Viewing by month: December 2012

Dwelling finance commitments in October

 

According to recently released data from the Australian Bureau of Statistics (ABS), the total number of owner-occupied housing commitments rose by 0.1 per cent (seasonally adjusted) in October, following an upwardly revised 1.1 per cent increase in September.

 

Commenting on the figures, Housing Industry Association (HIA) Chief Economist, Harley Dale, said “there has been some modest improvement in total housing finance since mid 2012 and at face value that is an encouraging development.”

 

The October data showed that the number of owner-occupiers looking to upgrade their existing property increased, as owner-occupied housing commitments (excluding refinancing) rose by 1.0 per cent.

 

Finance for investors also rose over the month, with investment housing commitments increasing by 5.5 per cent to be up 21 per cent in the year to October 2012.

 

These positive results were, however, counterbalanced by a 0.3 per cent decline in the number of loans for construction and a 0.1 per cent drop in financing for the purchase of established dwellings.

 

The HIA noted that the total number of seasonally adjusted loans for the construction and purchase of new homes rose in three states over October, increasing by 6.7 per cent in New South Wales, 1.8 per cent in South Australia, and 2.9 per cent in Western Australia.

 

The number of loans fell by 0.2 per cent in Victoria, 3.0 per cent in Queensland, 12.5 per cent in Tasmania, 7.7 per cent in the Northern Territory, and 4.8 per cent in the Australian Capital Territory.

 

“Some signs of recovery are better than none and that is what the housing finance figures are showing. A pull-back in loans for construction over the October ‘quarter’ is clearly an area for concern, however, as is the decline in new home lending in a majority of state and territories,” continued Mr Dale.

 

“We also need to take note that a methodological issue with the measurement of housing finance may be exaggerating signs of recovery in 2012.”

 

For more information about the residential property market in your areas of interest, please feel free to stop by your local CENTURY 21 Real Estate office for clear and expert advice.


 


0 comments | Posted by Charles Tarbey on 19/12/2012 at 12:00 AM | Categories:

Protect yourself in cases of urgent repair

Most property investors will be required to undertake property repairs at one point or another. In many of these situations, repairs will be foreseeable and the investor will be able to prepare themself financially. However, there may also be instances where a property sustains damage out of the blue, and where urgent repairs are necessary. In such cases, it can pay for investors to have a strong insurance policy in place. To shed some light on this issue, I’ve decided to share the following article by EBM Insurance, which appeared in the November edition of CENTURY 21 Wentworth’s Property Investor. 

Urgent repairs - why an immediate response is critical

Damage from unpredictable weather conditions or a major failure of services can be a major headache for landlords across the country. 

Urgent repairs, such as a blocked or broken toilet, burst water mains, serious damage caused by floods, a storm or fire, or an electrical or gas fault, need to be dealt with quickly and with good lines of communication; without the right measures in place, urgent repairs can be an extremely costly exercise for landlords. 

EBM Insurance Brokers General Manager, RentCover, Sharon Fox-Slater believes that having the right cover in place can not only protect the landlord, it can also offer reassurance to tenants and protect established relationships. 

"A fast and proactive response to any urgent issues will demonstrate commitment on the landlord's part and is crucial if tenants are to be kept happy.  Should your property be unliveable, or even partly unliveable, then a tenant can give immediate written notice to end the tenancy permanently - this can leave the landlord high and dry, and still having to deal with urgent, and often costly repairs," said Sharon. 

"Precautionary measures, such as rental cover can offer long-term benefits for property investors - protecting against unexpected maintenance bills and potentially lost rental income."

As a rule, tenancy agreements will include an emergency contact list, with nominated tradespeople to call should an urgent repair be required.  Each state has a different set of rules to protect both landlords and tenants in the case of urgent repairs. 

For example, in Western Australia and South Australia tenants can arrange for repairs provided that the costs are 'reasonable' and that written confirmation is provided by a qualified tradesperson, while tenants in NSW and VIC must give the landlord a reasonable opportunity to arrange for repairs to be undertaken, but can spend up to $1,000 on urgent repairs which must be reimbursed within a 14-day period if action is not taken quickly enough. 

In the Northern Territory repairs must be made within five working days or tenants must be advised of arrangements for repairs to take place within 14 days of the original notification.  Meanwhile, in Queensland and Tasmania, if the tenant is unable to contact the landlord's nominated tradesperson, they can arrange for a suitably qualified person to carry out repairs, to a maximum value of two weeks' rent. 

There is a good argument to make that emergency contact lists, with preferred and secondary supplier details, should always be kept up-to-date.

"Never underestimate how stressful if can be to return home to find significant damage to your home, and often belongings. Strong and open lines of communication with your tenants can be incredibly important when dealing with urgent situations," Sharon added. 

"Where you can always provide a clear and accurate timetable of activity as soon as a significant repair is needed, it will help tenants to know exactly where they stand in terms of their living arrangements -  they will be feeling vulnerable at a time and will be eager for the issue to be resolved as quickly as possible," Sharon concluded. 

RentCover's various policy options offer landlords peace of mind against urgent repairs by not only protecting their property but also rental income lost if the building is uninhabitable due to repairs.

For more information about EMB’s range of insurance products please visit www.ebminsurance.com.au.


0 comments | Posted by Charles Tarbey on 17/12/2012 at 12:00 AM | Categories:

Housing affordability improves over September quarter

Housing affordability continued to improve in the September 2012 quarter across all geographical areas of Australia, according to the Housing Industry Association (HIA).

The HIA-CBA Housing Affordability Index increased by 5.3 per cent in the September 2012 quarter to be up by 15.0 per cent compared to the same quarter in 2011.

“This is the seventh consecutive quarter where we have seen an improvement in the headline affordability index,” said HIA Chief Economist, Dr Harley Dale. 

“The run of consecutive improvements in some regional indices is even longer, in some instances showing affordability has reached levels not seen since the early 2000s.”

Dr Dale explained that housing affordability has been improving on the back of steadily growing incomes, falling interest rates and easing dwelling prices.

“At the same time, however, transactions volumes have remained historically low as economic uncertainty has weighed heavily on households’ willingness to engage in the residential property market,” he said.

“An increase in home buyer action can occur without generating undue inflationary pressure and would assist a much-needed recovery in new residential construction activity,” concluded Dr Dale. 

While the HIA-CBA Housing Affordability Index confirmed improved affordability across each of the nation’s seven capital cities, the improvements in Australia’s two largest capitals, Sydney and Melbourne, were particularly notable. 

The Affordability index for Melbourne increased by 7.3 per cent over the September quarter, bringing affordability 18 per cent higher than it was in the September 2011 quarter. Meanwhile, Sydney’s Affordability Index improved by 4.4 per cent, to be up by 8.4 per cent compared to the September 2011 quarter.

For more information on residential property prices in your area, please contact your local CENTURY 21 real estate agency.    


0 comments | Posted by Charles Tarbey on 14/12/2012 at 12:00 AM | Categories:

Capital city dwelling values flatline over November.

According to RP Data-Rismark’s Hedonic Home Value index, dwelling values across all of Australia’s capital city housing markets, except Melbourne, rose over November with values now just -0.1 per cent lower over the past 12 months.

Australia’s capital cities saw dwelling value growth of 0.4 per cent during the first fortnight of November; but a lapse in growth over the last two weeks of the month resulted in capital gains being relinquished.

The strongest performer over November was Perth where improving housing market conditions were evident, with values up one per cent. Brisbane and Adelaide values each increased by 0.5 per cent while Sydney values rose by just 0.1 per cent.

On a quarterly basis, the majority of capital cities recorded dwelling value growth, with Darwin (+3.1 per cent), Perth (+3.0 per cent), Brisbane (+0.8 per cent) and Sydney (+0.6 per cent) recording the largest increases. The only capital cities where values declined over the three months ending November were Canberra (-0.7 per cent), Melbourne (-0.7 per cent) and Hobart (-4.5 per cent).

According to RP Data Senior Research Analyst, Cameron Kusher, the November market conditions highlight that the road to a market recovery will not be without pauses and those cities which performed very strongly in 2009 and 2010, like Melbourne, may show continued weakness.

“Capital city home values remain -5.6 per cent lower than their historic highs of 15 November 2010, but, up two per cent from their low of late May 2012.

“Home values in Brisbane and Perth remain below where they were five years ago whereas the other mainland capital cities have all increased over this period. This has meant that relative to the other capital cities, Brisbane and Perth have experienced affordability improvements and subsequently we may see them become more popular from both an owner occupier and investment perspective.”

Rismark International CEO, Ben Skillbeck, commented: “With the recent sharp improvement in consumer sentiment showing that optimists now outweigh pessimists, house price to income ratios back at 2003 levels and meaningful recent housing affordability gains, it will be interesting to see the impact on the housing market  if interest rates are further cut in December as widely anticipated. Given the historically weak seasonal month of December, if rates are cut in December, it’s likely we’ll have to wait until early in the new year to see the housing market response.”

For more information about the residential property market in your areas of interest, please feel free to stop by your local CENTURY 21 Real Estate office for clear and expert advice. 


1 comments | Posted by Charles Tarbey on 07/12/2012 at 12:00 AM | Categories:

Reserve Bank cuts interest rates to record low levels

At its monthly meeting in Sydney, the Reserve Bank of Australia elected to reduce the official cash rate by twenty-five basis points to three per cent. This decision was welcomed by CENTURY 21 and we expect that it will encourage prospective buyers to make property purchases in the lead up to Christmas and during the holiday season.

 

 

The Reserve Bank’s latest decision brings interest rates to their lowest levels since September 2009.

 

Chairman and Owner of CENTURY 21 Australasia, Charles Tarbey, said the decision should be an excellent shot in the arm for the residential property market and the economy at large as we move into the new year.

 

As part of its decision, the Reserve Bank mentioned subdued investment outside of the resources sector and the role that further easing in the stance of monetary policy would play in fostering sustainable growth in demand and inflation outcomes.

 

With the spring selling season now over, December will likely be a key period for real estate with many buyers and sellers aiming to have relevant inspections completed and property transactions finalised before the end of the year. 

 

“For those prospective property buyers who have been in a position to make a purchase this year but have refrained from doing so, this rate reduction could be the final encouragement needed to act on a suitable purchase,” continued Charles Tarbey.   

 

 

 “This rate cut will also likely help to ease the financial pressures felt by many Australian property owners and mortgage holders, particularly in the lead-up to the often expensive Christmas period,” concluded Charles Tarbey.

 

The Reserve Bank will not meet to decide on interest rates again until February 2013.

 

For more information about the residential property market in your areas of interest, please feel free to stop by your local CENTURY 21 Real Estate office for clear and expert advice. Additionally, if you would like to speak to a mortgage professional about the impact of this rate cut on your mortgage, or to find out more about suitable loan packages for your circumstances, please contact CENTURY 21 Home Loans. 


0 comments | Posted by Charles Tarbey on 06/12/2012 at 12:00 AM | Categories: