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How prepared are you for your property purchase?

A combination of factors are behind the movement in the Sydney property market, including:

  • Investors and those looking for interest-only loans finding it more difficult to get finance, as banks have tightened their lending criteria due to pressure from regulators,
  • Tougher restrictions being imposed on foreign buyers by the government,
  • Rising levels of housing supply, and
  • Buyers with more realistic price expectations.

If you’re looking to take advantage of current market conditions to get into the property market speak to Strategic Investor Group today.

Carl Thompson – Commercial Lending Specialist, Strategic Investor Group

How prepared are you for your property purchase?

Eighteen per cent of Australian bidders have failed to get pre-approved finance prior to attending an auction, a new study has revealed.

According to a recent YouGov Galaxy poll, nearly one in five adults in Australia failed to secure finance before buying at auction.

Given it takes time to seek and be granted pre-approval it is important to seek professional advice as early as possible.

Buyers need to determine how much they can borrow and gain certainty that they are being realistic with their expectations.

Pre-approval is an indication from a lender that they feel comfortable lending a set amount of money to a potential buyer. It puts the buyer ahead of the game and strengthens their position when negotiating a purchase.

Carl Thompson – Commercial Lending Specialist, Strategic Investor Group

Is your loan structured correctly?

The Reserve Bank has left the official cash interest rate on hold at 1.5 per cent for the 20th month in a row.

It is “universally anticipated” that the RBA won’t move on rates in the immediate future.

Most economists only expect one rate rise this year and 10 out of 24 analysts expect rates to remain on hold into 2019, and potentially beyond.

It is important to remain fully informed, and understand your options, by reviewing your individual circumstances today.

Carl Thompson – Commercial Lending Specialist, Strategic Investor Group

Location, Location, Location

Sydney has the nation’s most evenly distributed new apartment market – putting it at less risk of inner-city oversupply – according to the 2018 UDIA State of the Land Report.

Just over a fifth of new Sydney unit completions (apartments, townhouses and terraces) were within five kilometres of the city centre in 2017 compared with almost half of all Melbourne unit completions – the country’s fastest-growing apartment market – the report found.

A third of new Sydney units were within 5 to 10 kilometres of the CBD, 28 per cent of completions were 10 to 20 kilometres out and 18 per cent of completions were as far as 50 kilometres from the centre of town.

Obtaining industry best advice is essential prior to making any potential property investment decision.

Carl Thompson – Commercial Lending Specialist, Strategic Investor Group

Property Investment – Timing is everything

The market waits for no one. It will go up or down with or without you as an investor.

An experienced independent advisor will ensure you won’t buy the wrong asset, wait too long or pay too much.

Whilst it may seem like you’re paying more upfront, having professional advice in the early stages, will ensure that you come out financially on top in the long run.

Remember, the price is what you pay but the value is what you get.

Property is a forgiving asset and you can mitigate the perceived risk largely by ensuring you buy the right property and take a long-term view.

Carl Thompson – Commercial Lending Specialist, Strategic Investor Group

Housing investor loan cap ‘reaching end of useful life’: APRA

The banking regulator has signalled it could ditch its 10 per cent cap on lending to property investors as the measure is “probably reaching the end of its useful life”.

Smaller lenders have criticised the 10 per cent cap for holding back competition.

The marketplace would welcome APRA addressing the cap’s current settings in order to improve competition, which will ultimately benefit the consumer.

Under pressure from regulators, banks have also in recent years overhauled their systems for assessing customers’ incomes, their debts, their cost of living, and their sensitivity to higher interest rates.

Now is the perfect time to seek professional advice if you are considering property investment.

Carl Thompson – Commercial Lending Specialist, Strategic Investor Group

Competition heats up among lenders for first home buyers and investors

Softer conditions in home lending are prompting the country’s banks, whose loan portfolios are dominated by residential mortgages, to target growth opportunities in specific customer segments, including property investors and first home buyers.

Under the Australian Prudential Regulation Authority’s rules to dampen the housing market, no more than 30 per cent of new bank home loans can be interest-only, and banks’ housing investor loan books can grow no faster than 10 per cent.

The big four banks are now all well below these caps after various moves to increase interest rates and tighten credit.

Now is a great time to invest in property and source a great financing package in a highly competitive marketplace.

Carl Thompson – Commercial Lending Specialist, Strategic Investor Group

Getting started in property investment

Some people get overwhelmed when considering a property investment and quit before they even begin. Reality is, property investing is relatively straightforward, especially when you partner with the right professional.

What does success look like to you? Property investors generally invest in property to secure their financial future or to be free to do what they want, when they want it.

Understanding the property market is the key to making the right investment decision.

Strategic Investor Group exists to create your unfair property advantage with advice regarding location, investment strategy, debt structuring and property acquisition.

Carl Thompson – Commercial Lending Specialist, Strategic Investor Group

Investor Mortgage interest rate payments rise despite no hike from the RBA

Australia’s banking and finance system delivers higher profits to only a few and rips off its most loyal customers, a Productivity Commission report has found.

The commission found loyal customers were “ripe for exploitation”, with one in two people still banking with their first bank. Only one in three have considered switching banks in the past two years, accepting interest rates on home loans up to 0.4 per cent higher than new customers.

Banks responded to orders from the Australian Prudential Regulation Authority to curb interest-only mortgages by raising interest rates – not just for new loans – but for all existing investor loans.

Now’s the time to seek professional advice and review your property investment strategy and mortgage interest rate.

Carl Thompson – Commercial Lending Specialist, Strategic Investor Group

First home buyers on the rise

First home buyers increased their share of housing demand this quarter, hitting the highest level since 2011.

Overall, first home buyers accounted for almost two in five sales in new housing markets and around one in three in established markets.

Most of the first-time buyers were owner-occupiers rather than investors.

It is a trend expected to continue over the year ahead, with first home buyers, owner-occupiers and local investors tipped to increase their share as foreign demand continues to fall.

Now is a great time to obtain market-leading advice on your property investment strategy.

 

Carl Thompson – Commercial Lending Specialist, Strategic Investor Group