Melbourne Real Estate Update: Gradual Recovery Amid Interest Rate Uncertainty
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What are the current challenges facing Melbourne's housing market?
It's the Real Estate Podcast, brought to you by ANZ Home Loans for financial well-beings.
And it's your real estate breakfast right across Australia, talking all about your property news and current market conditions, which are changing as the months progress through 2026. We are streaming from Noosa in Queensland to the suburb of Point Cook in Melbourne. And it's a Thursday. This week is going by pretty fast. February the 26th, so is the month. March is nearly here. And I want you to spare a thought this morning for a woman living in a homeless camp north of Brisbane who says that she fears for her children's safety every night. Now, this is a mother of seven. who was denied social housing because her Centrelink parenting payments placed her above the income threshold. She now sleeps in tents with her children and relies on charity support.
Under current rules and regulations, eligibility would require surviving on less than $18 per person per day, a figure she says is unlivable. I'd have to agree. Seven children living in tents at night. Now, is that the Australia that we know and love? Let us know what your thoughts are. Of course, you can email us to myrealestatepodcast at gmail.com. Or you can send us the voice message and the link to that voice message is below. Click on the link and then you can start talking. Let's right now take you to Melbourne and catch up with Stephanie Jordan, the founder of Zara Lend. And a very good morning to you, Stephanie. Welcome into the Real Estate Breakfast. Pretty tragic sort of a story there. The mum of seven living in tents and can't get social housing.
Good morning, Craig. Thanks for having me. Yes, it is completely outrageous. Surely there is room in the budget to help people like this. It doesn't seem fair. It's shocking, actually.
Yeah, not good. And I'll tell you a place that we do highlight from time to time, and that is Dubai. The UAE, they do not have any homeless people. In fact, what they do for the local, the local Emiratis, is the government gets them into housing. So not a single person is out on the street. Talking of streets, Melbourne families are waiting patiently for the next pandemic. potential rate decision and the prospect of repayments rising to about $104 a month on a $650,000 loan. Auction volumes are building with around 1,200 homes scheduled this weekend and more expected next week. Most buyers heading to auctions already hold pre-approval and understand their limits, suggesting more of a measured confidence rather than panic.
Yes. So if we circle back to that, a quarter of a percentage point rise would add roughly 24 bucks a week to repayments on the average loan. How are you finding it in terms of your clients wanting to buy property? They're cautiously being probably more prudent, are they?
Yes, they are a little bit more cautious, but I don't believe the potential $24 a week increase in repayments is going to stop many people, including first-time buyers, wanting to get into the market. I haven't really seen any people that concerned about the rate increases. Yeah, I'm still getting a lot of inquiry about buying property.
And is that because the 5% threshold that is kicked in, they've obviously got more room to manoeuvre, but of course at the other end there is a much more higher mortgage ceiling that they're having to service?
Yes, that's true. However, what lenders generally do in the first and second tiers is they add a 3% serviceability buffer and stress test the repayments based on 3% higher than the actual rate. So it would take 12 rate rises of 25 basis points to actually surpass that. It doesn't really affect people's ability to afford their mortgage that much because we've already stress tested the repayments.
It's always a busy place Melbourne when it comes to mortgages. You've been working for yourself there now for seven years in the mortgage space. It's been very very chaotic hasn't it over the last seven years. What are some of the things that you have noticed in that time?
I think it's just the roller coaster of rates being slightly higher and then them plummeting all the way down to almost 2% and then them sharply increasing.
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