This is a question I’m asked often due to rising interest rates and prices falling in some key areas of the Capital Cities.
In some ways there is no correct answer as hindsight in the future may well prove correct or incorrect for people buying in different areas of Australia. The reason for that is that some regions such as the Central Coast have seen only marginal drops in house prices for some suburbs whereas sales data shows that other suburbs have had little decrease in value / have remained stagnant or in fact have had some subtle price growth. Then you can look at the Northern Beaches house market where there have been large drops to house prices which had previously increased dramatically in value.
To wait may prove a win for some buyers…whereas for others it may see them waiting for ‘something’ that never eventuated. What buyers also need to be aware of is that the longer they wait then potentially they’ll see their borrowing capacity decrease as interest rates continue to rise in an uncertain financial market. This is because banks increase the assessment rate whenever the interest rate increases. Generally when assessing loan applications banks will add a 3% buffer to their advertised interest rates and that’s what your loan is assessed at for serviceability.
If unsure what is going to best suit your situation the best course of action is to consult a mortgage broker who will be able to give you some guidance and a helping hand in determining what will work for you.