Mortgage Prediction; Rates to fall.
Next Mortgage Interest rates move predicted to be down from November 2011 and beyond. Here's why.
The RBA is getting mixed messages from the economy and what to do about mortgage rates. They put up the rates once too many times in my view, but not within their objectives of low inflation and high employment.
The US economy and mortgage rates
The US economy seems to going nowhere, and the possibility of a second dip recession in the US seems more likely than not. That will have implications for China, and when China is affected, so is Australia
Australian retail and manufacturing in particular are hurting
The Australian Government is now onto manufacturing as in need of growth or sustainability.
The Housing Construction industry is down. Is it staying down?
I see this as a necessary and good thing, because houses are over priced. They got over priced, becasue land was allowed to rise with phony scarcity manipulation by land developers and then paying too much for land. This all happened, because of the First Home Owners Grant, lax lending and the Howard Government sleep walking when banks were throwing money at home buyers. The Banks got rich and homeowners got double the debt that they could handle. Believing the mantra supply and demand is where the problem arose. Even economists were saying it. The supply and demand were about finance, not housing. If we tighten credit demad falls, and so will house prices. This is the real motive of the RBA.
Europe money worries will take years to iron out, and that will keep Australian mortgage rates low
The Greeks have been lying about their finances for years and over spending. That would have been fine if their finances was not tied to the Euro. So who was checking up on them? Now the Greeks have get their economy in order and that will mean massive unemployment their. Like it is in Spain now. Young people will be moving elsewhere. Maybe some will come to Australia?
Rick Adlam, Mr Mortgage.