If buying a home is at the top of your wish list for 2024, don’t miss our rundown on how the property market has fared in 2023 – and why the new year is shaping up as potentially another big year for real estate.

As we turn the page on 2023, let’s take a quick rear mirror look on how home values moved over the past 12 months.

In a year that saw five official rate hikes, and a cost of living squeeze thanks to high inflation, home prices still jumped by 7% nationally.

Several cities eclipsed those gains, with double-digit price growth in Sydney (up 10.2%), Brisbane (10.7%) and Perth (13.5%).

But it wasn’t just price growth that took everyone by surprise.

The speed of home sales was also astonishing, with plenty of suburbs in Perth, Sydney, Brisbane and Melbourne selling houses in as little as eight to 25 days on average.

Will property values keep rising in 2024?

Well, higher interest rates are starting to take a little heat out of the market.

According to CoreLogic, home values across Australia rose 0.6% in November – the smallest monthly gain since early 2023.

But here’s the rub.

The factors that pushed prices higher in 2023 are still in place, and plenty of experts are tipping house prices will keep rising in the new year.

Three factors that could drive prices higher

Three main drivers look set to support house price growth in 2024, including:

1. Strong population growth: Population growth is rebounding strongly, driven by high immigration levels. More people generally means more demand for housing.

If you’re not convinced, a recent Domain report says “unprecedented” population growth will exert “extraordinary upward price pressure” on the property market.

2. A housing undersupply: On the supply side, we’re just not building enough new homes.

Australia’s housing shortage made headlines through 2023, and it doesn’t look like it’ll get better any time soon. Building approvals for new homes are reported to be well below average levels.

3. A rental market that’s as tight as a drum: Anyone looking for a rental can face an uphill battle. Vacancy rates are at record lows, making rental conditions tough.

This could encourage more people to buy a place of their own through one of the government’s low deposit buying schemes.

The First Home Guarantee scheme for instance, lets first home buyers get into the market with just a 5% deposit and zero lenders mortgage insurance.

Price growth is expected to be (slightly) lower next year

Most experts are tipping house prices will keep rising in 2024 though maybe not at the breakneck speed seen nationally in 2023.

That said, price growth won’t be anything to sneeze at.

Domain is forecasting house prices to jump 5-7% nationally, and in each capital city by:

– 7-9% in Sydney
– 2-4% in Melbourne
– 7-8% in Brisbane
– 6-7% in Perth
– 7-8% in Adelaide
– 3-5% in Canberra
– 2-4% in Hobart

The bottom line is that we could be facing another bumper year of price growth in 2024, and if buying is on your radar, it may be worth trying to buy sooner rather than later to potentially avoid paying more.

So call us today to get the ball rolling on a home loan that helps you achieve your new year property goals sooner.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

First home buyers with a small deposit now have an even wider range of lenders to choose from. We reveal the latest banks to join the 5% deposit scheme that’s helping more buyers get into the market sooner.

First home buyers have just received an early Christmas gift, of sorts, with an uptick in the number of lenders that have signed up to the Home Guarantee Scheme (HGS).Three Westpac brands, St.George, Bank of Melbourne and BankSA, have added their names to the list of lenders available to first home buyers under the HGS.If you’re not familiar with the HGS, it gives first home buyers an opportunity to buy a place of their own with as little as a 5% deposit (and no lenders mortgage insurance) through the First Home Guarantee or Regional First Home Buyer Guarantee.First home buyers aren’t the only ones to benefit. The HGS also includes the Family Home Guarantee, which allows solo parents to buy a home with just a 2% deposit.More competition is good news for home loan ratesAccording to Housing Australia, which runs the HGS, first home buyers can now choose from 33 lenders participating in the scheme.This includes most of the big banks (ANZ has not signed up) plus a generous variety of small banks, credit unions and non-bank lenders.The extra sweetener is that more lenders can boost competition, which potentially encourages banks to keep their interest rates low for first home buyers.Buying with a 5% deposit helps get you into the market soonerSaving a deposit is often the key barrier for first home buyers. And when home prices and cost of living are rising, it can seem like the goal posts are constantly moving out of reach.The beauty of the HGS is that it lets first home buyers jump into the property market about four years earlier (on average) than they normally would.So, it’s no surprise that last financial year one-in-three first home buyers purchased with the help of the HGS.Better yet, new data from Housing Australia shows that first buyers who have tapped into the scheme are now sitting on $82,000 in home equity, on average.It’s a great result, especially when you consider that the average first home deposit across the scheme was just $35,200 in 2020, rising to $36,400 in mid-2023.Compare that to the average deposit of $159,000 across the broader first-home buyer market, and it’s easy to see how the 5% deposit scheme gives first-home buyers a valuable leg-up into the market sooner.How to choose the right loan for you?With more than 40 lenders offering 5% deposit home loans under the HGS, the challenge can be choosing the loan and lender that’s right for your needs (or finding one that will take you on if your application is a bit touch and go, or if you’ve just started your own business in recent years).The simple solution is to give us a call.We can explain whether you’re eligible for the low-deposit scheme, and answer any questions you may have.We’ll also take the time to understand your needs, so you can be confident that the lenders and loan products we put forward to you are a good fit.Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

It may be called the silly season but a few smart strategies could help you enjoy the festive season this year without missing a beat on your home loan. Check out our tips to share the Christmas cheer this year without breaking the bank.

Store shelves are starting to be lined with tinsel, ‘Santa stop here’ signs are popping up around the neighbourhood, and chances are you’re beginning to hum a few bars of Jingle Bells.Yes, Christmas is just around the corner, and now’s the time to plan for what can be a pricey time of year.After 13 rate hikes in close succession, plenty of homeowners are feeling the squeeze of higher home loan repayments.The good news is that you (hopefully) won’t have to cancel Christmas this year. Below are three clever hacks that could help you manage your mortgage over the festive season.1. Follow Santa’s lead – make a list (or two)Plan ahead by listing all the fixed expenses you’ll face in December such as utilities, your home loan, car loan, and credit card repayments, as well as less frequent bills such as council rates that may fall due before Christmas.Add up the total to know how much you need to set aside. It’s a good idea to try and prioritise these bills over seasonal spending.Next, draft up a Christmas spending budget that allocates money to gifts, food, drinks and decorations.Finetune your budget based on your ability to pay, bearing in mind the upcoming costs you identified in the bill list.If things are looking tight this year, consider opting for Secret Santa instead of everyone buying everyone a present.It can help make the giving experience more personal and is definitely gentler on the hip pocket.Websites like elfster.com can help keep it anonymous and straightforward for everyone.2. Plan for how you’ll payIt can be tempting to pay for Christmas purchases with a credit card or buy now, pay later. But these options can just mean kicking the can down the road until January when payments fall due.It’s also worth noting that late payments on either option could affect your credit score for any future home loan applications.So where possible, consider reaching for your debit card for festive purchases. It’s hard to get into too much trouble when you pay using your own money.3. Ask your lender for a giftChristmas is the season of giving, so why don’t we hit up your lender for the gift of a lower interest rate?Reserve Bank data shows there is still a gap between the rates on new versus established loans.If you took out your loan through us, get in touch and we can either reach out to your lender on your behalf for a discount or, if they don’t come to the party, help you explore your refinancing options with another lender.Don’t let Christmas spending ruin your home loan plans for 2024It’s easy to get swept up in seasonal good cheer. But it can sometimes be important not to get too carried away with Christmas spending.If you plan to refinance your home loan or purchase a house in 2024, a lender will likely look at your spending patterns over the past few months.Hamming up your purchases in December can bump up your average living costs, and if you go way over the top, potentially see you knocked back for a new loan in the new year.Want more tips to manage your mortgage over the holiday season? Call us today for more festive saving strategies.Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

If the November rate hike will seriously stretch your finances, one potential solution may be to extend your loan term. It can ease the hip pocket pain by lowering monthly repayments. But taking more time to pay off your mortgage can come with hidden downsides. Here’s what to weigh up.

Will the RBA’s latest 0.25% cash rate rise squeeze you financially? (not to mention the other 12 rate hikes!)

The majority of lenders lost no time increasing their variable home loan rates following the Reserve Bank of Australia’s 0.25% Melbourne Cup Day rate rise.

According to Mozo, the 13th rate hike since May 2022 has pushed up the average variable rate to 6.62%.

What does that mean in dollars and cents?

On a $500,000 variable rate home loan payable over 25 years, the latest 0.25% rate hike can see monthly repayments jump by $78.

For homeowners who didn’t have much fat left to cut from their budget, those extra dollars can be hard to find.

One potential strategy that may help to lower repayments is to stretch out your loan term.

How extending your term can reduce repayments

If you have a 25-year loan, your lender may give you the option to extend for up to five more years, possibly pushing out the term to 30 years.

If you get the green light, this kind of reset can significantly lower your monthly repayments.

On the $500,000 mortgage we looked at earlier, moving from a 25-year loan to a 30-year loan could cut monthly repayments by around $214 – even after allowing for the November rate hike.

The hidden cost of a longer term

There’s a lot to love about the prospect of slashing a couple of hundred bucks off your loan repayments each month, especially as we head into the festive season.

But pushing out your loan term can come with a hidden cost.

Taking longer to pay down your loan means you’re also paying interest for longer. And while your repayments can decrease, the long-term interest cost can skyrocket.

Stretching a $500,000 loan from 25 to 30 years could mean paying a whopping $128,000 more in total interest.

It’s worth keeping in mind though that those extra interest repayments aren’t a given.

You may be able to close the gap and cut down the interest cost by either making extra repayments in the future, loading up an offset account, or paying off the loan early (if, for example, you receive a lump sum inheritance).

So the upshot is that stretching your loan term can be a short-term fix now, but you’ll have to weigh up the costs against the benefits, not to mention whether you think you’ll be in a better financial position later down the track to pay down the loan quicker (and thus reduce the interest payments).

Other ways we can help

Along with exploring extending the length of your loan, we could also help you look into other solutions to ease the pain of higher rates.

Options that may be available with your lender include:

– temporarily lowering your loan repayments;
– deferring repayments for a while; or
– shifting you to interest-only payments for a set period.

The common thread is that the earlier you reach out for assistance, the sooner we may be able to help you get some financial relief.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

The Reserve Bank of Australia (RBA) has increased the official cash rate by 25 basis points, taking it to 4.35%. So just how much will this year’s Melbourne Cup day rate hike increase your monthly repayments?

Some more tough news for mortgage holders around the country today.

Despite the official cash rate being on hold since June (and many hoping it would stay that way), the RBA has decided to press ahead with a second consecutive Melbourne Cup day rate rise in an attempt to rein in inflation.

This means we’ve now had 13 rate hikes in 18 months since 1 May 2022, and it takes the official cash rate to its highest level since November 2011.

It also happens to be the first rate hike under new RBA Governor Michele Bullock, who commenced in the role in September.

So why did the RBA raise the cash rate?

Governor Bullock said while inflation in Australia had passed its peak, it was still too high and was proving more persistent than expected a few months ago.

“While goods price inflation has eased further, the prices of many services are continuing to rise briskly,” she said.

“While the central forecast is for CPI inflation to continue to decline, progress looks to be slower than earlier expected.”

Governor Bullock added the RBA Board judged an increase in interest rates was warranted today to be more assured that inflation would return to target in a reasonable timeframe.

“If high inflation were to become entrenched in people’s expectations, it would be much more costly to reduce later, involving even higher interest rates and a larger rise in unemployment,” she said.

How much could this latest hike increase your mortgage repayments?

If you’re on a variable-rate home loan, the banks will likely be increasing the interest rate on it very shortly.

For an owner-occupier with a 25-year loan of $500,000 paying principal and interest, this month’s 25 basis point increase means your monthly repayments could go up by about $76 a month.

That’s an extra $1,211 a month on your mortgage compared to 1 May 2022.

If you have a $750,000 loan, repayments will likely increase by about $114 a month, up $1,816 from 1 May 2022.

Meanwhile, a $1 million loan will increase by about $152 a month, up about $2,422 from 1 May 2022.

Need help reining in your mortgage? Get in touch

Are you feeling the pinch? You’re not alone. Many households around the country are feeling the effects of 14 rate hikes in 18 months.

There are also lots of people on fixed-rate home loans wondering what options will be available to them once their fixed-rate period ends.

Some options we can help you explore include refinancing (which could mean increasing the length of your loan and decreasing monthly repayments), debt consolidation, or building up a cash buffer in an offset account.

So if you’re worried about how you might meet your repayments going forward, give us a call today. The earlier we sit down with you and help you make a plan, the better we can help you manage your mortgage moving forward.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

Mortgage brokers have notched up a new personal best, with seven out of every 10 new mortgages settled thanks to their help! It’s a sure sign that mortgage brokers are delivering the goods when it comes to helping Australians move into their dream homes.

In the nine months to 31 March 2023 (while interest rates were rising), mortgage brokers helped settle more than 70% of all new residential home loans, according to the latest data from the MFAA.

It’s the first time ever that brokers have helped settle more than 70% of home loans over a three-month-plus period.

For context, just two years earlier brokers were helping settle between 50-60% of new home loans.

So why are more Aussie home buyers turning to mortgage brokers?

For starters, it looks like word is getting out about how much help we can provide when it comes to giving you an informed choice with your home loan.

And in this environment of higher interest rates, it’s important to be sure your home loan offers value.

With a wide network of lenders – including big banks, small banks and non-banks – brokers are well-placed to help you choose the loan that’s right for you.

It doesn’t end there, though. Here are five more reasons why Australians are turning to brokers for help.

1. Brokers do the legwork

There are hundreds of home loans to choose from. But who’s got the time to find a loan that suits your needs?

Your broker does.

Better still, your broker does a lot of the legwork, sorting the paperwork and supporting your loan application right through to settlement.

That lets you sit back, relax, and focus on moving into your new home.

2. We’re flexible

You’re busy, right? That’s why brokers offer flexible appointment times.

Want to chat after hours? No problemo.

Prefer to chat online rather than face-to-face? Can do.

It may seem like a minor benefit, but the flexibility brokers offer is a big deal when you’re flat out with work, family, or just busy house hunting.

3. Brokers provide tailored facts

Brokers provide clear details to help you make informed decisions.

From your borrowing power, to how much of a deposit you really need, and what your loan repayments will be under various scenarios, we’ll crunch the numbers based on your unique situation.

It takes the guesswork out of buying a home and lets you plan ahead.

4. No additional costs and a best interests duty

It often comes as a surprise that a broker’s home loan help comes at no cost to their clients. That’s because brokers are paid a commission by lenders.

Rest assured though that unlike the banks, we’re (happily) bound by a best interests duty that means we’ll always put your best interests first.

So while banks and digital lenders might try to tempt you with cashback offers for loan products that may not really be in your best interests (due to fees, high interest rates, and other undesirable loan terms), we’ll only ever try to match you up with lenders and loans that are in your best interests.

5. Brokers keep working for you over the long term

Chances are you’ll have your home loan for quite a few years.

We’ll be with you along the way to help make sure your home loan continues to be the right option for you, no matter how your life changes.

So call us today to see why more Australians than ever are partnering with a broker.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

No matter whether you’re in the market for a home or an investment property, it makes financial sense to buy in an area where values are tipped to rise. But where to look? Today we’ll unveil the Australian cities where population growth is tipped to turbo-charge the property market.

One of the biggest drivers of property price rises right now is … drumroll … population growth, according to PropTrack.

Let’s take a look at the cities more people are expected to call home.

Is the regional renaissance over?

During the height of the COVID-19 pandemic, Australians were flocking to regional areas.

The population of regional Australia grew by 70,900 people during 2020-21 – the first time in over 40 years that the regions outpaced capital cities.

However, the COVID-inspired rush to the regions is reportedly over.

Despite the new work-from-home trend, the reopening of borders is seeing a return to urban living.

According to property exchange platform PEXA, this will see two-thirds of Australia’s population growth concentrated in four cities over the next two decades.

Which cities are set to benefit?

PEXA is predicting population growth of 7.4 million between now and 2041.

That’s a lot of people looking for a place to live.

It’s not just about net migration to Australia, either.

Regional dwellers, especially younger people, are expected to head to urban areas, attracted by the availability of study and work opportunities.

The upshot is that two million new homes will be required over the next 18 years, and 67% of population growth will be concentrated in Sydney, Melbourne, Brisbane and Perth.

The stats are astonishing.

PEXA says the four hotspot cities require vast numbers of new homes:

– 723,000 in Melbourne (that’s 40,000 new homes per year, or 772 per week);
– 582,000 in Sydney;
– 381,000 in Brisbane; and
– 334,000 in Perth.

Adelaide meanwhile is predicted to need at least another 141,000 dwellings between now and 2046.

What does this mean for property buyers?

For starters, increased demand on this scale is expected to continue to push up property prices unless supply can increase at a similar pace.

Despite higher interest rates, already we have seen values rise in all of these four cities over the past 12 months.

CoreLogic says property prices have soared 7.3% in Sydney over the past year, 5.0% in Brisbane, a whopping 8.8% in Perth, and a comparatively modest 1.5% in Melbourne (and 5.0% in Adelaide).

So if you own property in these cities, you could be sitting on more equity than you realise – with potentially more to come.

Or, if you’re considering buying, particularly as an investor, it could be worth looking at one of these hotspot cities – even if you don’t live there yourself.

Are you home loan ready?

No matter where you plan to buy, understanding your borrowing power is a key starting point.

Give us a call today to find out how much you can borrow and what grants and schemes you might be eligible for to help fund your next purchase.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

Not sure what refinancing is all about? You’re not alone. Our quick explainer lets you master the basics and helps you work out how much you could save.

Home loan refinancing is a hot topic right now.

Ever since interest rates hit an upward trajectory in May 2022, skyrocketing numbers of homeowners – as many as 28,000 each month – have turned their attention to refinancing.

However, plenty of Australians could be missing out on the savings of refinancing simply because they’re unsure of what’s involved.

Research by Finder shows one-in-five people are in the dark about refinancing, while 63% admit to being only “slightly confident” in their knowledge of refinancing.

So, let’s take a quick look at what refinancing is, and how it can reduce stress by potentially putting cash back in your pocket.

What does refinancing mean?

Refinancing simply means replacing your old mortgage with a new loan and lender.

The process is similar to the one you followed to apply for your current loan.

You decide the loan you’d like to switch to, make a formal application, and provide evidence of income, expenses, and your personal ID.

If the loan is approved, you can sit back and relax as the new lender arranges to pay out your old loan. When that’s taken care of, you just start making repayments to the new bank.

Refinancing can be a surprisingly simple process. Better still, it can all happen very quickly, usually taking about four weeks from start to finish.

Refinancing can be a stress buster

Refinancing can be an opportunity to access home equity, enjoy better loan features, or consolidate several personal debts.

But the number one reason for refinancing is to save money by paying a lower loan interest rate. Those savings can help take the financial pressure off homeowners.

According to Finder, 60% of refinancers admitted to being stressed about their home loan before deciding to switch.

If that sounds like you, making the move to a new loan could be a valuable stress buster.

How much could you save by refinancing?

Potentially, a lot!

That’s because lenders are still saving their best deals for new customers.

The average rate on established loans is currently 6.20%. But if you’re a new customer, you’re more likely to pay an average rate of 5.99%.

That’s an instant saving of 0.21% interest. Think of it as reversing almost one official rate hike.

So what does that rate difference mean for your hip pocket?

Right now, the average loan being refinanced is worth $526,093. On that balance, a 0.21% rate saving could slash more than $70 off each monthly repayment, which equates to $840 in the first year alone, assuming a 30-year loan term.

Is refinancing right for you?

If you’re starting to feel the interest rate squeeze, give us a call today to discuss your refinancing options.

We’ll help you work out if refinancing is the right step for you and how much you could save by switching to a new loan and lender.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

Know anyone who wants to buy their first home? A new report confirms that low deposit schemes are getting younger buyers into a place of their own sooner.

First home buyers are ignoring headlines warning that it can take years to save a deposit.

Instead, they’re flocking to guarantee schemes that allow them to get into the market with just a 5% deposit – and without the cost of lenders’ mortgage insurance (LMI).

NHFIC, which runs the First Home Guarantee schemes set up by the federal government, says that in 2022/23, close to one-in-three first home buyers tapped into the guarantee schemes.

That’s up from one in seven the year before.

In total, 41,700 home buyers got into the market with the help of guarantee schemes last financial year, following an uptick in the number of places available.

Younger Australians are buying a home

What’s especially exciting about NFHIC’s research is that it shows the schemes are allowing younger buyers to crack the property market.

In 2022/23, more than half of all places in the First Home Guarantee and Regional First Home Buyer Guarantee were taken up by people under the age of 30.

There has also been a fivefold increase in the number of buyers aged 18-24.

Key workers are buying with just a 5% deposit

The low deposit schemes are also helping a growing number of key workers such as teachers, nurses and social workers purchase a home.

Around 7,721 guarantees were issued to key workers last financial year. Great news for these essential workers in our community!

Debunking the low deposit myth

The First Home Guarantee has at times attracted criticism. This has largely been around the risks of buying with just a 5% deposit, which can mean taking on a larger loan with higher repayments.

But NFHIC data suggests this hasn’t been a problem.

Fewer than 0.1% of homeowners using the schemes have fallen behind on their loan repayments, which is less than the market average for all buyers with a low deposit loan.

Better still, close to 10,000 scheme borrowers (over 12% of total guarantees issued to date) have already transitioned out of the scheme, with most of these buyers having accumulated enough equity to achieve a loan-to-value ratio (LVR) of less than 80%.

Could you be eligible for a 5% deposit scheme?

If you’re a first home buyer struggling to save a 20% deposit, it’s good to know there is a pathway to home ownership that can get you into a place of your own sooner.

And it can also help you to avoid paying LMI – which can cost you anywhere between $4,000 and $35,000, depending on the property price and your deposit amount.

Conditions apply for the 5% deposit schemes, but new rules mean you can buy with a sibling or mate and still be eligible for this valuable financial helping hand.

With property values rising in many markets across Australia, time is of the essence.

Call us today to see if you can buy a home with a 5% deposit and zero LMI.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

Drumroll … The RBA has hiked the official cash rate for the 12th time since April 2022, increasing it to 4.10%. How much will this increase your monthly repayments? And how long does Philip Lowe plan to keep marching to this beat?

Another month, another 25 basis point cash rate rise. It’s now apparent the cash rate pause back in April was nothing but a false peak.

Reserve Bank of Australia (RBA) Governor Philip Lowe explained in a statement that while inflation in Australia had passed its peak, at 7% it was still too high and it would be some time yet before inflation was back in the 2-3% target range.

“This further increase in interest rates is to provide greater confidence that inflation will return to target within a reasonable timeframe,” he said.

Governor Lowe added that some further tightening of monetary policy may be required to ensure that inflation returned to target in a reasonable timeframe, but that would depend upon how the economy and inflation evolved.

“If high inflation were to become entrenched in people’s expectations, it would be very costly to reduce later, involving even higher interest rates and a larger rise in unemployment,” Governor Lowe explained.

“Recent data indicate that the upside risks to the inflation outlook have increased and the Board has responded to this.”

How much could this latest hike increase your mortgage repayments?

Unless you’re on a fixed-rate mortgage, the banks will likely follow the RBA’s lead and increase the interest rate on your variable home loan very shortly.

Let’s say you’re an owner-occupier with a 25-year loan of $500,000 paying principal and interest.

This month’s 25 basis point increase means your monthly repayments could increase by almost $76 a month. That’s an extra $1,135 a month on your mortgage compared to 3 May 2022.

If you have a $750,000 loan, repayments will likely increase by about $114 a month, up $1,702 from 3 May 2022.

Meanwhile, a $1 million loan will increase by about $152 a month, up about $2,270 from 3 May 2022.

Concerned about how you’ll meet your repayments?

A lot of households around the country will now be feeling the pain of these 12 rate rises. So if your household is one of them, know that you’re not alone.

Similarly, there are likely a lot of people on fixed-rate home loans wondering just what options will be available to them once their fixed-rate period ends.

Whatever your situation, please know that there are options we can help you explore.

Some of those options might include refinancing (which could involve increasing the length of your loan and decreasing monthly repayments), debt consolidation, or building up a bit of a buffer in an offset account ahead of more rate hikes.

So if you’re worried about how you might meet your repayments going forward, give us a call today.

The earlier we sit down with you and help you make a plan, the better we can help you manage any further rate hikes.

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