Households with mortgages have been advised to take advantage of the pause in interest rate rises and pay down their debts. This follows analysis by financial comparison website RateCity of Australian Bureau of Statistics data which has found that the value of home loans has been falling since September 2009. This decline predates the start of the Reserve Bank’s rate rises, which have seen the cash rate rise from 3.0% to 4.5%.
The total value of total home loans in March was $13.5 billion (seasonally adjusted) and has not been this low since November 2008 when the average standard variable rate was 7.34% – 31 basis points higher than the current average of 7.03%.
The number of mortgage commitments has dropped by 14,628 since March 2009 – with 48,260 home loans recorded by the ABS in March 2010.
more on Terry Ryder’s website www.hotspotting.com.au