Forum Replies Created
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So seems to me the RBA is caught between upping rates to cool the housing sector but by doing so decreasing exports and so on. In short I dont think rates are likely to rise as you suggest –One also has to consider that it isn’t the RBA’s concern what may be going on in specific sectors. As long as inflation stays in check, there should be no need for interference in housing…. and the major culprit IMO are the lenders which require little if any capital to be put up by potential investors, leading to our current boom in investment lending. Sooner or later, there’s a correction, there always is.
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The average homeowner would screamn and the it would spell death to the Govt at the next election.
Also payclaims and inflation would go thru the roof.
No
unless something really really drastic happens then i think 8 – 8.5 would be max for 2-3 years.
any one comment on this.
any other thoughts?I’m inclined to agree. I have read that because of the level of personal debt people carry nowadays, even a modest increase of 2% or so above current levels would be the equivalent of the 17% rates we had during the recession.
The RBA have painted themselves into a corner. A substantial rate rise in the short-medium term will undo all the good work that went into boosting the economy, and will in all likelihood plunge us into another recession.
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Being a renter is actually a cheaper option financially. This way you can put your money into investment properties and get some tax advantages which you wouldn’t get if you were owner occupierShort-term, yes. Long-term, no way (IMO). Look at the cost of housing relative to salary, it’s been going up steadily for many years. The longer you wait, the more you pay (as a proportion of what you earn). Add that to the fact that sooner or later, almost everyone buys (I don’t know of anyone that has rented long term).
Of course, you could take a gamble that there will be a price correction or even crash, and put off any potential purchase til then.
Hmmm… conflicting views on this after a quick search of the forum:
https://www.propertyinvesting.com/forum/topic.asp?TOPIC_ID=2758
Some say *no* claims allowable at all if the PPOR is converted to an IP (as told to them by accountants), others say no problems at all. What is the story? Are *all* the same deductions allowable (ie. rental costs, maintennance, building depreciation, interest), some, or none at all?
IMO, the bigger the deposit the better. While the interest is deductible, it’s still money out of your pocket. The sooner the loan is payed out the sooner that property is making money (unless you only want it for the capital gain rather than the income stream). Even though a tenant may be paying the loan off for you, do you want the rent going to the bank, or to you?
