That Home Loan Hub
Welcome to That Home Loan Hub, your ultimate guide to mastering the world of home loans and property. I'm Zebunisso Alimova, here to simplify the complexities of real estate and provide you with expert insights and the latest trends.
Whether you're a first-time homebuyer, an experienced investor, or simply curious about the property market, this podcast is for you. Join me each week as we unlock the secrets to property success and help you make informed decisions. Let's dive into the world of property together!
That Home Loan Hub
Mortgage Chess: How to Position Yourself for the Coming Rate Drops
Whispers about interest rate drops are turning into roars, and your mortgage strategy needs immediate attention. While the Reserve Bank currently holds steady, economists are predicting another OCR cut as inflation softens and unemployment ticks up slightly. Forward-thinking banks have already begun trimming long-term fixed rates, signaling the shifts to come.
The choices you make now could significantly impact your finances for years. Fix your loan today for too long, and you might miss the window to secure better rates when cuts arrive. Currently house hunting? Your affordability could dramatically improve once rates drop. Rolling off a high fixed rate soon? Relief might be closer than you think—but timing remains critical. Jump too soon, and break fees eat your savings. Wait too long, and you're locked in just before rates fall.
Take Sam's situation—fixed at 6.99% in mid-2023 for two years and now facing crucial decisions. Should he fix long-term, short-term, or float? With proper analysis, he could potentially refix below 5% with the right strategy. Don't simply accept the first rate your bank offers through their app. Consult a mortgage advisor who can calculate multiple options across various lenders, including splitting loans or floating short-term to buy time until the upcoming OCR reviews in July and August.
For investors, this environment presents a golden opportunity as falling rates often translate to higher yields and rising property values. If you're currently floating, stay in close contact with your advisor—when the first bank moves, you'll want to react quickly. While rate drops aren't guaranteed, they're looking increasingly likely by year's end. The winners won't be those who waited passively but those who planned strategically. Want a review of your current mortgage or need to build a game plan? Reach out now to ensure you stay smart, stay ready, and stay one step ahead of the market.
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Hey team, welcome back to that Home Loan Hub. I'm Zibunisa, your no-fluff mortgage mentor, and today we're talking about the whispers that are turning into roars. Interest rate drops might be on the horizon even further. But here's the real question Are you prepared? Because, whether you're current homeowner, first-time buyer or somewhere in between, what you do now could make or break your next five years. So let's start with what's happening out there.
Speaker 1:The Reserve Bank is holding rates steady for now. The economists are circling that we're going to have maybe another cut for OCR and it looks like inflation is softening, unemployment is ticking out slightly and the global vibe is ticking up slightly. And the global vibe is shifting to ease, not squeeze. Some banks have already started quietly trimming long-term fixed rates, hinting at what's to come. So, even though the cuts haven't hit the headlines fully yet, the forward-thinking buyer is already planning.
Speaker 1:So why is this a big deal? Look, if you're fixing your loan today for two to three years, you might miss the window to refix at a better rate when the cuts come. If you're house hunting, you might be able to afford more than you think once those rates dip. And if you're rolling off a high rate fix soon, the relief might be closer than you think, but and this is important timing matters. Jumping too soon can cost you in break fees or missed savings. Waiting too long can mean you're locked into a rate just before the drop.
Speaker 1:So let me give you a real example. One of my clients, sam, fixed in mid-2023 at a rate of 6.99 for two years. He is now coming off the fixed rate and he's thinking should I fix for longer or should I float, or should I just fix for short term load or should I just fix for short term? Now we looked at the math and we looked at what the break fee will be potential break fee in the future and if he wants to wait Now, he can likely refix below 5%. And coming up with the right strategy whether it's a long-term or short-term makes the whole difference. So don't be like Sam. Don't just jump at the first available rate available on your app.
Speaker 1:Go and talk to a mortgage advisor and calculate your options, because floating could be a good option, but then floating too long can cost you thousands of dollars over the same period. So just to recap if you're due to refix soon, talk to advisor before you do anything and we can look at multiple lenders. We can look at splitting the loans or we can even float short term to buy you more time Because, remember, the next OCR review is coming up in July and then the next one after that will be end of August coming up in July and then the next one after that will be end of August. If you're buying now, consider shorter fixes or split options. Don't lock in high for too long just to feel safe. If you're an investor, this could be your golden window to gear up again.
Speaker 1:Falling rates sometimes equal higher yields plus rising values. And if you're floating right now, stay close to your advisor. The moment the first bank flinches, we move. So are the rate drops guaranteed? No, but are they looking more likely by end of the year? Absolutely, and when they do come, the people who win won't be the ones who waited, they'll be the ones who planned ahead. So, do you want a review of your current mortgage? Want to build a game plan? You know what to do. Reach out. Thanks for listening to that Home Loan Hub Hit, follow, drop a rating if you loved it and share this with your future homeowner mates. Until next time, stay smart, stay ready and stay one step ahead.
