With Christmas once again fast approaching, it is promising news that the Reserve Bank are tipped to lower rates again this week. It is estimated that the official cash rate could be cut by a further 1.25% in the month of December.
If you are currently renting or are looking to branch into an investment property, this could be the perfect time to really maximize the benefits on offer and take advantage of much lower interest rates. For First Home Buyers in Queensland you are now also eligible for $14,000 and nil stamp duty up to a $500,000 purchase price.
On an average $350,000 mortgage, the Principle & Interest (P&I) repayments currently are as low as $537 per week. If the interest rates are cut by a further 1.25%, that could see P & I repayments reduce to $471 per week.
Some leading economists are predicting interest rates will fall below 4% by Easter and we have seen the start of this already with several lenders today offering a 1 year fixed rate at 3.99% which would see the same repayment reduced to $385 per week.
If you are paying $385 per week in rent, you could be paying off your own home instead of renting at the same repayment on this 1 year fixed special, even without having saved a deposit. Food for thought!
This information is only the views of the writer. It is advised that everyone seeks their own independent advice before obtaining any type of finance.
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