Increased Interest Rates: Has Christmas Come a Little Early? 

Westpac recently raised their rates by 0.2% and I recently wrote an article predicting that the other banks would be interest-ratefollowing suit.

So it’s no surprise, but late last week, CBA announced that they have raised their rates by 0.15% and NAB has also announced that they have increased their rates by 0.17% as well!

These interest rate hikes will affect every loan across the board and will impact both investors and owner-occupiers.

The thing to remember here is that banks are running a business to the tune of billions of dollars.

When APRA changed it’s financial rules around investment lending, it put restrictions around how the banks would generate revenue.  From a bank’s point of view, they needed to figure out a way to reclaim the lost revenue.  Raising interest rates is the way that the banks would do it.

This move from the banks has been quite strategic, and it has forced the RBA – who meets next month – to reconsider raising interest rates.  Chances are that they’ll hold off doing so for a while otherwise the banks will respond in kind.  This would not be good for the retail sector especially over the Christmas period.

However, higher interest rates mean that it’s the perfect time to go shopping for the property investor – there’ll be a ton of deals out there, ripe for the picking!

Share this post

Share on facebook
Share on google
Share on twitter
Share on linkedin
Share on pinterest
Share on print
Share on email

Become a successful Property Investor

Start Here With Your Free Investment Gift Pack Valued at $297

Get one step closer, Fill in the form below

More from Real Wealth Australia

Blog - The Next Boom Cycle Is Coming... Prepare Yourself
Articles

Post COVID-19 Property Boom Cycle is coming… prepare yourself!

The Corona virus pandemic is in the process of trashing property prices by possibly up to 30% according to some and when it’s over be …

How to invest and prosper in uncertain times
Articles

How to invest and prosper in uncertain times

Most of us have gone from living our lives, going about our business, taking care of our homes, to a level of uncertainty that caught …

Will the property market crash_
Articles

Will the property market crash?

Australia is in lock-down, schools are closed, many people have lost their jobs or are working from home. We must all exercise safe distancing, which …