Tuesday, April 2, 2013

How to avoid Negative Equity - 23

How to avoid Negative Equity - 23

Some Property commentators are predicting a flat Property Market
or a 5-10% squeeze on Australian Property prices
over the course of this year,
whilst the majority of commentators are predicting
"Confidence has returned",
"Everything is dandy again",
"We're on the up and up".

To create a Financial Strategy to avoid Negative Equity,
it is very important to follow the minutes of the monthly RBA Board meetings.
In an Article on April 2nd, 2013 on the News Limited Network,
"Reserve Bank leaves Interest Rates on hold at 3 per cent ".
The key sentiment being expressed by the RBA at present is caution.

The economic problems in Europe are creating a cautious attitude
with central Banks across the globe at present.
The article continues ,
"Homeowners can breathe easy for another month
  after the Reserve Bank left Interest Rates unchanged at 3 per cent
  at its monthly board meeting.

Most economists had expected the central bank
to keep the cash rate steady."

Why did most economists expect the cental bank
to keep the cash rate steady ?

Is it because of the attitude of caution
considering the European Economic crisis ?

What effect is this attitude of caution going to have
on Australian Property prices ?

What will happen to Australian and New Zealand households
who buy Property at inflated Prices ?

What is one of the major causes of the
European Economic crisis ? 

Europe is experiencing a Tidal Wave of Baby Boomer Retirements,
the same as Australia, New Zealand and the USA.

The article continues,
" RBA Governor Glenn Stevens said with economic growth
   expected to be a little below trend over the coming year,
   it was not prudent to change the cash rate. "



Reserve Bank leaves Interest Rates on hold


Why is economic growth expected to be below trend ?


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Copyright - Craig Holme - 2013


 

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