Dedicated to enhancing the knowledge of Australian Mortgage Finance Information.
Thursday, October 30, 2008
Saturday, October 18, 2008
Good News for First Home Buyers in Sydney!
From Aussie Legal Posted: 15/October/2008 at 02:45
The newly increased $21,000 Grant for First Home Buyers in Australia will be available immediately and for the rest of the 2008-09 financial year, it was reported today. The Prime Minister said today the first home buyers grant will double to $14,000 for those buying an established home and triple to $21,000 for those buying a newly built home.
That means for a typical first home buyer in Sydney (price up to $400,000), the $21,000 Grant for First Home Buyers will take care of all major costs including mortgage insurance and/or deposit when purchased with a No Deposit or 3% deposit home loan. To complete your purchase without a contribution for deposit or mortgage insurance, though, you need to apply for your First Home Owners Grant with your Mortgage Consultant who then submits it through your lender, so that you can have the grant funds available at settlement.
As New South Wales and some other states exempts eligible first home purchasers from stamp duty up to a maximum price level (nil stamp duty upto $500,000 in Sydney), you make the application for exemption through your Solicitors.
Disclaimer: The information in this public forum is general information only and should not be regarded as legal or financial advice in any way. Please see a solicitor or financial advisor for formal advice regarding your situation
Friday, October 17, 2008
Interest rates may reach 8-year low
by Rachel Seymour of Inside Finance 16/10/2008
Interest rates could drop to to the lowest level for over eight years, according to Macquarie Group interest rate strategist Rory Robertson. He is forcasting that the Reserve Bank of Australia (RBA) would cut the official cash rate from 6% to 4.25% over the next 12 months.
Due to the crisis in global financial markets, the Australian economy is under immense pressure and has been slowing towards a recession. If interest rates did drop to 4.25% it would be the lowest rate since the aftermath of the September 11 terrorist attacks in the US.
''As the financial conditions continue to deteriorate, the Reserve Bank is becoming increasingly worried about the outlook for growth,'' Mr Robertson said.
''So the Reserve Bank is cutting aggressively to limit the risk of recession in Australia.''
Suggestions that an unprecedented zero interest rate by 2010 could be on the cards, come from one Sydney academic who believes that debt-laden consumers will stop spending all together and threaten to push the economy into a deep economic contraction.
Economists are expecting the RBA will cut interest rates by 75 basis points in November and then again by three-quarter of a percentage point in December.
Such cuts would take the cash rate to 5.25% in November and 4.5% by Christmas, a level not seen since mid 2002.
When the RBA cut rates by 100 basis points earlier this month, it was the largest one-off cut since May 1992.
Interest rates could drop to to the lowest level for over eight years, according to Macquarie Group interest rate strategist Rory Robertson. He is forcasting that the Reserve Bank of Australia (RBA) would cut the official cash rate from 6% to 4.25% over the next 12 months.
Due to the crisis in global financial markets, the Australian economy is under immense pressure and has been slowing towards a recession. If interest rates did drop to 4.25% it would be the lowest rate since the aftermath of the September 11 terrorist attacks in the US.
''As the financial conditions continue to deteriorate, the Reserve Bank is becoming increasingly worried about the outlook for growth,'' Mr Robertson said.
''So the Reserve Bank is cutting aggressively to limit the risk of recession in Australia.''
Suggestions that an unprecedented zero interest rate by 2010 could be on the cards, come from one Sydney academic who believes that debt-laden consumers will stop spending all together and threaten to push the economy into a deep economic contraction.
Economists are expecting the RBA will cut interest rates by 75 basis points in November and then again by three-quarter of a percentage point in December.
Such cuts would take the cash rate to 5.25% in November and 4.5% by Christmas, a level not seen since mid 2002.
When the RBA cut rates by 100 basis points earlier this month, it was the largest one-off cut since May 1992.
Thursday, October 16, 2008
Huge boost to cash grants for home buyers
By Mark Davis Political Correspondent SMH
October 15, 2008
CASH grants to first home buyers will be doubled to $14,000 - and trebled to $21,000 for those buying newly built properties - over the next eight months under the Federal Government's economic package.
The Prime Minister, Kevin Rudd, said the move was designed to stimulate construction and help first home buyers, tackling the economy's "twin challenges" of a subdued housing industry and poor affordability.
First home buyers are already eligible for a grant of $7000, which is funded by the Federal Government and administered by the states.
Now anyone who signs a contract to buy their first home from yesterday until June 30 next will be eligible for a grant of $14,000 if they buy an established dwelling and $21,000 if they buy a new house or apartment.
Mr Rudd said about 150,000 people were expected to benefit and the measure would cost the Government almost $1.5 billion.
"The construction sector and private dwellings investment are important generators of economic activity," he told Parliament. "They are also important for the well-being and the living standards of Australians."
The higher grants, which follow last week's 1 percentage point cut in official interest rates, will give a shot in the arm to a housing market hit by higher interest rates and falling consumer confidence.
The latest statistics show housing loan approvals in August were down 25 per cent from their peak in the middle of last year and council approvals for construction of new dwellings were down more than 8 per cent compared with a year earlier.
The housing industry welcomed the move but developers warned it needed to be matched by action by local and state governments to release new land and speed up planning approvals.
The managing director of the Housing Industry Association, Ron Silberberg, said the grants would stimulate activity and help address the housing shortage.
He said that in 2001 when the Howard government doubled the first home owners grant for new house purchases, the number of dwellings built rose by 3000 a month in nine months. He expected yesterday's initiative to boost new dwellings by 15,000.
Meriton's sales manager, James Sialepis, said:"It will now be much easier for potential purchasers to provide their initial deposit. The grant is nearly half an average deposit."
Australand's NSW general manager, residential, Tony Pizzolato, said it would stimulate demand and improve sentiment among home buyers.
But many potential buyers might wait for a couple of months before deciding whether to enter the market. "Our customers are telling us they want to see how the global economic turmoil and the possibility of job losses play out before committing themselves."
Economists welcomed the grants for newly built homes but were sceptical about the increase for those buying established homes. The ANZ Bank economist Riki Polygenis said the extra $7000 for existing homes would have little impact on housing activity and might really be designed to prevent falls in prices. "However, the $14,000 for first-time buyers of newly constructed homes should, because its time period is limited, pull forward demand."
October 15, 2008
CASH grants to first home buyers will be doubled to $14,000 - and trebled to $21,000 for those buying newly built properties - over the next eight months under the Federal Government's economic package.
The Prime Minister, Kevin Rudd, said the move was designed to stimulate construction and help first home buyers, tackling the economy's "twin challenges" of a subdued housing industry and poor affordability.
First home buyers are already eligible for a grant of $7000, which is funded by the Federal Government and administered by the states.
Now anyone who signs a contract to buy their first home from yesterday until June 30 next will be eligible for a grant of $14,000 if they buy an established dwelling and $21,000 if they buy a new house or apartment.
Mr Rudd said about 150,000 people were expected to benefit and the measure would cost the Government almost $1.5 billion.
"The construction sector and private dwellings investment are important generators of economic activity," he told Parliament. "They are also important for the well-being and the living standards of Australians."
The higher grants, which follow last week's 1 percentage point cut in official interest rates, will give a shot in the arm to a housing market hit by higher interest rates and falling consumer confidence.
The latest statistics show housing loan approvals in August were down 25 per cent from their peak in the middle of last year and council approvals for construction of new dwellings were down more than 8 per cent compared with a year earlier.
The housing industry welcomed the move but developers warned it needed to be matched by action by local and state governments to release new land and speed up planning approvals.
The managing director of the Housing Industry Association, Ron Silberberg, said the grants would stimulate activity and help address the housing shortage.
He said that in 2001 when the Howard government doubled the first home owners grant for new house purchases, the number of dwellings built rose by 3000 a month in nine months. He expected yesterday's initiative to boost new dwellings by 15,000.
Meriton's sales manager, James Sialepis, said:"It will now be much easier for potential purchasers to provide their initial deposit. The grant is nearly half an average deposit."
Australand's NSW general manager, residential, Tony Pizzolato, said it would stimulate demand and improve sentiment among home buyers.
But many potential buyers might wait for a couple of months before deciding whether to enter the market. "Our customers are telling us they want to see how the global economic turmoil and the possibility of job losses play out before committing themselves."
Economists welcomed the grants for newly built homes but were sceptical about the increase for those buying established homes. The ANZ Bank economist Riki Polygenis said the extra $7000 for existing homes would have little impact on housing activity and might really be designed to prevent falls in prices. "However, the $14,000 for first-time buyers of newly constructed homes should, because its time period is limited, pull forward demand."
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