How Brisbane property punters can prepare for 2018
It’s the question on the lips of Brisbane property punters, homeowners and wannabe buyers – What will happen in 2018 and how can we prepare?
Below are Blocksidge Real Estate’s tips for Brisbane property punters to get ready for 2018.
1. Be prepared for mortgage rates to rise
Financial markets predict the Reserve Bank will lift the official cash rate off the record low 1.5% late in 2018. So in case this happens and mortgage rates rise, be prepared to save a little more during 2018. This will provide a financial buffer and hopefully prevent any mortgage distress.
To give Brisbane property punters an idea of how mortgage rate rises may affect their budget, Patrick Nolan, head of loans at ME Bank, says that repayments typically increase by, “$50 for every 25 basis point rise on a $400,000 loan.”
Regardless of whether the RBA increases rates, it is unlikely that mortgage rates will decrease.
2. Property price growth is likely to slow
Banking regulators want to see a slowdown in house price growth, and they want to see it in 2018.
The Australian Prudential Regulation Authority has tightened lending policy, which compelled the banks to lift interest rates out-of-sync with the Reserve Bank. This has flowed on to cause weakness in the property markets, with demand for property decreasing. Since mid-2017 auction clearance rates have softened and if mortgage rates were to rise, it’s unlikely that property prices will grow at the high rates we’ve seen over the past 5 years.
Source: ANZ Research
3. Increased opportunity to buy entry-level properties
First-home buyers rejoice! With tighter restrictions being placed around investing, first-home buyers should find more opportunities to buy in 2018.
Brisbane property punters in the first home buyers bracket should have plenty of options with ample stock, the extended First Home Buyers Grant (to 30 June 2018), stamp duty concessions, and competitive mortgage rates boosting their opportunities.
4. Owner Occupiers are entering centre stage
As investment lending begins to retract, owner occupiers should see a lot more deals coming their way. As banks compete for their business, there is plenty of opportunity for great offers and deals to be put to market to win their hearts.
If you’re an owner occupier looking to refinance in 2018 keep a lookout for any deals that will suit you.