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Friday, January 24 2014
Businesses expect a better trading year in 2014 amid strong profits and a reduction in operating costs. The Commonwealth Bank future business index, which gauges the sentiment of mid-size businesses with a turnover of $10 million to $100 million, suggests businesses are experiencing a sharp increase in confidence. The index was 17 points in the December quarter, its highest level since the survey began in September 2011, and up from 10.8 points in the previous three months. "The vast majority of businesses are anticipating a more prosperous year ahead," said the bank's general manager for corporate financial services, Michael Cant, when the report was released on Thursday. "Notwithstanding the buoyant sentiment .... there remains a level of conservatism as businesses continue to focus on managing costs." The survey found the top three challenges facing business are weak consumer confidence, a falling Australian dollar and uncertainty about government policy decisions. There are also increasing concerns about skills shortages. However, 77 per cent of organisations expect a better performance in 2014 compared with 2013. The survey's revenue index for the next six months jumped to 41 points in the December quarter from 25 in the September quarter, the profit forecasts index increased to 27 from 15, and the operating costs index eased to 29 from 33. Commonwealth Bank chief economist Michael Blythe said the sharp improvement in revenue and profit expectations was quite encouraging. "We're seeing this improved sentiment flow through to other important areas, such as an enhanced appetite for risk and an expected increase in capital expenditure and headcount," he said. Friday, January 24 2014
Two out of three Australian businesses are more optimistic about growth this year compared to 2013. Dun & Bradstreet's Business Expectations Survey shows that 68% of respondents expect positive sales, profits, selling prices, investment and employment. The survey found that 18% of businesses are planning to access new finance during the first quarter, the highest response since the last quarter of 2011.Thirteen percent of businesses plan to increase capital spending, compared to 5% who will decrease spending. Hiring plans have also strengthened, with 15% of businesses intending to take on more staff, taking D&B's employment index to a three-year high of 8.8 points. Thursday, January 23 2014
Monthly home loan approvals reached the highest level in four years in November. The Australian Bureau of Statistics (ABS) says there were more home loan approvals in November 2013 than any other month in the past four years. The resource-rich states of Queensland and Western Australia approved 15% and 12% more home loans respectively than the same time last year. Tuesday, January 21 2014
 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. 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. “ Friday, January 17 2014
 Just as lenders have different views on how income is treated, the same applies to expense. Household expenses Loans with other lenders 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 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 Credit card and personal loans 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 Child maintenance 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. Thursday, January 16 2014
 This Boutique apartment complex has come up on our radar.
The units are complete What opportunities are you missing? Contact us for an initial discussion. What are the secrets you need to know before you start investing? Tuesday, January 14 2014
 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.” Tuesday, January 14 2014
 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. 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   |
