Six Tips to Profit from a Low Growth Low Rate Environment

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The government is clamping down on perceived lax lending standards and many banks are no longer lending to foreign investors.

As a result, it’s now clear that the investor-fuelled property boom (of Sydney) has peaked.

Where people once made a mozza by flipping properties in a rising market, many are now left wondering what to do.

 Here are six ideas.


1) Enjoy the Calm

Variable rates have come down and look like they will come down further. This is going to be beneficial for household budgets that will have more cash in their pockets.

2) Go Shopping

 With a slowing property market, the banks have to find new ways to compete for business. Many are now offering up to $1,500 to switch lenders (and they will give you a better rate too).

3) Call Your Broker

Most, but not all, lenders have passed on all the Reserve Bank’s cuts (see Jenna Ford’s article). If your bank has not passed it on in full, call your broker now to see if she can get you a lower rate.

4) Arbitrage

Arbitrage is where investors play one market off against another. If you have been blessed with massive growth in equity in your property, now may be time to tap into this growth and use it as a platform to invest interstate where growth is more likely to occur.

5) Wave Goodbye to the Competition

We have all heard the stories of Sydney and Melbourne first home-owners being outbid by investors. Well, now the shoe is on the other foot; rental yields are low and some banks are no longer lending to overseas borrowers. For some, this may well be the time to buy.

Related:  What Structure Should I Use to Purchase a Property?

6) Create Wealth through Paint

Rather than spending every Saturday going to auctions maybe you can stay at home and put in a new kitchen or bathroom. With interest rates at ultra-low levels, it would be fairly affordable.

Right now, in some locations, this may be the biggest driver of growth for an investor.

Need some guidance on how to profit in an “ill” property and lending environment?
Get a Quick Finance Health Check-up with a Chan & Naylor Finance Broker. Call us or submit your inquiry now to discuss.


Graeme Salt

New Clients Manager, Chan & Naylor Finance

Graeme Salt - Chan & Naylor Finance

Disclaimer: This article contains general information. Before you make any financial or investment decision you should seek professional advice to take into account your individual objectives, financial situation and individual needs. 

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