With these uncertain times placing great stress on finances and financial decisions it is hard to see any good news. In the short term we can expect demand for housing to fall and many homeowners to experience mortgage stress as unemployment rises and consumer confidence plummets. Fear is a key driver in both the property and stock market right now, with wild price fluctuations in ke stocks evident and auction clearance rates falling to very low levels.
While it’s easy to be caught up in the emotion of the time and to start to make knee jerk decisions based on fear, the safer option is to take a deep breath, and to recognise that this coronavirus situation won’t last forever, there is light at the end of the tunnel and now is the time to take stock, assess your financial situation and to make preparations for the economic rebound that is likely to come. Here are some facts to take into consideration.
- Demand for housing has fallen sharply as the restrictions on public gatherings have come into place. Auction clearance rates in Melbourne last weekend were a very low 26%. This doesn’t mean people have stopped wanting to buy – rather right now, in these circumstances, their priorities have shifted. There will be a build up in demand the longer this situation lasts.
- All major banks and most smaller ones are endeavouring to work with borrowers to soften any hardship brought on by job loss or loss of income associated with the coronavirus.
- Governments around the world are making every effort to shore up economies and position them for the transition back to “normal”
- There will be opportunities arise in coming months for canny investors to take advantage of.
- Interest rates remain at all time lows.
The current situation is difficult and hard to negotiate. However, as the threat of the coronavirus eases, the world will return to a somewhat normal footing. As it does, there will be opportunities in both ehe property and stock market to make shrewd investments. Now is the time to position yourself to take advantage of the growing light at the end of the tunnel. For a full appraisal of your current financial situation give the team at Australian Finance Hub a call.