Posts Tagged ‘GFC’

FHBG boost comes to an end

Wednesday, January 27th, 2010

There was plenty of fanfare when the government boosted the first home buyers grant to $21,000 for new properties as part of the economic stimulus package but very little coverage has accompanied the ending of the boost from 1 Jan 2010.

In NSW the government boost has been in part replaced by a $3,000 supplement for new homes (nothing for established properties). A further change to the scheme has been to cap availability to properties costing less than $750K the argument being that any home buyer who can afford more than three quarters of a million dollars on their first home doesn’t need any additional help from the government. We’re inclined to agree.

Tags: , , ,
Posted in General real estate | Comments Off

Wespac – We’ll see your 0.25 and raise you another 0.2

Tuesday, December 1st, 2009

Westpac is the first bank to increase it’s mortgage interest rates following todays rise by the RBA and has surprised many analysts by raising rates by 0.45 pts. A whopping 0.2 pts more than the RBA.

This greedy exploitation of homeowners is likely to be repeated by the other major banks in the coming days now that Westpac have lead the way. Wayne Swan somewhat naively claimed that any bank that follows Westpacs lead can expect a severe backlash from it’s customers. In reality homeowners will grumble to themselves but very few will move to another lender. The banks know this which is why they feel that they can raise rates to such high levels.

Since the GFC the banks are in a stronger position having acquired their weaker lending rivals such as RAMS during the crisis. With less competition and the four major banks all likely to follow the lead of Westpac homeowners have little choice but to accept the rise.

Tags: , , ,
Posted in General real estate | Comments Off

RBA increases rates by 0.25 pts

Thursday, November 12th, 2009

The RBA has increased rates by a further 0.25 pts as the economy continues to improve and the bank eases back it’s stimulus program. While there had been some speculation that the rate rise could have been as large as 0.50 pts homeowners will be thankful of the reprieve with another rate rise now unlikely before Christmas.

Some sections of the media ran stories with homeowners saying that they felt tricked into buying a property when rates were at there lowest and the latest rate rise meant that they would struggle to keep up repayments. This is quite worrying. Anyone who thought that the low rates set at the worst of the GFC were sustainable has either been living under a rock or has received some spectacularly bad financial advice. The RBA has been quite clear in stating that rates will rise further as the economy continues to  improve.  any one currently looking to buy a home should factor in at least 1.0 of further interest rate increases to their loan repayments just to get back to “normal”. It would be wise to add 2.0 – 3.0 pts to current rates when considering whether you can afford the loan.

Tags: , , ,
Posted in General real estate | Comments Off