Otis Finance

Rising interest rates have pushed property prices down. Here's what's going to prop them up There’s another factor that, over the long-term, has a surprisingly strong impact on property prices.

Here's what was happening in Australia the last time interest rates rose this quickly The rapid increase in interest rates feels all too sudden for borrowers, but it's not the first time this has happened. Here's how events played out almost 30 years ago.

With the start of the new financial year upon us, I'm sure you would have heard in the past 'It's a good time to review your banking and finances'

Yes, I'm an advocate for doing this annually - but I want to summarise why now is just as important as ever before.

The last 2 years the landscape has changed, we've seen the property values appreciate, the labour market tighten and now central banks increasing interest rates to combat inflation.

This means that you have likely seen a spike in the value of your property, you've considered or accepted a new role in the same or a different industry or you are concerned about the increase in interest rates.

A finance review is important, to take time and consider the road ahead, forecast what changes you are expecting and protect against unexpected changes or events. It's a time to review your existing position and if required make adjustments to align with the road ahead.

To support you in this, I wanted to put together some things to consider

Future Planning:
- Where do you see yourself in 3 - 5 years
- What do you envisage during this time (starting family, new car, new job, one income, upgrade house, school fees, buy your first home, purchase an investment property, renovate your property, start a business, travel)

Current Position:
- Review of budget, is there any unnecessary expenses that can be adjusted
- Where is my/our surplus cashflow best suited, do I need to make consider rising interest rates
- What is my/our current interest rate, when was the last time this was reviewed with my Broker/ Banker
- Is our insurance coverage adequate for our current and future circumstances (life and income protection, building and contents, health)

Once you have an understanding of what's ahead, this can allow you to plan appropriately. Some of the actions I am seeing as a result of the above include:

- Unlocking equity to purchase an investment property, complete renovations or purchase a new car
- Renegotiating interest rates with current lender or seeking more competitive options
- Restructuring current lending or maximising borrowing capacity for further/future investments
- Adjusting budget to allow additional repayments to mortgage/s
- Utilising support available through FHB grants and schemes to get into the market earlier

I've found the following resources a great support during this process:
- https://mortgage.monster/
- https://moneysmart.gov.au/saving/save-for-a-house-deposit

If you would like guidance to support you through this process, please reach out
[email protected] or 0448 436 703

Thanks :)

A great flashback and comparison from 1982 to now 🙈

How much more expensive has life gotten since 1982? I compare wages - LinkedIn How much more expensive has life gotten since 1982? I compare wages, the cost of property and groceries then and now. Check out the results of my 40-year...