RBA keeps rates at 2.50%

At its meeting today, the RBA decided to leave the cash rate unchanged at 2.5 per cent.

This is again welcome news for any mortgagee, and less welcome news for my retiree clients with larger fixed income portfolios.

Most home owners are aware (and if you are not, then listen now), that mortgage rates are at epic lows. This has meant a few of my clients have started considering locking in rates. It is a tough call, and I recommend talking with your broker, and considering carefully what a fixed rate means for your cashflow, and what it costs you if rates stay below it for two or three years.

As always, welcome your comments below.

View the RBA release here.

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RBA keeps rates at 2.50%

At its meeting today, the RBA decided to leave the cash rate unchanged at 2.5 per cent.

Some good friends of mine recently purchased a house, and were asking what I thought was going to happen with interest rates. I guess my simplest answer is “sometimes they change, sometimes they wont.”

Historically, Australia is at very low-interest rates. Globally, we are very high. We live in interesting times (referencing the ancient Chinese “Curse”), and navigating these times comes with its own challenge. My recommendation to anyone looking to buy, or to fix rates, is be able to pay at least 2.5% higher than current, and if possible, 10%. Then you have more capacity in your budget than if you can only just afford payments now.

View the RBA release here.