The Sydney market has been impressive since last year, breaking several auction records including a 10 weekend streak of auction clearance rate at above 80%. This year, Sydney’s clearance rates have barely reached that mark, but experts are still optimistic that the housing market in Sydney has yet to lose steam.
Despite high median prices, Sydney remains the forerunner in auctions for home buyers and investors. Sydney has been sitting at a 78.1% auction clearance rate recently, due to the huge number of listings. The most expensive property sold was a 4 bedroom house valued at $4.95 million by McGrath Lane Cove.
Overall housing loans have increased by 6% according to the Australian Bureau of Statistics, clear signs that public demand for property is still high.
Read more about this on the Sydney Morning Herald website.
With cash rates at a record low 2.5% for the past 2 months, lenders and mainstream banks are pushing the panic button.
Banks in the country are pushing for an increase of interest rate buffers, an amount originally ranging from 1.25% to 2%, used as a key indicator whether the borrower has the capacity to pay within that buffer range due to market changes. This is an initiative pushed by the Reserved Bank of Australia, after cutting interest rates due to the record low cash rate. Banks are encouraged to maintain their lending standards, with the influx of borrowers due to the low interest rates as it is forecasted that these interest rates will eventually return to its normal levels.
It is a little known fact that when lenders service home loans they add a buffer on in case rates go up. Some lenders cap theirs when rates get too low. ING Direct, for example has stopped at 8%. It doesn’t matter how low rates go, you have to pass their serviceability calculator at 8% or they won’t give you a loan.
Read more about this on the Financial Review website.
If you are grappling with many debts of differing interest rates, there is no need to despair. There is surely a good way for you to make the debts more manageable to pay. Financial troubles caused by the accumulation of loans and interests can be very stressful indeed. Debt consolidation is one good way for you to get control of your life again and get a grip on your financial situation.
Life gets very difficult when you have accumulated multiple loans for years that it becomes almost impossible to deal with them. If you have defaulted on credit card payments, you will most likely have trouble paying off compounded interests. If you are in this dire situation, you should consider completely getting rid of your debts one small step at a time. The mere fact that you are in that situation means that you are probably not capable of paying off all your debts in one lump sum. You will need a strategy, a good one that will make things easier and manageable for you. Debt consolidation would be a smart move to deal with such a problem.
You can consolidate all your loans into one home loan, which would give you the lowest interest rate. This would free you from the high interests that credit card companies charge. If you still do not have a bad record in your credit history, then you can get a very good deal in your debt consolidation plan. The only thing you would need to do is to use your property as collateral for the loan.
If ever you have bad credit, debt consolidation would help you improve your chances for refinancing. Debt consolidation can be good for people who need home loans for bad credit as this would signal to your lender that you are doing your best to keep your loans in check.
There is one thing that borrowers have to be careful about when looking for a debt consolidation deal, and that is getting into a debt agreement that refers to Part 9 or Part 10 of the Bankruptcy Act. Avoid getting into this type of debt agreement as this would be the same as declaring yourself bankrupt. Once that happens, your credit history will show you as bankrupt and you will have difficulty getting loans again for the next 7 years.
When in deep trouble with the lenders of multiple loans, consider the advantage you would get if you go into debt consolidation. It will give you a single loan, resulting in a single monthly payment that is more manageable than if you were struggling to pay off a lot of loans with higher interest rates.