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Tuesday, January 21 2014
State Government Announces $5 Billion for Underground Bus/Train (UBAT)

Brisbanites will have access to an innovative double decker public transport tunnel which will accommodate both rail and busway services under the new “UBAT” (underground busway and train) tunnel. The project is budgeted at $5 billion, around $3 billion less than previous Cross River Rail proposal.

Premier Campbell Newman announced the Underground Bus and Train project, a 5.4 kilometre tunnel with two train lines in the lower section and two busway lanes in the upper section.

“We’ve taken two of Brisbane’s major congestion challenges – the Merivale train bridge and the Cultural Centre bus precinct – and come up with an affordable and elegant solution.

“The project we are announcing today delivers the public transport services needed for the next 50 years.

“A single 15-metre-wide tunnel will be built, requiring the largest borer ever used in Australia – almost two metres wider than the Clem7 and Airport Link tunnels.”

Mr Newman said a public competition would be held early in the New Year to come up with a name for the project.

Lobby group Rail Back on Track described the UBAT plan as exciting and welcome news, but spokesperson Robert Dow said it must be constructed with future capacity demands in mind.

Posted by: Greg Carroll AT 10:49 pm   |  Permalink   |  Email
Tuesday, January 21 2014

Spending is set to lift across the Australian economy this year, after healthy and sustainable growth continued during December, according to new research released today.

The Commonwealth Bank Business Sales Index (BSI), which tracks the value of credit and debit card transactions processed by Commonwealth Bank, saw spending rise by a seasonally adjusted 0.4% in December, bringing annual growth for 2013 to 10.6%.

Seasonally adjusted data excludes certain seasonal factors to give a more accurate month to month comparison.

“The spending increase in 2013 has provided a strong foundation for further increases in 2014,” said CommSec economist, Savanth Sebastian.

“The housing recovery continues to gather momentum, while rising wealth levels, low interest rates and a recovering share market is supporting consumer confidence and in turn spending.

“The lower Australian dollar should also provide a boost to exports in coming months and help to alleviate the risks surrounding the rebalancing of the economy. “

Posted by: Greg Carroll AT 10:47 pm   |  Permalink   |  Email
Friday, January 17 2014
How expenses can affect how much you can borrow.

Just as lenders have different views on how income is treated, the same applies to expense. 

Household expenses
Each lender will have its own method for estimating your general living expenses based on factors including the number of adults, number of dependents and number of vehicles. The higher any of these variables, the higher your calculated living expenses and therefore the less you will be able to borrow.

Loans with other lenders
If you will continue to have loans with other lenders (as might be the case if you have investment property) then these will be recorded in your commitments. Be aware that many lenders will place a loading on other bank commitments above their standard variable rate. Also they will calculate the repayments based on the loan being fully amortised.

The net result of this approach is that it makes your loan repayments appear much higher than they really are. This can have quite a significant impact for property investors with several properties who want to keep building their portfolio. It is not unusual for property investors to hit a road block with their lender because they can not pass their serviceability test – even though they clearly have sufficient capacity to fund additional properties.

There are however some lenders that wil asess other bank loans at their actual repayment which can significantly increase your boorowing capacity.

Joint loans
Let’s say for example you bought a property jointly with a friend 12 months ago for investment. The loan for the property is $400,000 and the property rents out for $400 a week. And now you want to buy a home with your partner and need a new loan of $400,000.

Your loan commitments will be based on total loan commitments of $800,000, not $600,000 (New loan $400000 plus half of investment loan)  as many people expect. This is because as a party to the loan you are jointly and severally responsible for the debt. For example if your friend got injured and couldn’t make their share of the loan repayments you would have to make the repayments or risk losing the property. Therefore the full $400,000 will be recorded as your commitment.

To make matters worse only half the rent can be used as your income as this is all you are legally entitled to.

Aside from the other issues and risks that can be associated with joint ventures it is worth considering how it will impact on your future plans.

Guarantees
Much the same rules apply as above. If you go guarantor for someone else you are jointly and severally liable for the loan. As such the full loan amount will be recorded as your commitment.

Credit card and personal loans
Credit cards, personal loans, store cards, and products bought on interest free, all impact on your borrowing capacity. Credit cards in particular can have a significant impact. Whether you are using the card or not, or even if you are clearing the balance each month, lenders will still record the limit as a commitment.

So if you have a card with a limit of $20,000, most lenders will view this as a $600 a month loan commitment. 

Rent
If you intend to continue renting after you obtain the home loan this will be added to your expenses. Exceptions to this would be if you are only renting for a short period. As might be the case if a lease was continuing for a number of months on a property you had purchased.

Child maintenance
If you are required to pay child maintenance on an ongoing basis then this would be included in your expense. The lender will also want to see any court ordered or settlement agreement to see what other expenses you may be responsible for like school fees.

In a number of the above situations some lenders will assess aspects differently which will be more favourable to your borrowing capacity which is why is important to have your situation propertly asessed by a broker. If you only talk to one lender you will be limited to their policies.

Contact us to discuss your home loan requirements or a for a review of your current lending.

Posted by: Greg Carroll AT 06:21 am   |  Permalink   |  Email
Thursday, January 16 2014
New property just 6km from the CBD

This Boutique apartment complex has come up on our radar.

  • 6 km to CBD
  • Bus stop right out front
  • Train 200m
  • School 550m
  • Shopping Centre 800m
  • Expected gross yields approx 5.1%
  • Low body corps

The units are complete

What opportunities are you missing?
Are there ways to improve your current cashflow that you are not currently doing? Are your finances correctly structured to build a property portfolio or are they holding you back? Do you have a plan of attack of how to build a portfolio? Are your finances set up to ensure you can acquire property without negatively impacting your lifestyle? Are there things you are missing that you should or could be doing that could have a significant impact on your wealth creation plans?

Contact us for an initial discussion.

What are the secrets you need to know before you start investing?
Sign up for FREE Online Investor Bootcamp to start receiving information straight way

Posted by: Greg Carroll AT 06:47 pm   |  Permalink   |  Email
Tuesday, January 14 2014
7% plus growth tipped for Brisbane real estate this year

Raine & Horne are tipping 7% plus growth for Brisbane in the coming year.

While Brisbane finished behind Sydney and Melbourne last year, they believe it is well-placed for a comeback with tight supply and growing demand.

Raine & Horne’s general manager for Queensland, Steve Worrad, said that while activity has slowed over the holidays it’s often being reported as up 25% for the same time last year, with listings down by as much as 60%.

“Property prices in the southern capitals enjoyed a robust 2013, with the median house price in Sydney, for example, between $665,000 and $712,000 depending on who you listen to, while the median house price in Brisbane is an affordable $445,000,” said Worrad.

“This gives Sydney retirees, especially, scope to sell a family home tax-free, and make a lifestyle shift to Brisbane and add the difference to their retirement savings.”

He noted a new listing of a two-bedroom modern apartment, 52/2 Masthead Drive, Cleveland, which they expect will fetch $300,000 to $320,000. RP Data notes that it previously sold in December 2011 for $262,000.

“While attracting local interest, we’ve fielded enquiries from Melbourne-based retirees for this spacious apartment, which makes sense as it is located on the sought-after Raby Bay Marina, and has a beach at the end of the street and excellent river boardwalks,” he said.

Fly In/Fly Out workers are also set to be a growing demographic in Brisbane, whether they’re working in the mines or investment banking, he predicted.

Brisbane’s New Farm in particular was mentioned as a good performer over 2013, with days on market at just seven.

This comes as confidence builds in Queensland economic sectors, with Australian Bureau of Statistics data seeing a 4.9% increase in trend dwelling approvals and a 0.5% increase in retail turnover during November of 2013. This may help increase the supply that Raine & Horne notes is currently lacking.

Acting Treasurer and Minister for Trade, John McVeigh, said that they were cutting red tape and the cost of business to help maintain Queensland's job creation and speed up building approvals.

“Importantly, this increase in trend dwelling approvals follows 23 consecutive monthly increases, with approvals now 50.6 per cent higher than December 2011," said McVeigh.

“This figure was driven by private other dwelling approvals, such as townhouses or apartments, which were 78.4 per cent higher over the year and at their highest level on record in November 2013," he said.

“We’re working steadfastly to grow the property and construction sector, implementing a $15,000 Great Start Grant as part of the 2012-2013 Budget which has already seen 4100 grants given to Queenslanders.”

Posted by: Greg Carroll AT 06:36 pm   |  Permalink   |  Email
Tuesday, January 14 2014
Master planned communities see huge growth

First-home buyers are being attracted to affordable master-planned communities on the outskirts of Brisbane, according to the Real Estate Institute of Queensland and St George Bank. The Courier-Mail reported that North Lakes and Springfield head the list of outlying suburbs with a median house price below $450,000. North Lakes, 25km north of the Brisbane CBD, recorded 377 sales in the 12 months to September. Forest Lake and Springfield Lakes, 22km west, achieved 600 sales between them. St George Bank head of retail Ross Gillam says loan applications are up 20% across Brisbane's western corridor. "The region has huge potential for growth, with concentrations of employment, retail services, infrastructure and transport links," Gillam says.

Posted by: Greg Carroll AT 06:25 am   |  Permalink   |  Email
Thursday, January 09 2014

As is typical for this time of year the various commentators and researchers are making their predictions for the year ahead in property. General consensus seems to be for growth between 3 - 5% for capitals excluding Hobart. In a recent webinar Terry Ryder put Brisbane at the top of the tree at 10% for 2014.

Based on what I am seeing already I share Terry's view

Posted by: Greg Carroll AT 01:00 pm   |  Permalink   |  Email
Wednesday, January 08 2014

Just negotiated another 1% rate discount for a client. Another happy client.

Contact us to discuss your home loan requirements

Posted by: Greg Carroll AT 12:44 am   |  Permalink   |  Email
Tuesday, January 07 2014
Dual income properties - Cash Positive

Hot off the press - New options located. Price Circa $445000 Estimated weekly rent up to $720*

Dual income properties provide the investor with two rents instead of one and yet the build cost is roughly the same as a standard house. This means in most cases the properties will be cash positive.

The properties have

  • Separately metered power and water
  • Tenancy managed separately by Agent
  • Living areas divided by fire rated wall with sound reduction

When viewed from the road it appears to be a high-quality standard residential dwelling which means that it has been accepted by Queensland’s leading developers of owner-occupier land estates. It’s when you look at the floor plan that the revolutionary design becomes clear. What appears to be one dwelling is in fact two dwellings.There are minimal outgoings with only one set of rates and no body corporate fees. Because the dual dwelling is constructed of such a high standard, these are able to be constructed in owner- occupier dominated estates, helping to drive capital growth.

Example Summary of Inclusions:

  • HIA Fixed Price Contract inclusive of all site costs
  • Stone Bench Top in Kitchen
  • Ceramic Cooktop
  • Canopy Rangehood
  • Stainless Steel Dishwasher
  • Reverse Cycle A/C Unit to living area & fans to bedrooms
  • Downlights to living areas
  • Tiles to all living & wet areas
  • Carpet to all bedrooms
  • Tiles to alfresco and portico
  • Roller Blinds to all opening windows
  • Tile Roof

* Note different specifications may apply for this option.

What opportunities are you missing?
Are there ways to improve your current cashflow that you are not currently doing? Are your finances correctly structured to build a property portfolio or are they holding you back? Do you have a plan of attack of how to build a portfolio? Are your finances set up to ensure you can acquire property without negatively impacting your lifestyle? Are there things you are missing that you should or could be doing that could have a significant impact on your wealth creation plans?

Contact us for an initial discussion.

What are the secrets you need to know before you start investing?
Sign up for FREE Online Investor Bootcamp to start receiving information straight way

Posted by: Greg Carroll AT 05:34 pm   |  Permalink   |  Email
Tuesday, January 07 2014

2013 proved once again that fence sitting is a costly exercise. While many would be property buyers sat back and span their wheels waiting for the heard to jump into the market a handful of people took action and more than likely picked the bottom of the market.

According to RP Data Brisbane house values increased by 5.3 per cent over 2013 compared and unit values 3.5 per cent.

To put this in perspective a $400,000 property purchased 12 months ago at that rate of growth would now be $421,200. And if the growth rate is repeated in the next 12 months it will be $443,523.

A number of independent researcher expect the Brisbane market to continue to grow over 2014 as it makes up time from a few years of subdued growth and it's relative affordability to the Sydney and Melbourne markets.

What opportunities are you missing?
Are there ways to improve your current cashflow that you are not currently doing? Are your finances correctly structured to build a property portfolio or are they holding you back? Do you have a plan of attack of how to build a portfolio? Are your finances set up to ensure you can acquire property without negatively impacting your lifestyle? Are there things you are missing that you should or could be doing that could have a significant impact on your wealth creation plans?

Contact us for an initial discussion.

What are the secrets you need to know before you start investing?
Sign up for FREE Online Investor Bootcamp to start receiving information straight way

Posted by: Greg Carroll AT 04:00 pm   |  Permalink   |  Email

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