rates hit new lows
The Reserve Bank’s decision to slash the cash rate by 0.25% in October is good news for home owners and first home buyers, and takes the cash rate to a new record low of just 0.75%.
In response, several lenders have made cuts – taking home loan interest rates to their lowest since the 1950s, some so low they even start with a ‘2’.
To be absolutely sure you’re making the most of these rates go straight to Aussie. It’s a no-brainer that you shouldn’t be paying more than necessary.
Big opportunities ahead for first home buyers
Excitement is building for the launch of the government’s new First Home Loan Deposit Scheme (FHLDS) on 1 January 2020. What a way to celebrate New Year’s Day if you’re a first home buyer!
Under the Scheme, if you have saved a 5% deposit the Federal government will guarantee the remaining 15% of your deposit. This means you could get started in the property market sooner without the cost of lenders mortgage insurance – which is a potential saving of up to $10,000.
The FHLDS is limited to 10,000 first home buyers each year. And with industry research showing that three out of four first home buyers are planning to apply for the Scheme, chances are those places will be hotly contested.
With the end of 2019 fast approaching go straight to Aussie to find out how to get ready to apply for the Scheme come New Year’s Day 2020.
Is a complex process holding you back?
If home loan red tape is seeing you hold off getting into the market you’re not alone. Research* commissioned by Aussie has revealed that almost one-third of Australians are putting off buying a property because the home loan process seems confusing and hard to navigate.
In addition, an overwhelming 70% of people described the home loan process negatively, citing it as stressful, a waiting game, difficult and painstaking. More worrying, a stunning 69% of home owners said they know they should review refinancing options, but it just seems too hard.
The thing is, it doesn’t have to be this way. Today’s property market is ticking all the right boxes. Values are rising, we’ve got lower interest rates and auction clearance rates are higher. Don’t miss out because you’re overwhelmed or confused by the home loan process.
Your Aussie Broker’s job is to simplify the increasingly complicated home loan process, explain the jargon and minimise the paperwork.
If you’re still not convinced, the same study showed that four in five seasoned homebuyers believe a mortgage broker makes getting a home loan easier.
Opportunity knocks in today’s market. Go straight to Aussie to start putting your property goals in place.
You may also be interested in: James Symond’s commentary: October RBA Cash Rate Falls and Confused about the mortgage process? Stop taking advice from faux-perts!