Nobel Finance Sydney – Money Matters Newsfeed

The population of Australia has increased by just under a tenth between 2004 and 2009, according to new statistics.

The Australian Bureau of Statistics (ABS) has revealed that the estimated resident population in Australia at the end of June 2009 was 21.96 million – an increase of 1.83 million since June 2004. That equals a total population growth of 9.1%, and a yearly average of 1.8%. Should population growth continue at this rate, Australia would have a total population of 23.93 million in 2014 and 26 million by 2019.

The ABS figures also revealed that just under one-third of the country’s population lived in NSW as of last June, with the Northern Territory and ACT containing the fewest people. In terms of population growth, Queensland saw both the largest and fastest growth. There were also around 92,000 more women than men in Australia last June.

Tags: Real Estate, real estate bubble australia
Posted in Early 20's tips, General, Retirement Planning |  | Comments Off

Continuing RBA monetary policy tightening in the first and second quarters of 2010 has impacted arrears performance

The RBA increased the cash rate target by 25 basis points during March with two further consecutive rises of 25 basis points each during April and May. This has taken the cash rate to a current rate of 4.5 per cent from a low of 3.0 per cent between April and early October 2009.

Fitch Ratings has seen arrears performance during Q1 2010 start to  deteriorate on the back of the rising cash rate, which has flowed through to home loan lenders’ lending rates.

Fitch’s Dinkum Index, which tracks arrears across all Fitch rated residential mortgage backed securities (RMBS), has seen an increase in its prime index during the first quarter with 30+ day arrears increasing from 1.19 per cent to 1.38 percent.

The increase was mainly attributable to 30-59 day delinquencies which rose from 0.52 per cent to 0.65 per cent with almost no change in the 90+ day arrears, which remained at 0.49 per cent.

All low doc loans evidenced an increase in the 30+ day delinquencies, which jumped from 4.82 per cent to 5.53 per cent; most of this increase was attributable to the 90+ delinquencies which rose 0.31 per cent to 2.67 per cent.

The deterioration in later stage arrears for low doc loans could be explained by Christmas credit spending rolling over into the New Year and successive rate rises in the last quarter of 2009.

Non-conforming low doc loan arrears remain persistently high with 30+ day arrears increasing from 16.5 per cent at Q409 to 17.7 per cent at Q1 10, while conforming low doc arrears also rose, but at much lower levels, from 2.8 per cent at Q409 to 3.6 per cent at Q1 10.

The RBA have held rates steady at 4.50 per cent since May 2010, after 6 rate increases since October 2009.

With decreasing unemployment, and a strengthening economy, the RBA is expected to increase rates further during 2010, putting continued upward pressure on borrower’s ability to service debt.

Fitch anticipates an increase in arrears for both conforming and low doc borrowers during the remainder of 2010 as compounding interest rate rises impact borrowers and flow through to rises in Fitch’s Dinkum Indexes.

David Carrol, Director Fitch Ratings

Tags: home loan, interest rates
Posted in General, Home Loan, Interest rates |  | Comments Off

Despite the RBA’s decision to keep rates on hold last month, 50 per cent of consumers are already sacrificing a range of everyday necessities to accommodate higher interest rates.

According to the latest Bankwest/MFAA Home Finance Index, 50 per cent of Australians are forgoing eating out to deal with the burden of higher rates, while 47 per cent are reducing costs at home or taking lunch to work and 42 per cent are going on cheaper holidays or not taking a break at all.

The Index found the number of borrowers feeling ‘worse off’ than 12 months ago has been steadily increasing since November 2009.

Those who are most concerned and affected by the state of the economy are the over 60s, unemployed, low income earners, students and those involved in home duties.

“With interest rates higher than last year, many mortgage holders seem to be holding back on their spending.  Home buyers are opting for practical strategies such as packed lunches, shopping during the sales, and buying in bulk to balance their household budgets. There is a clear move to more thrifty spending for many Australian households,” Bankwest retail chief executive Vittoria Shortt said.

Tags: home loan, interest rates
Posted in General, Home Loan, Interest rates, Real Estate |  | Comments Off

House prices are expected to soar 20 per cent over the next three years, a new report has found.

According to QBE LMI’s Australian Housing Outlook report, improving economic conditions are expected to facilitate further house price growth in Sydney, Adelaide and Perth.

More moderate growth is expected in Brisbane and Hobart, where affordability is not as strained and there is no sustainable dwelling deficiency.

QBE LMI chief executive officer Ian Graham said the Australian property market gained momentum in 2009 on the back of the First Home Owner’s Grant Boost Scheme (FHOGBS) and record low interest rates.

However, the expiry of the FHOGBS at the end of 2009 and several interest rate rises between October 2009 and May 2010 effectively moderated house price growth in the first half of 2010.

“The decline in first home buyer demand in the first half of 2010 is primarily due to first home buyer activity being pulled forward into 2009 because of the FHOGBS. However, demand is forecast to return to more normal levels, believed to be around 130,000 to 140,000 loans approved, in 2011” Mr Graham said.

“Future median house price rises will be underpinned by a deficiency of dwelling stock across most capital cities, which in turn will lead to tight vacancy rates and solid rental growth, flowing through to investor demand.”

Tags: home values rise, Real Estate, real estate bubble australia
Posted in Buying property, Home Loan, Interest rates, Real Estate |  | Comments Off

The latest property and housing finance figures suggest the recent slump in property price growth may soon be over

Despite Another fall in housing finance in the month of June, low property growth in

most capital cities and a low number of building approvals, a recovery of the property market is on the horizon, based on a broad analysis of the latest figures.

In June, owner occupied finance fell 3.9 per cent from the month prior, according to the ABS.

Building approvals were down in June by 3.3 per cent overall, according to the ABS, with private housing development hit the hardest.

But these factors do not mean that market growth will continue to slide in the months to come. In fact, there are a few positive signs that indicate that some areas will be on a steady growth path in the 12 months to come.

Westpac senior economist Andrew Hanlan said the latest slump in price growth has been “expected” in the wake of the RBA’s interest rate normalisation strategy and the recent dip in consumer confidence.

Westpac’s consumer sentiment index in August showed renewed consumer  confidence, with a reading of 119.2 compared to 113.1 in July. Further, the RBA’s decision to hold the cash rate since May, strong population growth and strong employment growth are sure to continue to boost consumer confidence and borrowing over the months to follow.

While lending figures dropped off in the upgrade and investor sectors in June, overall there’s been an aggregate increase over the past months, indicating a steady upswing.

Investor numbers fell in June by 3.6 per cent, but since January 2009 lending to investors has actually risen by 29 per cent.

And further gains can be expected in response to strong rental income growth, particularly in the unit sector.

Units have continued to eclipse house growth by an average of 0.3 per cent over the last five years and gross rental yields have remained remain strong at 4.8 per cent (4.0 percent for houses). By Belinda Luc

Tags: home values rise, Real Estate, real estate bubble australia
Posted in Buying property, Real Estate |  | Comments Off