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FAQ's (frequently asked questions) & 'In the Press'
Why use our finance services?
The reason you would use our finance is due to us being an independently owned and operated mortgage broker, providing services to the public to assist in the identification and delivery of the best bank and non bank loans in the Australian market place.
We are experienced in meeting with the client to assess their specific need and designing the best loan product or structure to suit those needs.
When buying property, is it best to buy new?
When purchasing a home or especially an investment property it is strongly recommended that you purchase NEW where ever possible, the advantages are enormous
What are the current Council rates for the Brassall area?
Rates are currently $1770 per annum approx.
What are the average rental returns for the Brassall area?
Rentals depend on property, but we aim for a 5% return on all our developments. Currently a 4 bedroom,2 bathroom property in Brassell costing $360,000 will rent for about $360 per week.
What is the age of the property in Brassall?
The properties are all brand new.
IN THE PRESS...
07th November 2006
How to achieve financial independence through property
We all yearn for financial freedom - the power to leave our day jobs and enjoy a long, leisurely retirement. November's Australian Property Investor magazine reveals how Australians can use property to earn just as good an income from doing nothing as they did from working nine to five.
Working hard, plying extra cash into the super fund and banking on a nice hefty payout at the end of your career won't necessarily provide enough wealth for retirement. It might free up some spending money in the short term, but most Australians will live well beyond their 60s and 70s. So what do they do when their super dries up?
There's the pension, but after living on $50,000 to $60,000 a year, would you be happy settling for an $18,000 or so handout from the government?
As API explains, with a bit of foresight, some smart strategies and the old, reliable bricks and mortar, Australians have the capacity to make their golden years even more comfortable - and a lot more prosperous!
According to API, the first step is to build equity through property investment, and then to spend time consolidating your portfolio - reducing the debt.
Monique Wakelin of Wakelin Property Advisory tells API, "The more equity you can control and the sooner you can control it, the greater your level of financial independence. Your increasing equity adds to your asset base because it allows you to use that equity as leverage to buy further assets."
How much is enough?
But how much equity (or property) will you need in order to become financially independent?
Michael Yardney of Metropole Properties takes a reasonably simple angle on how much is enough, theorising that five median-priced properties paid out completely can give investors the ability to replace their annual working income.
"In Australia, the average rent for median-priced property is about a quarter of the average weekly income," Yardney explains in API. "Therefore if you want to replace your average weekly income, you'll need at least four properties owned outright… plus a fifth to pay for rates, maintenance, outgoings and so forth."
How to live off your portfolio
Once the time comes and you leave your job, the key to financial independence is to turn your equity into income.
Mark Armstrong, CPA with Property Planning Australia, tells API that investors need to adopt some savoir-fare when they swap their day job for a life lived on equitable indulgence.
He says the smart approach is all about "getting your equity to generate income for you, so that you're not actually reducing your equity. Investors should think, 'I've got $1 million worth of equity - where can I now put it to start making it work for me in terms of an income'."
He suggests, "That's where they might look to the share market or commercial property trusts - a nice diversified portfolio."
Yardney outlines an alternative option - living off equity.
"The concept of living off equity is one that very few people adopt because it's foreign to what they've been taught. What you have to do to live off equity is to live off increased borrowings.
"The principle is: I've got $2 million worth of properties in good locations across capital cities so therefore every year I'm worth $200,000 more. If I live on $100,000 of that I'm still going to be worth another $100,000 every year, so even if I'm eating away $100,000 capital, at the end of the first year I'll be worth $2.1 million, at the end of the next year $2.2 million and so on."
He adds, "You really can't count on that 10 per cent increase each and every year because we know property doesn't achieve that rate of growth consistently, so every year you have to leave yourself a safety buffer."
© Australian Property Investor magazine - www.apimagazine.com.au. Reproduced with permission. To subscribe to API, go to www.apimagazine.com.au or pick up a copy from your local newsagent.
The true power of equity
20th July 2007
Australian homebuyers who fail to realise that their first home is potentially a great investment as well as a place to live can miss out on the wealth-creating tool of equity, Australian Property Investor magazine's July issue reveals.
Some Australians' closest encounter with the concept of equity might be the memorable bank TV ad campaign in which a man washing his boat is asked how he could afford such a prized possession. "Equity, mate," is his simple reply.
The truth about equity, API editor Eynas Brodie says, is that it can do much more than help you buy depreciating assets like a boat. Used correctly, equity can provide a stepping stone to help investors buy more appreciating assets.
"Equity is a property investor's most powerful tool in the quest for financial freedom and you can use it to leapfrog into more investments," Brodie says.
"Simply put, equity is the current market value of an asset less the debt that's owed on that asset," she explains.
"As it applies to real estate, equity is essentially the portion of a property that you own outright. So if you have a $300,000 property and you owe the bank $200,000 then you have $100,000 - or 30 per cent - worth of equity.
"Once you have equity in a property, you can leverage off that equity to borrow more money to buy a boat - or better yet, an investment property that will help you move closer to your long-term financial goals."
Equity is generally built up through debt reduction - the repayments you make on your mortgage - and through capital growth, API notes. But what many first homebuyers may not realise is that their first step into the property market can be crucial.
"Your first purchase is critical and its potential for growth in the early years is very important," Stuart Wemyss, director of mortgage broking firm ProSolution Private Clients, tells API.
"Buying a property that languishes in the first five years but starts to do really well thereafter might be okay over the long term but it isn't necessarily going to help you increase you asset base. Whereas if you buy something that grows at 8 to 10 per cent each year on average from year one, that will really help you build a portfolio."
Brodie says starry-eyed house hunters making their initial foray into the property market shouldn't overlook the long-term impact their first home can have on their ability to build wealth.
Brodie says starry-eyed house hunters making their initial foray into the property market shouldn't overlook the long-term impact their first home can have on their ability to build wealth.
"We're not taught to think long term, so many of us make that vital and often most expensive life purchase with little consideration for its ability to build equity through natural compounding growth," she says.
"Obviously today's first homebuyers have a lot on their mind - not least simply overcoming the affordability issues in the current market - but if they can give some thought to the investment potential of the property they're buying then they can start to tap into the benefits of equity from the day they move into their first home.
"If they purchase a good quality asset, they can simply move in and let capital growth work its magic over a few years, then refinance to release the equity in that home, providing a deposit they can use to buy their first investment.
"This is the true power of equity - giving homebuyers the ability to step up the property ladder."
© Australian Property Investor magazine - www.apimagazine.com.au. Reproduced with permission. To subscribe to API, go to www.apimagazine.com.au or pick up a copy from your local newsagent.
Investing on a shoestring budget
15th Jun 2007
Australians who think their income is the only thing stopping them from investing in property may need to think again, according to Australian Property Investor magazine.
"High prices, low affordability, recently rising interest rates and high buying costs might appear to conspire to keep people with single or low incomes out of the property market," says API editor Eynas Brodie, "however, there are still options for these buyers. They just need to have the right approach to the market and do the right research."
API’s June edition reveals a checklist for people who would like to invest on a single or low income. Some of the advice it offers is:
Have realistic expectations of what you need Investment adviser and property author Margaret Lomas tells API that one of the biggest hurdles is the mismatch between expectations and reality.
"They have to understand they can’t aim too high – but nor do they need to despair," Lomas says. "Providing they understand what their capacity is and aim for lower-end properties, they can be successful property investors."
Check out the ‘ugly duckling’ areas
Every major city, including Sydney, has areas with affordable homes, and if you’re buying for investment the whole of Australia is your market: there are numerous regional centres with solid economies where typical homes are within reach of most people.
"With the right research, low-income investors should be able to locate affordable properties in ‘ugly duckling’ areas that might offer strong rental returns and also opportunities for capital growth," Brodie says.
Find positive cash flow property
A positive cash flow property is one where the rent is high enough to cover the costs of owning it.
"Given the price rises experienced in the last boom, it’s not as easy to find positive cash flow property as it once was but it is still possible," Brodie says.
"Rental returns are especially important for investors on low incomes, as a higher rental yield can mean the difference between gaining finance approval on a loan and missing out."
Understand what matters to financiers
"It’s important for investors to understand how getting a loan works and what criteria lending institutions make their decisions on," Brodie says.
South East Queensland Regional Plan
Desired regional outcome 9
A strong, resilient and diversified economy - growing prosperity in the region by utilising its competitive advantages to deliver exports, investment, and sustainable and accessible jobs.
SEQ is the main economic engine for Queensland. In recent years, the economy of the region has been growing faster than the Australian average, driven mainly by consumption as a result of its high population growth.
The regional economy is not homogenous, but is overwhelmingly a services economy. There are variations in employment and economic activity throughout the region. To sustain living standards it is necessary to strengthen and diversify the region's economy and raise productivity.
Accordingly, the region's capacity to create jobs and support the preferred pattern of development requires specific sub-regional strategies and initiatives. These will focus attention on:
encouraging skills to support industry and regional growth;
developing a more outward looking, entrepreneurial culture including increased integration into the global economy;
continuing to provide land for industry and economic activity that creates employment close to where people live;
preserving the region's natural economic advantages; and
diversifying the region's economic base.
The economic development initiatives reflected in the Regional Plan are underpinned by the Queensland Government's Smart Queensland: Smart State Strategy 2005-2015. This Strategy identifies investment in research, development, technology diffusion and commercialisation of ideas. It also includes investments in knowledge, skills, diversity, creativity and connectivity as the key mechanisms to achieve increased productivity and a better quality of life.
Other factors that support continued economic growth and development include providing infrastructure and services such as transport and freight networks; educational, scientific and technological institutions; and water and power. One way of diversifying the economy and stimulating investment is to plan and design mixed-use developments that foster collaboration and networks between business, industry and research institutions.
The continuing movement of people into the region will drive consumption-related jobs and provide employment in emerging residential areas. The challenge is to continue to create higher-skilled jobs in knowledge-based industries.
Current and impending skills shortages are recognised as critical issues. Attractive living environments and lifestyle opportunities are therefore, an important way to attract or retain such skills.
Variations in the economic base around the SEQ region necessitate more detailed sub-regional strategies, addressing local issues such as reliance on one or two industry sectors, specific skills shortages and infrastructure needs.
Western Corridor
As a significant growth area for SEQ, the Western Corridor provides major opportunities for economic development and employment creation. Factors supporting this include:
suitable land available for large-scale industries and logistics with adequate separation from sensitive land uses;
good freight transport links to state and national highway and rail networks;
a workforce with the appropriate mix of skills for local industries;
investment in training and upgrading skills; and
competitively-priced energy.
Priority industries for the Western Corridor comprise food, manufacturing, aviation, aerospace and education. Key initiatives include the:
planned redeployment of Australian Defence Force personnel to Amberley airbase, creating the opportunity for continued growth through development of the Amberley aerospace park;
University of Queensland campuses at Ipswich and Gatton and the University of Southern Queensland campus at Springfield ;
Bremer and Southern Queensland Institutes of TAFE;
development of regional activity centres at Ipswich, Springfield and Ripley;
Swanbank Enterprise Park centred on the Swanbank Power Station and nearby Bremer Business Park ;
location of heavy, difficult to locate or large footprint industries at Ebenezer; and investigation of the opportunity to redevelop the Wacol Institutions Precinct to provide a major gateway development for the Western Corridor
Brisbane tops growth in housing prices, up 9.8pc
Robert Harley
Brisbane houses prices jumped almost 10 percent in the past six months and the city is expected to show the best price growth over the next five years, according to analysts RP Data and risk mark International.
The RP Data- Rismask Hedonic index, released yesterday, showed a continued recovery in nation is established housing market.
House prices rises for the half-ranged from 9.8 per cent in Brisbane to 9 per cent in Melbourne 8.7 per cent in Adelaide, 3.5 percent Sydney and 1.9 in Perth. Canberra prices jumped 10 percent but analysts warned of large fluctuations in the nation’s capital. Apartment prices rose even further _ up 18.7 percent in Adelaide,14.7 per cent in Melbourne and 4.4 percent in Sydney “Units are catching up again,” said Rismark’s head of research, Mathew Hardman. Dr Hardman said Brisbane had experienced growth right across the metropolitan area, whereas gains in Melbourne and Sydney were confirmed to upmarket inner and coastal strips. “Sydney appears to have officially turned the corner, with consistent growth in house prices of up to 7 percent shown in the inner city, eastern suburbs, lower North Shore and the Northern Beaches,” he said. “However house prices in the city’s outer metropolitan suburbs and Central Coast continue to stall, with no sign of Growth in the near future.” With the Reserve Bank board meeting next week, the chief executive of RP Data, Graham Mirabito, warned that interest rate rises could stall growth across the whole market. “Brisbane is expected to cope better than any other city,” he said. “We expect Brisbane to be Australia’s top performing capital city market over the next five years.’ The view is shared by forecaster BIS Shrapnel.” Sydney and Brisbane have the most percent-up demand,” said BIS Shrapnel managing director Robert Mellor.” But in a long term sense, Brisbane Prices are 10 to 20 per cent undervalued, whereas Sydney might still be 10 to 15 percent overvalued.” “You could easily get annual 6 to 7 per cent house prices growth out of Brisbane over the next four years”.
Financial Review - August ’07
Rates safe until 2008
Concerns that interest rates will be raised in the latter part of 2007 were quashed yesterday after the latest ABS data showed that loans for housing in New South Wales and Western Australia eased dramatically in the May housing in the region. The total number of housing finance approvals issued in May rose just 0.1 % on a month by month basis, however, the best news for the interest rate approximately sensitive Australian economy was that the total number of residential housing finance commitments fell in the nation's two most expensive states, NSW and WA, where commitments fell 2.6% and 7.3%, respectively, from the figures in April. The number of commitments rose in Victoria by 1.6%, Queensland 1.4%, South Australia 0.7%, Tasmania 6.4%, Northern Territory 2.3%, and ACT 4.6%. JPMorgan has forecast interest rates will remain on hold until 2008. www.propertyreview.com.au, id 3584,11 July 2007.
Highways accelerate land value
The construction of highways is having a potentially greater impact on land values than in the past, research by Jones Lang LaSalle has found. The analysis compared land value growth around new major roads built in Melbourne during the 1990s with that around today's projects. The construction of the EastLink in the city's south-east has prompted very solid increases before the tollway's expected opening next year. Over 2005 and 2006, land values in Knox/Scoresby increased by 46% and by 50% in Dandenong. The 2005 opening of the Craigieburn Bypass pumped up values in Campfield, rising 40% two years before the opening and 27% in 2006. The Australian Financial Review, Page 58 Property, 11 July 2007.
MORE than half of Australia's property owners plan to buy another investment property in the next five years, research by the country's largest property management company has shown. The survey of 1038 landlords by RUN found that 58 per cent said they planned to buy another property in this timeframe, with 40 per cent claiming they would not.
Landlords in Melbourne were the most likely to buy additional real estate, with 60 per cent claiming it was on the cards - a factor that could see property prices there rise further.
RUN chief executive Rob Farmer said it would also worsen the shortfall of rental properties.
"Clearly we are in one of the worst rental situations Australia has ever seen, with the March quarter Real Estate Institute of Australia's statistics reporting some of the lowest vacancy rates in years," he said.
"To meet tenant demand in our cities, we need to take steps to entice investors into the existing residential property market. More importantly, we need to do it now before the current crisis spirals totally out of control."
The research found that property investors would buy more real estate if the government reduced stamp duty concessions (39 per cent), interest rates (33 per cent) and land tax concessions (25 per cent).
And just over half of those who planned to buy additional properties expected to pay between $350,000 and more than $550,000.
By Joanne McCulloch
21 August 2007
Brisbane property market soars Brisbane's residential property market continues to soar, with figures from the REIQ showing the city's median house price has risen 13.3% to $425,000 in 12 months to the end of September. For the fourth consecutive quarter, property price growth across the Sunshine State was healthy and shows no signs of slowin down. The median houjse price in Ipswich increased 13.3% to $269,000 over the last 12 months. While there has been steady growth on the Gold Coast, up 9% to $436,050, there has been a lack of good quality stock of late, REIQ chairman Peter McGrath said. www.brisbanetimes.com.au , 8 December 2007
Home loan demand softening Economists say high property prices are set to continue for as long as migration continues to grow, labour shortages continue to drive up wages and tax cuts remain the Government’s favourite fiscal implement. Yesterday’s ABS housing data showed a 0.7% fall in the number of borrowers seeking mortgages, down 62,509 requests in October –one of the first signs the RBA’s monetary policy may be starting to bite. The Courier-Mail, Page 61 Business, 11 December 2007
Population tops 21 million The nation's population growth of 1.5% in 2006/07 was its highest annual level in almost 20 years, ABS figures showed. The world average was 1.2%. In the year ending 30June, experience positive net migration, especially NSW (-27,300), folliwed by SA (-3,600) overtook the state's net interstate migration for the first time. The Australian Financial Review,Page 7, 5 December 2007.
Residential vacancy rate at all time low
Residential rental vacancy rates have averaged an all-time low of 1.9% across Australia for the past two and a half years, compared to a 20-year average of 3.6%. Darwin is now the most expensive rental location, with a 34.4% annual increase in the median rent for a three bedroom house to $440 per week and a 51.1% annual increase in the median rent for two bedroom other dwellings to $340 per week. Sydney and Canberra renters also pay $340 median weekly rent for two bedroom other dwellings. The cheapest rental location is Adelaide at $225 per week for a three bedroom house, and $205 per week for a two bedroom other dwelling, although this represented annual growth of 8.5% and 7.9% respectively. "There were double digit annual returns on three bedroom investment houses in Melbourne, Brisbane, Adelaide, Canberra and Hobart in the year to September 2007. Returns on two bedrrom other dwellings were even better with only Sydney invetment properties returning less 10%, "REIA president Noel Dyett said. Dyettsaid over five years, the average annual return on investment property exceeded 10% in all capital cities except Sydney and Melbourne. Over ten years, every capital city exceeded the 10% mark www.propertyreview.com.au 11 December 2007
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