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Fairly flat for a while, like the rest of the year, then trending up. There are quite a few inflationary pressures emerging through higher commodity prices, A$ re-tracing against the US, wages growth and an expansionary federal budget.
Rates are unlikely to rise too rapidly or excessively because of the level of debt we all now carry as a nation. Last year from memory Wizard carried out research to show that a 2% rise in rates in today’s terms would have the same choking effect as 17% home loan rates did around 1990.
As a guess, it would be a surprise to see rates any more than 1.0-1.5% higher within the next three years. However, if you start seeing headlines about serious inflation concerns then watch out for even higher rates.
You’ll get a lot of different opinions so just weigh them up.
Micasa,
If you are buying a house in Australia there isn’t a great case for borrowing in USD even though you are earning USD.
A A$550K loan converted to USD at the current exchange rate of 0.7735 gives you a loan of USD425K. If the currency falls to 0.7000 you could be A$58K worse off if you have to convert the loan back such as in a sale situation (no principal reduction for simplicity). You also have to factor in what would happen if you change jobs and no longer get paid in USD.
Conversely, if the rate goes the other way you would be better off but you run the risk that the A$ has been relatively strong for a while now and has some significant downside potential. You could hedge against it but anything beyond 3 years gets expensive for the amount involved.
I would reckon that you are better off taking out a A$ loan, not worrying about exchange fluctuations creating a mismatch with the property value and reaping or wearing the gains each time you convert part of your salary to meet the repayments.
That’s my two US cents worth. Good luck,
FL
Try http://www.araf.com.au. They go to a higher LVR and lend for commercial in regional areas.
There are a few lenders who do up to 75-85% LVR but will usually only want city properties.
No LMI available on commercial property loans.
If the numbers on the property still stack up as Terry says, try to top up the commercial security with resi if you have access to it (self, parents, friend).
Are you serious?????
In case you are:
1. wait until ASIC complete their investigations/enquiries and make an announcement
2. keep an eye on http://www.ifhl.com.au for signs of a pulse
3. keep searching “derivex” on the news services for further media reports
4. read every other thread here with one or more or the words “derivex”, “conduit”, “reserve”, “step funding”, “trev”, “cohen”, “bankrupt”, “agent”, “sorry”, “don’t understand” or “I’ll be the first to sign up”It will all become clear.
