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The problem is the money is tied up, I can't see the point in having most of your money tied up in your house, just to access a pension.
This one stood out for me. The family home is still totally TAX FREE when you sell it and it is NOT asset tested. You can pump as much money as like into it and you don't lose your pension. In fact the family home can be a $10 Million mansion and you can still collect the aged pension if you have no other assets. Bloody good country dis a Australia.
If our (country) credit rating deteriorates we will need to increase rates to attract funding?
The rises come as lenders face profit-margin pressure because of rising costs to wholesale funding at a time when they also need to build up large capital reserves to meet new prudential rules.
The rises come as lenders face profit-margin pressure because of rising costs to wholesale funding at a time when they also need to build up large capital reserves to meet new prudential rules.
What keeps former NAB boss and BHP chairman Don Argus up at night?
Iron ore prices? Interest rate rigging scandals? No. It is interest-only home loans.
"It scares the hell out of me – the size of the debt people are taking on without principal repayments," he says.
The famously forthright executive says banks giving million-dollar home loans to young people had lost perspective.
"It used to be very difficult to get a home loan in the old regulated banking environment," he says. "Now it's like a commodity."
According to data compiled by the Australian Prudential Regulation Authority, interest-only mortgage loan approvals peaked at a record 46 per cent of total mortgage loan approvals in the June quarter of last year.
Since then, their proportion of total mortgage approvals has reduced to 37 per cent, still much higher than the level of five years earlier.
Read more: http://www.theage.com.au/business/m...in-reverse-20160519-gozg8h.html#ixzz499uhVe5Q
Tenants market: residential rents are barely budging.
11:59am: What correction? We're in one of the biggest, and certainly most dangerous, house price cycles in history, the AFR's Chris Joye writes:
House prices are going nuts again. According to RP Data, home values across the five capital cities have expanded 9.8 per cent over the last year with staggering 4 per cent capital gains in the past three months alone.
The correction called by so many in late 2015, which this column dismissed, has been superseded by an elongation of one of the biggest, and certainly most dangerous, house price cycles in history.
The Reserve Bank of Australia's decision to further crush the cash rate to another record low of 1.75 per cent in May has compelled an upward revision to my 2016 forecasts. In December our contrarian position was capital gains of one to two times wages in 2016, which translated into nominal appreciation of 2 per cent to 4 per cent.
Yet this assumed an unchanged cash rate. Given current yield curve expectations for a second cut in 2016, my central case is house prices run at three to five times wages, which represents capital growth of between 6 per cent and 10 per cent.
...
Just as it (the RBA) was blindsided by the sharp house price growth over 2009 and 2010, which compelled it to normalise the cash rate from the then-record low of 3 per cent in April 2009 to the 4.75 per cent (jeepers!) level applied in November 2010, it has presumably been shocked by the price action since 2012 (whether it chooses to admit it or not).
The likely explanation lies in the level of leverage: neither the RBA nor Australians have experienced an economy with this much residential mortgage debt sitting on household balance-sheets.
We are, therefore, in completely unchartered territory that means the risk of policymaking errors apropos asset price bubbles is higher than it has been before. So if you are buying a house, you would be well-advised to embed a chunky margin of error in price terms to hedge against such hazards.
Read more: http://www.theage.com.au/business/m...in-reverse-20160519-gozg8h.html#ixzz499v5YpfT
Just sayen
So this is what you're getting for your hard earned cash:
View attachment 67244
Looks like a normal wall right?
Nope!
View attachment 67245
View attachment 67246
Come on Notting, house prices in Australia only ever go up. Nothing to worry about at all, we can keep this ponzi scheme going for decades, well sort of, IR's down have much further to go to get to ZIRP.
Met a friend's friend who is a real estate agent with a focus on selling to the Chinese from China. Even he admitted that there is currently a property bubble in Australia and thinks that prices will drop slightly by June 2016.
Met up with this friend's friend recently again. He said the banks' recent restrictions on foreign lending had hurt the market somewhat, especially those who bought off the plan intending to resell before settlement, but told these clients not to panic, as a 'solution' would come up within a year.
He didn't elaborate on what that solution was, but I wonder...
A growing industry of private lenders is offering temporary funding to Chinese investors to settle their apartment purchases in Australia while they wait for Chinese capital restrictions to lift, Chinese agents and analysts say.
There are projects across Australia – mostly those which have been marketed mainly to Chinese investors – which are struggling to close apartment settlements but the foreign investor market has not toppled over, they added.
The use of private lenders, as major banks clamped down foreign lending and Beijing clamped down outward bound transfers, is a temporary measure for investors to pay off their purchases.
Off-the-plan buyers of Australian apartments are in crisis as tough new borrowing rules mean thousands of investors who have paid a deposit are struggling to complete their purchases, according to local and overseas mortgage brokers and financiers.
Shanghai-based financiers claim their Chinese clients' funding from Australian banks has been frozen and they face foreclosure - or usurious interest rates - from private financiers.
Australian financiers claim their local clients, many of them Asian, have had their settlements deferred by three months to find alternative funding.
"All the deals have been frozen," said Mark Yin, an agent with Shanghai-based Home Tree Group, about his Shanghai clients' funding with Australian banks.
"We are now looking for finance all over the world."
I don't know about anywhere else but the Sydney market is as hot as hell, very little on the market and I'm talking about good 2 berdroom units in a good location. I am on the market looking to buy, I got to pay nearly $700,000 in Hornsby for such a 2br unit. Further north on the Central Coast there are several apartment blocks that have been approved by Gosford Council for Gosford, very few have started the build. Off the plan they start at 500K for a 2br unit, you need more, much more for 3br unit or townhouse up to 750K. And Gosford is classed as regional.
The biggest problem I face in looking for a decent 2br apartment is the supply, there is almost zero around and when they do come on the market they are gone within a week. Sure you can find older style junk but we are looking for quality but there is very little around. Build you guys, BUILD.
Didn't you sell in Sydney a few years back, Bill?
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