Vector Business Finance

28/09/2025

The future, in my opinion, will be less about building assets and more about building income streams. As AI ramps up more 9-5 roles will go that's just the reality. Creating income streams and diversifying is the way forward.

I speak to people who have done this in my new podcast.

These are people who have bought, started and in some cases successfully sold businesses.

Listen here:

https://open.spotify.com/show/0sudwXz7NW4b9b9WWTkEUF

12/08/2025

Yes the cash rate has just been cut. -25 points. Good news for mortgage holders. 50/50 on if this is good news for those looking to get in. Yes, you can borrow slightly more but this may very quickly get eaten up by a slight bump in prices.

What is the cash rate anyway?

The cash rate is the rate banks lend or borrow money from each other to increase their liquidity. This is set by the RBA through overall market conditions, jobs, inflation – you know the drill. Larger banks with excess liquidity can lend to smaller banks at or near the cash rate (3.6% today). Banks can then on sell this money as home loans (mostly) at typically between 5-6% variable to make a margin. Banks can also borrow from the RBA at this same cash rate.

Fun fact: After costs, the RBA remitted $5.9 billion to the Australian Government for the 2023-24 financial year.

The below is from ChatGPT: presented without comment:

Historical Remittance Trends from the RBA (Approximate Figures):
- **2015-16**: ~$1.3 billion (low due to low interest rates and modest profits).
- **2016-17**: ~$2.5 billion (increase as rates began to rise slightly).
- **2017-18**: ~$3.7 billion (reflecting gradual economic recovery).
- **2018-19**: ~$4.5 billion (higher earnings from bond holdings and rates).
- **2019-20**: ~$1.8 billion (drop due to COVID-19 economic impacts and policy responses).
- **2020-21**: ~$0.9 billion (low remittances as the RBA held rates near zero).
- **2021-22**: ~$1.2 billion (modest recovery with stable rates).
- **2022-23**: ~$3.0 billion (rise as rates increased to combat inflation).
- **2023-24**: ~$5.9 billion (significant increase due to higher cash rates and bond yields).
- **2024-25**: Not yet finalized (ongoing, but early indications suggest a potential continuation of high remittances given the 3.6% cash rate as of today).

Mark.

08/07/2025

No rate cut.
We may not like it, but probably the right call. Property prices have not slowed and growth is steady across most markets. Another cut would only fuel this fire.
Most who own are already sitting on a stack of equity but those trying to get in need wage growth to catch up to borrowing capacities. The RBA stated part of the reason was uncertainty around US tariffs etc, what a load of nonsense. Has basically zero effect on Australia and if it did and was to hurt the economy the first thing you would do is cut rates to get people spending again.

RBA board votes 6-3 to hold rates; Michele Bullock to address media at 3.30pm; $A and bond yields spike. Follow live.

18/02/2025

Finally. -25 points.
$400,000 = $65 less p/m
$500,000 = $82 less p/m
$600,000 = $100 less p/m
$1,000,000 = $144 less p/m

Mortgage holders have been given much-needed breathing room, with the Reserve Bank announcing inflation has fallen enough for Australia to begin its rate-cutting cycle.

19/01/2025

Here's an article we wrote recently for the Businesses For Sale Australia magazine on how to fund the purchase of a business or franchise.

19/11/2024

25% properties are bought in cash. But yeh, interest rates are the problem right RBA?

Basically the housing market has become a tale of have and have nots. I.e you have a property(s) or equity now you can buy again, if not you are priced out. Even if you have a large deposit, say 20% most peoples borrowing capacities don't stack up to borrow the other 80% and who wants a debt that large anyway?

The only sensible solution is for the government to mandate a drop in the servicability buffer from 3% to 2% or perhaps even 1% for First Home Buyers and force the banks to offer longer term fixed rates then the standard 5 years max.

We'll see how the current senate review into this plays out, but as it stands cash buyers are the ones driving up/keeping prices high not mortgage holders.

PEXA Cash Purchases Report breaks down the state-based data behind Australian homes purchased with cash in 2023.

24/10/2024

Property prices are about to boom in the NT. Funny that. $50,000 is a ridiculous amount to give as a grant for new first homes. But hey, get in whilst you can. We all seen what this did to the new home market in NSW when they rolled out the $25,000 grant during Covid.

First-home buyers can get up to $50,000 to put towards building or buying their first home.

05/09/2024

Way to go Macquarie. 5.59% for 2 years fixed (comp 6.01)

Lock in a fixed home loan rate today & you could save money on future interest repayments.

29/08/2024

This article sums up my thoughts exactly. US moves, we move. I'm expecting a rate cut before the US election in November with a flow on to Australian rates December/Jan. What this means for the market, who knows, but one thing is for sure there is a lot of people waiting to get in that are currently constrained by high rates and borrowing capacity. Naturally once more people come in the market and rates drop, prices rises. That's why timing is not important, time in (at least 10 years) is.

Rate cuts by the US Federal Reserve and other central banks will create a near-irresistible pressure for Australia's Reserve Bank to follow, potentially very soon.