What's Happening in Your Market?
Update From Sales Manager James Carmichael
RBA records rising interest rates – what does this mean for Brisbane homeowners?
After over a decade of low interest rates and an all-time low of 0.1%, the Reserve Bank of Australia (RBA)
has officially raised its cash rate to 0.35% - the first raise we’ve seen since November 2010
This, along with the 2022 federal elections, has affected the movement of Queensland real estate. As a result, both buyers and sellers are understandably thinking about what this all means for our local Brisbane property market.
So, as your trusted real estate experts, we’re here to help you make sense of these developments as well as discuss the causes and impacts of these changes based on our experience.
Why are the Australian interest rates rising?
Australia has enjoyed low interest rates over the last decade, even withstanding the Coronavirus pandemic. This month, however, we saw a rise of 0.25% in the RBA’s official cash rate, raising the alarm for investors across many industries.
But why is this happening?
The rise in interest rates is the RBA’s natural response to control inflation. After a year of record lows, this is attributed to the strength of the Australian economy, combined with global events such as the war in Ukraine.
This is not an isolated case as we are seeing the same trend across economies worldwide, with a 0.33% cash rate in the USA. Experts also predict that the rates will continue to move upward in Australia, possibly up to 1.5% by the end of the year to address the rising inflation rates.
What does the interest rate change mean for the Brisbane property market?
Given that this is the first interest rate increase in years, many property buyers and sellers have started to reconsider their financial position which can then flow onto the property market.
While no one can predict the future, here are some of our observations and predictions for the Brisbane property market following the announcement from the RBA:
- Buyer numbers have reduced.
This change may be attributed to both interest rates and the upcoming federal elections.
Rising interest rates instil a concern amongst buyers, causing them to hesitate. The upcoming elections also heighten their uncertainties regarding the possible changes to housing policies, leading them to potentially hold off buying until the elections are done.
Both of these changes, however, are temporary – and we are predicting a continuous increase in Brisbane buyer numbers over the upcoming months.
- Banks and lenders are setting mortgage rates at around 5 to 7%.
Following the RBA announcement, banks and lenders are re-evaluating their rates and bumping them up.
However, these numbers are still encouraging for those looking to invest in properties in our Queensland region. As these figures will remain relatively stable, Brisbane will continue to be an ideal location for investment properties.
- Volumes of property listings across Brisbane are still strong.
Despite all these changes, we’re still seeing a strong volume of property listings enter the market across Brisbane Bayside, Manly and Redland Bay.
This means that the market is still offering a lot of opportunities for both buyers and sellers.
What does this mean for you?
Despite all of these market shifts, we are still seeing healthy Brisbane real estate sales every week.
If anything, this seems to be encouraging buyers who have missed out over the last year to secure their dream properties before the interest rates change any further.
Housing prices across Brisbane Bayside, Manly and Redland Bay are relatively stable at present, but only for now, given that experts predict the rates to continue to rise. So, if you’re considering selling your home in Brisbane, there are still great buyers who are ready to purchase property now.
If you’re looking for a sign to sell, this is it.
While Brisbane buyer numbers may be lower than last year, there are still many out there who are looking for the perfect property.
At LJ Hooker Property Centre, we take the time to monitor and assess real estate market developments like this to understand how it affects our local community.
In our years of industry experience, we have learned that natural shifts in the market affect buyer behaviour and selling conditions. However, our team have a thorough understanding of real estate market fluctuations, which allows us to advise our clients on the best plan of action when selling in Brisbane.
As always, we are committed to achieving the best results for you.
Do you want more tailored property advice?
At LJ Hooker Property Centre, we provide an unmatched level of service within the highly competitive Brisbane real estate market.
If you need help navigating the changing property market and want a reliable team by your side, feel free to reach out to us. Our team of Brisbane property specialists can discuss your options and find out how much your property is worth.
Let us help you achieve your real estate goals.