A Trifecta You Can Bet On

With punters gearing up for ‘the race that stops a nation’, it would be easy to miss the other big event that took place this afternoon: ‘the news that stops a heartbeat’ or the Reserve Bank’s interest rate decision. Here at UNO, we were waiting in anticipation for the latter, because hey – we’re in the business of home loans. And while historically, the Melbourne Cup is a popular date for a change in interest rates (did you know that between 2006 and 2011 the RBA moved them for six years straight?), it’s now been six years since the bank made a move in November. Today, the RBA chose to stay put for a 13th consecutive month, keeping the cash rate at 1.50%. Which leads me to why we were waiting in such anticipation for the RBA announcement. (Okay, we admit it was kind of fun watching the winning trifecta in the Melbourne Cup and yes, we might have had a champagne in hand.) But to be perfectly honest, there was a better reason to be excited. You see, there’s actually a trifecta happening right now in home loans. With interest rates low, property prices cooling and seven weeks to settle before Christmas, this unique moment in time would have bookies in a frenzy. It’s possibly one of the best times in history to consider taking out a home loan. UNO’s chief financial officer got pretty animated about it last week, calling it a “property sweet spot”. “Inflation figures last week indicated price weakness except for rising electricity and gas prices, leading to the inflation rate remaining below the RBA target of 2-3%,” he said. “What this typically means is that the central bank would reduce rates to give things a kick along. “They’re not going to do that in fear of stoking the property bubble further. There’s only one direction they can go from here.” He said almost all economists are tipping two 25 basis point increases at some point next year. But before that happens, there’s a window right now where these three things – low interest rates, cooling property prices and Christmas – are aligning to benefit home buyers and those looking to refinance. For home buyers: Why now might be the best time in history to consider a home loanFor home owners: Why now might be the best time in history to refinance

Homebuyers, here’s why:

1. Interest rates are low

The September quarterly growth figures showing weak inflation growth – even with soaring electricity prices – suggest interest rates will remain stable for some time to come. September’s figures were the third strongest in four years at 0.6%, yet the annual inflation growth of 1.9% remained below the RBA’s target range of 2-3%. The reason for this is electricity prices, which rose 8.9% this quarter, according to the ABS. If it weren’t for rising electricity prices, the RBA would be reducing the cash rate – to boost the economy, which is essentially flat. But for now, the bank’s expectation is that growth in the Australian economy will gradually pick up over the coming year.

2. Property prices are cooling

According to Domain, this financial year’s clearance rate for houses now averages about 62%, well down from the 72.9% clearance rate over the same time frame last year. Capital gains across Australia’s housing market have also been losing momentum since moving through a peak rate of growth in November 2016, according to CoreLogic. National dwelling values remained unchanged during the month of October and conditions were flat across both the combined capital cities and the combined regional areas of Australia, with negative movement in values over the three months ending October recorded in Sydney (-0.6%), Perth (-0.7%) and Darwin (-4.4%). “Seeing Sydney listed alongside Perth and Darwin, where dwelling values have been falling since 2014, is a significant turn of events,” CoreLogic’s head of research, Tim Lawless said, adding that despite a stronger growth profile, Melbourne dwelling values are also rising at their slowest quarterly pace since mid-2016. Source: CoreLogic

3. It’s seven weeks ’til Christmas

For houses on the market now, it’s a sure thing their owners want them sold, packaged up and shipped out by Christmas – which is only seven weeks away. “Vendors like to be in the new house for Christmas or settled before school starts in the new year,” says Michael Pickham from Propertunity Buyers Agents. “Christmas time can be a great time to snap up a deal as sellers just want their house sold. With seven weeks out to Christmas now we’re in a little bit of heat as the vendor doesn’t want the uncertainty of having a property on market over the holiday season.” With these three things in mind, the time could be ripe to buy a house that has passed in at auction or is failing to attract the excitable bidding that agents rely on to push prices to ridiculously high levels. I should know. My partner and I searched for a home for months, finally securing a property at auction just over six weeks ago – for less than the reserve price. All in all, it’s the perfect property trifecta. Want to know more? Read Choosing the Right Home Loan

Home owners, here’s why:

1. Interest rates are low

The September quarterly growth figures showing weak inflation growth – even with soaring electricity prices – suggest interest rates will remain stable for some time to come. September’s figures were the third strongest in four years at 0.6%, yet the annual inflation growth of 1.9% remained below the RBA’s target range of 2%. The reason for this is electricity prices, which rose 8.9% this quarter, according to the ABS. If it weren’t for rising electricity prices, the RBA would be reducing the cash rate – to boost the economy, which is essentially flat. But for now, the bank’s expectation is that growth in the Australian economy will gradually pick up over the coming year. With lenders offering competitive rates and reduced fees, it’s never been a better time to take advantage of them and refinance to get a better deal. Hey, when you look back on this period ten years from now, will you see it as the once-in-a-generation opportunity it was to pay down your mortgage while interest rates were low?

2. Property prices are cooling

According to Domain, this financial year’s clearance rate for houses now averages about 62%, well down from the 72.9% clearance rate over the same time frame last year. While there certainly hasn’t been a “property crash”, if property prices were to drop further, it might be harder to negotiate a better rate with your lender as your LVR is likely to increase if the cost of your property drops. Right now, your debt is a lower portion of the value of the property, meaning it could be the best time to refinance.

3. It’s seven weeks ’til Christmas

Finally, with Christmas just around the corner, everyone’s looking at ways to save for that much-needed holiday, presents for the kids or a seafood lunch for the family. Last Christmas, UNO calculated that the average Sydneysider could save $3408 a year through refinancing. In Melbourne it’s $2532*. Lenders often work to targets and are super hungry to do deals and settle them before the end of the quarter (end of December). With these three things in mind, now could be a great time to consider refinancing. After all, it’s the perfect home loan trifecta. Want to know more? Read Thinking of Refinancing? Here’s How to Get the Best Deal for You* This saving is based on the median Sydney house price of $995,804 and a median Melbourne house price of $740,000, at an 80% LVR, assuming an original interest rate of 4.5% and a refinanced rate of 3.89%.This information in this article is general only and does not take into account your individual circumstances. It should not be relied upon to make any financial decisions. UNO can’t make a recommendation until we complete an assessment of your requirements and objectives and your financial position. Interest rates, and other product information included in this article, are subject to change at any time at the complete discretion of each lender. Book a call in with UNO

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Sally Mackenzie
February 19, 2024
We chose Uno Home Loans from their impressive web site knowing we were going to find it hard, on many fronts, to qualify for a home loan. We were incredibly fortunate to be assigned Mike Parsons as right from the get-go, despite the complexities, he hit the ground running for us. He was incredibly knowledgeable, with years of experience but what was immediately apparent and impressive was that he was totally invested in getting us over the line, doing absolutely everything possible, including working around the clock. Despite it being a relatively small loan in the order of things, Mike never missed a beat, getting docs ready, following up and answering every request from the proposed funder immediately. He kept us informed on progress the minute anything happened, and again if anything needed to be done, he was right on it. In short, we highly recommend Uno, and Mike, knowing what a remarkable job he did, over many weeks, to get us our loan. He got us a great deal, with far better rates than we expected, so we couldn't be happier. In fact, without doubt, you'd be hard pressed to find a more personable, sharp, hard working, dedicated professional who clearly prides himself on getting his customers standout results.
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February 13, 2024
Scott and his team were just A-mazing. We felt supported through the whole process with the greatest quality and care. Every question answered right in time, or even before we asked. The process was smooth and we got the best outcomes we could have wished for.
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Angela Biddle
February 6, 2024
Our mortgage recently came up for renewal, and with interest rates skyrocketing we were looking for ways to minimise the impact. Michael and his team were proactive and attentive. Michael spent time with us to understand our circumstances. He found mortgage options that worked with our current financial situation and longer investment plans. He presented clear options, providing guidance where needed. He and his team were helpful and responsive - streamlining the process and keeping us updated through the negotiations. In the end, Uno did the heavy lifting and secured a significantly better rate than our current bank offered, all with friendly, personal service. We would highly recommend UNO Home Loans.
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Fotis Bikas
January 15, 2024
I cannot help but congratulate Scott Wilkinson of UNO Home Loans for being an absolute credit to both his company and the entire loans industry. Scott is a truly rare gem of a broker in that he will not only go the extra mile to achieve for each customer the very best deal, but his knowledge of all and sundry within the industry is unsurpassed (you will see what I mean if you speak to him). Additionally, Scott has a clear passion for imparting his wealth of information with each customer, whereas the conversation with most other brokers would simply be over if they could not get you the best deal. For me, Scott Wilkinson of UNO Home Loans stands head and shoulders above the competition and I feel privileged to benefit both from his expertise and professionalism whenever it is time for a refinance or new loan.
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Tomoharu Matsui
January 11, 2024
Michael Parsons helped me a lot when it's difficult to establish my capabilities in loan.
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Gillian Kearon
January 9, 2024
I highly recommend Mike Parsons as a mortgage broker. I couldn't fault the service provided by UNO. Thanks Mike!
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Taner T
December 20, 2023
Thank you Eren Tan for the amazing service and support. Our Loan was a little tricky and complex for other lenders but Eren managed to get it over the line in record time. His professionalism and dedication to our needs was exceptional. If you need a Loan no matter how complex your situation, make sure you contact Eren at UNO Home Loans.
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Karaipu Brown
December 20, 2023
Buying & selling a house at the same time is very stressful but Scott Wilkinson from UNO home loans made sure we knew what was happening & took most of the stress away. He always kept us up to date and if we had a concern or wanted clarification on something we were able to call him, if he didn’t know the answer straight away he will find out and contact us back.. now we are enjoying our new house and turning it into a home :)
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Chris Anderson
December 18, 2023
Just completed my first loan with UNO which was so much easier than with other other brokers I have used in the past. Our broker MIKE PARSONS always had time for me and broke things down for me in the simplest of terms and was very patient with my silly questions and my constant changing of plans. I wish I had used them in the past as I wouldn't be in the situation I'm in now. Can't recommend them highly enough. Thanks UNO and Thanks MIKE 😊
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Stephen Broomfield
December 11, 2023
To be able to recommend Scott Wilkinson for your mortgage broker was a privilege. We had deals fall through but Scott supported, guided and stuck with us, proper partnership. The whole team at UNO helped us and supported us right through to after settlement. Made sure everything was correct and how we are progressing. Communication was amazing and straightforward and easy to understand. Transparent. We can not Recommend Scott and the team as Uno high enough. Use UNO with confidence.
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Tarek Hussain
December 6, 2023
Can't thank Amy enough for her hard work, dedication and determination on getting multiple loans completed for me. I wouldn't hesitate in recommending Amy and the Uno team to any of my associates. Will definitely be back in the near future!
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Linda
November 3, 2023
If you’re looking for a trustworthy, thorough, reliable & knowledgeable Mortgage Broker then you must call Anita Callaghan! I can’t even imagine how stressful this process would’ve been without her. Anita went above and beyond to make sure she answered every question, responded to every text (even on weekends/after hours), and followed up on every detail to ensure we had all the info we needed. Anita is a true people person who is warm, empathetic, kind and supportive. You can tell she loves helping people and loves what she does, which is probably why she’s so good at it! Can’t thank you enough Anita, or recommend you more highly! You’re the best!
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