yes i am with kincella all this hype about int.rates ,given small business is a big driver of our domestic economy and many have tax arrears,which i believe the taxation office have granted generous extensions.
personally amidst all the hysteria i doubt int . rates will rise dramatically if personal debt and expenditure is kept in check,understandably some people are in quite desperate circumstances,however this could well be the year of a strengthening usa dollar and while many suggest this will auger well for the resources sector we might well find china begin tightening their conditions of trade.
most likely effect will be significantly higher fuel prices,that will certainly dampen spending,the rba have already demonstrated a flexible approach to economic measures,meanwhile some sectors of the r/e market will probably suffer,however i tend to believe ordinary suburban areas will be ok and some may well appreciate marginally.
mortgages are traditionally the last to suffer any major effect,and while the gfc impacted many,strangely the working class and the conservative remained largely unaffected by the gfc--these people are low on debt and big on equity,there still being an enormous amount of cash held in int.bearing investments,some of which are subject to special conditions preventing a drawdown of funds.
so dont think its all gloom and doom,many still sit on the sidelines,and others like myself have funds which could significantly reduce a mortgage but still have money invested and geared,which i do, and constantly question wether it is a worthwhile strategy as opposed to the opportunity property might present.
buying might seem expensive,but as a family home or just a home it provides security of tenure which is the reason i bought after the horrendous impact of the GFC on my personal assets ,i have a very modest dwelling however the cost is the same as renting---and moving constantly as a tenant is both expensive and time consuming,not to mention the stress as well,some renters in my area have moved 7 times in two years,because the homes were sold mainly to owner occupiers who have found this area affordable,and yes prices have appreciated around 6-8% in the past year
