September’s cash rate can benefit Brunswick house hunters

What happens in the housing property is strongly tied to the official cash rate.

Last Tuesday saw the cash rate hold at two per cent, as announced by the Reserve Bank of Australia. This rate is a record low that could go on to encourage the continuation of low interest rates offered by banks, as well as drive consumption further up.

Reserve Bank Governor Glenn Stevens indicates that this continued low in cash rate is needed to encourage borrowing and spending in order to stimulate further growth in the economy.

Tim Lawless of CoreLogic RP Data states that while no further stimulation is needed in Sydney's and Melbourne's property markets, other capital cities such as Perth, Darwin and Canberra, have seen dwelling values decline over the past twelve months.

How this can benefit Brunswick house hunters

Looking to buy property in Brunswick? There are a number of ways you can take advantage of this news.

The cash rate is a percentage set every month by the RBA that has substantial influence over the interest rates set by commercial banks. A high cash rate usually leads to higher interest rates, while a low cash rate will allow banks to take more financial risks and keep interest rates low.

The most obvious way to benefit from the low interest rate is by securing your home loan sooner rather than later. While some are expecting the cash rate to remain low until the end of the year, the RBA is always scrutinising the economy to see if a cash rate change is required.

Furthermore, if you're in the midst of deciding what type of loan to get, it might be an opportune time to opt for a fixed home loan. This will will mean that when the cash rate inevitably rises again, you'll still be paying interest at the same low fixed rate.

When you're ready to begin your exciting house hunt in Brunswick, give Ray White Brunswick a call. We'll help you through the whole journey to make sure you arrive at the home of your dreams.