A win for FHB you reckon?
So if house prices lost 25 to 35 percent of their value in say Sydney and interest rates hit 8 percent .
Whats the difference ?
Check my maths but :
Interest and principal prepayments per month over 30 years
$1,000,000 $4,884 @ 4.19 % (fixed rate westpac)
Interest rates @ 8 percent
$750,000 $5,368
$700,000 $5,136
$675,000 $4,953
$500,000 $3,669
If a crash did happen , banks would tighten lending and larger deposits needed.
Saw it in NZ in 2007/08 when interest rates rates hit 10 percent and everyone was like the market is going to crash .
It didn't really people struggled through , till as you can see on the graph
