At its December meeting the Reserve Bank of Australia decided to lower the cash rate by 1.00% (or 100 basis points) to 4.25% in an early Christmas present for borrowers. As a result, this will reduce the average $350,000 home loan repayment by around $221 per month.
If you are are looking to enter to take out a home loan now that interest rates are substantially lower than 6 months ago then don't forget to get your Good Loan Guide for all your home loan help. Just visit http://www.goodloanguide.net/ for details.
Monday, December 8, 2008
Friday, November 7, 2008
Reserve Bank of Australia lowers rates by 0.75%
At its November meeting the Reserve Bank of Australia decided to lower the cash rate by 0.75% (or 75 basis points) to 5.25% in a move which was widely unexpected. As a result, this will reduce the average $350,000 home loan repayment by around $175 per month.
If you are are looking to enter to take out a home loan now that interest rates are substantially lower than 6 months ago then don't forget to get your Good Loan Guide for all your home loan help. Just visit http://www.goodloanguide.net/ for details.
If you are are looking to enter to take out a home loan now that interest rates are substantially lower than 6 months ago then don't forget to get your Good Loan Guide for all your home loan help. Just visit http://www.goodloanguide.net/ for details.
Wednesday, October 29, 2008
First Home Owners Grant has Increased
The Australian Government has recently announced that the first home owners grant will be increased.
The boost to the grant for first home buyers will be as follows:
1. First home buyers who purchase established homes will receive a boost of $7000 that will double the grant to $14,000
2. First home buyers who build a new home or purchase a newly constructed home will receive an extra $14,000 to take their grant to $21,000.
If you are a first home buyer in Australia then now could be the time jump into the market.
As the home loan market can be a daunting place, if you are looking for more information on home loans and selecting the best home for you visit www.goodloanguide.net to find out more.
The boost to the grant for first home buyers will be as follows:
1. First home buyers who purchase established homes will receive a boost of $7000 that will double the grant to $14,000
2. First home buyers who build a new home or purchase a newly constructed home will receive an extra $14,000 to take their grant to $21,000.
If you are a first home buyer in Australia then now could be the time jump into the market.
As the home loan market can be a daunting place, if you are looking for more information on home loans and selecting the best home for you visit www.goodloanguide.net to find out more.
Tuesday, February 26, 2008
Rate rises: Is the worst over?
Source: Your Mortgage Magazine
While many economists are forecasting another interest rate hike to come as early as March, one expert says further interest rate rises may not eventuate as Australia gets closer to the top of the rate cycle.
"I'm pretty confident we're pretty close to the top of the cycle because there are increasing signs of mortgage stress, consumer confidence and business confidence are falling, and the global economy is slowing," says AMP chief economist Shane Oliver.
"All these will have an impact on Australia's economy. At the same time, the pace of rate increases has been very fast, as banks independently raise their rates outside RBA. I believe we're getting to the end point here, but there will be pain before we get there," Oliver said.
Borrowers have been warned to prepare for more mortgage pain ahead as the Reserve Bank of Australia (RBA) intensifies its fight against raging inflation.
The RBA said in a statement that "the risk of inflation remaining uncomfortably high for some time is considerable", prompting it to upgrade inflation forecasts and downgrade its economic outlook prediction. "Absent a further shift in economic risk to the downside, therefore, monetary policy is likely to need to be tighter in the period ahead," the RBA said.
Some economists have forecast the next rate hike of 0.25% to come as early as March and a further 0.25% rise in May.
"The simple message for borrowers is to factor in further rate hikes," said CommSec chief economist Craig James. "The RBA doesn't expect inflation to be comfortably back inside the 2-3% target band for at least another two years. That means there will be ongoing risks of higher interest rates - not just in the next few months but for some time to come."
If you are considering taking out a new home loan in these uncertain times, make sure that you have the best loan for your situation.For great tips on applying for a home loan visit www.goodloanguide.net for all you need to know about home loans.
While many economists are forecasting another interest rate hike to come as early as March, one expert says further interest rate rises may not eventuate as Australia gets closer to the top of the rate cycle.
"I'm pretty confident we're pretty close to the top of the cycle because there are increasing signs of mortgage stress, consumer confidence and business confidence are falling, and the global economy is slowing," says AMP chief economist Shane Oliver.
"All these will have an impact on Australia's economy. At the same time, the pace of rate increases has been very fast, as banks independently raise their rates outside RBA. I believe we're getting to the end point here, but there will be pain before we get there," Oliver said.
Borrowers have been warned to prepare for more mortgage pain ahead as the Reserve Bank of Australia (RBA) intensifies its fight against raging inflation.
The RBA said in a statement that "the risk of inflation remaining uncomfortably high for some time is considerable", prompting it to upgrade inflation forecasts and downgrade its economic outlook prediction. "Absent a further shift in economic risk to the downside, therefore, monetary policy is likely to need to be tighter in the period ahead," the RBA said.
Some economists have forecast the next rate hike of 0.25% to come as early as March and a further 0.25% rise in May.
"The simple message for borrowers is to factor in further rate hikes," said CommSec chief economist Craig James. "The RBA doesn't expect inflation to be comfortably back inside the 2-3% target band for at least another two years. That means there will be ongoing risks of higher interest rates - not just in the next few months but for some time to come."
If you are considering taking out a new home loan in these uncertain times, make sure that you have the best loan for your situation.For great tips on applying for a home loan visit www.goodloanguide.net for all you need to know about home loans.
Saturday, February 2, 2008
Have you missed Australia's property boom?
Source: Your Mortgage Magazine
The rapid growth of property prices over the past two years may be coming to an end, according to a leading property expert.
Tim Lawless, RP Data national residential research director, predicted that the strong run in Australia's property markets is likely to peak during the first half of 2008 amid higher interest rates, tightening credit markets and the gloomy outlook for the global economy.
Lawless noted that one of the most standout periods in the history of the Australian property market was when value growth reached 12.5% nationally during the year ending November 2007 -almost double that of the same period in 2006.
"We'll see multiple factors impacting on the market as we travel through 2008," said Lawless. "These include a lift in cash rates underpinned by inflation, banks acting independent of the RBA to lift rates based on rising credit costs, and the threat the sub-prime crisis has had on the overall US economy - particularly its share market."
Lawless said that based on these issues, the expected peak in the first half of 2008 is likely to see growth rates slow down to around 15%. However, he said he does not think a crash is likely.
"It's rare for a property market to crash. Rather, growth is typically controlled. We see no reason why this wouldn't be the case during this cycle also. This merely means that national growth in property values will taper back to more sustainable levels during the second half of 2008."
Lawless also predicted that by the end of 2008, the property markets will slow further to between 9% and 10% nationally.
If you are thinking about taking out a home loan to step up the property ladder, check out www.goodloanguide.net to kae sure you are an informed borrower.
The rapid growth of property prices over the past two years may be coming to an end, according to a leading property expert.
Tim Lawless, RP Data national residential research director, predicted that the strong run in Australia's property markets is likely to peak during the first half of 2008 amid higher interest rates, tightening credit markets and the gloomy outlook for the global economy.
Lawless noted that one of the most standout periods in the history of the Australian property market was when value growth reached 12.5% nationally during the year ending November 2007 -almost double that of the same period in 2006.
"We'll see multiple factors impacting on the market as we travel through 2008," said Lawless. "These include a lift in cash rates underpinned by inflation, banks acting independent of the RBA to lift rates based on rising credit costs, and the threat the sub-prime crisis has had on the overall US economy - particularly its share market."
Lawless said that based on these issues, the expected peak in the first half of 2008 is likely to see growth rates slow down to around 15%. However, he said he does not think a crash is likely.
"It's rare for a property market to crash. Rather, growth is typically controlled. We see no reason why this wouldn't be the case during this cycle also. This merely means that national growth in property values will taper back to more sustainable levels during the second half of 2008."
Lawless also predicted that by the end of 2008, the property markets will slow further to between 9% and 10% nationally.
If you are thinking about taking out a home loan to step up the property ladder, check out www.goodloanguide.net to kae sure you are an informed borrower.
Monday, January 14, 2008
Housing recovery on its way
Source: Your Mortgage.
Building approvals surged in November, spurred on by a sharp increase in new apartment buildings in NSW according to the latest data from the Australian Bureau of Statistics (ABS).Total units approved jumped by 8.9% after dropping by 3.6% in October. There were 14,620 dwelling approvals in November - the highest result in three and a half years. On a year-on-year basis, this represents 14.6% growth in new buildings approved. Detached housing remained in the doldrums however, notching up a small gain of 0.30%.CommSec chief economist Craig James says that the trends are very "encouraging". "For the first time in almost three years, the number of approvals can be finally described as 'above-normal', that is, above the longer-run averages," he says. "Overall, we believe that there's a light at the end of the tunnel for the beleaguered home building industry. Demand for accommodation is soaring, with population growth at the strongest pace in 18 years, while supply of new homes has been struggling to keep up."The strong numbers are also seen as a sign that investors may be shifting their attention from the sharemarket following a massive decline in the recent weeks."It may be the case that investors are warming to higher house prices and surging rents, and starting to shift attention from the sharemarket to the property market," says James. "Property will be seen as an especially favourable investment destination if the sharemarket continues its soggy performance in coming months."Housing Industry Association (HIA) chief economist Harley Dale says the strong numbers from the unit sector may indicate that the bottom of the cycle has passed, however he warns that there is a long recovery road ahead following four years of weakness."The first half of 2008 is going to be a challenging period for new home building amidst upward pressure on interest rates. It will be difficult for a sustained recovery in new home building to emerge," says Dale.
If you are looking to purchase a home make sure you choose the best loan for you. Visit www.goodloanguide.net for simple home loan help and tips in choosing the right mortgage for you.
Building approvals surged in November, spurred on by a sharp increase in new apartment buildings in NSW according to the latest data from the Australian Bureau of Statistics (ABS).Total units approved jumped by 8.9% after dropping by 3.6% in October. There were 14,620 dwelling approvals in November - the highest result in three and a half years. On a year-on-year basis, this represents 14.6% growth in new buildings approved. Detached housing remained in the doldrums however, notching up a small gain of 0.30%.CommSec chief economist Craig James says that the trends are very "encouraging". "For the first time in almost three years, the number of approvals can be finally described as 'above-normal', that is, above the longer-run averages," he says. "Overall, we believe that there's a light at the end of the tunnel for the beleaguered home building industry. Demand for accommodation is soaring, with population growth at the strongest pace in 18 years, while supply of new homes has been struggling to keep up."The strong numbers are also seen as a sign that investors may be shifting their attention from the sharemarket following a massive decline in the recent weeks."It may be the case that investors are warming to higher house prices and surging rents, and starting to shift attention from the sharemarket to the property market," says James. "Property will be seen as an especially favourable investment destination if the sharemarket continues its soggy performance in coming months."Housing Industry Association (HIA) chief economist Harley Dale says the strong numbers from the unit sector may indicate that the bottom of the cycle has passed, however he warns that there is a long recovery road ahead following four years of weakness."The first half of 2008 is going to be a challenging period for new home building amidst upward pressure on interest rates. It will be difficult for a sustained recovery in new home building to emerge," says Dale.
If you are looking to purchase a home make sure you choose the best loan for you. Visit www.goodloanguide.net for simple home loan help and tips in choosing the right mortgage for you.
Friday, January 11, 2008
CBA increases home loan rates
Source: LendingCentral.com.au
All eyes are on Westpac Banking Corporation Ltd and St George Bank Ltd after the Commonwealth Bank of Australia Ltd (CBA) succumbed to the global credit crisis and lifted interest rates.
CBA, the third major bank to lift rates, has increased its standard variable rate on home loans by 0.10 per cent to 8.67 per cent, effective from January 11.
The move by CBA follows in the footsteps of Australia and New Zealand Banking Group Ltd (ANZ) and National Australia Bank Ltd (NAB), which increased their variable interest rates independent of any action by the Reserve Bank of Australia.
Westpac and St George remain the only two major banks that have not increased their standard variable home loan rates - but analysts tip it is only a matter of time.
"We believe the other majors will follow shortly with similar standard variable mortgage rate increases," Macquarie Research Equities said in a January 8 client note.
A Westpac spokesman told AAP today that "rates remain under review".
CBA chief financial officer David Craig said the bank had been exposed to additional funding costs of about $100 million since the start of the credit crisis.
"The impact of the cost of the wholesale fund is something that is impacting all Australian banks," Mr Craig said in a statement.
CBA group executive of retail banking services Ross McEwan said the "modest increase strikes a good balance between the needs of our customers and shareholders".
"We have given careful consideration to the size of this increase and while a higher increase could be justified, we believe that the current level of wholesale funding rates will moderate from the high level experienced pre-Christmas," he added.
In addition to its standard variable interest rates, CBA is also lifting its variable business loans by 0.15 per cent.
A St George spokeswoman told AAP the bank was "still monitoring the market".
AAP
If you are not sure what type of loan is best for you in the current market, visit www.goodloanguide.net for help on choosing a loan structure that will work best for you.
All eyes are on Westpac Banking Corporation Ltd and St George Bank Ltd after the Commonwealth Bank of Australia Ltd (CBA) succumbed to the global credit crisis and lifted interest rates.
CBA, the third major bank to lift rates, has increased its standard variable rate on home loans by 0.10 per cent to 8.67 per cent, effective from January 11.
The move by CBA follows in the footsteps of Australia and New Zealand Banking Group Ltd (ANZ) and National Australia Bank Ltd (NAB), which increased their variable interest rates independent of any action by the Reserve Bank of Australia.
Westpac and St George remain the only two major banks that have not increased their standard variable home loan rates - but analysts tip it is only a matter of time.
"We believe the other majors will follow shortly with similar standard variable mortgage rate increases," Macquarie Research Equities said in a January 8 client note.
A Westpac spokesman told AAP today that "rates remain under review".
CBA chief financial officer David Craig said the bank had been exposed to additional funding costs of about $100 million since the start of the credit crisis.
"The impact of the cost of the wholesale fund is something that is impacting all Australian banks," Mr Craig said in a statement.
CBA group executive of retail banking services Ross McEwan said the "modest increase strikes a good balance between the needs of our customers and shareholders".
"We have given careful consideration to the size of this increase and while a higher increase could be justified, we believe that the current level of wholesale funding rates will moderate from the high level experienced pre-Christmas," he added.
In addition to its standard variable interest rates, CBA is also lifting its variable business loans by 0.15 per cent.
A St George spokeswoman told AAP the bank was "still monitoring the market".
AAP
If you are not sure what type of loan is best for you in the current market, visit www.goodloanguide.net for help on choosing a loan structure that will work best for you.
Friday, January 4, 2008
NAB increases rates amid credit crisis
National Australia Bank Ltd (NAB) has moved to increase interest rates as Australian households get swept up in the global credit crisis.
NAB has increased its variable home loan rate by 12 basis points to 8.69 per cent amid rising wholesale funding costs from the credit crunch.
The bank said the change equates to about $4.60 per week on the average NAB home loan.
NAB has also increased its HomeSide variable rates by 12 basis points, which will come into effect tomorrow, and its business lending variable rates by 15 basis points.
The hike in business lending variable rates comes into effect from January 7.
NAB said its wholesale funding costs have increased on average by 20 to 30 basis points over the past five months, peaking at 40 basis points in December.
Australia's largest mortgage holder, the Commonwealth Bank, this week also increased its rates when it lifted its fixed-rate home loans by 30 basis points to 8.64 per cent for one to four-year mortgages.
Make sure that you have the loanis best suited to your needs. Visit www.goodloanguide.net for tips on all you need to know about applying for the the right home loan.
NAB has increased its variable home loan rate by 12 basis points to 8.69 per cent amid rising wholesale funding costs from the credit crunch.
The bank said the change equates to about $4.60 per week on the average NAB home loan.
NAB has also increased its HomeSide variable rates by 12 basis points, which will come into effect tomorrow, and its business lending variable rates by 15 basis points.
The hike in business lending variable rates comes into effect from January 7.
NAB said its wholesale funding costs have increased on average by 20 to 30 basis points over the past five months, peaking at 40 basis points in December.
Australia's largest mortgage holder, the Commonwealth Bank, this week also increased its rates when it lifted its fixed-rate home loans by 30 basis points to 8.64 per cent for one to four-year mortgages.
Make sure that you have the loanis best suited to your needs. Visit www.goodloanguide.net for tips on all you need to know about applying for the the right home loan.
Wednesday, January 2, 2008
Families facing credit crunch
Source: Australian IT. January 1 2008
AUSTRALIAN households are about to be swept up in the global credit crunch, with the major banks raising interest rates across the board in an effort to protect their profit margins.
Lending rates for almost all loans - particularly fixed home loans, investment loans and some credit cards - have risen in recent weeks by more than the Reserve Bank's 25 basis-point increase in November.
Most at risk are credit card holders, who owe the banks a record $31 billion and face interest rates of up to 19.9 per cent as the Christmas bills fall due in coming months.
The Commonwealth Bank, the nation's biggest mortgage holder, yesterday became the latest bank to lift rates when it boosted all its fixed-rate home loans by 30 basis points to 8.64 per cent for one- to four-year mortgages.
The majority of fixed-rate loans, apart from the Commonwealth's, remain lower than the standard variable rate, which rose to 8.57 per cent in line with the Reserve Bank's November rate increase to an 11-year high of 6.75per cent.
Economists believe the mortgage rate could hit 9 per cent this year as the central bank is forced to raise official interest rates to contain inflation. Banks and other financial companies are raising rates faster than the Reserve Bank to recoup their higher borrowing costs in global financial markets. Interest rates have risen around the world in response to the crisis in the US sub-prime, or low-quality, mortgage market.
Cannex senior financial analyst Harry Senlitonga said there had been increases in fixed-rate loans by most of the major banks.
The rises come as new figures show the financial future for some families appears bleak, with consumer debt at record levels.
With record spending reported over Christmas, statistics from the Reserve Bank show the five interest rate rises over the past two years have failed to slow spending on credit. Personal loans and credit card debt held by consumers with the banks is at $151billion, up 13.2 per cent compared with a year ago.
According to the Australian Prudential Regulation Authority, the total credit card debt is at least $31.12 billion, with the main four banks dominating the market.
CommSec equities economist Martin Arnold said despite record employment levels, some families would have been forced to borrow to survive over Christmas. "The November rate hike has not dented the desire of households to borrow," he said. "Despite rising petrol prices and interest rates, borrowing remains firm and evidence suggests consumers have been spending heavily."
The ANZ has lifted some of its Gold Visa credit card rates to 19.9per cent, which prompted the NAB and Bank of Queensland to lift rates by 35 and 50 basis points on low-rate cards. The interest rate on BankSA cards was raised by 25 basis points to between 13.5per cent and 17.25 per cent.
The major banks have yet to raise their standard variable mortgage rates because of political pressure during the election campaign. They are also keen to keep pressure on non-bank lenders, such as Wizard, which rely more heavily on international credit markets for their funding rather than customers' deposits.
The variable rate offered at Bendigo Bank is now 8.6 per cent - slightly above the standard 8.57per cent - because of its reliance on the credit market.
Bryan Fitzgerald, a spokesman for the Commonwealth, said the bank was facing higher funding costs because of developments on world financial markets.
The NAB has said its costs are nearly 40 basis points higher than a year ago, before the sub-prime crisis hit. And the ANZ said some of its credit card rates were raised because the full 25 basis-point hike from the RBA was not passed on to customers in November.
Now is a better time than any to take a look at your current home loan structure. For great information on the pro's and con's of different home loan structures, visit www.goodloanguide.net and be an informed borrower.
AUSTRALIAN households are about to be swept up in the global credit crunch, with the major banks raising interest rates across the board in an effort to protect their profit margins.
Lending rates for almost all loans - particularly fixed home loans, investment loans and some credit cards - have risen in recent weeks by more than the Reserve Bank's 25 basis-point increase in November.
Most at risk are credit card holders, who owe the banks a record $31 billion and face interest rates of up to 19.9 per cent as the Christmas bills fall due in coming months.
The Commonwealth Bank, the nation's biggest mortgage holder, yesterday became the latest bank to lift rates when it boosted all its fixed-rate home loans by 30 basis points to 8.64 per cent for one- to four-year mortgages.
The majority of fixed-rate loans, apart from the Commonwealth's, remain lower than the standard variable rate, which rose to 8.57 per cent in line with the Reserve Bank's November rate increase to an 11-year high of 6.75per cent.
Economists believe the mortgage rate could hit 9 per cent this year as the central bank is forced to raise official interest rates to contain inflation. Banks and other financial companies are raising rates faster than the Reserve Bank to recoup their higher borrowing costs in global financial markets. Interest rates have risen around the world in response to the crisis in the US sub-prime, or low-quality, mortgage market.
Cannex senior financial analyst Harry Senlitonga said there had been increases in fixed-rate loans by most of the major banks.
The rises come as new figures show the financial future for some families appears bleak, with consumer debt at record levels.
With record spending reported over Christmas, statistics from the Reserve Bank show the five interest rate rises over the past two years have failed to slow spending on credit. Personal loans and credit card debt held by consumers with the banks is at $151billion, up 13.2 per cent compared with a year ago.
According to the Australian Prudential Regulation Authority, the total credit card debt is at least $31.12 billion, with the main four banks dominating the market.
CommSec equities economist Martin Arnold said despite record employment levels, some families would have been forced to borrow to survive over Christmas. "The November rate hike has not dented the desire of households to borrow," he said. "Despite rising petrol prices and interest rates, borrowing remains firm and evidence suggests consumers have been spending heavily."
The ANZ has lifted some of its Gold Visa credit card rates to 19.9per cent, which prompted the NAB and Bank of Queensland to lift rates by 35 and 50 basis points on low-rate cards. The interest rate on BankSA cards was raised by 25 basis points to between 13.5per cent and 17.25 per cent.
The major banks have yet to raise their standard variable mortgage rates because of political pressure during the election campaign. They are also keen to keep pressure on non-bank lenders, such as Wizard, which rely more heavily on international credit markets for their funding rather than customers' deposits.
The variable rate offered at Bendigo Bank is now 8.6 per cent - slightly above the standard 8.57per cent - because of its reliance on the credit market.
Bryan Fitzgerald, a spokesman for the Commonwealth, said the bank was facing higher funding costs because of developments on world financial markets.
The NAB has said its costs are nearly 40 basis points higher than a year ago, before the sub-prime crisis hit. And the ANZ said some of its credit card rates were raised because the full 25 basis-point hike from the RBA was not passed on to customers in November.
Now is a better time than any to take a look at your current home loan structure. For great information on the pro's and con's of different home loan structures, visit www.goodloanguide.net and be an informed borrower.
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