Confidence up with more talk of rate cuts

Isn’t it interesting that as we see further signs of easing restrictions and a return to more ‘normal’ daily lives, (whatever normal means nowadays), we are also seeing more talk about the possibility of further cuts to interest rates?

In recent weeks, one topic that has popped up a few times is the possibility of the Reserve Bank using ‘negative interest rates’ to stimulate the economy. You may have seen reports that Bill Evans, the chief economist of Westpac, has said that the RBA board should consider this move.

It sounds like a weird idea, we know, but several countries around the world currently have negative interest rates in place, like Denmark, Switzerland, Sweden, Japan, and the European Union. In Denmark, there are banks that will pay borrowers 0.5% interest to take out a home loan with them!

Most economic commentators are suggesting that this is unlikely to happen in Australia, it does give you something to think about!

Another interest rate-related topic that is generating some talk among mortgage brokers is the possibility that we could see home loan rates dropping below 2% in the not-too-distant future.

A quick look at some of the home loan websites this week shows that there are two-year fixed loans being offered at 2.09% and three-year loans at 2.14%, whilst variable loans seem to start at 2.39%

Over the past week or so we have seen some loan brokers being quoted in the media saying that they expect the competition between lenders to push some rates under 2% to lure customers away from the big banks.

Whether either of these options becomes a reality, it is clear that 2020 is a great time to negotiate hard on your home loan, whether you are purchasing a property or simply refinancing. It’s certainly made an impact on buyer confidence as we saw once again this week with the successful sale of a fine family home in Thomastown.

The three-bedroom home at 10 Earlwood Court, (pictured), made the most of a peaceful position with Chantal Park at the end of the court and walking tracks around the corner that provide scenic and peaceful access to the schools and Thomastown Aquatic and Recreational Centre. Buyers also responded positively to its impressive car accommodation, with a double garage being enhanced by a wide side driveway.

With the combined strength of our Barry Plant network reaching over 5 million people every month, (as you may have read in Saturday’s Herald-Sun), there are definitely some outstanding opportunities out there for local homeowners who are ready to sell at the moment. If you’d like to discuss how to maximise your opportunities in the current market, you can call the team at Barry Plant Thomastown on 9466 3233.


Con Constantinou

Barry Plant Thomastown