Saturday, September 18th, 2010 - Real Estate View
With another interest rate rise just announced agents are no doubt worried about the impact that this could have on their sales and inventory for the rest of the year ahead. This and other questions were answered by a recent www.realestateview.com.au survey conducted in late March which has revealed the effect interest rate increases are having on buyer’s confidence in 2010.

The survey, which was completed by 1,100 potential buyers found that buyers are clearly concerned by the 6 interest rate rises since October last year. When asked ‘Will further increases in interest rates cause you to delay purchasing a property,’ 70% answered ‘yes’ or ‘maybe’ signifying buyers apprehension about further rises in the year ahead.

Of those surveyed who answered ‘yes’ or ‘maybe’ there was a fairly alarming amount who said they would cease their housing search at what seems a fairly low increase.

When asked ‘How much of an increase would cause you to delay buying?’ The results were as follows:

- 0.1%-0.5%, 18 per cent

- 0.6%-1%, 29 per cent

- 1.1%-1.5%, 24 per cent

- 1.6%-2%, 10 per cent

- Over 2%, 18 per cent

So with 2 interest rate rises since the survey was conducted there is no doubt that buyers are going to start to dropping out of the market which could result in a reduction in housing demand in the year ahead. This interest rise and subsequent ones however may not necessarily push buyers out of the market. Rather it may just mean more consumer have to compromise on what they are looking for and as a result this may mean consumers look at areas further out from CBDs of each state, or look at downgrading their size requirements to get onto the property ladder.

Contact Profile

Petra Sprekos

P: 1300 695 645
W: www.realestateview.com.au/

Keywords

Real Estate, Buy Real Estate

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