Interest rates. Up, down and all around.
A really interesting seminar today with the Real Estate Institute of Queensland and guest speaker Bill Evans, Chief Economist with Westpac.
Bill says 95% of Queenslanders believe that interest rates are on the way up. We’re amongst the nation’s most pessimistic on this topic and a big number of us expect rate rises to exceed a full percentage point. But his forecasts point to just a 0.25% rise over the next 12 months. He says there’s “no way” we can expect a full 1%. Bill’s an economist and they do make mistakes in their forecasts – but he’s been in the same job for 20 years so you have to give him a bit of a hearing.
Interestingly when they survey on whether it’s a good time now to buy real estate, most of us say “absolutely yes”. But many of us don’t want to do it ourselves! Bill says memories of GFC job insecurities still linger and even with the mining boom happening under our noses here in Queensland many of us think it won’t benefit us personally.
He says underlying demand for housing is still very strong and any comparison to the US housing market is “fundamentally flawed”.