It's official: ABS index shows house prices rising

[datto]

http://www.abc.net.au/news/2013-02-05/official-house-price-index-rises/4502362

This could be the turning point

Its one of the reasons the RBA left rates on hold

Could be time to lock and load that fixed interest rate

Time to keep a close eye on the market

 

[Aaron Sice]

i reckon you're a mug to fix now, or anytime in the past few years.

rates are coming down, stupid down and the lock in fear was one thought that they've never been this low - fact is, that doesn't stop them going lower.

 

[datto]

Ooh strong words. Hope you are right. I'd like to see the housing market take off, not dampen. Have to wait and see.

 

[Aaron Sice]

thing is, even i miss the bottom and make the wrong call, i'll still grab the market within 30-50bp anyway - so really - s'not worth worrying about too much, at all....

 

[Noodle]

i reckon you're a mug to fix now, or anytime in the past few years.

rates are coming down, stupid down and the lock in fear was one thought that they've never been this low - fact is, that doesn't stop them going lower.

But even if they do come down another 50bps, how long will they stay down? Probably not three of five years, at least we hope not.

Also looking at countries like the UK and in various parts of europe, despite their respective low central bank cash rates the retail rates still seem to be around the 5% mark. Is Australia so different? How low can the banks retail rates really go?

 

[MTR]

http://www.abc.net.au/news/2013-02-05/official-house-price-index-rises/4502362

This could be the turning point

Its one of the reasons the RBA left rates on hold

Could be time to lock and load that fixed interest rate

Time to keep a close eye on the market

I have purchased 3 properties over the last 6 month locked IR 5.4%, I believe now is the time to lock.

 

[datto]

MTR you obviously subscribe to the belief that rates aren't going much or any lower. You have lock n loaded for the next 3 to 5 yrs. Well done.

 

[HotRod]

Until the economy stalls again and the RBA goes another 0.75% and then you might be thinking it was not such a wide idea.

But I think it's pretty close to the bottom. We are either there now or a little bit left to squeeze out.

 

[HomePage]

I'd never lock rates in. Banks, who are very good at making money, just factor the cost risk in to whatever fixed rate they offer and pass it on to you.

 

[hobo-jo]

I'd never lock rates in. Banks, who are very good at making money, just factor the cost risk in to whatever fixed rate they offer and pass it on to you.

People who locked in at the bottom of the rate cycle in late 2008/early 2009 would have done well locking in their rates for 3-5 years and now be in the process of coming off those rates back into a low interest rate environment.

 

[mrmonopoly]

People who locked in at the bottom of the rate cycle in late 2008/early 2009 would have done well locking in their rates for 3-5 years and now be in the process of coming off those rates back into a low interest rate environment.

Exactly, and who's to say we won't see the same thing happen all over again. Will be interesting to revisit this thread in 3 years time.

 

[joeExpat]

I locked an AUD loan for 5 years back early 2009, don´t regret it. Hopefully the current low rates will still be around when it comes off next year, I don´t expect AUD rates to go as low as other countries (my Spanish EUR loan will be around 2% next year, and friends have 1% CHF loans).

 

[MTR]

MTR you obviously subscribe to the belief that rates aren't going much or any lower. You have lock n loaded for the next 3 to 5 yrs. Well done.

Properties positive/neutral so happy to lock at this point

 

[keithj]

I too would be enjoying low variable rates while they last.

The market is a lot smarter than any of us here, and it thinks rates will be staying low for the next 18 months.

However, it is worth keeping an eye on what the market thinks as it changes on a daily basis. The above chart is updated every evening.

When the curve starts to slope upwards it is a good indicator of fixed rates rising.


As a contrast back in June 2009 when rates were expected to rise the curve looked like this.... and in October the RBA started the raising cycle.

When the economic indicators & consequent news flow turns more positive, I'd expect to see the curve looking more like that of June 2009 - then will be the time to be ready to fix at short notice.

 

[ozmale42]

I think even if there was more downward movement it's nice having the comfort that everything is set at 5.5-5.7 for 5 years to provide some certainty. The difficulty is, as others have pointed out, what will be the situation in 5 years when the fixed rate period is over ? I was around in 1989 when I had a mortgage on an IP at 17%... Don't want to see a repeat of those days, not that I expect that to occur. However rates in the teens were commonplace in the 70's and 80's and there's nothing to stop that happening again.

Should there be a change in government later this year (quite likely) this will likely put some upward pressure on rates I'd imagine given the perception held by many that the coalition will be better economic managers.

 

[grubar30]

i reckon you're a mug to fix now, or anytime in the past few years.

rates are coming down, stupid down and the lock in fear was one thought that they've never been this low - fact is, that doesn't stop them going lower.

Too true that.

ABS Index VS unemployemnt rate, sectors in a death sprial (retail, building), other sectors cost-cutting (oil & gas), even stevens inflation.

Ummm, no thanks, I'll also pass on the fix rate suggestion.

The AUS economy is not in a good place...in fact it's crap, putrid.....

Next time the OP gets all excitied about ABS data, he should read something like this:

Further job cuts at BHP's Olympic

Boral cuts 700 jobs across Australia in business restructure

Big 75-basis-point RBA cash rate cut needed in February to override consumer sentiment: John Edwards

 

[MTR]

Well we have 4 weeks until the RBA meet again, we will have to revisit this thread. Certainly interesting times ahead.

In my neck of the woods I am seeing property prices rise and optimism coming back in the market. Its providing some amazing opportunites.

MTR

 

[ozmale42]

Well we have 4 weeks until the RBA meet again, we will have to revisit this thread. Certainly interesting times ahead.

In my neck of the woods I am seeing property prices rise and optimism coming back in the market. Its providing some amazing opportunites.

MTR

Me too...hence the reason I started 2013 by buying another property to get in now .

 

[dan c]

People who locked in at the bottom of the rate cycle in late 2008/early 2009 would have done well locking in their rates for 3-5 years and now be in the process of coming off those rates back into a low interest rate environment.

Exactly right. Savings can be made if you choose the right time to fix. We fixed for only a year, in July last year, and have been paying less than the variable rate. If we can fix again in July for low 5's, for three years, I think we'd be crazy not to. The RBA rate is already at historical lows and there isn't the room to move downwards like there was in late 08 / early 09.

 

[Andrew_A]

Well it looks like the RBA is paying attention to the housing indices.

If you view fixing as a risk control strategy it's much easier to win the game