Questions & Answers Round 5: What should we do now?

Property market does not like uncertainty, and the Coalition win should return confidence to our subdued property which means our housing markets are likely to pick up by the end of the year.

We are already seeing signs of market recovery, but what does that mean to you? Is it a good time to buy? A good time to invest? Or maybe better to rent? All answer in our weekly vBlog.

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‘The tap has been turned back on’: APRA to relax assessment rate for home loans

Australia’s banking regulator announcing its plans to relax the assessment rate for home loans.

This effectively means homeowners could borrow more money, which industry figures are describing as the biggest development for the property market “in at least four years”.

Currently, lenders have to assess whether a borrower can afford their repayments using a minimum interest rate of at least 7 per cent. This was a rule introduced by the Australian Prudential Regulation Authority (APRA) in December 2014 as part of its efforts to reinforce sound residential lending standards.

The changes, while likely to increase the maximum borrowing capacity for a given borrower. AMP chief economist Shane Oliver said in light of this proposal, it was likely Australia’s falling property markets in locations like Sydney and Melbourne would bottom out much sooner than he had anticipated.

Of course, it’s all about your perspective – if you’re someone who has just bought in Sydney and have negative equity, you’d love to see prices rise, but if you’re a first-home buyer who now has more of a chance to get in the market, this could mean you have to borrow more.

Certainly, if this happens in combination with another interest rate cut, this will turn the market around.

*source Domain

Posted in Buy, Latest news, Manage, News, Sell on 22nd May, 2019