Debbie Shankar - 30 Apr, 2015

Housing Market April Snapshot

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For the April RBA announcement, interest rates remain on hold at 2.25%, but another rate cut is likely in the coming months. Speculation over whether lower interest rates will fuel investor buying and push housing prices up further has been raised. However, economists estimate that higher rates of unemployment and weaker job growth, as well as declining housing affordability and lower rental yields could sway consumer confidence.

The Housing Market

Research indicates that lower interest rates are putting more money into the pockets of Australians. In 2011, for example, a $400,000 home loan would have accrued approximately $27,000 in interest. However, based on today’s interest rates, where the average home loan sits at 4.9%, the interest on a $400,000 home loan is reduced to $19,400. Based on these rates, Australians are estimated to be saving around $150 on their mortgage a week.

Despite this, lending for owner-occupiers declined during February by 0.1%. However, financing for investors marginally increased.

A slight decrease in first home buyer lending was also witnessed. This has led to a debate over whether or not first home buyers should be given access to their superannuation to fund home deposits. Many economists feel that this move could reduce housing affordability further as demand for housing would increase and property prices will get forced-up.

Mean Property Prices

Mean property prices for the month rose in Sydney, Melbourne, Adelaide, Darwin and Canberra. While Brisbane, Perth and Hobart experienced a decline.

Location Median Price Monthly Value % Quarterly Value % Year on Year Value %
Sydney $680,000 +1.4 +2.8 +13.7
Melbourne $515,000 +1.4 +4.5 +7.4
Adelaide $410,000 +0.2 +0.8 +3.4
Darwin $530,000 +0.9 -1.0 +1.6
Canberra $510,000 +1.3 +1.6 +1.8
Brisbane $452,000 -0.8 +0.5 +5.9
Perth $510,000 -2.2 -0.9 +4.8
Hobart $336,000 -0.9 +3.3 +0.7

Is it time for you to consider buying again or purchasing an investment property? Then contact eChoice, today and ask them how you can find the right home loan.

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