Days have started to get colder as we see the first glimpse of winter. We hope you are well and safe where you are.
Autumn is usually a busy time for property auctions, but we have seen a decline in numbers due to the temporary ban on onsite auctions and open inspections. When the COVID-19 restrictions start to ease, we should start seeing activity in the property market increase again. Read on to find out more.
Interest rate news
The Reserve Bank of Australia (RBA) announced it has decided to keep the official cash rate unchanged at 0.25% at its meeting on the 5th May. According to the RBA, most lenders did not reduce their standard variable rates following the further cut to the cash rate on March 19, but some announced a reduction for interest rates on fixed-rate loans and measures to defer interest and loan payments for distressed households. If you have had your home loan for a while, now is a good time to review it to make sure you’re getting a competitive rate.
Further information: 5 Reasons to review and fixed your home loan
Home value movements
CoreLogic has released its National Housing Market Update for May 2020. See the video and presentation below.
Key points:
Data to May shows that combined capital cities are about to decline
The top quartile of the Melbourne market has begun leading the downturn registering a 0.8% monthly reduction in value
Property sales volume is 40% lower than the previous month
Inner-city rental markets have seen a significant uplift in rent listings off the back of falling demand, and increased supply, amid COVID-19
By April, all markets saw an annual decline in vendor discounting. But as the market turns, vendor discounts are likely to become larger
Investor participation continues to decline. First Homebuyer participation at its highest since 2012
Should you wish to discuss this in the context of your financial situation, please do not hesitate to contact to speak to an adviser.
Download Corelogic presentation:
Credit policy changes
In light of the current economic environment, some lenders have changed their lending policies towards specific borrowers and locations impacted by COVID-19 and in general. Changes include the assessment of income of casual employees, employees in the hospitality and tourism sectors, bonus/commission income, short term rental income and borrowing limits for properties in holiday locations. Some lenders have also changed their LMI waivers policy towards doctors and other professionals.
To discuss how this impacts you, contact us to speak to an adviser.
We’re here to help you achieve your property goals
While it’s too early to call the future market trend, we can look forward to the economy’s recovery once the pandemic ends. During this time, you may have questions regarding your current loan, or you might have plans to take this opportunity to explore new property options. Please know that we’re here to help you. Give us a call and we’ll help you find the right solution for your current financial needs and future goals.