Australian interest rates and how to profit

[Anonymous No.49664926]

Our housing market is a huge bubble, the RBA either has its head up its arse or is playing cute. 0.85% cash rate but
>Inflation is expected to increase further, but then decline back towards the 2–3 per cent range next year
THEY THINK ITS OVER BY NEXT YEAR???
Philip Lowe is smoking shabs and talking shit. Anyone with eyes can see we've been kicking the inflation can down the road for the last two years (if not more) and its going to take more than 12 months of 0.85% cash rate to stop inflation
>cpi (aka manipulated bullshit) is up to almost 6% from -0.3
>actual shopping baskets are up 20%
>most house prices are up 50 - 100%
>650 billion in Quantitative easing now ending
But yeah nah inflation will be back to 2% in a Jiffy will it Phil?

Whats going to happen is either
> A) the RBA wakes the fuck up and raises interest to a level that will actually control inflation, and that will slow the economy and one if not more of the big 4 banks will go under
> B) the RBA will protect the banks and we'll all be spending dollars like they're yen with massive inflation and a loaf of bread costing $34

Either way over leveraged fuck heads are going to default on their 5% deposit 1.5mil McMansion loans, and house prices will be cheaper. Weather credit will be easier or harder to get is yet to be seen as is interest rates.

Whats the play here? I'm thinking go hard into commodities or PMs to protect from inflation, the wait for mortgagee in possessions (foreclosures) and try to get some cheap properties.

What suburbs will be effected most? Why is the RBA sticking its head in the sand? What are your plans to profit from this?

[Anonymous No.49665089]

>>49664926
whether*
rba's comment on inflation source:
https://www.rba.gov.au/media-releases/2022/mr-22-14.html

[Anonymous No.49665144]

The east coast is fucked simply.

The other states will be fine.

Nothing of value will be lost.

[Anonymous No.49665214]

>>49665144
Hope so.
t. Sydney sider with a recession proof government job that can't afford property

[Anonymous No.49665352]

>>49664926
>Whats the play here?
buy link

[Anonymous No.49665888]

>>49665144
everyones got the same banks and cash rate. I can't see household debt being that much higher in non east coast states.

[Anonymous No.49666128]

>>49664926
Is it true you fags don't have fixed rate mortgages?

[Anonymous No.49666457]

>>49666128
as far as i know its true. We have split loans (like 50% is fixed 50% is normal) and normally our 'fixed' loans are only fixed for 1 to 5 years. I think it because our interest rates were so high not so long ago. 18% cash rate so like 23% interest rate for normal people as recently as the 1990's, so anyone who actually had a fixed rate found it way cheaper to remortgage and eat the fee's, so the concept was dropped.*

*talking out my arse

[Anonymous No.49666483]

>ConDom introducing a land tax
it's over

[Anonymous No.49666590]

>>49666483
>introducing a land tax
been a thing since 2014 as far as i know, whats changed?

[Anonymous No.49666629]

>>49666128
5 years max

[Anonymous No.49666681]

>>49666590
auctions drying up so no stamp duty into the coffers, gotta raise revenue somehow.

[Anonymous No.49666688]

yeah nah don't be a silly sausage she'll be right

[Anonymous No.49666703]

>>49664926
chill out cunt she'll be right

[Anonymous No.49666746]

>>49666457
23% is loan shark territory, nobody would have borrowed money for a mortgage at that rate the payments would have been astronomical, you must be confusing something.
I know it was up to 10% for a while in Europe in the 80s but I don't really believe 23% in a developed country.

>>49666629
Sucks I guess. I just got 3%, fixed for 30 years. Which was still really unlucky because it was 1.5% six months ago.

[Anonymous No.49666751]

>>49664926
>>49665089
>>49665144
>>49665214
>>49665352
>>49665888
>>49666128
>>49666457
>>49666483
>>49666590
>>49666629
>>49666681
>>49666688
>>49666688
>>49666703

[Anonymous No.49666824]

>>49664926
>Bonds and value stocks
>Long term (>1 year)

[Anonymous No.49666938]

>>49664926
Banks will be fucked in a few years.
>>49666824
Wouldn't go into bonds https://youtu.be/gzNeA_No6zg?t=796

[Anonymous No.49667034]

>>49665214
Does that mean you took the jab?

[Anonymous No.49667074]

>>49666746
can't find a good graph of the 80's. But ou can see here on the rba's site (our version of the fed) that the early 90's had a 17.5% cash rate(equivilent of the federal reserve interest rate). From memory it peaked at 18% in 1989 so a retail interest rate of 23% is real.

source
https://www.rba.gov.au/statistics/cash-rate/

https://www.rba.gov.au/statistics/cash-rate/

[Anonymous No.49667122]

>>49666751
kek, unnervingly accurate. Still I beliv the midwits are going to have their day soon.

[Anonymous No.49667223]

>>49664926
Keep spreading FUD Zoomer

Only a fraction of properties are mortgaged and those that are, only a small percentage have more than 60% lvr.

New mortgages have been getting stress tested at 5% before approval for a year now.

There might be a 10-15% in melb and syd but if you expect anything more than that, you're a moron.

[Anonymous No.49667251]

>>49664926
I don't think things are quite as dire here as in burgerland. Property is in serious need of a pullback but our inflation is only due to usd getting fucked, retards shutting down coal and fuel prices. I can't image desirable suburbs will see much of a drop, probably more holiday destinations and "upcoming" suburbs

[Anonymous No.49667377]

aussie cunts are faggots. im an indian cunt and i fucking hate all you dogs

[Anonymous No.49667448]

>>49667223
Got it, I’m millennial and even I have 3 properties at 50% LVR and HOPING for a crash to buy more but know we’ll see 10% pull back tops then everyone’s buying, zoomers btfo

[Anonymous No.49667453]

>>49667377
Good morning sir

[Anonymous No.49667489]

>>49667377
Yeah cool cunt just make my rippa roll.

[Anonymous No.49667526]

>>49664926
Buy a tonne of property with as much debt as possible. Buy in 2hb suburbs.

Inflation pushes prices and rent up. Dont foget we have a rent crisis in most cities.

The rent will cover the interest rate increases. Then people will complain so theyll atimulate the housing market again and youll make a bundle.

The wait out the 30 year loan and retire.

[Anonymous No.49667584]

>>49667377
good morning sir . wishing you a happy day anonbaba.

>>49667448
>>49667223
I guess I'm more pessimistic than you two. If it is only 10% drop what sort of timeline are you looking at? How are you securing deposit cash from inflation in the mean time?

[Anonymous No.49667607]

>>49666128
>>49666457
Not true at all I fixed at 2.29%
They gave me $5k cashback as well to take out the loan.

Its just that fixed is really high now so its not worth it.

[Anonymous No.49667678]

>>49667607
fixed for the full 30 years?

[Anonymous No.49667682]

>>49667584

I have 300k ready as deposit, just refinanced my investments and drew out the huge equity gain so now the deposit isn’t issue but servicing the loans in the eyes of the bank

[Anonymous No.49667717]

>>49667489
anyone else reckon the chicken at Red Rooter has gotten worse? the rippa roll in particular, it's like they changed the tendies. fucken sucks mate, I used to love those.

[Anonymous No.49667742]

>>49667607
You know your repayments will double in 1-3 years right?

[Anonymous No.49667767]

>>49667717
I got off the red rooters a long time ago i usually order korean fried chicken with my gf

[Anonymous No.49667781]

>>49667034
Yep, just like 90% of the country

[Anonymous No.49667828]

>>49664926

Real inflation is 17.2%, rents are up 50% morgage rates are up too, this could be all by design since we are in "the great reset" and they want u to live in a pod and eat ze bugs

[Anonymous No.49667902]

>>49667828
How do you come up with the 'real' inflation rate?

[Anonymous No.49667910]

>>49667767
>korean fried chicken
based

[Anonymous No.49667927]

>>49667717
>Kfc Chicken tastes different
Eat the bugs ye maggot

[Anonymous No.49667932]

>>49667902
>>49667828
also curious,

i agree its more than 5.1% but how do i find out what the actual inflation rate is

[Anonymous No.49667958]

I came to /biz/ to laugh at pink posting cause of crypto and saw this thread.

I have an unironically grug tier understanding of the economy, banks and inflation. I have almost no comprehension of what any of OPs numbers apply to.

I have a secure job consultanting with government bodies but have no property and $60k savings in a bank with no investments in anything.

Give it to me straight and simple boys, how fuck am I? Will I be wiping my arse with $100 notes as the country collapses around me or will I be snapping up a nice block of land in the country from boomers retiree's?

[Anonymous No.49668037]

>>49666746
I think they maxxed out at 17% in the early 90%, tumbled quickly during the and so did house prices.

[Anonymous No.49668043]

>>49667958
Not a bad position to be in desu. Convert cash into assets in line with your risk tolerance, unless you want to see inflation eat away at your savings.

[Anonymous No.49668042]

>>49667781
Cuck.

[Anonymous No.49668049]

>>49664926
>Either way over leveraged fuck heads are going to default on their 5% deposit 1.5mil McMansion loans, and house prices will be cheaper.

yeah "house prices will be cheaper" when bread is $35 a loaf

yeah nah a house just be a cheap $10 million instead of $30 million but you'll still earn $30 an hour welcome to New Argentina hope you enjoyed the lucky country while you could

[Anonymous No.49668060]

>>49665214
Whats your profession? Tax man or mortician?

[Anonymous No.49668070]

>>49666751
The “high-IQ” Libs are just the low-IQ Labor voters from 40 years ago.

[Anonymous No.49668142]

>market crashes, I buy cheap property
>market doesn’t crash, I inherit obscenely valuable property from my parents / grandparents
Feels good.

[Anonymous No.49668214]

>>49667377
Good evening sir

[Anonymous No.49668245]

anyone else full recession accelerationist mode here?
Haven't made or plan on any major purchases, stopped ordering from restaurants, egg+ramen and vitamin gummy student frugality, moved back in with parents, no subscriptions, cut my own hair, 120k a year recession proof government job with WFH where I do fuck all

Life is good, plan on taking a house off some boomers hands when the cost of living and his luxury lifestyle catch up with him for half price

[Anonymous No.49668275]

>>49668142
>market doesn’t crash, I inherit obscenely valuable property from my parents / grandparents

That's the worst time to get the property, boomers are all gonna die relatively close together, there will be a "bubble" of dead boomer property all hitting the market and that's what will eventually bring the prices down. By then the Millennials will be too old for families so sucks to be them. Zoomers will get a good chance though.

[Anonymous No.49668344]

>>49667958
Chances are you will be doing neither. Most money is "digital" ie doesn't exist. So you won't be wiping your ass with it. If housing collapses, you wont be buying shit with 60k and it will be hard to get a loan to buy a place.

[Anonymous No.49668355]

>>49668043
Cool. What are some retard proof assets? Looking for something stable to fend off inflation rather than a money maker.
Gold and silver or is that just a meme?

[Anonymous No.49668405]

>>49668245
Yes I'm in the same boat, income is good and a well timed crypto entry and exit positioned me well for a recession. Honestly feel bad for the people that got fucked by the lockdowns and that, but I've come out the other end of it in a good place.

[Anonymous No.49668493]

>>49667526
whats 2hb suburbs?

[Anonymous No.49668514]

Legal anon here. There is almost no such thing a foreclosure in Australia, foreclosure is when a bank takes possession of the property and via a court order and extinguishes the owner’s legal and equitable rights as registered proprietor. This act also extinguishes the debt owed under the mortgage. Basically they become the owner and the borrower doesn’t owe anything but why would a bank want to own a house and have no debt owed to them?
Instead banks exercise what they call the power of sale to become “Mortgagee in Possession” (MIP) This means they come into possession of the property via a court judgment or via a voluntary surrender of the property in response to a default by the mortgagor. The mortgagor still owns the house but the bank just sells it to recoup the debt owed under the mortgage and if there is surplus sale funds, the mortgagor is awarded the surplus funds.
These sales are sometimes referred to as forced sales but they are definitely not foreclosures. It actually doesn’t make any sense why banks and the media use this word. Foreclosures are literally non-existent and if you don’t beleive me read this:
https://www.gadens.com/legal-insights/the-first-reported-foreclosure-in-queensland-for-35-years-an-innovative-litigation-solution/
A MIP sale is not a bargain sale though despite what OP suggests. Banks are bound to not disregards the mortgagors interests when conducting the sale. A practical illustration of this is the banks have to conduct repetitive valuations of the property to ensure the sale price they accept is as close to market as possible. If the property has LMI, this is even stricter.
Hope this was educational anons

[Anonymous No.49668548]

>>49664926
>and its going to take more than 12 months of 0.85% cash rate to stop inflation
The futures market is pricing in a nearly 4% cash rate by the middle of next year retard.
>the RBA wakes the fuck up and raises interest to a level that will actually control inflation
The RBA just follows the short term interbank rate when setting the cash rate, the market decides the interest rate, the RBA are puppets of powerful market forces. If they try go against the market they get punished by the market like last year:
https://www.reuters.com/business/australias-central-bank-loses-yield-control-bonds-melt-down-2021-10-29/

It's crazy how little you guys know about how markets work.

[Anonymous No.49668554]

>>49668355
go full autist reading everything you can, you're in a good place but its probably time you get a little interested in your finances. Read everything, don't fall for guru's investing schemes, and take 4chan with a grain of salt.

[Anonymous No.49668638]

>>49668245
How tf do you score a gig like that

[Anonymous No.49668643]

>>49668514
Honestly better to find a deceased estate where there's little to no family that care about the property, or where the owner is elderly and being moved into a retirement home or something and so the family just want to dispose of the property with minimal fuss and will settle for a bit below the market price.

[Anonymous No.49668680]

>>49668548
>The futures market is pricing in a nearly 4% cash rate by the middle of next year retard.
Show me where you see this

[Anonymous No.49668780]

>>49668245
similar boat, high earner, investment bank, 0.25 mil saving, live at home. dunno if the market will correct enough... dont know wether to lever up for a nice house or what to do.

[Anonymous No.49668795]

>>49664926
>no debt
>work from home
>saving
>been waiting for this crash for 10 years plus
>all my panjeet co-workers with their 800 k mortgages on literal cardboard/plywood shit boxes are about to get wiped the fuck out

holy shit boys ive never been so erect tbqh

[Anonymous No.49668815]

>high interest rates

you profit by keeping cash in a high interest savings account

[Anonymous No.49668831]

>>49664926
When should I dump my cash into stocks? My non commodities stocks have been hit pretty hard. I've got $40k in the ASX, $40k in the bank, about $10k worth of gold and firearms. I earn about $110k and get a car. Rio and BHP have paid a solid dividend, I'll get a decent dividend from s32 since met coal price is so high. I've got a surplus of about $3k/Month I can save or invest

[Anonymous No.49668880]

>>49668514
in times of financial sunshine MIP sales are nothing special, the idea is if interest rates are too high, many people sell to downsize to a more manageable loan, or are forced into MIP and the market dips due to all the sales, and no one wanting to buy in during high interest rates.

[Anonymous No.49668918]

>>49668815
low effort shitpost

[Anonymous No.49668936]

>>49668680

[Anonymous No.49668950]

>>49668795
hope so breh, hope the over levved get rekt

[Anonymous No.49669025]

>>49668643
Exactly. Most MIP sales are likely to experience a shortfall at settlement anyway due to the arrears on the mortgage. This means that the banks don’t want to sell for a cheap price as it just means that they are left with a greater debt they have to chase up from the mortgagor. LMI is even stricter as they have to consent to a sale, so even if the banks approve, if the LMI doesn’t like the marketing or wants to wait longer, the bank has to follow their instructions. The idea that a MIP sale is a cheap sale is a meme idea perpetuated by people who probably bought pink for $60

[Anonymous No.49669092]

>>49668936
Thanks anon

[Anonymous No.49669180]

>>49669025
the concept is a rush of mip sales is symptomatic of an overall deflation in property prices, not that a mip sale is in itself below market value.

[Anonymous No.49669309]

>>49668831
when you think the change in the stock market, be it positive or negitive, will leave you better off than the loss of buying power inflicted by inflation. no crystal ball / personal risk / blah blah blah

[Anonymous No.49669532]

how do normies sleep at night tying themselves down to a 30 yr $800k loan
do they honestly expect to have a job for 30 yrs straight with no issue like divorce/recession/gov change?

[Anonymous No.49669693]

all the anons calling for hyper inflation in housing i just don't see it, for that to happen we're going to have people taking out multi million dollar 95% LTV mortgages, in a fucked supply environment and raising rates (meaning bigger repayments on an already hyperinflated low collateral loan)

What if the hyper inflation is already here and has been coming for the past 40 years while interest rates were dropping, and now were seeing the reversal and deflation?

[Anonymous No.49669866]

>>49668548
Markets have historically overshot the mark when it comes to predicting into rate rises.

If you think the cashrate can reach 4% when we were literally slipping into a recession PRE covid, then you're insane.

[Anonymous No.49669975]

>>49669866
they under shot it buy 1.2% this week in the US

[Anonymous No.49670048]

>>49667377
Good morning sir

[Anonymous No.49670117]

>>49669866
At the start of the year bankers in the US thought rates would peak at 4% late next year. They're currently 6% and likely to continue rising for some time.

[Anonymous No.49671664]

The thing that drives me insane is still nobody asks the question: was it worth it? There was zero attempt to forecast damage from the COVID response, zero attempt to run a cost-benefit analysis. Every story on the news is how dire the economy is but nobody dares mention how or why. Financial stress KILLS people, it withers them and shortens their lives, lowers their fertility. When I was begging my family and friends to consider that we were doing more harm than good with lockdowns they thought I was being ridiculous. I DETEST the quadruple vaxxed normie scum who sleepwalk through life, I hope this nation of fools reaps the hell it has sown

[Anonymous No.49672147]

>>49671664
M8 Australia is lost and it has been lost for a looooonnnnggg time. You know I’m right. The economy is fucked. No one is doing shit and eventually the whole thing is going to collapse. Australia will be the first western nation to fall which shows just how pathetic it is because it’s got some dam good competition for most pathetic citizens with Canada.

[Anonymous No.49672435]

>>49667377
Do the needful my bastard

[Anonymous No.49672626]

>>49671664
You've made a fatal assumption that these decisions were made in good faith. These people knew exactly what they were doing. They don't care. You're not going to do shit. They'll come out ahead and you and I will be destroyed. Not their problem.

[Anonymous No.49672702]

>>49671664
many of them were probably under the impression that interest rates wont be raised for another 2-3 years (like the rba said) and were sold sweet fantasy by realtors, the media, the bank and worst of all their boomer parents that investing in real estate is an absolute must and you need to 'get your foot in the door' before its too late. its disgusting and sad because alot of people in my generation are going to live depressing stressful lives because they thought they did the ring thing by listening to their parents.

[Anonymous No.49673219]

>>49664926
Im 25 and started looking to buy a place 9 months in Hellbourne. Fuck me is the market pumped to shit.
I've saved up six figures in 10 years, but outside of buying a Jewish Coffin 3/1 shitbox, nesrly everything is over inflated, especially in the outer suburbs where I'm looking.

Do you lads think this is even sustainable? Lendlease are charging 381k for 350sqm out in fucking Nar Nar Goon.. Surely thr peice of these blocks are going to plummet, especially considering the interest rate rise+building industry crisis

[Anonymous No.49673296]

>>49666483
This has got to be the most Jewish idea I've ever seen in my lifetime. Imagine having some developer build newr your place, which causes you to pay more in tax for a property you supposedly "own".

[Anonymous No.49673418]

>>49664926
>But yeah nah inflation will be back to 2% in a Jiffy will it Phil?
That's not the claim. Listen to the interview, even he is claiming 7% by the end of the year. Which means it will likely be close to double digits in reality.

Expect 4% to 5% which gives them some more to work with in terms of dropping rates when this recession starts to bite a little harder.

[Anonymous No.49674115]

>>49671664
For what it’s worth, I do think a lesson has been learned from covid.

You cant take draconian steps to prolong the life of the elderly while harming the young and imploding the economy. Next time there’s a pandemic, there will be an acceptance that such things are an act of god, people will die, and that the cure can’t be more devastating than the disease. The left will screech if this happens when there’s a pandemic but the average citizen in developed countries won’t go along with something like this again. You would see mass non-compliance rather than a shutdown.