Save thousands on your home loan
Compare 25+ lenders and hundreds of loans in an instant
I want:
Westpac Macquarie citibank commonwealth bank anz bankwest
finni mortgages logo
google reviews
4.9
star star star star star
Rating based on 147 reviews

×

Rate cut effect unclear

Investors will be watching any rate movements closely next week, but it’s unclear as to what effect they may have on the market.

spi default article image em4omm

Speaking to Smart Property Investment, Key Asset Management’s Grant Simpson explained that he’d noticed some significant trends affecting investors at the moment.

Firstly, he explained, investors are looking very closely at where they can increase their rent, “trying to capitalise on the push of rents going up in Sydney, which has been a constant now for two to three years”.

Secondly, however, “they’re focused on and are concerned with interest rates dropping and rents going up”.

While from a distance this may sound like ideal investment conditions, he said that many of the landlords he has spoken to are trying to find a very careful balance with their rental increases.

“[Many investors] are concerned about their current tenant leaving and the pool of tenants becoming smaller, and therefore they’re really thinking about how much they can push those rents before the tenant can move out and buy themselves,” he said.

These comments come as many industry spokespeople believe the rates will boost confidence in the market and first home buyer numbers.

SQM Research's Louis Christopher agrees with this sentiment, noting that "No doubt if the RBA does cut again we’ll see even more first home buyers in the market and even more investors in the market".

You need to be a member to post comments. Become a member for free today!

Related articles