Tens of thousands of HomeBuilder applicants around the nation can breathe a sigh of relief after the federal government extended the construction commencement requirement from six months to 18 months.
It’s fair to say that the success of the HomeBuilder program caught a lot of people off guard and, as a result, contributed to a surge in demand for manpower within the residential construction industry.
In fact, more than 121,000 Australians applied for the HomeBuilder grant, which is expected to support around $30 billion worth of residential construction projects.
“The number of new houses that commenced construction in the December quarter was the second-highest level on record,” says Housing Industry Association’s chief economist Tim Reardon.
Long story short: the $25,000 and $15,000 grants incentivised so many people to build or renovate their homes that many builders were going to be unable to turn the first sod within the required six-month time frame.
Ok, so if you haven’t lodged an application for the HomeBuilder grant, then bad news, this extension won’t apply to you as the application deadline was April 14.
This extension will benefit those who’ve already applied and signed contracts during the HomeBuilder eligibility period between 4 June 2020 and 31 March 2021.
It means applicants now have 18 months – from the date an eligible contract was signed – for construction to begin on their property.
Treasurer Josh Frydenberg says the extension will help smooth out the HomeBuilder construction pipeline and support construction jobs over a longer period of time.
“It will also ensure that existing applicants facing difficulties in starting construction on their new builds and renovations are not denied a HomeBuilder grant due to circumstances outside their control,” explains Mr Frydenberg.
If you applied for finance while making your HomeBuilder grant application several months ago, get in touch with us today to double-check it’s still the most suitable option for you (much has changed in the past months!).
And if you’ve signed a building contract for HomeBuilder, but haven’t got around to exploring finance options just yet, then be sure to reach out to us soon – we’d love to run through some solutions with you.
Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.
You open up the real estate app on your phone, scroll through a few listings, and then there it is: the home of your dreams, ‘added 1 hour ago’. So just how long do you typically have to act in this hot market?
Well, let’s just say it definitely helps to have spoken to us about pre-approval if you’re actively house-hunting right now.
That’s because the average number of days properties are listed for sale on realestate.com.au reached record lows in every state in March, according to the REA Insights Housing Market Indicators Report April 2021.
And that’s likely got something to do with the fact that demand is extremely strong, with ‘views per listing’ at record highs.
The average number of days properties were listed on the realestate.com.au website was 48 in March 2021.
Properties sold the fastest in the ACT (average of 25 days listed), New South Wales (27 days) and Victoria (30 days).
Tasmania (37 days), South Australia (48 days) and Queensland (54 days) were positioned in the middle of the pack, however, they dropped 9, 17 and 19 days respectively over the course of the month.
And while properties in Western Australia (71 days) and the Northern Territory (59 days) took the longest time to sell on average, they recorded the largest falls in average time online over the past year, down 28 and 14 days respectively.
Properties are currently viewed an average of 1694 times on realestate.com.au – up from 819 in March 2020.
“This growth can be attributed to several factors, including record-low borrowing costs, government support packages for first-home buyers and limited available stock,” the REA report states.
Buyers are also on the hunt for more expensive properties than they were a year ago.
The percentage of searches for properties valued between $750,000 and $2,000,000 has increased to 52% in 2021, up from 47% in 2020.
Make no mistake: competition amongst buyers is fierce.
More people are house hunting for more expensive properties, with fewer days to secure finance for the home of their dreams.
This all highlights the importance of exploring your borrowing options with us in advance, in order to increase your chances of securing a property in this hot market.
Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.
The COVID-19 loan deferral program and credit reporting amnesty is now over, which means banks will report any late repayments on mortgage or small business loans to credit agencies unless you’ve entered into a hardship arrangement.
The banks’ mortgage deferral program and subsequent credit score reporting amnesty officially ended on April 1.
The package was created during the peak of COVID-19 to provide loan repayment relief for almost one million home and business loan borrowers facing financial hardship.
Luckily, many people have since been able to resume their repayments – as of late February, just 2,803 small business loans (1.2%) and 22,480 housing loans (5%) were still deferred, figures show.
But, we’re not out of the woods yet.
The JobKeeper wage subsidy scheme has also just officially ended, which has the potential to put tens of thousands of households and businesses at risk once more.
Latest reports indicate up to 150,000 workers could lose their jobs this month due to JobKeeper ending.
If your ability to repay your home or small business loan might be affected in the months ahead, then it’s important to act now, rather than wait until after you’ve missed a repayment.
That’s because by then it could be too late and it might end up on your credit file.
Your most appropriate course of action, however, will depend on your individual circumstances, which we’ve broken up into two categories below.
If your upcoming loan repayments are looking tight, but possibly doable, then get in touch with us today to discuss some financing options that might make your repayments more manageable.
These options might include:
– switching to interest-only repayments for a period of time,
– renegotiating your rate with your current lender,
– refinancing to another lender,
– debt consolidation, or
– a combination of these and other measures.
If you’ve lost your job due to JobKeeper ending, for example, and the chances of making your repayments are looking a little grim, then it’s important to get in touch with your bank today to discuss entering into a hardship arrangement.
Not only will this potentially give you some breathing space on your repayments, but it will help keep any missed payments off your credit file, as the Australian Banking Association states below:
“For customers that enter into another form of hardship or forbearance arrangement with their bank, banks will not report the repayment history information. Instead, they will leave the field blank for the duration of the arrangement.”
If you’d like to discuss any of the above in further detail please don’t hesitate to get in touch today – we’re here to help any way we can.
Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.
House prices could jump 17% in 2021 and mortgage rates are set to rise much sooner than expected, ANZ Bank has tipped.
How much earlier than expected?
Well, the Reserve Bank has repeatedly said the official cash rate isn’t likely to increase for a few years, but ANZ senior economist Felicity Emmett believes fixed-mortgage rates have already reached their lowest point, or close to it.
In recent times, more than 30% of new loans have been at fixed rates, says Ms Emmett, with two to three-year fixed-term interest rates available below 2%.
But that’s unlikely to be the case for much longer, she believes.
“In the second half of the year these sub-2%, three-year fixed rates that we’re seeing advertised at the moment are less likely to be around,” says Ms Emmett.
“Cheaper funding is not available forever and that will feed through into variable mortgage rates too.”
Shane Oliver, Chief Economist at AMP Capital, also believes fixed mortgage rates “have already started to bottom out”.
“It’s likely that the 30-year tailwind for the property market of falling interest rates has now run its course and longer dated fixed rates (4+ years) are starting to rise,” adds Mr Oliver.
That’s right. ANZ economists expect house prices to rise by a “sharp” 17% across the capital cities in 2021.
They’re tipping Sydney and Perth to perform best with 19% growth, followed by Hobart (18%), Melbourne and Brisbane (16%), and Adelaide (13%).
ANZ’s forecast is much more bullish than those of Commonwealth Bank and Westpac, which in February predicted price increases of 8% and 10% respectively.
Ms Emmet says low housing stock levels are combining with FOMO (fear of missing out) to help drive up the market.
“Buyers are taking advantage of historically low interest rates, particularly fixed rates, as well as various government support programs,” Ms Emmet said.
After the relative hibernation of last year, there’s certainly a lot going on in the world of property and finance right now.
So, if you’d like to chat to us about financing a new home you’ve got your eye on, or refinancing your existing loan, get in touch today and we’ll help sort out that FOMO for you.
Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.
The property market is going through a boom phase, which means housing affordability is getting tougher. So how much does the average Australian household need to put towards their monthly home loan repayments in the current market? Let’s take a look.
You’ve probably noticed the housing market is going a bit crazy at the moment.
FOMO has taken hold and many properties across the country are selling well above their reserve.
As such, housing affordability has deteriorated, says Moody’s Investor Service, reversing the improving trend seen in 2020 during the peak of the coronavirus crisis.
On average, two-income households need to put aside a quarter (24.6%) of their monthly income to meet repayments on a new home loan, as of February 2021.
That’s up from 22.7% in June and July 2020, when new mortgages were the most affordable they’ve been in a decade.
The deterioration in housing affordability was evident in all capital cities over the five months to February 2021, with Perth remaining the most affordable and Sydney the least.
That said, housing affordability still remains better than the ten-year average of 26.1% and well under its peak of 30.7% in April 2011.
That’s because the average mortgage interest rate has nearly halved to 3.65% since 2011, according to Moody’s.
Got your eye on an exciting new property and want to know if you can get a loan for it?
Get in touch today and we’ll help you crunch the numbers, work out your borrowing capacity, and discuss your finance options.
Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.
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[et_pb_column type=”4_4″][et_pb_text admin_label=”Text”]Floods, fire and pandemic – it’s been an incredibly tough 15 months for many Australian businesses. And with government support about to end, looking after your mental health will be just as important as taking care of your business’s financial health.
With the federal government’s COVID-19 JobKeeper wage subsidy scheme expiring on 28 March, experts are tipping as many as a quarter of a million jobs could be lost.
When you also consider that rental eviction moratoriums are coming to an end in several states, and flooding is taking place across large parts of Australia’s east, then there is a lot of pressure on small businesses owners across the country right now.
Australian Small Business and Family Enterprise Ombudsman (ASBFEO) Bruce Billson says it’s important for small business owners to consider their mental health and reach out if they’re not coping.
“Help is available to small business owners who need it. NewAccess for Small Business Owners offers free one-on-one telehealth sessions with specially trained mental health coaches providing evidence-based advice on strategies for managing stress,” he says.
Developed by BeyondBlue, NewAccess is a confidential mental health program where coaches with a small business background work with business owners to tackle challenges.
Businesses can access up to six sessions, with the initial 60-minute assessment designed to talk through your challenges, develop a problem statement and create a personalised needs-based plan.
Subsequent half-hour sessions involve the business coach stepping you through your plan, providing practical tools for managing stress, and reviewing progress.
“Being able to talk to someone who understands the mental load of running a small business will make a real difference,” Mr Billson says.
“Small business owners who look after their mental health, can also help their business.”
No doctor’s referral or mental health treatment plan is required and the free service is available via phone or video call from 8am to 8pm.
NewAccess has been incorporated into the ASBFEO’s My Business Health tool, which provides assistance in three key areas.
The section on how to keep your business afloat looks at government support, managing outgoings and cashflow.
How to manage your business explores COVID-19, staffing, workplace health and safety, resolving disputes and insolvency challenges. Where to access support includes a 5-minute wellbeing checkup, links to support services and natural disaster recovery.
If it’s your business’s finances that are causing you stress, please know that there are lender support services to help you navigate financial challenges.
For example, Australian banks offer a range of financial support options to help farmers and small businesses affected by natural disasters, such as the NSW floods, which can include:
– a deferral of scheduled loan repayments
– waiving fees and charges, including break costs on early access to term deposits
– debt consolidation to help make repayments more manageable
– restructuring existing loans, without the usual establishment fees
– deferring interest payments on a case-by-case basis
– offering additional finance to help cover cash flow shortages.
If you’d like to talk through how some of these options may help your business, please don’t hesitate to get in touch with us or your lender today.
Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.[/et_pb_text][/et_pb_column]
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Thinking of building, buying a new home or renovating? The HomeBuilder scheme ends on March 31, which means you’ve got less than two weeks to take advantage of the $15,000 grant.
The Australian government scheme, which was initially due to end in December but was extended to 31 March, has led to a big spike in new home sales in recent months.
And experts are tipping HomeBuilder applications will continue to rise before the impending cut-off date.
“We expect a surge in sales in March,” says Housing Industry Association (HIA) Economist Angela Lillicrap.
“Record low-interest rates and rising house prices are sustaining market confidence into 2021. This strong level of consumer confidence combined with the demographic shift to regional areas is driving ongoing demand for new detached homes.”
The current iteration of the HomeBuilder program provides eligible applicants with a $15,000 tax-free grant for building contracts (new builds and substantial renovations) signed between 1 January and 31 March 2021, inclusive.
Applications for the grant can be submitted to the relevant State Revenue Office by 14 April 2021, and construction must commence within six months of the building contract being signed.
There are a number of property price caps worth noting, too.
For new builds, the property value cannot exceed $950,000 in NSW, $850,000 in Victoria, or $750,000 in all other states and territories.
For renovations, the reno contract must exceed $150,000 and the value of the property cannot exceed $1.5 million (pre-renovation).
Two weeks might feel like you’re cutting it a bit fine, right?
But rest assured there are a range of build and property types (including ready-to-go ones) that can be eligible for the grant if construction commencement deadlines are met, including:
– off-the-plan apartments
– house and land packages
– new home purchases
– new home builds (on vacant land)
– substantial renovations.
With the HomeBuilder deadline now literally days away, it goes without saying that time is ticking.
So get in touch today for more information on how you can take advantage of this $15,000 grant before it ends.
Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.
Who would take the reins of your family business if you had to take a step back from it? Turns out just one-in-six businesses have a proper plan in place. But rest assured you can develop your own succession plan fairly painlessly, with the help of a new guide.
So … it turns out the Murdochs aren’t alone when it comes to succession headaches.
Latest family business data from KPMG shows that just 17% of Australian family businesses have a documented succession plan to safeguard the longevity of their business.
That means a whopping 83% of businesses intend to wing it and do it on the fly.
Fortunately, the newly released ‘Introductory Guide to Family Business Succession Planning’ provides a step-by-step guide to passing the family business on to the next generation.
“Succession planning can be challenging,” Family Business Australia (FBA) CEO Greg Griffith says.
“But with the right approach, supported by quality information and advice, you can achieve rewarding outcomes.”
Australian Small Business and Family Enterprise Ombudsman Kate Carnell says there has never been a more important time to initiate a succession plan, given the highest proportion of business owners are aged between 45 and 59 years.
“Australia’s most successful family business stories – and there are many – are a result of well-executed succession planning,” Ms Carnell says.
“More than 60% of employing small business owners are approaching retirement age. This generational shift presents a number of challenges for the sector and the economy more broadly as some business owners may find it difficult to attract a buyer.”
Mr Griffith adds the easy-to-read guide offers tips on how to handle the kinds of tense conversations that can occur between family members throughout the transition phase.
“The key to families working well together is to have really open and honest communication – which can be difficult when your boss, colleague or direct report is also a member of your family,” Mr Griffith says.
“Our succession planning guide offers practical tips to ensure an orderly transition process.”
One critical area highlighted in the guide is the importance of your successor understanding your family business’s finance situation.
“You may also want to engage people outside the family and the business. In our experience, businesses can benefit from guidance from advisors in areas such as business finance: to understand the nuances of your family and business finances,” the report states.
Now, we understand that money and finances can be a difficult subject to discuss with family members.
So if you’re thinking of passing the baton to a family member – and you’d like help bringing them up-to-speed on your business’s finance obligations, opportunities and outlook – then please get in touch today.
We’re here to help your business succeed now, and in the hands of the next generation (engage!).
Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.
Did you know more than a third of Australian homeowners are considering putting their property up for sale so they can take advantage of the current boom in prices? Here’s how to get your property looking spick and span for prospective buyers.
New data shows seller confidence is now higher than it was prior to the COVID-19 pandemic, with 35% of homeowners considering selling by 2026, Westpac says.
And 12% of homeowners are already in the process of putting their house on the market or are planning to do so in the next 12 months.
So, if you’re a homeowner keen to sell your property in the current hot market, below are seven ways you could make it more attractive to potential buyers.
We hate to say it, but your bathroom/s will likely attract more scrutiny from prospective buyers than any other room.
If your bathroom is moderately new and not too dated, simply pay some professional cleaners to get it sparkling.
However, if your bathroom is fairly dated, consider updating some of the obvious essentials such as a new sink or tapware, updated countertops and cabinets, and a fresh coat of paint.
Also, ensure the taps and shower head are shiny and not leaking, and the toilet is spotless.
Giving the bathroom a good run for its money in terms of scrutiny is the kitchen.
Rest assured there are ways you can revitalise it without blowing the budget, such as replacing old cupboards and pantry doors, upgrading the benchtops, and making sure the taps and electrical fittings are in good working order.
And don’t forget that your kitchen appliances also act as sales props. If they’re old and outdated, they’ll bring the rest of the kitchen down with them. The good news is if you have to buy new appliances, at least you can take them with you!
Nothing screams “I’ve seen better days” like stained carpet, scuffed floorboards, or chipped tiles.
If the floor a prospective buyer is standing on is dirty and dated, it won’t be long until they start thinking about what else is wrong with the house that they can’t immediately see.
If it’s within your budget, definitely consider giving this part of your property a makeover before inviting potential buyers in.
One of the quickest and cheapest ways of making the inside of your home feel more alive is to add a bit of greenery in each room.
Pot plants are fantastic because they’re low maintenance, make your place look great, and are great for your health.
And once again, rather than leaving them behind, like most other things on this list, you can take them with you when you sell your property.
Properties with high energy-efficiency ratings typically sell for up to 10% more, a review of international research shows.
The government’s Your Home website is a great starting point when it comes to making your property more energy-efficient and environmentally sustainable.
It includes information and tips on how to include more energy-saving features in your home, which may include improved lighting technologies, insulation, draught sealing and batteries, to name a few.
A fresh coat of paint can make a property look and feel new again. And fortunately, it’s among the most affordable ideas on this list.
Best to play it a little safe though and go for neutral creams and whites that will suit most people’s tastes – you’ll attract more interested buyers that way.
And remember, lighter shades like beige and white also give the impression of more spacious rooms.
Finally, don’t forget the ceilings, even if they’re hard to reach!
First impressions last – so one way to instantly increase the initial ‘wow’ factor of your home is to upgrade its exterior.
Trim any overgrown bushes, mow the yard, apply grass seed where there are bare patches, get some new flowers and plants in the garden beds, and ensure the fence looks great.
If you don’t have the tools for the job, or you’re simply more of an indoors person, consider hiring a landscaper to help out.
If you’re thinking about selling your current property to buy elsewhere, get in touch today to discuss your finance options and borrowing capacity.
We’d love to take some weight off your shoulders when it comes to everything finance, so you can focus on getting your current property ready for sale!
Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.
It’s official: Australia’s housing market is in the midst of a broad-based boom, with the national home value surging 2.1% higher in February; the largest month-on-month change since 2003.
We haven’t seen this kind of fast-paced growth since Guy Sebastian robbed Nollsie to win Australian Idol, Roger Federer won his first of 20 grand slams (against the Scud at Wimbledon), and people primarily used their mobile phones to make calls (well, and play Snake).
The February surge, which was recorded by CoreLogic’s national home value index, was spurred on by a combination of record low mortgage rates, improving economic conditions, government incentives and low advertised supply levels.
Well, that’s the remarkable part.
Housing values rose in each capital city and rest-of-state region, highlighting the unusual and diverse nature of this housing upswing.
According to CoreLogic’s research director Tim Lawless, a synchronised growth phase like this hasn’t been seen in Australia for more than a decade.
“The last time we saw a sustained period where every capital city and rest-of-state region was rising in value was mid-2009 through to early 2010, as post-GFC stimulus fueled buyer demand,” says Mr Lawless.
Sydney and Melbourne were among the strongest performing markets, recording a 2.5% and 2.1% lift in home values over the month respectively, and making up for their weaker performances throughout 2020.
The quarterly trend, however, favours the smaller cities, including Darwin (up 5.5% over the past three months), Hobart (4.8%), Perth (4.2%) and Canberra (3.7%).
And Mr Lawless says whether Sydney and Melbourne can sustain their new found growth is yet to be determined.
“Both cities are still recording values below their earlier peaks, however at this current rate of appreciation it won’t be long before Australia’s two most expensive capital city markets are moving through new record highs,” he adds.
“With household incomes expected to remain subdued and stimulus winding down, it is likely affordability will once again become a challenge in these cities.”
There were two other very interesting pieces of news this week definitely worth noting for soon-to-be borrowers and refinancers.
Firstly, latest figures from the Australian Bureau of Statistics show the value of new home lending hit $28.75 billion in January, up a whopping 44% from the same time a year earlier in seasonally-adjusted terms.
That’s a record high, according to the ABS, and is reflective of the record low interest rates currently available.
Meanwhile, the Reserve Bank of Australia (RBA) kept the official cash rate on hold at 0.1% during their March meeting.
Now, the RBA Governor Philip Lowe once again stated he doesn’t believe that the economic conditions required to increase the cash rate will be met until at least 2024.
But, there are more and more economic pundits suggesting he might be forced into a change of heart if the prudential regulator (APRA) doesn’t introduce lending caps to help cool the booming property market.
So with all that in mind, if you’d like to explore your borrowing or refinancing options in the current lending landscape – before any potential changes come into play – get in touch today.
We’re here to help you with all your home loan and refinancing needs.
Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.
