Home loan demand in Australia is rising with the number of home loan approvals increasing by 1 percent to 52,305 in October of 2013.
The Australian Bureau of Statistics (ABS) states that the total value of housing finance rose by approximately 4 percent to $26 billion during 2013. It was estimated that owner occupied housing attributed to over $16 billion of this rise and that investment housing contributed to $10 billion.
Economists around the nation believe that this is a positive indicator that the housing market is strengthening and that housing investment is growing across the nation. This, in turn, indicates that the recent Reserve Bank of Australia (RBA) cuts to interest rates are beginning to make their mark on the Australian economy and the housing sector.
This growth is expected to continue well into 2014, as it is highly likely that the RBA will keep the official cash rate on hold until later in the year. Economists are predicting that no interest rate rises will occur before the last quarter of 2014. This will then enable the Australian economy to build strength and to fully recover from the Global Financial Crisis (GFC).
Housing experts believe that low interest rates and the stable approach currently being offered by the RBA are encouraging people to buy property. This is due to added confidence when planning and budgeting for home loan repayments.
In addition, many property buyers are researching their market well before buying. They are also waiting for the right property and making sure that their timing is right before buying.
Knowing When It’s Time to Buy
Home lenders and other financial experts suggest that the right time to buy is when you’ve got your finances in order, when you have minimal debt, and when you have accumulated a reasonable amount of savings. Financial experts suggest that if you’re looking to buy a home that you have your credit cards and other small debts paid off. They also suggest that your credit card limits are no more than $2,000 and that you have saved at least a 20 percent deposit. This will increase your likelihood of securing a home loan, reduce the amount you need to borrow and reduce your need to have Lender’s Mortgage Insurance (LMI), which can add thousands to the cost of a home loan.
Looking to buy a home? Then contact eChoice and find the right home loan for YOU today
Written by eChoice