The Reserve Bank of Australia (RBA) has just announced its first rate cut since 20 March 2020. This significant shift in monetary policy is likely to inject fresh optimism into the property market and create opportunities for both buyers and sellers. For those who’ve been hesitant due to interest rate uncertainty and affordability concerns, this rate cute could be the catalyst for taking action and making an exciting step on the property ladder.
Renewed Buyer Confidence & Market Implications
Industry experts and buyer advocates predict that further rate cuts could significantly boost buyer confidence, leading to increased competition.
Simon Cohen, Founder and CEO of Cohen Handler added “While this initial reduction may not trigger an immediate surge in property prices, it signals a turning point, encouraging more buyers to re-enter the market. This is where a skilled buyers agent can be invaluable.”
“Historically, lower interest rates increase both borrowing and repayment capacity. While the RBA Governor has suggested future rate cuts are not guaranteed, should we see indeed see further cuts we anticipate heightened competition in the market, which could put upward pressure on house prices.”
“If you’ve already been looking for a property for some time, and are finding competition already high, I highly recommend getting in touch with our team now as more buyers are likely to be entering the market.”
What Does This Mean for Buyers Right Now?
With rates declining, buyers have a unique window of opportunity before competition intensifies. The first rate cut may mark the start of a broader monetary easing cycle. If further reductions follow, buyers who act now could secure better deals before demand escalates. Here’s how to capitalise on this shift, especially with the help of a buyer agent.
- Get Pre-Approved: Increased borrowing power makes pre-approval crucial. Act now to be ready when the ideal property emerges. A buyer advocate can help you understand your borrowing capacity and what of properties your budget can realistically achieve.
- Assess Your Budget: Lower rates might allow you to adjust your target price range. However, sticking to a realistic and manageable budget is vital.
- Monitor Market Conditions: While prices may not skyrocket overnight, the trend could shift upwards as more buyers enter the market. Acting quickly can be advantageous and by using a buyers agent you may be able to expand your search by showing you more properties pre-market and off-market.
- Consider Off-Market Opportunities: With increased competition, accessing off-market property becomes even more valuable. A Cohen Handler buyers agent specialises in finding these hidden gems and providing strategic negotiation insights. They can give you a significant edge in any competitive market.
- Think Long-Term: Property cycles fluctuate, but strategic buying during a cooling rate environment can lead to substantial capital growth over time. A buyers advocate can help you develop a long-term property strategy.
Accessing Off-Market Property: Your Secret Weapon
In a competitive market, accessing off-market property is a game-changer. A seasoned buyers agent has established networks and industry connections that allow them to uncover properties before they hit the open market. For example, Cohen Handler has a team of buyers agents in Melbourne, Sydney, Brisbane, Adelaide, Canberra and Perth who can help you uncover more properties, This gives a buyer a significant advantage, reducing competition and potentially securing a better deal.
Relief for Recent Buyers & Those Under Mortgage Stress
Higher interest rates have placed considerable financial strain on buyers who purchased in the last few years. Increased mortgage repayments have tightened budgets, causing stress for many homeowners. This rate cut potentially offers relief, reducing repayment costs and easing financial pressure.
For those considering refinancing, it’s essential to carefully evaluate whether now is the right time to secure a better rate or if waiting for further adjustments is a more strategic approach. Many of our buyers agents have connections to mortgage brokers who can assist you with this.
Ready to Make Your Move?
Now is the time to start planning strategically and position yourself ahead of the competition. Contact us today to discuss how our team of experienced buyer’s agents can help you navigate this changing market and achieve your property goals. We have teams operating across the whole country.