Fane Levy of Shore Financial forecasts the RBA's cash rate could reach 3.5% next year after the latest 50-basis-point rise to 2.35%. A $500,000 mortgage costs $144 extra per month; a $1 million loan costs $288. Borrowing capacity has fallen about 5% per rate rise.
Hi, it's Conrad Vass from Space Property Agency, your trusted real estate advisor. It's interest rate week and we've got Fane Levy from Shore Financial just to share some thoughts. Fane?
Today the RBA announced a 50 basis point increase, taking the official cash rate to 2.35%. This is now the 5th consecutive rate rise we've seen this year. We're still expecting rates to increase, taking them up to approximately 2.85% this year and still travelling up towards maybe 3.5% next year. Some economists are predicting that the rates will plateau around the middle of next year and perhaps start decreasing towards the end of next year. What does this mean for borrowers? Someone with a $500K mortgage will probably see an increase of around $144 per month. Someone with a $750K mortgage will probably see an increase of $216 a month, and someone with a million-dollar mortgage will probably see an increase of around $288 a month. For the average household, since rates have been increasing, they're probably experiencing over $1,000 per month increase. Borrowing capacity unfortunately has dropped by about 5% for every 50 basis points. Now is a really good time for consumers to be engaging with their mortgage brokers so that they can shop around to see where they can sharpen their rates in such a volatile market.
Surry Hills Shop & Basement For Lease | 68 Campbell Street Walkthrough 134 sqm Surry Hills Shop Tour
