Over the past few months a major topic on this blog has been about interest rates rising: remember, the Reserve Bank increased the official cash rate earlier this month as well as in November and December last year, with predictions that there could be several more increases over the course of the rest of 2010. And as you’d expect, banks and other lenders generally followed suit, with some major banks raising rates by even more than the Reserve Bank did. Continue Reading »

Over the last few years, more and more Australians have been signing up for mortgages equal to 100 per cent – and sometimes even more, up to 110 per cent – of the value of the house or investment property they are buying. And while that was a huge advantage for people who had trouble saving a deposit, it’s also a big risk, both for the banks and the mortgage holder themselves – if something goes wrong and they need to sell the property, it’s certainly not always the case that the sale price will pay off the debt, even in times of a housing boom. Continue Reading »

If you’re in the market for a new house at the moment, you may have noticed that prices just keep rising, in pretty much every part of Australia. And unfortunately that’s not just a problem for first home buyers like I mentioned a few weeks back. With a 13.6 per cent rise in the average price of a house last year, even the Reserve Bank is warning that housing prices could continue to rise, and that’s not good news if you’re looking to buy. Continue Reading »

Having a mortgage is cool. Or it must be, because the trends show that we Australians are much more in love with mortgages than we were two decades ago. Reserve Bank statistics on mortgage debts, which they only began to record in 1990, show that our thirst for mortgages has been increasing at a rapid pace. Who would’ve thought that this thing we complain about so often is actually something we can’t get enough of? Continue Reading »

This time round, sadly, the Reserve Bank hasn’t surprised us: at this morning’s March meeting the powers that be announced that they would be raising the official cash rate by 25 points to 4.0 per cent, effective from tomorrow. After the surprise announcement in February that the cash rate wouldn’t rise – despite pretty much everyone in Australia being certain it would – the Reserve Bank has continued with the expected trend of having several rate rises during this year and now we’re going to have to start paying a bit more on our mortgages. Continue Reading »