Interest Rates Predictions Australia
The Reserve Bank of Australia has recently warned consumers that interest rates will rise and that homeowners should expect rate rises to mortgages. Dramatic cuts in interest rates, boosts to first home buyer grants and other government concessions have fueled the market in recent months. However, economists, estate agents and property experts said the improving economy and slashing of first home buyer grants from the end of September would be revealing the true state of the market.
Interest rates in Australia were slashed by 425 basis points since September last year in an efford to boost our economy and prevent a major downturn as seen in the US. However, Reserve bank governor Glenn Stevens has said interest rate rises could soon start to rise and warned new home buyers to factor in that interest rates would not remain so low for long.
Experts warn to always factor in an extra 2 to 3 per cent in interest rates when buying a home. Over the course of the loan interest rates will rise and fall depending upon the economy.
The financial markets are growing increasingly confident the RBA will begin raising interest rates before December, with up to six hikes expected by August next year.
Fixed rate home loans have already been increased by bany banks, and home owners should start preparing for rate rises to all types of mortgages by early 2010.