Chapter 1: What does the recent RBA interest rate rise mean for mortgage holders?
It's the Real Estate Podcast, brought to you by Ray White, the largest real estate and property group in Australasia. And welcome to another episode of the Real Estate Podcast, available on iHeartRadio and also Spotify and Apple Podcasts or wherever you get your podcasts from.
It is a Wednesday, June the 8th for 2022, a day after Reserve Bank Governor Philip Lowe yesterday made the half a percentage hike which makes it the biggest interest rate hike in 22 years. A new cash rate of 0.85%. This has come just five weeks after the first rate rise. If you haven't already caught up on what that means...
Well, for those that have a $500,000 loan, that is an extra $133 a month.
Chapter 2: How much will mortgage repayments increase with the new cash rate?
For those on a $750,000 loan, it's just under $200, $199 per month. And if you've got a million-dollar loan, it is an extra $265 per month.
Chapter 3: What factors are driving the current inflation and interest rate hikes?
So annual inflation is seen as the evil that is causing the rate hikes, running at 5.1%. We know that people are struggling with that inflation number and the cash rate increase of 0.85% is aimed at bringing that inflation rate down. Of course, there is a lot of instability with the war in the Ukraine, oil prices, supply chains and the uncertainty for the rest of 2022 and beyond.
Coming up shortly, we are talking to Mark Chapman about tax and what you should be doing and thinking about at this time of the year. It's the main centre forecast with propertybuyer.com.au. All right, let's go to Sydney first and expecting a mainly fine Wednesday. A little coolish though. Your expected top is just 15 degrees.
Chapter 4: What should homeowners consider regarding future rate hikes?
In Melbourne, expecting showers once again wrap up. Your expected high is just 12. On the other hand, in Brisbane, expect a mainly fine sunny day and a high of 19 degrees. And in Perth, showers increasing and your high is 21. We feature market updates, interviews and trends. It's your real estate podcast for breakfast.
Well, the Treasurer, Jim Chalmers, is said to expect more rate hikes, saying that inflation in Australia would worsen before it got any better. He says it's clear already that inflation will be significantly higher than the current 5.1%. and the word significantly is the concerning part. Australian home owners are already paying more for groceries, electricity and gas.
The bowser has never been more expensive. We are going to have to tighten an already tight belt. The buffers we talked about people having last week, boy oh boy, that is going to play a big part in this rise and future rises that will be coming down the track.
And if you've been a busy saver once you got into your home and saved for the rainy day, well, that day has arrived, but the storm is lurking, especially if another cash rate rise happens next month, and many economists are forecasting exactly that. So it's happening as forecast, but...
When you see the actual rate change and the dollar numbers for what people are going to have to find to pay for their mortgages, it's unsettling. When you actually see in reality those numbers, knowing the stress that it's going to cause around the country.
And let's not forget this, around 40% of people are on fixed rates, but by the middle of next year, they're going to be coming off those fixed rates and into a brand new reality, a different world of mortgage repayments. Enjoy your morning coffee. Wake up every morning to the Real Estate Podcast. When it comes to a tax podcast, it's been a while since we did one.
In fact, I can't think of the last time that we did a tax podcast. And at this time of the year, it reveals two types of property investors, the ones that have all of their paperwork miraculously all together and And of course, the ones that are somewhat disorganized with that last minute of throwing all of the papers together, throwing themselves into gathering and presenting.
I thought this morning, let's bring in some perspective to the podcast. And we're inviting H&R Block tax consultant, Mark Chapman into the program. Good morning, Mark. Great to have you on. Good morning. How are you? Yeah, pretty good. Is that a fair sort of an analogy? You do have those two different types of people? Yes. Don't be the second type.
Make sure you get all of your paperwork together. Spend the whole of June basically getting that paperwork together. Then when you go to see your accountant, you don't have to worry about that. And you'll know that you're actually entitled to claim all of the deductions.
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