Home News Rate cut breathes life back into Australian property investors

Rate cut breathes life back into Australian property investors

Font size :
Thanks to the Reserve Bank's decision to cut the official cash rate to a record low of 1.75 per cent, recent trends in auction clearance rates show that property investors are heading back into the Australian housing market.

Last weekend's auction clearance rates in Sydney was at 77.6 per cent, following the previous weekend's 80.3 per cent, which is the highest level since August of last year. Despite the slight fall in auction clearance rates, last weekend's auction numbers still better compared to the same weekend last year.

Melbourne also saw strong auction clearance rates at 73.8 per cent, also continuing the trend from the previous weekend. However, there are also signs that the number of homes entering the auction market is declining, with only 744 homes going under the hammer last Saturday compared to 995 homes over the same weekend last year and 759 over the previous weekend.

According to Domain Group, investor activity is clearly on the rise with rising demand from lower-priced, higher-yielding suburbs in Sydney's west. There are also strong regional results in budget and mid-priced Melbourne suburbs. This renewed investor appetite can be credited to the Reserve Bank's rate cut, which most lenders passed on in full to the borrowers through lower mortgage interest rates.

Last year, investors have been discouraged from borrowing when the Australian Prudential Regulation Authority clamped down on investor lending, which was rising above 10 per cent annual growth early in 2015. The banks then raised interest rates on investor mortgages, hence requiring investors to stump up higher deposits.

It can be confusing to know whether to get a variable rate or fixed rate mortgage, and what features are important. That's why it's important to not only check the right rates, but make sure that you're getting the right features in your home loan. Get help choosing the right home loan

Mortgage News and Articles

New social housing aims to transform Ivanhoe Estate New social housing aims to transform Ivanhoe Estate

The sprawling redevelopment aims to boost the supply of affordable housing in Sydney Read more

A new suburb will be built in west Melbourne A new suburb will be built in west Melbourne Mount Atkinson will become home to more than 22,000 people over the next 15 years ... Read more

Surging house prices threaten liveability in Melbourne Surging house prices threaten liveability in Melbourne Analysts warn the city could become just as unaffordable as Sydney, if property trends continue ... Read more

More Aussies would benefit from regional hubs linked to cities More Aussies would benefit from regional hubs linked to cities Shorter commutes could spur higher home sales in regional towns, analysts say ... Read more

More mortgage news and articles

Sponsored Links

Friday, Aug 18, 2017
Top Featured Rates
Top Bank Rates

Get help choosing the right home loan

Let us help you find the right home loan for your needs.

Tell us a bit about your circumstances:
  • Purpose of mortgage
  • Household Income
    $
  • How much do you want to borrow?
    $
  • How much deposit do you have?
    $
  • How much is your house worth?
    $
  • How much do you still owe on your mortgage?
    $
  • What type of mortgage do you have?


  • How much is your new home?
    $
  • How much do you want to borrow?
    $
  • How soon do you want a mortgage?
Next
  • First name
  • Last name
  • Where do you live?
  • Phone number

Special Offers

Related Keywords