Bespoke Finance Update – December 2014

The Reserve Bank of Australia (RBA) kept the cash rate on hold at 2.5% at the December meeting, continuing the longest run of interest rate stability in over 8 years. The RBA’s recent policy has been to provide a ‘period of stability on interest
rates’ in order to boost consumer confidence and stimulate our economy, with most analysts not predicting a change until mid-2015.

This long running period of interest stability has created a ‘race to the bottom’, with the lenders of Australia capitalising on the cheap cost of funding globally to provide record low interest rate offerings in the hope of attracting new customers. Households in WA have benefitted from these cheap interest rates, with the proportion of income required to meet loan repayments decreasing from 26.6% in the June quarter to 25.9% in the September quarter. Economists regard a ratio of 30% the benchmark for comfortable living, therefore most West Australians are now removed from ‘housing stress’ and are also well below the Australian average of 30.4%

As finance brokers it is our job to guide our clients through the finance process and ensure that they achieve the best possible outcome for their specific situation. With the incredibly competitive lending marketplace and the banks doing all they can to attract business it is easy to get lost in the search for the best outcome – and that’s why we are here to help.

This is a guest blog post by Chris Hazell from Bespoke Finance Group. If you need financial advice, please call Chris on 0403 527 440 or contact him via their website.


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