Powered by MOMENTUM MEDIA
realestatebusiness logo
Subscribe to our newsletter SIGN UP

Low interest rates lure investors to homebuying

17 December 2012 Reporter

As rental costs rise and interest rates continue to be more attractive, property investors may turn to homeownership, according to one data specialist.

“The rising rental costs and lower interest rates may, in certain areas, result in some renters now looking to enter into homeownership,” RP Data research analyst Cameron Kusher said.

“On the other hand, consumer caution persists and consumers broadly continue to prefer to pay down debt and shun new debt, which is likely to restrict any significant improvement borne through lower interest rates.”

Mr Kusher said the big wild card remains the global economy.

Advertisement
Advertisement

“There seems to be a likelihood of further interest rate cuts in the near future by the RBA, especially in light of the revelations of a slowing Chinese economy and a substantial decline in commodity prices, as well as the likelihood of much slower economic growth over the third quarter of 2012.”

The likelihood of further economic uncertainty is high, which will continue to dampen consumer confidence and willingness to spend on high commitment decisions like purchasing a property, according to Mr Kusher.

“As a result, any significant growth in values across the national housing market would appear to be some way off," he said. "The recent improvement in sales transactions will be vital to a sustainable return to value growth across the country. However, it will need to be maintained for a number of months before there is evidence to proclaim a recovery.”

Low interest rates lure investors to homebuying
lawyersweekly logo
FROM THE WEB
Recommended by Spike Native Network
Listen to other installment of the Real Estate Business Podcast

Are you considering offering a flat fee model in 2019?

No
Yes
Perhaps, but it would include a performance bonus on making the sale.
Do you have an industry update?
REAL ESTATE BUSINESS NEWSLETTER
Ensure you never miss an issue of the Real Estate Business Bulletin. Enter your email to receive the latest real estate advice and tools to help you sell.