Posted Tuesday, 26 October 2010 at 20:13 by Michael Chan
Tagged: property investing | interest rates
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Rate most likely will go up! By how much is the question?
RBA decision not to rise interest rate last month was based on the following:
1. Inflation was low due to high currency ( http://www.facebook.com/notes/shape-home-loans/negative-gearing/170427472967504)
2. international outlook was poor ie US market
3. Half of the 9 RBA board members were away- only 4 was present for the meeting ( lowest turn out in 2 years! )
Some of the RBA board memebrs that were absent on that day were people who would have supported a rate rise, including the academic Warwick McKibbin- who is very supportive for a "few " rate rise in order to keep up with the shortage of affordable homes.
A 0.25 increase doesn't sound like a lot- it's on average $50 extra a month for a standard $300,000 loan. But for many that's $50 to much already! especially with increasing public transport cost, living expense, food, school fees, petrol and toll charge ( don't even get me started on Toll charged, the government wants to push the M2 toll from $4.50 to $6!!! ).
So While the times are still ok, start a budget plan now and save save save. Because unfortunately good times are coming to an end.
The Above Graph say's it ALL! - it cant remain the same Forever.
The Shape Home loans Team