When people decide to take out a home loan with a mortgage broker, one of the driving factors in which product to take is the interest rate on offer.
And one of the biggest influences on interest rates month-to-month is the Reserve Bank of Australia’s (RBA) statement on the official cash rate.
While not the same as interest rates put forward by lenders, the RBA cash rate has a strong influence on these, and banks generally do follow the lead of the central body when setting their interest rates.
For this reason, the RBA announcement of the rate staying at 2.5 per cent for the 14th consecutive month will be welcomed by many who wish to take out a mortgage.
In the monthly statement, Governor Glenn Stevens said that monetary policy was in line with expected changes to inflation and demand, so he expected stability in the cash rate to continue for some time.
It was also noted that in the housing market, an increase in the number of lenders had seen interest rates stay low, which is excellent news for investors and in turn, the brokers who facilitate the borrowing of money.
Investors are also seeking higher returns on their investments and while credit growth has remained steady on the whole, the last few months have seen these investors taking out a greater amount of lending for houses.
With conditions as they are at the moment, it is an excellent time to consider becoming a mortgage broker.
As more and more investors enter the market, demand for loan products will increase – by entering the brokering industry, anyone can start an exciting new career in meeting this demand.
The RBA noted that dwelling construction has also risen, so there is unlikely to be any shortage of mortgage applications for these new homes into the near future.
