Quora Financial

06/05/2024

BORROWERS ARE LOOKING TO SAVE WHERE THEY CAN

The Lending Market remains buoyant though the market reflects two distinct tactics ultimately designed to save money. That’s the conclusion we drew from interviews with three major lending partners this week.

Group One are Buyers. They are trying to purchase Property now while the market is softer due to high-interest rates and other inflation pressures. They’re trying to secure their property for a better price. They’re not wrong. The correlation between property prices rising when interest rates drop is assured. Borrowers spend more for the same property when their borrowing capacity increases. Group One have concluded that they can withstand the high-interest rates now and is hoping interest rates will fall after they secure their new property. 20% of new loans are Approvals in Principal and 35% of new loan approvals are property purchases with a Contract of Sale in place already.

Group Two want to start their interest rate cuts now. They reflect the existing market’s desire to save money anywhere they can. The major lenders have noticed that offset balances market-wide are reducing while simultaneously; credit cards are not being cleared monthly as often as they had been up to 18 months ago. Existing mortgage holders want to save money anywhere they can and will interrogate their mortgage interest and fees to help. A rate drop of just 0.1% or 0.2% is often enough to trigger a refinance for borrowers with an average Australian mortgage size of $624,000.00. 40% of current loan approvals are for refinances.

As always, the lending market represents opportunity. Are you choosing Red or White wine?

Chris Devlin
Managing Director
Quora Financial

27/11/2023

One of the most common questions I’m asked is ‘Should I wait to buy a property? The answer is always ‘No’. Purchase the best property you can as soon as you are able. You will never ‘game’ the system. If you wait for rates to drop, you’ll also see prices rise. If you wait to save more, it’s likely, that you won’t afford the property you could buy now in the future due, again to inflation. If you’re waiting for the market to substantially drop ….. good luck with that! Stop wasting time.

21/11/2023

Clearance rate surprisingly high amongst cautious sentiment

https://www.elitebuyeragents.com.au/clearance-rate-surprisingly-high-amongst-cautious-sentiment/

30/05/2019

Last week brought some good news for anyone in the market for a new home or for those hoping to negotiate better deals with their banks. Proposed changes from the Australian Prudential Regulation Authority (APRA) are set to change the regulation behind the way banks assess home loan applications which would mean an increase to the borrowing capacity of many Australians.

Right now, lenders are required to assess whether borrowers can afford their monthly repayments using a minimum interest rate of 7 per cent. APRA is proposing that banks set their own floor, provided they allow a 2.5 per cent buffer on the current interest rate as part of their serviceability calculations. For example, that could be as low as 6% which is much closer to the rates we are paying in 2019.

For the past year, the banks have become much more realistic analysing household expenses. They have taken a less discretionary approach to your spending habits and that’s a good thing. Now, they also have the opportunity to become much more realistic about the about the actual rate of interest you’ll need to service. That means borrowers who wish to, will be able to obtain higher lending levels from the banks enabling them to purchase their property sooner.

These changes will have an impact on the property market… more buyers able to borrow more and Vendors therefore willing to sell their property due to the increased buyer demand…unfortunately, it also typically means greater pressure on demand over supply which have upward pressure on pricing for buyers.

02/12/2018

Congratulations to John and Stacey on purchasing a terrific investment property. Great work by the Kim and the whole Team at Elite Buyer Agents in securing such great property within budget!!

28/11/2018

The time to review your lending is now. -

26/04/2018

Sell your home faster and get a better price with these 10 tips

Author: Gabrielle Chariton on Houzz

19/04/2018

How do I finance my new home?

Financing a new property is a huge undertaking. It’s definitely worth investing some time now to analyse your finances and research your needs and options.