The Early Signs Of A Recovery

The closing bell today showed the share market rose more than 1 per cent to a seven-month high, led by property stocks after data regarding the Australian economy was released today.

The figures out today now show Australia is expected to narrowly avoid a technical recession, defined as two consecutive quarters of negative growth

Today’s GDP data was widely tipped to show the economy decreasing in growth for a second consecutive quarter. That has since been reversed after the release of better than expected trade figures yesterday.  Gross domestic product – or GDP – tells us if the economy is growing or shrinking, by measuring the number of goods and services bought and sold. A negative figure means fewer consumers are shopping; companies are producing less and signals the start of a recession – defined as two quarters of negative GDP in a row.

So what about the property market? How will this be affected and those with investment mortgages?

Up until now the property market has been fairly resilient and has only dropped in average price across the board approximately 2.5 percent.  Somewhat less than the majority of stocks and funds that lost around 30 percent in months.

Remembering this is the worst global economic recession in 75 years, it is still a long way to a recovery and a lot more indicators need to present themselves for us to be getting excited about our investment loans decreasing against our equity.

Unemployment is still tipped to reach 9 percent at years end, which directly affects those with mortgages and loans.

Just getting residential and investment loans at present is harder due to the banks ever changing policies.

Times are still tough however the light is definitely shining down the tunnel and it’s starting to get brighter!!