Long term outlook to increase interest rates: Propell
The Australian Residential Market September 2015 report from Propell has found land subdivisions are adversely affected by new lending criteria, rental vacancy rates are increasing in most cities and foreign investment in housing will strengthen due to lower AUD.
It noted 2016 may witness a combination of slowing economic growth and rising interest rates, bringing the threat of a recession if non-mining sectors do not respond sufficiently to a lower exchange rate.
"In 2016, the RBA may find itself in the position of having to start increasing the cash rate, suggesting that we are now at, or close to, the bottom of the cycle," the report said.
"The long term outlook is for rates to start increasing. As far as property investors are concerned, there has already been a de facto increase, as banks stop discounting investment home loans and start requiring more equity."
