Interest rates

Last year I took a gamble and locked in my home loan interest rate at 7.85%. At the time, and for the first half of this year, it looked like it had paid off.

With the recent drops though, I’m not so sure it will in the long term. I’m locked in at 7.85%; the current basic home loan variable rate through the same bank is now 7.94% (though it’s 8.57% for the standard variable rate), though who knows how long it’ll stay that high. People who didn’t get around to fixing their rates may end up ahead.

It’ll be interesting to see how the current financial mess affects the rental market. It may be a minor hiccup in what appears to be an ongoing upwards trend. At one point I was semi-seriously considering the benefits of buying an investment flat somewhere half-decent that one day in 10-ish years when they move out, my kids might live in, subsidised by me. Though at present, my own savings might be in no state to try such a thing.