We’ve been trying to avoid telling you about property prices over the past few weeks, since roller coaster hardly seems to cover the reports of exactly what is happening out there.

But actually, the next few months may pose a good buying opportunity.

Property prices have been steadily falling and the country’s biggest housing markets in Sydney and Melbourne are predicted to slide by another 5 per cent this year with further falls next year according to AMP Capital’s chief economist Shane Oliver.

At the same time, interest-only borrowers are about to face a 30 per cent to 40 per cent hike in their monthly mortgage payments as the honeymoon period of interest-only payments comes to an end.

Faced with a potential $7000 jump in their annual mortgage costs, some borrowers may not be able to afford the extra loan costs and be forced to sell.

According to the Reserve Bank, about $120 billion worth of interest-only loans is on track to convert to the normal principal-and-interest loans over the next three years.

This means that borrowers will face a jump in monthly mortgage repayments by 30 to 40 per cent or $7000 a year for a borrower with a $400,000, 30-year mortgage and a typical five-year interest-free period.

“Some interest-only borrowers may have to consider selling their properties to repay the loans,’’ says the Reserve Bank assistant governor, Chris Kent.

If this is so, there will be more properties coming on to the market.

With inflation slipping a little in the first three months, curtailing any prospect of an official interest rate increase by the Reserve Bank in 2018, this may be the right time to jump into the housing market and potentially snap up a bargain.

Australia’s house prices have been falling for six consecutive months. So far, Sydney’s house prices are down 1.9 per cent and 0.5 per cent on Melbourne, according to property analytics group, CoreLogic.

With the two biggest property markets in Sydney and Melbourne dragging down on the national housing markets, already weighed down by tighter lending standards, Mr Oliver predicts that Sydney and Melbourne property prices will fall by another 5 per cent this year with further falls next year.

So all the stars are being lined up.

The next few months may indeed pose a good buying opportunity for property investors.

See you at the auction on Saturday!

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