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The Reserve Bank of Australia (RBA) has cut the cash rate to 2.5 per cent – its lowest level since 1959.
It’s a win for investors, with those who have an average loan of $300,000 now likely to save at least $50 per month.
RP Data’s national research director Tim Lawless says the amazingly low interest rates aren’t only helping investors, they’re even adding cash to their hip pockets. He says it now means many residential properties have switched from being negatively geared a couple of years ago to neutrally geared and in some cases, even positively geared.
“With the average discounted variable mortgage rate now approaching the five per cent mark, they’re more likely to find more and more properties are approaching a cash flow neutral or cash flow positive yield,” he says.
“Anecdotally, more and more investors seem to be focusing on rental yield and positioning for long-term capital growth.”
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