What a 20%+ Increase to Your Borrowing Power Will Mean for Property Prices in 2024-2026

Send us a textWe've modelled out borrowing powers for 7 years straight.  This shows a close relationship between borrowing amounts and house prices.In this episode, we deep dive directly into what will happen to borrowing powers in 2024.  We discuss 4 separate scenarios:Scenario 1 (near certainty): Stage 3 tax cuts kick in and add 5% to borrowing powerScenario 2 (currently forecasted by markets): Stage 3 tax cuts + 0.50% reduction in interest rates.  Combined this adds 11% to borrowing capacities.Scenario 3 (uncertain timing of APRA change, inflation will likely need to come down): Stage 3 tax cuts + 0.50% reduction in interest rates + a 2% assessment buffer.  Combined, this adds 21% to borrowing capacities.Scenario 4 (CBA’s rate forecast for 2025): Stage 3 tax cuts + 1.50% reduction in interest rates + a 2% assessment buffer.  This scenario leads to a whopping 36% increase to borrowing power!What will this all do to property prices?  If Scenario 4 comes to life with employment markets remaining strong enough, its likely to bring forward the next leg up of the housing cycle to 2025-2026.Reach out to us at www.australianpropertytalk.com.au

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