Glimmers of financial opportunity in 2024

WITH JAMIE HYNDMAN FROM TRIBE FINANCIAL

In the understatement of the decade, it’s an interesting time for Aussie households and businesses at the moment – from interest rates to the cost of living crisis, we’re living in a time of great stress and uncertainty.

Yet, reflecting on the last financial year and what’s coming across our desks at Tribe Financial at the moment, I am starting to feel a sense of hope and opportunity.

If we consider some context, for the last half of 2023, refinances were our main game. Having been battered by the RBAs ‘lucky number 13’ of successive rate rises we were all looking for a break. It made sense we were all scrambling for the ‘refinance’ button. Before the RBA got trigger-happy, we were the ones that were trigger-happy, me.

2022 was the year of “I don’t care who gives me money, just give it to me so I can buy something, because I have a morbid fear of missing out” or FOMO as we have now come to know it.

Back to 2024, and what are we seeing in finance land now? We’re definitely still seeing refinances. Not at the same numbers as last year, but they’re still coming to us. And for good reason. Knocking half a percentage point off your average home loan saves you more than $3,000 a year*. Not chump change.

But, we’re also starting to see the thinkers, the creators, and the innovators (thanks Steve Jobs) begin to feel out opportunities. We’re being asked “Is this possible?” and some of our clients are starting to look at how they can capitalise on the market at the moment. We’re seeing our clients explore new property purchases, consider upgrades on current homes, look at commercial property purchases for businesses, and business acquisitions.

Property and asset prices are depressed at the moment, so it makes sense to try to acquire while prices are low. And interestingly, people are starting to actually do things, which brings me back to the glimmers of hope we’re seeing in finance.

People are looking to buy warehouses. They’re buying the adjoining property to the one they already own. They’re starting to expand their business by acquiring the competing business down the road from the retiring business owner. And let’s not forget, that despite current interest rate levels and the general cost of living crisis, the banks still need to lend money to make money. So even the banks are trying to find ways to make things work.

And so while the general household is still struggling under the weight of the cost of living crisis (and we’re not downplaying that at all… it is an absolutely brutal time), those who have a little bit of capacity are recognising that at some point in the next 12 to 24 months, this “cost of living” burden will start to ease and with it, hope will blossom, and financial gains will be recognised.

Considering something similar for you or your business and not sure what’s possible? Or have a question you’d like to ask our team? Email [email protected]

Jamie Hyndman is the director of Tribe Financial, a lending and mortgage broking firm based in Torquay and covering Geelong, the Bellarine and Surf Coast.

*Victoria’s average loan size has reached $601,891, with the average interest rate being 6.27 per cent. Taking a $601,000 loan with a rate of 6.57 per cent to 6.07 per cent reduces the interest payable by more than $3,000 per annum.