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=20
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Hello,
Welcome to our=20
latest 'new look' newsletter. For our regular =
subscribers=20
you'll notice the new look and feel with added =
features like=20
forward to a friend and print friendly buttons for =
your=20
benefit.
A quick update on property markets =
around the=20
country point to a steady increase in median values =
across the=20
eastern states, with a moderate cooling of the =
spectacular=20
rises in values in WA & NT over the last 3 years.=20
Despite recent media attention given to the =
exodus of=20
baby boomers selling investment properties to take =
advantage=20
of the current superannuation benefits before June =
30th. New=20
data released shows rental vacancy rates across the =
country=20
are now at 40 year lows! A new wave of investors are =
now=20
looking to come back into the market, with one real =
problem -=20
a severe shortage of =E2=80=98in demand' real estate. =
This is only=20
doing one thing to market values.
Melbourne in =
particular has had regular auction clearance rates =
above 80%=20
since the beginning of the year. This indicates a =
buoyant=20
market with strong buyer demand but with a real lack =
of=20
quality real estate available.
Recent media =
articles=20
suggest the Reserve Bank is now likely to leave =
interest rates=20
on hold for the rest of the year, much to do with the=20
relatively low current inflation rate. This will more =
than=20
likely lead to an increase in demand for property and =
mortgage=20
finance around the country, as debt is still =
relatively cheap=20
and mortgage products are now more flexible and =
accessible=20
than ever before.
On the finance front we are =
busier=20
than ever, with strong demand for investment finance =
in all=20
states with a surge in demand for development and =
construction=20
finance. At Red Rock we specialise in providing fast =
flexible=20
and highly leveraged development finance facilities. =
For more=20
information our development finance mortgages please =
visit the=20
loans and products section of our website or contact =
us today=20
for a confidential discussion.
We hope you =
find the=20
newsletter of interest. Please pass your copy on to =
family or=20
friends. We look forward to helping you, and those you =
recommend our services to. Please call with any =
questions.=20
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St Kilda Rd =
Towers
Level 4, 1=20
Queens Rd
Melbourne VIC 3004
| Tel: |
1300 667 694 |
| Fax: |
1300 667=20
=
594 | |
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Renovate=20
or emotionally detonate? |
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Home=20
Affordability and you |
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Avoiding=20
Trauma makes sense. |
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Have=20
you got the right credit card? |
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![3D""=20](3D"http://www.powerport.com.au/images/nport_images/newsletter_images/=) |
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Renovate or emotionally detonate?
You really like where you live but not the house you =
live in.=20
Renovating your house then becomes a viable alternative to =
the costs=20
of selling, buying and moving somewhere =
else.
There are=20
three main ways people renovate. They self-manage the =
project,=20
meaning they find the different trades, get them to quote,=20
co-ordinate them so the different trades turn up when and =
where=20
wanted, pay them and so on. The second way is to go the all=20
encompassing route and have one builder do everything all in =
one=20
package. The third way is to hire an architect or a building =
professional to manage the whole thing for you.
Each =
method=20
brings with it different costs and different forms of =
frustration,=20
but, in theory at least the more you do yourself, the less =
the cost=20
should be. As to the quality of the renovation, that can be =
another=20
question entirely. So which way do you go?
That =
depends on=20
your time, your building knowledge, research, expertise and =
your=20
stress levels.
If you're like most of us and working=20
fulltime, have the family, the pets, the garden, the meals, =
the=20
house and finally yourself to worry about, then the =
professional=20
licensed builder or hiring the building professional may be =
best.=20
You'll usually pay a bit more, but you're paying for quality =
and=20
peace of mind.
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Home Affordability and you
How do you think Australian cities rate when it comes to =
home=20
affordability around the world? The answers are in the 3rd =
Annual=20
Demographia International Housing Affordability Survey=20
2007.
The survey has just been released, and it =
makes=20
for fascinating reading.
The survey looks at the =
median or=20
middle of the range house price in various places and =
divides that=20
by the median or middle of the range annual income in those =
same=20
places. They look at how many years of income is needed to =
buy that=20
house in each place. In other words if the median house =
price in a=20
place was $500,000 and the median salary $100,000 it would =
mean 5=20
years salary would be needed to buy that home. They use this =
measure=20
as a standard way of looking at how affordable houses really =
are.
Some 159 urban housing markets were looked at in =
Australia, Canada, Ireland, New Zealand, the United Kingdom =
and the=20
United States during the 2006 calendar year.
Of the =
twenty=20
five most unaffordable markets in the entire survey sample, =
Sydney=20
ranked 7th worst, Perth ranked 11th, Hobart 20th and =
Melbourne 23rd.=20
Why Hobart? The average incomes earned there were relatively =
lower.
If you thought houses in Australia were =
relatively=20
expensive, and that we had to work hard and long to buy =
them, you=20
were right!
Out of all of the countries surveyed =
Australia=20
did not fare well. We were found to be the least affordable =
country=20
of all to buy a home in.
The survey showed that =
nationally on=20
average it took us 6.6 year's salary to buy that median or =
middle of=20
the price range home. This was more than double what the =
report=20
considered the "affordable" standard of 3 times the salary. =
The=20
average for New Zealand was just a little better at 6 times =
while=20
our friends in Canada had the most affordable real estate =
with 3=20
times annual salary needed to make their purchase.
No =
doubt=20
you've also heard a lot about what the resources boom has =
done to=20
house prices in the West. According to the survey, the cost, =
including mortgage interest of the median or middle priced =
house in=20
Perth has risen more than $575,000 compared to the same =
figure in=20
1996. This is equal to 11 years
of gross income for the =
median=20
income household.
So, given we love where we live, =
it's even=20
more important to make sure you get the very best =
information and=20
help when it comes to your mortgage and buying your home. =
That's=20
where we come in, remember as your mortgage broker we're =
just a=20
telephone call away.
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Avoiding Trauma makes sense.
There have been lots of new products in the insurance =
world in=20
the last ten years or so. One of those that are important =
but often=20
quite misunderstood is called trauma cover.
Life =
cover=20
is helpful, if you or your partner die, then the person left =
can=20
have the mortgage paid off so that there is one less thing =
to be=20
worried about at such a critical time. Life cover however =
pays only=20
on the death of the insured person and a claim within the =
terms of=20
the life policy. So, what happens if the person covered has =
a=20
serious car accident or is severely disabled but does not =
die? Life=20
cover doesn't pay out yet the person probably cannot work as =
a=20
result and the mortgage still needs to be =
paid.
That's where=20
trauma cover comes into its own. Trauma insurance (sometimes =
referred to as critical illness insurance) provides a cash =
lump sum=20
in the event of contracting a specified disease or trauma. =
Examples=20
might be stroke, heart attack, cancer, Multiple Sclerosis, =
Dementia,=20
Parkinson's disease or serious head injuries (where these =
occur=20
after entry into the policy).
Generally, trauma cover =
is=20
designed to assist with the payment of specialist medical =
bills and=20
the increased hospital and other costs that can follow an =
event of=20
this kind. This money might mean the difference between =
private care=20
versus relying on the public health system and the waiting =
lists=20
that may come with it.
Similarly, if the house needs =
to be=20
modified for the person to be cared for more comfortably, =
the money=20
may possibly be used for that purpose as well as used to pay =
out=20
debt. Subject to capacity, it's up to the recipient of the =
funds to=20
make those choices.
Depending on the terms of the =
policy and=20
the circumstances, this form of insurance may also be =
helpful if a=20
spouse needs to leave work to become a full-time carer for =
the=20
person who has suffered the trauma. Their lost income to the =
household may be offset by the payout received.
There =
are=20
companies offering this cover, but as with all insurance you =
need to=20
shop around, read everything very carefully and seek =
competent=20
professional advice. For example, there may be medical =
examinations=20
involved in arranging the cover.
By the way, some =
policies=20
cover fewer types of trauma so please don't buy on price, =
make sure=20
the policy meets your individual needs.
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Did You Know?
The Australian Bureau of Statistics has just released =
their=20
findings on where people with the highest average wage and =
salary=20
incomes live. The survey covered the year to 30 June=20
2004.
Of the top ten areas with the highest =
average=20
incomes from wage and salaries nationally, seven were in=20
metropolitan NSW, one was in metropolitan Victoria and two =
were in=20
metropolitan WA.
People living in the ACT had the =
highest=20
average wage and salary income of all the states and =
territories at=20
$44,664, followed by wage and salary earners in New South =
Wales=20
($41,407) and the Northern Territory (NT) ($40,027).=20
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Have you got the right credit card?
Australians have very much taken to using credit cards.=20
According to the Reserve Bank, at the end of January 2007=20
Australians owed about $38.4 billion on credit=20
cards.
With 20.7 million of us, every man, woman =
and=20
child owes around $1,855.00 on a credit card. The intriguing =
and=20
important question is do you have the right card to suit =
your needs=20
and your budget?
Firstly, what interest rate does =
your card=20
carry? At the moment the interest rate on Australian credit =
cards=20
ranges roughly between 9% and 19%.
Generally, the =
accounts=20
with the highest interest rates should offer you the most =
services.=20
In other words, reward schemes, interest free periods, and =
initially=20
cheap interest rates on any balances you transfer in from =
other=20
accounts.
We can discuss each of the main issues in=20
turn.
Reward schemes seem on the face of it, like a =
good=20
idea. Frequent flyer points, shopping, holidays, the list =
goes on. I=20
guess the only questions are do I ever use them, what are =
the=20
limitations on use, and what are these rewards really =
costing=20
me?
Interest free periods basically mean that if your =
transactions using the card comply with the terms and you =
pay the=20
balance of the card off in full during the interest free =
period, you=20
don't pay any interest. Now, it's not always this simple. =
According=20
to the same Reserve Bank statistics 75% of cards have a =
balance that=20
is never paid off. Does your card have an interest free =
period? If=20
you never use it, why pay for it?
Annual fees range =
from=20
around the $20 mark to roughly $350. There are some cards =
which do=20
not charge this fee at all. What is your annual fee, and =
what do you=20
get in return?
So, maybe it's time to have a close =
look at=20
all the cards in your wallet or purse. How do you use the =
card, what=20
do you want it to do for you? Can you cut the interest rate =
and your=20
costs by going somewhere else? The time you spend doing your =
homework here might just pay off.
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Book Review
Authors: Nigel Gazzard; Hilarie Owen & Vicky=20
Hodgeson
Everybody wants quick, practical =
information=20
that will aid them to become successful in whatever they do. =
Learning quick management tools is easy. Leadership is more =
of a=20
challenge as it's as much about who you are as a set of=20
skills.
The Leadership Manual is the first practical=20
reference guide for busy professionals, managers and =
entrepreneurs=20
that addresses both sides of the leadership challenge - your =
authentic self and your skills.
The authors have =
surveyed 500=20
leaders in a mix of organisations to identify the key =
challenges,=20
problems and issues that individuals say they face. This =
manual=20
addresses those questions.
The Leadership Manual =
provides=20
fast, practical information, suggestions, ideas and steps to =
encourage the reader to use their full leadership potential =
in every=20
situation they face at work.
Available at Dymocks =
Bookstores=20
for $52.95. Pearson Professional Education Publishers.
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Our Partners
Red Rock =
Mortgage=20
Group is a Full Corporate Member of the Finance Brokers =
Association=20
of Australia.
All members are bound by a strict code =
of=20
ethics to ensure the highest levels of service, integrity =
and=20
professionalism.
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About Us
Red Rock =
Mortgages=20
specialise in mortgage finance for property Investors &=20
Developers. Whether you're a novice or an experienced =
investor=20
looking for a flexible finance solution to create wealth. =
Red Rock=20
offers a mortgage to suit your needs.
Our aim is to =
assist=20
investors in creating wealth through property by utilising=20
innovative and flexible mortgage finance solutions. =
Our=20
boutique approach, experience and expertise means you'll be =
able to=20
source the right finance facility to build a diverse =
property=20
portfolio. We not only look at investment finance =
strategically, but=20
also understand the needs and requirements for a successful =
property=20
investor.
Red Rock Mortgages provides you with =
choice &=20
flexibility from a diverse lender panel including the major =
banks=20
and other lenders. In addition our own unique range of =
lending=20
products can provide you with cutting edge innovation and =
additional=20
leverage where others cannot.
As investors and self =
employed=20
business people we understand the needs of self employed =
borrowers=20
and property investors. You can be assured of receiving =
expert=20
advice and prompt assistance, with the added comfort of =
knowing we=20
are both speaking the 'same language'.
For =
professional=20
intelligent finance advice, contact us today.
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Disclaimer: =
This=20
newsletter is intended to provide general news and =
information only.=20
Readers should rely on their own enquiries before making any =
decisions regarding their own interests. Please do not rely =
on any=20
part of this newsletter as a substitute for specific legal =
or=20
financial advice. All material is copyright 2007. =
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