Interest Rates

Rate rises weigh on house prices in Australia

November 6, 2010

Economists have indicated that the lack of a stimulus as well as rises in rates have begun to impact the growth of home prices. According to numerous economists, the recent reductions of policies such as the first home buyers grant, as well as increases in interest rates early in 2010 have resulted in a weighing down of home values across Australia.

Official data gathered on house prices showed that the prices of homes in Australia rose 11.5 per cent from the start of the year until September.

RBA Increases Rates by 0.25% to 4.75%

November 3, 2010

Borrowers are preparing to deal with higher costs for repayment in the coming months after the Australian Reserve Bank surprised a number of economists and speculators by raising the headline interest rate, the cash rate, this week. This is the first raise the headline interest rate has seen since May. The Reserve Bank decided to consider more than the regular figures for inflation for the quarter in September and decided to raise the key interest rate, the cash rate, from 4.5 per cent to 4.75 per cent.

Prepare for Rate Rises Now

October 27, 2010

The Mortgage & Finance Association of Australia (MFAA) urges borrowers to get ready for a an interest rate rise that will definitely take place within the next six months, which means that they will be dealing with higher mortgage costs. In October, the RBA decided to freeze the interest rate at 4.5%, which took both the banking industry and consumers by surprise.

The MFAA further explained that the interest rates were on hold because information from the most recent Consumer Price Index was unavailable at the time.