There have been constant calls for interest rates to be reduced as a
result of cost of living increases and housing affordability concerns.
Given that, when a property professional suggests interest rates need to go up
before they go down, we’re going to sit up and listen! Australia’s cash interest rate sits at 4.35%.
Robert Mandanici from Paddington Realty in WA says inflation is not falling fast enough.
“Interest rates need to go up further if the Government does nothing,” he said.
“The tax cut is inflationary, now I’m not against tax cuts, you take tax cuts, you couple that with energy credits, couple it with all these other false stimuli the Government’s putting out there and it does nothing, it does nothing but fuel inflation.
“Do I want to see families slugged with another 25 point rate rise? Absolutely not.
“But if the Government doesn’t ship up and really stop spending, then the RBA only has one lever with monetary policy.”
He talks about skills shortages affecting Australia, but says we shouldn’t be bringing people into Australia if we don’t have homes for them.
How times have changed!
Fifty years ago the majority of Aussie families lived in 3 bedroom, 1 living, 1 bathroom homes on 1000 square metre-quarter acre blocks in the suburbs.
Today the predominant housing type is twice the house on
half the block size.
How do you invest for the future?
We talk with property investor Aman Sethi, who has amassed a $10M portfolio in 4 years.
He said strengthened relations between Australia and India, and, Australia and China had seen more migrants coming from there, along with more people coming from Vietnam, Philippines and Thailand. Australia remained attractive to those from the US and UK.
“We came here as migrants many years ago now and we were renting initially in an apartment,” he said.
“What were looking for was something that was convenient, something with good public transport into the city for the work opportunities, something where we had things like an Indian shop near by and some sort of Indian community there.
“Cost is a big thing, so for most migrants getting that $2-3 million home as your first property purchase is something out of the budget, and they’re looking at more the $500,000 to $1.5 million maximum.
“You need to go out of the CBD to get a house with land and 4-5 bedrooms otherwise you’re looking for a 2-3 bedder apartment that’s more central and conveniently located, and I think people are going more towards that direction.”
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