What a difference a month makes in economic news. Only last month interest rates were on hold and the market was forecasting the next rate movement down. Now a month later everyone was calling for rates to go up and the Reserve Bank of Australia answered their calls with a rate rise.
Apparently, inflation has been more stubborn than first thought in the past few months. Data released in October reversed the trend of inflation being tamed by the barrage of rate rises since May 2022. In other countries around the world inflation seems to be coming back under control more quickly and therefore comments were being made that our more subdued approach to the rate rises was not working. Hence, we saw another rise on Melbourne Cup Day and even more concerning was commentators saying more could be to come!
I have written previously about the detrimental impact this is having on mortgage holders in our area. A number of financial-related sales have already taken place and more may be to come.
In addition, those looking to buy have to keep getting their pre approvals rechecked and purchase price expectations reduced. One buyer I spoke to today said it has been a nightmare to know where they stand and whether a loan will be approved. Their purchasing power has reduced over $300,000 since rates started rising.
A few more notable sales over the past few weeks showed the $3m target can still be achieved and lower-priced properties of $1m to $2m sell quickly with good results:
- 32 Squires Crescent, Coledale – $3,500,000 sold by McGrath on 08/11/2023
- 419 Lawrence Hagrave Dr, Thirroul – $1,850,000 sold by AMRutty on 06/11/2023
- 14/20 Walker St, Helensburgh – $780,000 sold by Ray White on 02/11/2023
- 11 Sheridan Crescent, Stanwell Park – $1,700,000 sold by Ray White on 30/10/ 2023
- 39 Lawrence Hargrave Drive, Stanwell Park – $1,575,000 sold by Ray White 20/10/2023
About the writer
Ian Pepper has had a long and distinguished career as a finance and real estate professional. Originally trained as a Chartered Accountant in 1995, Ian worked in Sydney and London. He has an MBA from Macquarie Graduate School of Management and now sells real estate with Ray White Helensburgh. Ian also volunteers with local community groups including school P&Cs, sporting clubs and business chambers.
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