There’s so much talk at the moment about interest rates rising, property values dropping, speculation of crashes, doom and gloom and uncertainty. Well I’m here to say ‘stay calm.’
Interest rates do go up. They’ve gone up again yesterday. Hopefully that will be the last for a few months but it might not be. They’ve been so low for so long that we’re no longer used to the fact that rates fluctuate. That’s one of the monetary controls we have in place. They’re supposed to go up and down.
Property values also go up and down. Statistics show that 41.9% of properties analysed in the June quarter dropped in value. But only by a couple of percent. Given the astronomical growth that has been experienced in the past couple of years, this is more of a value correction than a sign of a crash.
Taking a look at the actual year on year property values in capital cities, as analysed by Australia’s leading property researchers, CoreLogic RP Data, Adelaide is leading the charge at 24.1% with Brisbane hot on its heels up 22.1%. These are phenomenal figures. Sydney and Melbourne are bringing averages down with 1.6% and 0.3% increase respectively. But it’s still an increase!
We can’t look at little moments in time without looking at the big picture.
The only times that property values are really relevant are when you’re planning on buying, selling or re-financing. Other than that, we recommend that you relax and let the market do its thing. If you’re buying and selling in the same market, it’s not even particularly relevant. If you’re in the position to take advantage of buying property while its value is down, do it!
If interest rate increases are causing you stress, please get in contact and we can discuss your options.
Other than that, stay out of the panic and the drama and keep your eyes on your own plans and goals.
