Shaw and Partners: Mortgage Rates Need To Rise Nearly 6% Before House Prices Begin To Slide

Mortgage rates need to rise nearly 6% before house prices begin to slide nationwide


And it will be years before we get anywhere near that level of interest rates given the state of the current economy.

US stocks just plummeted yesterday and today and the flow on effects will probably mean no more interest rate rises by the american fed and unlikely for Australia to have any major raises either.

My 2 cents are that Sir tweetsalot will cause the US economy to either remain where it is or go backwards and there will be a flow on effect everywhere keeping the interest rates where they are now.

 

Here's an interesting interview from last week with Martin Feldstein about Trumps plans...

Extended interview with Martin Feldstein

 

Dont think you can necessarily read so much out of one day on the market.

 

Even if rates increased to 6%, no problems for the knowledgeable investors in PC. Make it 12% and that's going to make it interesting.

 

Hitting 8% last time had many on somersoft in panic mode. Much more debt floating around now.

 

LOL
Republicans are meeting on Thursday to look at the replacement for Obamacare and markets are having a reaction to this. Lets not forget interest rates are rising in US because the economy is on the rise, this is fact.

I think we should be looking in our own backyard, there is lots of talk that our share market is close to peak?? 22 billion lost on Australian stock market today

 

....6% mamma mia, I would be having a coronary
This is property biased reporting with an agenda to promote property

Property markets will turn if RBA raise interest rates and it will only need to be a couple of rises at .25% to change market sentiment. You will see investors go from being bullish to fear setting in.

This is a huge trigger for property markets changing, don't believe me? Look at previous boom/bust cycles, it does not take much to change market sentiment.

 

Meh. When my interest rates averaged over 9% I had more debt, less assets and less income than I have now. It wasn't a particularly stressful time. That's just a little bit sad

 

Shaw & partners make money through share trading. Obviously, they want people to move from property to stocks.

 

If rates go up another 12% (to 16+%), then I think the world will become an interesting place.

We survived the times when rates were over 17%. Our property portfolio was a lot smaller back then and so was our loan portfolio. Our LVR is a lot lower now and so is our household income (as we are retired).

All of our stress testing says we should be OK.

 

I was hoping 0.5% increase will be enough to slow the Melb/Syd market. Am now thinking it will need to be more. At least 1+%

 

Its not so much what happened but rather why it happened.

Republicans are competing with each other to distance themselves from DJT because they know they will get annihilated in the upcoming congress elections if they are seen associating with him.

Who can blame them, only 2 days ago DJT met with German chancellor and when asked if he wants to shake her hand, he had a blank look as if he is not sure where he is and whats required of him. The dude is lucky if he remembers to wear pants in the morning let alone making any meaningful decisions for the economy.

The markets are finally coming to their senses realizing the president is incapable of looking presidential let alone making any meaningful decisions and his own party will break ties with him and therefore so very little of his promises will go through and the whole presidency was a publicity stunt which then triggers the sell offs. This also shows a huge lack of consumer confidence in the market.

It can well translate into few more years of bad juju for american economy and thereby keeping the interest rates lower.

 

They always knew his talk about building infrastructure was to excite the gullible hill billies to vote for him. Otherwise he doesnt even have a plan, his plan is to ask the congress to give tax break to private sector to then build infrastructure. So congress has to first approve it (while having billions and billions of debt that must be paid from tax money) and the private sector has to then see it as interesting enough to invest. Therefore if all the ifs and buts were candy and nuts we would all have a merry Christmas.

Its wishful thinking to think the man who thought he is going to get mexico pay for a wall has anything of value to propose.