Interest Rate Hike Bad News For First Home Buyers

News.com.au

One thing we talk about here at WWW.MRHOMEBUDGET.COM you must take into account interest rate rises. We have people asking us all the time for advice on home loans. We always suggest if you are taking out a home loan, look at your monthly repayments at current interest rates. Now pretend the bank suddenly ups the home loan interest rate by 2.5%.

Can you still afford the repayments? And if you can, how much breathing space do you have? If things are a bit tight with this extra 2.5% added, you might need to find a cheaper house.

While rates currently are at a lower rate compared to the grand scheme of things. Remember in the 1980s rates hit 15% plus. Take a long-term view, as we never know what the future may hold.

Here is an article from news.com.au which predicts interest rates are on the way up. In fact, they have made three predictions about the upcoming year:

1. 1.First home buyers will struggle
2. 2.Home owners should assess their loans
3. 3.More rate hikes on the way this year

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