The prospect of ultra-low interest rates persisting for years to come has been conjured up by policymaker after a further fall in oil prices and stock market sinking to it’s lowest level since the GFC.

With Australia’s official cash rate at a 53-year historical low of 2.5%, Australian home owners are enjoying lower mortgage repayments than ever. For this reason, knowing the right times to take on a new mortgage, or even refinance a current home loan, can give you a large advantage when you’re looking at property investment.

At a basic level, lower interest rate means finance is more affordable, and home buyers can purchase homes for less. It’s not an insignificant amount, either. According to Domain, if you take the average home loan of just shy of $620,000 in Victoria, for example, the typical homeowner will save around $94 per month, or $1128 per year.

Don’t Give It Away

Low interest rates might mean lower repayments, but it is up to you to ensure you get good value for your purchase. It’s tempting to simply bid over your personal reserve during a competitive auction. That will credit all the gain from the lower interest rates to the seller, and leave you with a debt that you may not be able to pay off down the track.

Buyer’s agents who specialise in investment properties can help you source the right type of property in locations with good prospects for capital growth.

This can save you time, money and stress in the long run – lessening your chances of making an ill-informed investment decision.

Low interest rates are great for borrowers who are looking to get ahead in the property market or want to pay off their mortgage sooner. Always consult a financial adviser to make the most informed decisions about your circumstances.


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