Be prepared for higher rates says RBA

Homebuyers have to be prepared for higher interest rates says the governor of the Reserve bank, Glenn Stevens. Stevens told a parliamentary hearing that rate are currently well below normal and would move “a good deal north” as Australia emerges from what “may turn out to be one of the shallower recessions Australia has experienced.”

Many economists expect official rates to climb by two per cent from three per cent now to five per cent by the middle of next year. That would push standard variable mortgage rates from 5.37 per cent currently to about 7.37 per cent. On a $300,000 mortgage that would push repayments up from $1819 per month to $2191 per month.

Source: Herald Sun