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If the latest federal government budget is leaving you hungry for perks and savings, you’re not alone. We’ve had a brainstorm and here are four ways you could start working towards your property goals now. The 2024 federal budget is out, and you might be wondering what’s in it for you. Sure, an energy rebate of $300 annually can help take the sting out of electricity bills, though at $75 per quarterly bill, it’s not a huge saving. But you don’t need to rely on the federal budget. Here are four strategies that could get your wealth growing. 1. Helping hands for first home buyers? There’s plenty available Disappointed that the federal budget didn’t offer more support for first home buyers? There is still a wide choice of home buying assistance schemes to pick from. Take a look at: – The Home Guarantee Scheme that lets eligible first home buyers, regional Australians, and single parents buy a place of their own with a low deposit (between 5% and 2%) and zero lenders...
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Whether you’re rat running your local streets, or have a knack for always picking the fast-moving supermarket queue – everyone loves a good time-saving hack. Well, today we’ll let you in on a scheme that could get you into your first home years – yep years – sooner! When you’re saving for a first home, growing a 20% deposit can be a tough challenge. It’s certainly not made any easier by national property values soaring higher each month and cost of living challenges. But there is one potential solution that has seen 156,000 first home buyers, single parents and regional Australians buy or build a home of their own over the past four years – it’s the federal government’s Home Guarantee Scheme (HGS). How to buy with just a 5% deposit The HGS helps eligible first home buyers and single parents buy a home sooner by requiring only a small deposit. The scheme has three different parts. First home buyers can take advantage of the First Home Guarantee, or the Regional First Ho...
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Who doesn’t love a tax cut? Most of us are now only weeks away from saving on our tax bills, with Stage 3 tax cuts to kick in from 1 July. But another key advantage is that the tax cuts could give your borrowing power a nice boost. The upcoming Stage 3 tax cuts have received plenty of attention – some good, some bad – so we won’t focus on the politics of it today. But they are still expected to benefit about 13.6 million Australians, and how much tax you might save depends on your income. A person on the national average wage of around $73,000 will pocket a yearly tax saving of $1,504, says the federal government. If your income is, say, $100,000, you could expect to save $2,179 in tax each year. For households juggling a cost-of-living crunch, the tax cuts can’t come soon enough. But if you’re in the market for a new home, the tax cuts may offer an unexpected sweetener: a handy boost to your borrowing power. What is ‘borrowing power’? Your borrowing power, or borro...
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We all love the idea of nabbing a bargain property, but for most home buyers the real issue is whether they’re overvaluing a place – and paying too much in the process. Buying a home is an exciting prospect, but it’s perfectly natural to have a big dose of nerves given that you’re likely committing to spending hundreds of thousands of dollars (or millions!). But with a bit of research, and some other handy tips below, you can help protect yourself when the bidding or negotiations begin. Why it’s important to pay a fair price Paying above the odds for a home can have serious financial impacts. The more you pay, the more you may need to borrow to fund the purchase. That can mean paying higher loan repayments, potentially leaving your budget thinly stretched, especially if interest rates rise again. Worst case scenario, you could get caught out by a bank valuation that comes in lower than the purchase price – leaving you facing a funding shortfall. The question is, how do...
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Where you put your car keys, who won the footy premiership three years back, the new prime minister of New Zealand’s name – all very much socially acceptable things to forget. Your home loan rate shouldn’t be on that list. It’s a fair bet that your home loan repayments are one of your biggest household expenses. Yet it’s surprising how many borrowers haven’t kept up with what their home loan rate currently is. In fact, a new report by Mozo shows that 42% of mortgage holders have no idea what interest rate they’re paying on their home loan. And it’s an oversight that can cost home owners dearly. How does your loan rate shape up? It’s not just that large numbers of borrowers can’t pinpoint their loan rate. Mozo also found one-in-five home owners have never compared rates since taking out their loan. Your home loan may have had a competitive rate back in the day, but in a rapidly changing mortgage market, that may no longer be the case. And with the cash rate at its hi...
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When it comes to buying investment properties, younger Australians are punching above their weight, with Millennials taking the title as the nation’s most active generation for property investment. Investors are continuing to flock to the property market, with the Australian Bureau of Statistics saying the volume of new investor loans in February was 21.5% higher compared to a year ago. Investment loans now make up over half of the growth in new loans over the past year. But in an unexpected twist, it isn’t older generations of Aussies who are leading the charge to buy rental properties. Younger investors flex their muscles New data from the Commonwealth Bank shows Millennials (those born between 1981 and 1996) accounted for almost half (46%) of the bank’s new property investors in 2023. And almost one in three of those buyers purchased an investment property on their own, without the help of a partner. Gen Xers (1965 – 1980) are also snapping up rental properties, acc...
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You may not feel richer, but if you’re a homeowner, there’s a decent chance your personal wealth has surged over the past 12 months thanks to soaring property values. And it could open up a world of exciting possibilities. Sometimes you’ve just got to shake your head in disbelief at the resilience of the property market. Despite a cost of living crunch and higher interest rates, national home prices have somehow ploughed on over the last year and a bit. CoreLogic says home values nationally are up $71,832 since January 2023 – a jump of 10.2% in just 14 months – which averages out to an increase of $5,130 per month. To put that into perspective, last financial year the average full-time Australian worker earned $6,565 per month after tax. The thing is, higher values can give homeowners much more than a warm inner glow. Rising property prices can also provide opportunities to boost your wealth further – without having to hammer in a For Sale sign out the front. Let’s...
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Nobody likes missing out on a good thing. But then again, who likes overpaying? So how do you strike the right balance when both fears can work against one another? The property market rarely stands still. Interest rate movements, the number of homes listed for sale, and even the time of year can all drive shifts in the market. And change plus commitment isn’t something we’re all comfortable with. It can even see us put mental traps in place that mean we panic about missing out on a good buy, or alternatively, we convince ourselves it’s better to sit things out on the sidelines. Let’s take a look at three mind games that can work against home buyers – and how you could beat them. Fear of missing out – uh oh, FOMO FOMO can be a real thing for home buyers, and it’s possibly starting to have an impact on the property market once more. According to REA Group, today’s buyers are being gripped by a sense of urgency to make their move into the market. The reason? Growin...
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There’s something very special about moving into a newly built home or putting the finishing touches on a major renovation. Maybe it’s the look and feel of new paint and fresh flooring, or just knowing you’ve kicked a worthwhile goal. Whatever the motivation, plenty of Aussies are rolling up their sleeves right now, with the value of building approvals jumping 14.7% from December 2023 to January 2024. Meanwhile, on the renovation front, we’re not just pimping our pads for looks and lifestyle. Almost half the home renovations carried out in 2023 were designed with a ‘green’ focus to improve energy efficiency, according to Houzz Research. The upshot is that planning a new build or renovation can be exciting and rewarding. But long before you kick back and enjoy the fruits of your (or your builder’s) labour, you may need to decide how to pay for it all. And a construction loan could be the right tool for the job. How do construction loans work? Construction loans work ...
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Spare cash can be tight right now (cost of living crunch, anyone?). But if you’ve still got some savings plus a home loan, there’s a way you could make your surplus funds work harder. Ever heard of an offset account? They’re becoming an increasingly popular add-on feature to home loans, with new data showing that homeowners are stashing money in their offset accounts at a record pace. In fact, balances in offset accounts have increased to 11% of credit limits, the highest share since APRA started collecting data on this particular stat in March 2019. This essentially means that, on average, people with offset accounts are only paying interest on 89% of their mortgage each month. So how do home loan offset accounts work? An offset account is a cash account linked to your home loan. The bank doesn’t pay you interest on the offset account. Instead, the balance of the account is deducted from (or ‘offset’ against) the balance of your home loan when loan interest is calcula...
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