Rate rise unlikely to hold back property market recovery

Font size :

The widely expected 25 basis points (0.25%) rate rise on Wednesday may cause a short-term decline in property transactions but will not be enough to put a lid on the strong recovery in the sector, according to a property research analyst.

Grant Dearlove, residential managing director of Colliers International, believes that the residential property market has too much momentum for it to be held back by a quarter of a per cent interest rate rise.

"Historically, some of the biggest property price hikes have occurred when interest rates were at their highest. Our economy is so strong, and the price we pay for this prosperity is higher interest rates," he said.

However, he pointed out that there will be a slow down in sales volumes in the short term while people assess their personal positions.

"The sales activity normally slows for about one to two months before picking back up again. My advice would be to check your finances, see what you can afford," he said.

"Don't think that if you buy the value of your asset will go backwards - the economy in Australia is too strong for rate increases to have a negative impact."

He added that property investors were leading the charge towards a resurgence in property investment, despite rate rises.

"We're seeing more investors coming back into the market because of the volatility in the stock market and because they're able to secure good rental yields from those that are renting while they search for a home to buy or save for a deposit," he said.

With interest rates at their lowest for more than 50 years, there are some great rates available. The best thing to do is to compare rates from all the lenders. Let us help take the leg work out of doing this - Compare Home Loans now

Mortgage News and Articles

How to tell when a housing market is cooling How to tell when a housing market is cooling

You need to check clearance rates, listings, and the price gap, among other factors Read more

Growing demand for green apartments in Sydney Growing demand for green apartments in Sydney Both owner-occupiers and investors favour eco-friendly buildings for their energy-saving features and reduced environmental footprint ... Read more

Are property investors as rich as they appear? Are property investors as rich as they appear? A multi-property portfolio doesn’t guarantee easy millions ... Read more

Be proactive about getting a better mortgage deal Be proactive about getting a better mortgage deal Apathy could be costing you a considerable amount of money over the lifespan of your loan ... Read more

More mortgage news and articles

Sponsored Links

Saturday, Sep 23, 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