GDP Grows 0.4% — Why Your Repayments Aren’t Getting Cheaper Yet
The economy is still growing, and the latest numbers give us a clearer picture of what that means for your repayments and borrowing power.
New figures from the Australian Bureau of Statistics show the economy grew 0.4 per cent in the June quarter, taking annual growth to 2.1 per cent. That’s a steady, if measured, pace of growth — and for anyone with a mortgage or planning to buy, it’s a useful signal for planning your next move around interest rates and repayments.
What’s Actually Happening
Household spending stayed cautious through the quarter, rising just 0.4 per cent, with most categories staying subdued. On the income side, household disposable income rose 1.1 per cent, and dwelling investment increased 1.6 per cent, both modest gains rather than a strong rebound.
The bigger story for borrowers is what is sitting behind these numbers. Three Reserve Bank cash rate rises have already flowed through the economy this year, and the RBA continues to keep a close eye on inflation as it decides its next move. CommBank expects growth to settle to around 1.5 per cent by the end of 2026, and its economists are still forecasting one more rate move before Christmas. That gives borrowers a fairly clear window to plan around, rather than guessing at what’s next.
What This Means If You’re Managing A Household Budget
With more rate movement possible, it is worth building your household budget around a slightly higher repayment, not just today’s figure. Reviewing your home loan now, before repayments rise further, gives you time to make changes on your terms rather than reacting under pressure. It is also worth building a repayment buffer into any new loan decision, so a future rate rise does not catch you off guard.
What This Means If You’re Buying Or Refinancing
If you were pre-approved a while ago, it is worth reassessing that number, since lending conditions and borrowing capacity shift as rates move. Comparing lenders rather than sticking with one option can also make a real difference to what you are offered. First home buyers should set a purchase budget they are genuinely comfortable with, not just the maximum a lender will approve, and anyone looking at investment finance should factor in higher holding costs while rates stay elevated.
The Smart Move Right Now
The economy is not falling apart, but it is not racing ahead either, and that in-between state is exactly when a flexible finance strategy matters most. Keeping your options open and reviewing your position regularly puts you in a stronger spot than waiting to see what happens next.
Want to make sense of what this means for you?
At OM Financials, we make the loan process simple and guide you every step of the way. Speak with our brokers today to understand your borrowing power and the options available to you. Book your free consultation or contact us anytime on 0478 876 967.
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