This means buyers can continue to shop around for super cheap home loans for a couple of years yet.
The Reserve Bank governor Philip Lowe also tipped some further growth in property prices but expected a slower pace, reports realestate.com.au.
“While I hesitate to provide forecasts for the housing market, I think it’s quite likely we’ll see further increases in the next little while,” he said this month.
“It’s a global story. It’s not just in Brisbane or Sydney or Melbourne where prices are rising, it’s almost in every city around the world, and it’s largely because interest rates are low and they’re likely to stay low.”
But growth will reach a natural peak at some point, he said.
“We’re building a lot of dwellings and the population is not growing as quickly, and every day the prices go up it’s harder for people to afford,” Lowe said.
“Ultimately there’s some point at which these things will start equilibrating and the big price rises come to an end, but I’m afraid I can’t forecast when that actually happens.”
So what does this mean if you’re looking to buy?
A property purchase is best treated as a long-term commitment. Get some independent financial advice to determine what loan repayments you can afford now and how much you could afford if interest rates rise down the track.
A realistic budget at the outset will make your property such much easier.
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