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The Reserve Bank Of Australia (RBA) ended 2019 by keeping the cash rate on hold for December. We have seen the cash rate drop from 1.5 percent to 0.7 percent over the past twelve months. This has seen interest rates for home and investment loans decrease by around 0.60 percent as banks and lenders did not pass on the full rate cut.

2019 has been a huge year in the finance and banking sector which has been heavily influenced by the Royal commission findings in February and the election result in May. This made the first half of 2019 extremely tough for home buyers and investors as banks and lenders were making it very difficult as they had extremely strict lending policy. This had a large negative impact on property prices, particularly in Melbourne and Sydney as property buyers simply could either not secure finance or were limited with their borrowing capacity. Fortunately the back half of 2019 has seen banks and lenders relax their lending policies and serviceability rates, making it much easier to secure a home or investment loan.

The forecast for 2020 looks like being very positive with banks continuing to ease their lending policy which is likely to be reflected in local property prices continuing to increase. Early next year will be a good opportunity to get organised and arrange a loan pre-approval if you are looking to purchase a new home or investment property. It is also a good opportunity to review your existing lending to see if you are getting a fair deal.

As always if you would like to discuss your situation, please give me a call or send me an email.