Homeowners beware: Reserve Bank of Australia issues a chilling warning that will have all mortgage holders worried
- Reserve Bank of Australia warned rising interest rates may hurt their pockets
- Philip Lowe said ‘borrowers never experienced a rise in official interest rates’
- The RBA has keep the interest rate on hold at 1.5 per cent since August 2016
The Reserve Bank of Australia (RBA) has warned all homeowners and mortgage holders that rising interest rates may hurt their pockets.
Philip Lowe, the governor of the nation’s top bank, issued the warning on Tuesday, saying that it’s been eight years since the last interest rate hike and that ‘borrowers have never experienced a rise in official interest rates’.
‘If we continue on this current improving track, as we expect we will, it is likely that the next move in official interest rates will be up, not down,’ he said.
Reserve Bank of Australia Governor Philip Lowe has warned all home owners and mortgage holders that rising interest rates may hurt their pockets.
The RBA has keep the interest rate on hold at 1.5 per cent since August 2016
The RBA has kept the interest rate on hold at 1.5 per cent since August 2016.
Mr Lowe said he understood that borrowers may be uncomfortable with a possible interest rate hike but said they should prepare their finances just in case.
The RBA is expected to increase interest rates in the second half of 2019 depending on inflation rates and the job market, the Financial Review reported.
He also said in the years to come, home owners should not expect the value of their homes to continue to climb.
‘Most of our cities have seen falls in housing prices at some point over the past decade,’ Mr Lowe said.
‘While I would expect housing prices to trend higher over time as our incomes increase, there is no guarantee that your home will be worth more tomorrow than it is today.
‘So plan accordingly.’
He also said in the years to come, home owners should not expect the value of their home will continue to climb
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