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This week on Money and Investing, Mitch Olarenshaw and I break down Australia’s real estate resurgence, looking at how new policies, lower rates, and market demand are reshaping opportunities and risks.
1. Rate Cuts and Market Pressure
Lower interest rates are giving buyers and investors more borrowing power, which is pushing property prices higher. While this helps investors, it adds pressure to households already dealing with rising costs.
2. First-Time Buyer Policies
New rules now allow first-time buyers to enter the market with a 5% deposit and no lender’s mortgage insurance. From 2026, income caps will be removed, making it easier to qualify. While this seems attractive, Andrew and Mitch argue it could fuel even higher property prices and create long-term risks.
3. Investor Dynamics
Property investors stand to benefit from rising values, but rental yields remain tight. As property values increase, so do rents, worsening affordability for tenants. The hosts also explore whether adjusting investor deposit requirements could balance the market.
4. Upgraders in the Market
Those with equity in their homes are trading up, creating movement across the market. This “domino effect” opens opportunities for buyers at different levels, but it highlights the need for new housing supply to meet demand.
5. Alternatives Beyond Property
For those priced out of real estate, Andrew and Mitch highlight other ways to build wealth. From equities and options strategies to new business opportunities, they stress the importance of putting money into assets that generate income, not leaving it in cash.
For more Info about Money and Investing, you can go to the podcast; The Wealth Playbook: Your Ultimate Guide to Financial Security; and The Wealth Playbook by Andrew Baxter – Audiobook, which is on Audible.
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