Interest rates in Australia are expected to remain stable in the short term, with the Reserve Bank of Australia (RBA) indicating that the current cash rate has likely peaked in late 2024.
Since May 2022 to November 2023, we have seen 13 increases.
Market predictions suggest a possible reduction in rates starting mid-2025, gradually lowering to approximately 3.5% by the end of 2026. This anticipated decline is tied to improving inflation conditions, stabilising economic growth, and easing pressures on households and businesses.
How does this affect me?
With an official cash rate of 3.5% this would see investor rates drop by 0.85% saving the average investor that has a $600,000 mortgage $330 per month.
The big four bank economic teams are predicting:
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- CBA: Peak of 4.35% in November 2023, then dropping to 3.35% by December 2025
- Westpac: Peak of 4.35% in November 2023, then dropping to 3.35% by December 2025
- NAB: Peak of 4.35% in November 2023, then dropping to 3.10% by June 2026
- ANZ: Peak of 4.35% in November 2023, then dropping to 3.60% by December 2025
Keep in mind, these are subject to change based on quarterly reports.
Did you know?
When rates start to drop your Lender will not automatically reduce your repayments.
You will need to adjust this yourself each month we experience a rate drop.
Did you want to keep up to date with what your Lender is doing with your investment rates? Reach out and our Team will add you onto our VIP Harcourts list, so you hear the news within minutes of the RBA announcement. You will then have the chance to discuss the Lenders rate movement and when to expect the lower rate on your loan.
Vision Money VIP List – info@visionmoney.com.au
