28 10.14 4:14

A must read for PROPERTY OWNERS and BUYERS!!!

Every year we provide you with this invaluable annual report, the QBE / BIS Shrapnel “Australian Housing Outlook 2014 – 2017″.

Here is what QBE / BIS Shrapnel had to say.

Housing price growth will slow from it’s dizzy growth over the past 18 months (no surprise there!). However, eastern states will continue to see significant growth. Brisbane 17%, Sydney 9%, Melbourne 5%, Adelaide 6% and Hobart 6%. Lagging somewhat behind will be Darwin 2%, Canberra 1% and Perth is expected to a decline of about 2% over the period.

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Nationally, economic growth is expected to remain muted. Consequently, there seems to be no significant impetus for the RBA to rush to the levers and raise interest rates. Interest rates are expected to increase by a modest 1% over the forecast period.

There remains some difficulty in accurately determining the various sectors comprising the property market, as the ABS data on first home buyers is known to be highly unreliable. However, it is clear that the number of first home buyers continues to dwindle (although possibly not as significantly as some may believe). By far the most active market segment at present is investors. This is expected to continue, although their numbers will gradually diminish as rising property prices and rising interest rates affect rental yields.

The full report can be read on the QBE LMI website at http://www.qbelmi.com/pg-Publications-and-Presentations.seo .

Towards the end of this report you will see a series of charts that compare BIS Shrapnel’s predictions to the outcomes. It is remarkable how accurate they have been over a relatively long period of time.

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12 10.14 3:36

Which DIRECTION will the RBA go from here???

Most media outlets have already informed you about the RBA’s decision to keep the cash rate on hold…you can check out the statement from the Governor of the RBA here – http://www.rba.gov.au/media-releases/2014/mr-14-18.html

The RBA cash rate has not moved from 2.50% p.a. for 15 CONSECUTIVE MONTHS!!!

Our ongoing interest rate chart shows that basic variable, 3 year fixed and 5 year fixed rates have converged.

In particular, fixed interest rates are sitting at historically low levels. This has made many people think a lot more about the option of locking in an interest rate for a fixed term. This decision should not be made lightly. If you are inclined to seriously consider fixing your home loan, please call me sooner rather than later, to spend some time to discuss the pros and cons…you can also check out my BLOG about fixed / variable interest rates here…Fixed v Variable

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According to the ASX futures market, the outlook for variable interest rates is remarkably stable. They are speculating that the RBA will keep the cash rate at 2.50% p.a. for a further 18 months!!!

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The Aussie dollar is an economic indicator that is worth keeping an eye on if you are wishing to understand the RBA’s cash rate decisions. If the Aussie dollar drops in value against the USD (which is happening at the moment), this theoretically gives our RBA more flexibility to lift rates. If inflation lifts we could potentially see a rate rise. Having said that, inflation remains low so the above chart reflects the general sentiment that variable interest rates should stay low.

As always, please don’t hesitate to call me if you would like to discuss your current situation.

NOTE: If you have a variable interest rate that begins with a 5, we should talk through your savings options.

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5 10.14 10:18

How to you pay off your mortgage QUICKLY???

Taking out a loan is a long-term process. Often people lock in interest rates or specific types off lending, like an interest-free investment home loan, for a period of five years or more before changing any details. Others work with mortgages over the course of decades, paying off a family home.

Whatever the case, it is something that takes a very long time – but there are ways you can cut down on that mortgage period!!

Here are some tips on reducing the length of that loan.

Pay

Dumping the ONE-OFFS

We all love to be treated to an extra bit of money, but sometimes it is wiser to put these one-off monetary boosts into a mortgage. Perhaps you received a healthy tax refund this year, or were given a big work bonus? Put these extra funds into the mortgage every time, and in the long term you’ll be able to cut years off your home loan.

Don’t follow the RATE CUT

When interest rates fall, don’t follow them down! You may be contributing a little more per month than you absolutely have to, but this will pay huge dividends down the line. And if interest rates rise, you’ve got plenty of breathing room.

Bump up that OFFSET ACCOUNT

You can save thousands by creating an offset account with your loan. While you pay interest on the full amount of a loan regularly, any money put in an offset account will reduce this total amount of borrowing on which you pay interest. If you come into a large amount of money or have healthy savings going into a loan application, you should consider this to shave time off your mortgage repayment period.

Pay it FORWARD

What’s more, you can make savings and cut down on time spent making payments by having wages paid into your offset account. Interest is calculated daily, so any one day you have more money in this account is a day you pay less interest!!

If you want to find out more details about where identifying the best options in a home loan for you, just drop me a SMS or give me a call on 0407 642 484, or send me an email to dutz@smartline.com.au to find out how I can help you.

Remember, I am only too happy to help out!!!

 

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5 10.14 10:10

3 refinancing MISTAKES to AVOID!!

When you refinance a loan, it is easy to get caught up in questions of how much you can borrow and how quickly it can be organised.

This means you can forget some simple factors that have the potential to jeopardise your new mortgage.

By avoiding these mistakes, but also engaging the services of an experienced Mortgage Broker, you will greatly improve your chances of successfully refinancing your debt!!!

Refinancing 3

Ignoring the LVR

When your loan value ratio (LVR) is above 80 per cent for refinancing, you can incur lenders mortgage insurance, even if you already paid this on your first loan. One way this can happen is if you try to refinance when your home has lost value, as any equity will be reduced.

This is a risk for self-employed borrowers in particular, who already have a higher LVR and interest rate. Protect that equity and make sure you refinance at the right time!

Forgetting about the FEES

It’s all too easy to assume that you will be better off refinancing your loan based solely on the difference in interest rates between the old and new loan. However, it’s crucial to look at all of the fees involved.

While exit fees don’t apply to loans established after 2011, discharge and establishment fees can – and don’t forget about stamp duty if you are purchasing a new property! Total all of these up and determine whether the fee costs will outweigh the savings you stand to make on interest.

Not getting a wide range of QUOTES

When you wish to refinance, it can be easy to just jump into the first offer you come across. However, to get the best deal on your new home loan it’s imperative to look at all of your options. By engaging a mortgage broker you can cut out a lot of work on this end. A broker will collate a wide range of loan products from dozens of lenders and bring you a set of lending options that suit your needs.

If you want to find out more details about where identifying the best options in a home loan for you, just drop me a SMS or give me a call on 0407 642 484, or send me an email to dutz@smartline.com.au to find out how I can help you.

Remember, I am only too happy to help out!!!

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4 10.14 6:49

Choose a home loan with SMART FEATURES!!!

There are tons of options to think about when choosing a home loan, from the current interest rate to whether you prefer a fixed or variable rate mortgage.

But the features that you can include as part of your home loan are also an important thing to bear in mind. The right features can make the process of monitoring and repaying your loan smooth and straightforward – and can even save you money in the long-term.

Pay off your loan FASTER!!

Certain home loans have features that allow you to pay off the balance faster than the terms set out in your agreement with your lender.

Over the long-term, extra repayments can save you thousands of dollars of interest, and shave years off the term of your loan. Some features you may wish to bear in mind include the ability to make extra repayments whenever you like, or changing your payment frequency.

For example, making fortnightly payments instead of monthly ones can help you pay an additional month’s worth of mortgage repayments every year – after all, there are only 12 months in a year, but 26 fortnights!

Use your home loan to CONSOLIDATE your debts

Some home loans will allow you to consolidate your other debts into one single payment – and best of all, the interest rate is often lower as a result. If you already have a personal loan, credit card or car loan – and you are disciplined about your finances – this can be a useful solution.

OFFSET your loan

Have you considered that the money you have in other accounts can be used to reduce your mortgage? Ask your broker about 100 per cent offset accounts.

These handy options let you make efficient use of every cent you have and allow you to use the balance of your cheque or savings account to offset your mortgage. Ask your broker about your various offset options – there’s bound to be one that works well for you.

If you want to find out  more details about where identifying the best options in a home loan for you, just drop me a SMS or give me a call on 0407 642 484, or send me an email to dutz@smartline.com.au to find out how I can help you.

Remember, I am only too happy to help out!!!

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4 10.14 4:28

Common questions about taking out an INVESTMENT LOAN

With the housing market in Australia so strong and home prices on the up, it is no surprise that many people have decided to take out home loans in droves for investment in the property market.

These investments allow people to offset taxes against rental yields, and watch a property appreciate (hopefully!!!) in value over a long period of time.

Investment Loans

What’s the worst that could happen?

Overall, the likely worst situation you’ll find yourself in when investing in a property is failing to find good tenants, thus, not making any money on your purchase. Good maintenance and advertising can fix this by appealing to tenants all year around, but it’s important to make sure you can cover mortgage repayments without rental income before you take the plunge – just in case.

How do you maximise growth?

The key to this is RESEARCH!!! Take an in-depth look at the area you want to invest in and find out how much growth has occurred for rental yields and overall property value. Is it an area that will have high rent increases, or perhaps one that will be a slow-burner, giving you strong home value returns a decade from now? Depending on your financial situation, you will want different things. Talk to experts and make sure you invest wisely and for the future.

Which kind of loan do you take out?

This depends on how you wish to gear your property, whether you intend to maximise rent gains or to negatively gear your property and have it be tax deductible. However, an interest-only loan is often recommended for investment home loans, especially if you intend to change items in your portfolio relatively regularly. This allows you to pay off interest, claim tax deductions and, if you invest intelligently, make profits from rises in property value.

What if I don’t have enough to deposit on a new loan?

If you already own property, you may be able to leverage equity from your existing property as part of an investment loan on a new property. As an experience mortgage broker, I can fill you in on the details, as well as help you choose a suitable type of loan for your next move.

Please give me a call to discuss your investment property loan options in more detail…I would love to be able to assist you increase your financial health!!!

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2 10.14 10:14

Smartline is the No.1 Franchise in Australia…AGAIN!!!

Smartline Personal Mortgage Advisers has just taken out the Top Franchise competition for 2014!!!

This award is a direct measure of franchisee satisfaction, and we have to compete against franchise groups from completely different industries.

This is the sixth year in a row that we have defended our No.1 position and once again, we would like to thank you and all of our terrific clients for continuing to support our business. Over 90% of our clients come to us by way of a personal referral, so it is you that we need to thank for our success.

The last six years have been terrific for Smartline. We have now grown into a mortgage advice business that rivals (and often exceeds) the size of many banks, building societies and credit unions. We now have over 120,000 active clients and we help around 500 people into home loans every week.

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The table above only shows a ranking of the top 10 Franchise Groups. Understandably, groups that do not make the top 10 are not published.

Smartline also managed the number one spot for the following survey categories:

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It pays to be with the best!!!

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1 10.14 11:06

The September 2014 edition of The Smartline Report is here!!!

Check out the latest edition of The Smartline Report where:

  • Cameron Kusher, Senior Research Analyst, RP Data, provides an outlook for the housing market for the rest of 2014; while
  • David Bassanese, Chief Economist, BetaShares, believes and provides his argument that house prices are not about to crash; and finally,
  • Michael Matusik, Founder, Matusik Property Insights, explains that better property investment buying doesn’t have to be hard; it just has to be smart, especially the case in today’s market.

 

Click on this link to find out all the details - Smartline Report – September 2014

ENJOY!!!

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1 10.14 11:01

The perpetual HOUSING BUBBLE argument!!!

Residex and RP Data are both highly reputable information businesses that specialise in measuring property trends.

We have attached links to two of their recent blog posts…both of these articles make very strong arguments against the housing bubble argument.

RESIDEX

John Edwards is first and foremost a statistician. His approach to property analysis has always been about finding patterns in the data. His article in the link below is very informative. We particularly liked this paragraph.

“It is this high level of un-affordability that probably leads many to suggest that we are in a “housing bubble”. However, something has changed: The buyers in our markets. Our measure is likely no longer as valid as it once was, because the current buyers are no longer median income families. Median income families living in the median value areas of Sydney are largely renting.”

http://blog.residex.com.au/2014/09/24/september-property-market-update-2/?Cid=ResiNewsSept142RedBlog

RP Data 

This particular blog by RP Data’s Senior Research Analyst, Cameron Kusher, is incredibly important to the “housing bubble argument” as it looks at “REAL” property prices. Real property prices must take into account the diminishing value of money, better know as inflation.

http://blog.rpdata.com/2014/07/inflation-adjusted-home-values-still-lower-previous-peak-across-cities/

The following table will surprise many people…this information shows capital city house price performance since their last price peaks.

Take Brisbane as an example…since Brisbane’s last peak in property prices 10 years ago, prices initially dropped by 17.8% and are currently still over 14% lower after inflation is taken into account. This makes it hard to argue a bubble exists in Brisbane.

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Whilst arguments about asset values will never be conclusive, we feel these two arguments are at least highly compelling.

Please give me a call if you are looking at buying property in the near future…or just want to check on the competitiveness of your home loan.

I am only too happy to help out!!!

 

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4 09.14 8:16

The August 2014 edition of The Smartline Report is here!!!

Check out the latest edition of The Smartline Report where:

  • Cameron Kusher, Senior Research Analyst, RP Data, explains that most of the growth in home values occurred in the first six months of 2013-14; while
  • Olivia Long, Founder, Xpress Super, analyses that self-managed super funds continue to be an option for a growing number of people; and finally,
  • John McGrath, CEO, McGrath Estate Agents, promotes the old strategy of buying and holding as the easiest form of real estate investment; as well as expounding the myth that Winter is a bad time to sell a property.

 

Click on this link to find out all the details - Smartline Report – August 2014

ENJOY!!!

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