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3. Newsletter

Hi,

As summer comes to an end, the property market tends to kick into gear. There’s a lot of real estate news around right now, including these four big stories:

– Building approvals trending down.

– Rents rise as vacancies fall.

– Real estate price update.

– Australia sets a refinancing record.

Read more below.

But first….

Some things you might like to know!

– The results of our new poll are out! Our question was: As a business owner, the main reason I would borrow money is for..

– We have 5 more updates for our regional property reports.  The last 3 months of updates are set out below.

– Our 5 suburb comparison report is great for buyers looking to buy in a specific area when they are not 100% sure which suburb to buy in.  And as we know, property prices and trends can often vary significantly between neighbouring suburbs.  Click the link below to find out what you might not know.

5 suburb comparison report

 

#1 Our survey results are in!

Our question was: As a business owner, the main reason I would borrow money is for..

– A commercial property purchase

– An asset purchase

– Working capital cashflow

– More than one of the above

Some observations:

– Interestingly, most business owners are not seeing much need for cashflow borrowing.  Despite this, there are now a number of lenders who operate in this space and they are finding there is strong demand.  I wonder if there is a disconnect on this type of funding or perhaps it is still a small but growing niche.

– I am not surprised that asset purchases and commercial property purchases are the main reasons for borrowing.  Large, lumpy capital requirements are always a good reason to borrow; the logic being that the cost of funds is offset by either capital growth and rental savings (commercial property) or profit generation (asset purchase) – the exception to the latter being a new Porche for the Business Owner 😂

– Although the survey was unable to untangle the ‘multi-purpose’ loan requirements, I am guessing that, in the absence of any other data, this would reflect the proportion of loans in the other 3 categories.

– Unlike home loans where brokers complete over 70% of the loan transactions, in the business space, only 25% of loans are written by brokers.  So for borrowers and brokers, there are a lot of opportunities to ‘do better’.  For borrowers, they may not necessarily be getting the best and most suitable product for their business and for brokers who have the skills to understand business operations and business structures, there are lots of opportunities for growth.

– If you have a business or you know of someone who has a business, we would love to assist them getting the most suitable deal for them and their business.  We are currently organising funding for a commercial property refinance, a large working capital loan as well as a couple of construction builds in the commercial and residential space.  Please make time to have a chat by clicking the link below.

Book a time for a chat!

 

#2 Updates to our Property Market Reports.

These Reports are a great resource for those looking to buy in a new region or just to get a feel for what is happening in that region. Each Report also includes a suggested recommendation to Buy / Hold / Sell.

Updated Regional Property Reports

Here are the last 3 months’ updates of these detailed regional reports (including the property clock: Buy / Hold / Sell).

There are 30+ regions analysed and they are updated regularly.

Get your Free Property & Regional Reports!

 

The number of new homes that will be built in the coming years appears to be falling, judging by the latest data from the Australian Bureau of Statistics.

Fewer building approvals were issued in 2022 than 2021, for both houses and other dwellings (which are mainly apartments, but also include townhouses, semi-detached houses and row or terrace houses):

– Approvals to build houses = fell from 145,833 in 2021 to 114,179 in 2022.

– Approvals to build other dwellings = fell from 77,096 in 2021 to 70,062 in 2022.

There’s usually a lag of several months, and sometimes several years, between when an approval is issued and construction begins. And, sometimes, construction never begins at all, because the individual or developer decides not to proceed with the project. However, it’s likely that the reduction in approval numbers in 2022 will translate to a reduction in home building activity in the coming years.

Would you like to build a new home, either to live in or for investment purposes? If so, get in touch and I’ll be happy to explain how construction finance works, and the difference between a construction loan and a regular home loan.

Need a construction loan? Let’s talk!

 

Property investors are enjoying strong growth in rents, thanks to the severe shortage of rental properties.

Across Australia, just 1.0% of rental properties were vacant in January, according to SQM Research. That was down from 1.6% the year before.

The reduction in rental supply has led to an increase in demand, which in turn has made tenants more willing to pay higher rents.

Asking rents jumped by a remarkable 17.4% in the year to February 12, according to SQM.

Vacancy rates are low and rents are rising in many parts of Australia, which means now might be a good time to buy an investment property.

Reach out if you’d like to discover your borrowing capacity and discuss how you could finance a potential purchase.

Get in touch if you need an investment loan!

 

In the case of the Australian property market, what goes up tends to go down less.

History shows there are periods when prices rise, as occurred from late 2020 to early 2022, and periods when prices decline, as has occurred over the past year or so. But, over the long-term, the increases have tended to far outweigh the decreases.

That’s reflected in new data from PropTrack, which compared property prices in January 2023 with prices just before the pandemic, in January 2020.

Across Australia, prices were 29.4% higher in January 2023 than January 2020.

PropTrack economist Angus Moore said that while recent price falls “are not insignificant”, they are occurring after an extraordinary boom, with 2021 being the third-fastest year of national price growth on record.

“While anyone that bought near the peak in 2022 has probably seen their home value fall relative to when they bought, most homeowners aren’t in that boat. That’s because the vast majority of Australians bought before that peak,” he said.

Reach out if you want to buy a property!

 

Home owners have been doing an extraordinary amount of refinancing since the Reserve Bank began raising the cash rate in May 2022.

The eight months from May to December included the eight biggest months in refinancing history, according to the latest data from the Australian Bureau of Statistics.

That included $19.4 billion of refinancing in November, the biggest month on record, followed by another $19.1 billion in December, the second-biggest month.

Lenders compete fiercely for business, so they often charge lower interest rates for new customers than existing customers.

That’s why it’s possible to score a significant rate reduction by switching lenders.

Even better, some lenders are offering cashback deals of several thousand dollars to people who refinance.

Refinancing comes with pros and cons, so it’s important to do your research and crunch the numbers before switching lenders.

I can help. Get in touch and I’ll talk you through your options, so you can find out how much you could save by refinancing and whether it’s right for you.

Get refinancing help!

Hi,

I hope you and your family had a great Christmas break. Even though it’s early in the year, there’s already some big news around:

– Refinancing hits new record

– Property listings rise 4.6%

– 3 key fixed-rate loan tips

Read more below.

But first….. 3 things!

#1 Our survey results are in!

Conveyancer Vs Property Lawyer?

Our question was: As a property purchaser, would you use:

– A conveyancer

– A property lawyer

– Someone who does both

Some observations:

Personally, I like to use a conveyancer who works closely with a property lawyer or alternatively, a property lawyer. The reason being that if something goes awry, I want my conveyancer to be onto it like a dog with a bone. I don’t want to have to suggest and then engage a property lawyer at the last minute (I had a client who was once in that position and it was painful for all concerned 😥)

Property lawyers can cost a little bit more than a conveyancer (but not always a lot more) and for run-of-the-mill property transactions, you might think “Is this overkill?‘ But for me, I come from the perspective ‘I am not the expert and I don’t know what I don’t know‘ so I rely on the legal and property experts to assist me. I would call those extra few hundred dollars I might need to spend as my insurance policy!

And if there is complexity but I don’t understand the complexity, I don’t want my conveyancer to assume I have already obtained appropriate legal advice (noting that conveyancers cannot give legal advice).

#2  Updates to our Property Market Reports.

These Reports are a great resource for those looking to buy in a new region or just to get a feel for what is happening in that region. Each Report also includes a suggested recommendation to Buy / Hold / Sell.

Updated Regional Property Reports

Here are the last 3 months’ updates of these detailed regional reports (including the property clock: Buy / Hold / Sell).

There are 30+ regions analysed and they are updated regularly.

Get your Free Property & Regional Reports

#3  Phil Anderson – Guru or ….?

If you don’t know or have not heard of Phil Anderson, you are not alone. He runs a business called Property Share Market Economics and pre-COVID, he presented at a CBRE property seminar.

Phil has a contrary view on all things economic to what you might read in the media. As he says, the economy runs off the back of the price of land and the economic rent of land. And most economists don’t factor this relationship (and the cyclical nature of this relationship) into their economic forecasts.

Phil’s food for thought: Phil believes the property market runs in a predictable cycle (18.6 years is pretty precise!) and that the next peak is in 2026/27.

Further, he is predicting banks, with their higher margins from the interest rate increases will be increasing access to credit which will fuel the next series of price rises. On this I am in agreement – and, watch out for bank profits to go up even higher as a result.

Now, whether you think Phil is blowing steam from you know where or whether you agree with him, the interesting thing is that he is bullish on the property market for the next few years. And, he says he has data on his side. Of the last 10 cycles of interest rate increases, the price of property has increased 9 times (and in the 10th it went sideways).

So there you have it!

 

Mortgagees refinanced a record $19.5 billion of home loans in November, the Australian Bureau of Statistics (ABS) has reported.

That included $13.4 billion of owner-occupied loans (also a record) and $6.1 billion of investment loans (the second-highest on record).

The ABS had a simple explanation for the astonishing amount of refinancing that occurred in November: “More borrowers switched lenders for lower interest rates as the RBA’s cash rate target continued to rise.”

There are two reasons why so many people are able to find lower-rate home loans at other lenders.

First, rising interest rates are causing people to shop around, because not all lenders are increasing rates at the same pace.

Second, with so many lenders in the market, competition for business is fierce, so institutions often charge new customers lower rates than their existing customers.

If you like the sound of switching to a home loan with a lower interest rate, get in touch. I’ll compare the market on your behalf and give you multiple options to choose from.

Want to compare interest rates? Let’s talk!

 

In a strange twist, the number of properties listed for sale has increased, even as the number of homes coming onto the market has decreased, according to SQM Research.

At first glance, it appears as though there must be fewer for-sale properties. That’s because, across Australia, the number of new listings (those that had been on the market for less than 30 days) in December was 22.4% less than the year before.

However, while fewer new homes are being listed for sale, those already on the market are taking longer to sell. In December, the number of listings that had been on the market for more than 180 days was 14.3% higher than the year before.

However, while fewer new homes are being listed for sale, those already on the market are taking longer to sell. In December, the number of listings that had been on the market for more than 180 days was 14.3% higher than the year before.

As a result, the total number of homes listed for sale in December was 4.6% higher than the year before.

SQM Research managing director Louis Christopher said the rise in older listings appears to be uniform across cities and towns, and is typical of what happens in a housing downturn.

“As there remains more sellers than buyers, dwellings on the market that are not priced to market, don’t sell,” he said.

Get in touch if you need a home loan!

 

If you fixed your home loan in early 2022 or before, and your fixed period is going to expire this year, it’s important to prepare yourself for higher interest rates.

That’s because, once your fixed period ends, you’ll revert to a variable loan, whose interest rate will almost certainly be higher.

Since May 2022, the Reserve Bank has raised the cash rate by 3 percentage points, and most banks have increased their variable rates by a similar amount.

Here are three tips to prepare yourself for a rate rise:

– Pretend your interest rate has already increased by 3 percentage points and pay the extra amount into a special savings account each month

– Look for ways to reduce your discretionary costs, such as by holidaying domestically rather than internationally or buying a used car rather than a new vehicle

– Speak to a broker ahead of time about refinancing to a lower-rate home loan once your fixed period ends

Many lenders offer special inducements to refinancers, including lower interest rates and cashback deals, which is why refinancing can be such an effective tactic.

Get in touch if you want to refinance!

 

The Australian Banking Association, which represents the country’s biggest banks, will make changes to the Banking Code of Practice to better protect customers.

In response to the 2021 Independent Banking Code of Practice Review, the ABA has said it would:

– Accept clear statements about customers’ rights and how to enforce them.

– Ensure banking services are inclusive of people of diverse sexual orientations and gender identities.

– Update the definition of a ‘small business’, to protect an additional 10,000 small business customers.

– Update the definition of a ‘vulnerable customer’, to better recognise that anyone can be vulnerable at any time.

The changes around vulnerable customers will also clarify the type of support available to all customers, including financial difficulty options for small businesses or those needing access to external support services such as interpreters and financial counseling.

The ABA has started work on drafting its amendments.

The ABA’s membership includes 20 of Australia’s largest banks, including the big four banks, Macquarie Bank, Bendigo & Adelaide Bank, Bank of Queensland and ING.

Hi,

Christmas is just around the corner, so if you haven’t done your shopping it might be wise to start now. In the meantime, here are four stories I think you’ll like:

– Borrowers pass their ‘rate buffer’

– Govt tackles housing affordability

– Australian property earns praise

– ABS releases good economic news

Read more below.

 

And for the business owners amongst you,

we have snuck in the results of our most recent survey (towards the end 😉)

This month’s survey question: 

If you were borrowing money for your business, would you…..

  • use your transaction bank
  • a specialist lender
  • a broker

(Scroll to the end to see the results – and our commentary!)

Plus…..

Updated Regional Property Reports

Here are the last 3 months’ updates of these detailed regional reports (including the property clock: Buy / Hold / Sell). 

There are 30+ regions analysed and they are updated regularly.

Request FREE Report

 

 

The mortgage market has entered interesting territory, thanks to the Reserve Bank’s decision to hike the cash rate by another 0.25 percentage points in November.

That increased the rate rises that have occurred since May from a cumulative 2.50 percentage points to 2.75 percentage points.

The reason that’s significant is because when lenders assess home loan applications, they have to make sure the borrower could repay the loan if interest rates were to rise.

Until October 2021, lenders had to add a buffer of at least 2.50 percentage points – so the November rate rise pushed many borrowers beyond their buffer.

Since October 2021, that buffer has increased to at least 3.00 percentage points

But despite the series of rate rises, CoreLogic isn’t seeing any signs of panicked selling or forced sales in its listings data.

“In fact, the flow of new listings remains substantially below what they would usually be for this time of the year,” executive research director Tim Lawless said.

Reach out if you’d like to discuss refinancing. I can explain the pros and cons, and potentially help you refinance to a comparable loan with a lower interest rate.

 

One of the highest-profile elements of the Albanese government’s first budget was a target to “build one million new well-located homes over five years from 2024”.

Only 2% of these one million new builds will be funded by the federal, state and territory governments; the other 98% will come from the market, with governments “playing a key role in enabling and kick-starting investment”.

CoreLogic’s head of residential research, Eliza Owen, noted that some have said the target lacks ambition, given that 974,732 homes were constructed in the five years to June 2022, and an average of 1,010,723 have been completed on a five-year basis since 2017.

One of the highest-profile elements of the Albanese government’s first budget was a target to “build one million new well-located homes over five years from 2024”.

Only 2% of these one million new builds will be funded by the federal, state and territory governments; the other 98% will come from the market, with governments “playing a key role in enabling and kick-starting investment”.

CoreLogic’s head of residential research, Eliza Owen, noted that some have said the target lacks ambition, given that 974,732 homes were constructed in the five years to June 2022, and an average of 1,010,723 have been completed on a five-year basis since 2017.

“However, the past five years have been conducive to high levels of construction (notwithstanding immense bottlenecks for the construction industry in the past two years) and there’s no guarantee activity levels will remain at the same level for the next five years,” she said.

“As interest rates rise, home prices fall and supply-side constraints persist, the delivery of a million homes is not guaranteed and may be more ambitious than what was achieved in the past five years.”

 

Australia’s population is set to grow strongly over the next decade, which is likely to lead to higher demand for rental accommodation.

Global real estate giant CBRE said population growth is one of the main reasons why “Australian real estate represents a compelling investment”.

CBRE said Australia’s population was expected to grow by 14% between 2021-2030, which would be the highest rate among developed economies.

That strong population growth is partly due to migration, with the federal government recently increasing its annual permanent migration intake from 160,000 people to a record 195,000.

More competition for rental accommodation would put upward pressure on rents, in an environment that’s already strongly favouring landlords. As CBRE noted, there is “less than 1% vacancy in select markets”, which is leading to “robust rent growth”.

CBRE forecasts that from 2022-26, rents will increase by an average of at least 5% per annum in Sydney, Melbourne, Brisbane, Perth and Adelaide.

 

Australia’s economy has posted its best growth numbers in a decade, according to the most recent data from the Australian Bureau of Statistics.

The economy grew 3.6% in the 2021-22 financial year – the best result since it grew 3.9% in 2011-12.

That strong economic growth has helped drive down the unemployment rate to below 4%, which is very low. As a result, the vast majority of workers have jobs, which is the key to being financially secure.

The ABS also reported that households saved 13% of their income in the 2021-22 financial year, which is high by historical standards.

That means many people put money aside for a rainy day – a smart move given the subsequent increase in prices and interest rates.

The Reserve Bank said earlier this month that it “expects to increase interest rates further over the period ahead”, so if you have a home loan, it would be wise to budget accordingly.

Two possible ways to save money are to ask your bank for a rate cut (you’d be surprised how often they agree to this) or to refinance to a comparable loan with a lower interest rate.

 

This month’s survey results are in!

If you were borrowing money for your business, would you…..

The interesting thing here is that whilst 70% of borrowers consider using a broker for their residential property loan, business owners still prefer to use their bank.

 

This is interesting for a few reasons:

– Transaction banks are not always the best solution for business finance.  That is why there has been a proliferation in the growth of non-bank lender finance for businesses.

– Using property security for business purposes may work when there is an asset being acquired and the asset is the property which is being used as security.

– However, for other business purposes e.g. working capital finance, cashflow finance, ‘urgent cash’ finance and debt consolidation finance, other types of security might work better – particularly in terms of turnaround time and flexibility of the amount able to be borrowed.

– There are now non-bank lenders offering not just invoice finance (commonly referred to as debtor finance or factoring) but also trade finance where the supplier’s invoices are financed so the supplier remains happy as they are being paid on time. This can be particularly relevant for purchases from overseas suppliers who don’t like to ship their stock if they haven’t guaranteed payment is going to be received.

– Sometimes (e.g. for a property acquisition), the business owner is using the business entity to hold the asset.  However, the assets can be held in other entities which might be more appropriate eg a super fund, or a trust. Typically, we see good tax accountants assist business owners make this assessment.

We can help you work out the best way to fund the cash your business needs in order to grow.  And, as a broker, we can introduce you to the lender which will best suit the needs of your business.

Hi,

Supply chains are still not back to normal, so it might be wise to start ordering your Christmas presents now. In the meantime, here are four big property and finance stories:

– Property buyer breakdown

– Regional scheme goes live

– Home loan landscape changing

– Buyers value energy efficiency

Read more below.

 

But first…. our monthly survey results 😉

How much can you save by

checking and renegotiating your variable interest rate with your lender?

This result is interesting for a number of reasons:

1. Over $1,000 a year saving is a lot of lattes!

2. If there is money to be saved, then it is important that borrowers who don’t want to pay more than they should to their lender, get cracking! Particularly if they don’t use a broker 😉

3. If they use a broker, it is important for borrowers to make sure their broker is doing this for them – at least once a year. (We have now started this process for our clients so watch your inbox for an email from us if you have a Variable Rate loan we have organised for you over 12 months ago 👍)

4. In the current changing interest rate climate, lenders are making hay – at their borrowers’ expense – as no one can keep up with the constant and rapid interest rate increases.

5. The ACCC’s 2020 report on home loan interest rates suggested that borrowers were paying FAR too much interest compared to the best rates in the market.  And, to make matters worse, the longer the borrower had been with a lender, the greater the difference between this ‘best rate’ and the rate they were being charged by their lender.  Check out the table below.

So, if you would like us to do our FREE rate review for you (whether we organised your loan or not), just reach out and I will get our team cracking to see what we can save you!  Just click the link below to get this moving!

Contact Us

 

New analysis has found that different buyer groups respond quite differently during downturns – with the current slowdown fitting the historical pattern.

“The main difference between the buyer types over historic downswings is that first home buyer demand for finance has traditionally been more resilient through downswings, with subtler declines in demand, and during some periods, increases,” according to CoreLogic’s head of residential research, Eliza Owen.

“Subsequent home buyers and investors have seen a more distinct decline in demand for housing finance initially through downswing.”

Ms. Owen’s research findings came after studying downturns in 2004, 2008-09, 2010-12, 2015-16 and 2017-19.

Since April (when national home values peaked) and August (the most recent month for which the Australian Bureau of Statistics has data) the value of new home loans fell:

– 9.9% for first home buyers (owner-occupiers)

– 10.8% for subsequent home buyers (owner-occupiers)

– 20.1% for investors

I can help you enter the market, whether you’re a first home buyer, an upgrader or an investor.

 

The federal government’s first home buyer support package for regional Australians has been launched, as of October 1.

Here are the key details of the Regional First Home Buyer Guarantee:

– The scheme is limited to owner-occupiers

– Eligible buyers can enter the market with just a 5% deposit

– You don’t need to pay lender’s mortgage insurance

– You must buy in a regional area

– You must have been living there, or in an adjacent area, for at least 12 months

– Income limits apply ($125k for singles, $200k for couples)

– Price caps apply (which vary from area to area)

The government has allocated 10,000 places per financial year to this scheme.

“Australians living in regional areas have faced some of the largest drops in housing affordability, making it increasingly hard for locals to save a sufficient deposit,” according to Housing Minister Julie Collins.

“The Regional First Home Buyer Guarantee will help aspiring first home buyers living in regional Australia realise home ownership sooner by overcoming the deposit hurdle.”

 

Over the past six months, the average person’s borrowing capacity has fallen by about 25%.

That’s because the maximum amount a typical person can borrow falls by about 5% every time the Reserve Bank increases the cash rate by 0.50 percentage points, according to the Reserve Bank’s head of domestic markets, Jonathan Kearns.

Since May, the cash rate has jumped by 2.50 percentage points, which is why borrowing capacities have fallen by about 25%.

As a result, it’s become harder to qualify for larger loans; and harder for some borrowers to qualify for any loans at all.

If you want to buy your dream home, it’s a good idea to consult an expert mortgage broker. Here’s why:

– Your borrowing capacity varies from lender to lender

– Brokers work with a large, diverse panel of lenders

– So they can recommend lenders that want to do business with borrowers like you

– They can present your application in a way that appeals to the lender’s individual criteria

Unfortunately, if you try to manage the application process yourself, you might choose an unsuitable lender or present your application incorrectly – and potentially get rejected.

 

Property buyers are placing increasing importance on energy efficiency, according to research from realestate.com.au.

A survey found 56% of consumers believe energy efficiency is extremely important, compared to 48% for the same survey last year.

The top five reasons people thought energy efficiency was important was so they could:

– Reduce their energy bills 76%

– Do good for the environment 57%

– Reduce their carbon footprint 53%

– Reduce their chance of bill shock 50%

– Live in a better-designed property 44%

 

And the top five sustainable property features that interested them were:

– Solar power 71%

– Efficient lighting 63%

– Insulation 60%

– Air flow 59%

– The position of the home relative to the sun 58%

 

Meanwhile, the top five keywords that buyers entered when searching for energy-efficient features on realestate.com.au were:

– Solar power 93.3%

– Energy efficiency 3.6%

– Double-glazed windows 1.2%

– Hydronic heating 0.6%

– Star rating 0.5%

Hi,

We’ve made it to spring! As the season changes, so does the property and lending landscape. Here are four stories making headlines right now: 

– Rentals being snapped up

– Houses v units

– Prices surge for new land

– Savings rates above 3% p.a.

 

Read more below.

 

But first….

The results of our recent survey

What is the most important quality of a

mortgage broker?

Our thoughts on this survey

Objectivity – 48%

Objectivity is so important. And, our policy of always being totally transparent allows us to demonstrate our objectivity.

To achieve transparency, we use a filtering process – which we share with you every step of the way:

1. We identify who will lend to you in your circumstances (these days, everyone’s circumstances are different).

2. We then clarify a lender’s willingness and capacity to lend to you with their humans – just to make sure. 

3. Only then do we check the rates for those who can and will lend to you.

4. From this rate review, we will give you the short list of these ‘willing and able’ lenders – to get your input via a discussion with us.

5. And only then do we finalise our recommendation.

 

Communication – 31%

Whilst transparency is key, so is communication. 

With your loan, we communicate with you in a number of ways. 

1.  To save you time and to avoid errors and duplications, we use technology to gather information about you as well as receiving your documents which lenders will need to see. 

2. We will regularly ring you, SMS you and email you (and sometimes a combo as we all know how emails, voice mails and even SMSs can be missed or overlooked when we are busy!).

We also follow a 3-day follow-up process – which you can of course vary at any stage (faster or slower).  Every 3 days we will reach out to you to make sure you don’t need any help or time to get the next bit done.

 

Simple to use processes – 14%

Our processes have been designed to be easy to use.  However, where you need us to vary our processes to suit you, we will do so!  After all, we are here to serve you! 

 

Speed – 7%

Speed is important but speed without Objectivity, Communication and Ease of use is not worth a lot to you.  And, dare we say, we know of some brokers who are ‘fast to lodge’ but then have to backtrack when the lender they have chosen says ‘no’.

We see our role as avoiding (or at least minimising) the risk of you receiving a lender No.

 

And, a quick sample of our free services for you!

Rate Checker

Every year (as a minimum), for our clients with a Variable Rate loan, we will do a rate check for you (if you have a settled loan with us, you will get an email to get this started).  We will do the following:

1. Check your rate with your current lender’s best rate for the same product you have.

2. Find a comparative rate for a similar lender with a similar product.

3. Write to your lender or use their online broker portal to request a rate review.

4. And hopefully, we can come back to you with some good news regarding a sharper rate! 😉

It’s a simple process and all you need to do is send us your most recent bank statement and any subsequent rate change advice from your lender.

 

Property Reports

Via our Free Property Report link www.bir.net.au, investors and homeowners can:

– Order a free property report for a particular property.

– Order a suburb report or a comparison of up to 5 suburbs.

– Access detailed regional reports (over 30 including the capital cities) which include a Property Clock (is it time to buy, hold or sell?).

In September, we updated reports for:  Canberra  [ACT]  <  >  Launceston  [TAS}  <  >  Melbourne  [VIC]  <  >  Mackay  [QLD]  <  >  Wollongong  [NSW]  <  >  Darwin  [NT].

 

Property investors are enjoying strong demand for their rental properties right now, with that demand expected to further increase.

The number of homes available to rent has been trending lower since the pandemic began, with listings in July 2022 31% lower than March 2020, according to realestate.com.au.

As a result, tenants are being forced to compete harder, which is leading to rising rents and lower days on market.

“Australia-wide properties are renting faster than ever, and the number of days it took a rental property to be leased after it was listed on realestate.com.au in July hit a historic low 19 days,” according to the portal.

REA Group senior economist Eleanor Creagh said a “surge” in international student arrivals would add further pressure to tight capital-city rental markets.

“In fact, overseas searches to rent have also skyrocketed in recent months, in the last six months compared to the six months prior overseas rental search volumes are up 59% with the borders having reopened,” she said.

 

Houses have significantly outperformed units over the past three decades, according to CoreLogic.

During the 30 years to July 2022, median prices increased 453% for houses compared to 307%.

That outperformance occurred in every capital city market:

– Sydney 507% v 340% (houses v units)

– Melbourne 519% v 354%

– Brisbane 390% v 170%

– Perth 325% v 194%

– Adelaide 370% v 289%

– Hobart 423% v 296%

– ACT 431% v 261%

– Darwin 98% v 96%

CoreLogic said the faster rate of growth for house prices was “likely a reflection of the scarcity value of land driving a faster rate of appreciation”.

During the same 30-year period, capital cities (409%) recorded significantly more growth than regional markets (294%).

“The higher growth rate across the capital cities probably reflects a combination of higher demand and greater scarcity of supply compared with regional markets, along with more diversified economic conditions within the capital cities,” according to CoreLogic.

 

New research by the Housing Industry Association and CoreLogic has found that the supply of new residential land is failing to keep up with demand.

Median lot prices in the March quarter were 19.7% higher than the year before, based on an analysis of 51 housing markets across Australia.

HIA senior economist Nick Ward said this was the strongest annual growth rate since 2004.

“An unusually sharp rise in the price of residential land indicates the supply of land is not keeping up with new demand that has emerged during the pandemic,” he said.

“Constrained supply of land will limit housing activity in greenfield areas from mid-2023 onwards.”

CoreLogic economist Kaytlin Ezzy said the increase in land prices was connected to a reduction in the number of lots sold.

“While increasing interest rates, rising construction costs and increased uncertainty, particularly across the building industry, has likely smothered some land demand, the surge in land prices suggests that those that want to build are finding it difficult to secure lots,” she said.

“With land often taking more than a decade to move through the development pipeline, it’s unlikely we’ll see any material change in land supply for some time.”

 

Rising interest rates are bad news if you’ve got a home loan. But they’re a blessing if you use savings accounts.

Six banks are now offering ongoing savings rates above 3% p.a., according to a RateCity analysis of the market.

Research director Sally Tindall said if your savings rate is below the cash rate [currently 2.35% p.a.], you’re being taken for a ride.

“There is competition in the market, you just have to get up and look for it. In this environment, a good rate is around 3% p.a., potentially even more,” she said.

 

How to get an even higher interest rate

If you have a home loan, there’s a way you can earn an even higher interest rate – by depositing money in your offset account.

The money in your offset account reduces the interest-bearing portion of your home loan by the same amount. For example, if you have $500,000 outstanding on your loan and $40,000 in your offset account, you’ll be charged interest on only $460,000 (i.e. $500k minus $40k).

As a result, the return you get on offset deposits is equivalent to your mortgage rate, which will almost certainly be higher than the rate paid by a conventional savings account.

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