Standing strong and stable with a steady cash rate

By Greg Bell

Taking out a loan is one of the fundamentals of purchasing commercial property for sale on the Gold Coast. Unless you have significant capital built up, it will be necessary to borrow to gain access to those excellent prime yields that come with this type of real estate.

There has been discussion over whether interest rates would go up or down in the coming months, after the Reserve Bank of Australia (RBA) brought the official cash rate down to an all time low of 2 per cent. We have already seen interest rated on fixed and variable rate home loans reach levels not seen in 50 years, which provides a great counterpoint to rising prices. With easier pathways to borrowing, real estate activity could be expected to rise.

Now that the RBA has released its cash rate decision for the month of June, there are even more positive factors for anyone seeking Surfers Paradise commercial real estate.

Another bout of stability

The decision, announced in a 2 June statement from RBA governor Glenn Stevens, sees the cash rate stay at 2 per cent for another month. This should see current positive aspects of our national economy continue to thrive unchecked.

"Credit is recording moderate growth overall, with stronger lending to businesses and growth in lending to the housing market broadly steady over recent months," the statement reads. Low interest rates are said to be inducing borrowing and spending activity, so another month gives people more time to lock in a mortgage with a lower interest rate.

If you've been looking at industrial real estate on the Gold Coast, it's another month of breathing space to take your time and make sure you select an ideal property- with the help of a professional real estate agent, of course. 

Nothing lasts forever… But it can come close

All good things must come to an end at some point, however, and it's important to remember this applies to the cash rate as well – especially if you're looking at commercial property in Surfers Paradise. The concluding statements in the RBA release have, in previous months, made allowances for the potential of further cuts down the line. 

However, the conclusion of the June statement noted that over the coming weeks, the RBA would take on information and determine whether the current situation was enough to foster growth across the Australian economy, rather than leaving open the door for more easing of policy.

Despite the Housing Industry Association's calls for the cash rate to be lowered further so that housing demand keeps on rising, 2 per cent could be the lowest point for this figure before it rises again. However, we could be about to enter another period of stability for a while.

Macquarie Research has suggested that the cash rate won't rise again until 2018, which could give you plenty of time to secure an excellent interest rate on a mortgage as you look at retail leasing on the Gold Coast. 

Know the odds and beat them

While it's impossible to truly tell when the cash rate will change again, current indicators suggest that we could be in for good financial weather ahead, perhaps similar to what we saw in the year and a half prior to February's cut. 

In the meantime, those seeking commercial property for sale on the gold Coast have a fantastic opportunity to make an entry into the local market. Working with Ray White surfers Paradise is a key step in this. We can find you appropriate property for your financial position, growth plans and target market. With clients across the world, we cater to a diverse set of interests and goals. 

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