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RBA Cash rate unchanged    1.75%

4/7/2016

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Statement by Glenn Stevens, Governor: Monetary Policy Decision

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At its meeting today, the Board decided to leave the cash rate unchanged at 1.75 per cent.

The global economy is continuing to grow, at a lower than average pace. Several advanced economies have recorded improved conditions over the past year, but conditions have become more difficult for a number of emerging market economies. China's growth rate has moderated further, though recent actions by Chinese policymakers are supporting the near-term outlook.

Commodity prices are above recent lows, but this follows very substantial declines over the past couple of years. Australia's terms of trade remain much lower than they had been in recent years.

Financial markets have been volatile recently as investors have re-priced assets after the UK referendum. But most markets have continued to function effectively. Funding costs for high-quality borrowers remain low and, globally, monetary policy remains remarkably accommodative. Any effects of the referendum outcome on global economic activity remain to be seen and, outside the effects on the UK economy itself, may be hard to discern.

In Australia, recent data suggest overall growth is continuing, despite a very large decline in business investment. Other areas of domestic demand, as well as exports, have been expanding at a pace at or above trend. Labour market indicators have been more mixed of late, but are consistent with a modest pace of expansion in employment in the near term.

Inflation has been quite low. Given very subdued growth in labour costs and very low cost pressures elsewhere in the world, this is expected to remain the case for some time.

Low interest rates have been supporting domestic demand and the lower exchange rate since 2013 is helping the traded sector. Financial institutions are in a position to lend and credit growth has been moderate. These factors are all assisting the economy to make the necessary economic adjustments, though an appreciating exchange rate could complicate this.

Indications are that the effects of supervisory measures have strengthened lending standards in the housing market. Separately, a number of lenders are also taking a more cautious attitude to lending in certain segments. Dwelling prices have risen again in many parts of the country over recent months. But considerable supply of apartments is scheduled to come on stream over the next couple of years, particularly in the eastern capital cities.

Taking account of the available information, the Board judged that holding monetary policy steady would be prudent at this meeting. Over the period ahead, further information should allow the Board to refine its assessment of the outlook for growth and inflation and to make any adjustment to the stance of policy that may be appropriate.
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Don't do these 6 things when selling your property

3/7/2016

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If selling your property was an exam, scoring 100 per cent would bring the reward of less stress and more money. Here’s a cheat sheet of mistakes to avoid in order to pass your exam with flying colours!
​      1. Don’t Wrongly Price Your Property
Over-pricing or under-pricing is a common mistake that occurs when property owners fail to do sufficient research about what buyers are looking for and what they are expecting to pay. Look at comparable sales in your area and use this data when you are discussing prices with your real estate agent.

       2. Not tidy up
Mess, dirt and clutter turns buyers off because it makes it harder for them to envisage themselves living in the property. Remove junk, personal items and family photos off countertops, shelves and walls.

       3. Don’t Spend too much on renovations
While a coat of paint or re-carpeting can help improve the value of your property, it’s never a good idea to spend considerable money on a major renovation that you may never get a return on.
Ways you can improve the presentation of your property without spending a lot of money include de-cluttering, cleaning windows, re-grouting bathroom tiles, adding plants to an outdoor space, fitting a new benchtop or splashback in the kitchen, installing new taps or a decorative light fitting in the bathroom.

      4. Don’t Hide problems
When you cover up a problem rather than fix it, the risk is that when the buyer finds out, they will quickly become suspicious about other problems the house might have. Your best strategy is to either repair problems properly or declare them outright.

      5. Don’t Sell your home empty
Homes devoid of furniture often look smaller and less appealing. It’s hard for potential buyers to imagine themselves living in an empty home or their furniture fitting into the space.
Professionally styling your home for sale (also known as property staging) is a great option to consider, with anecdotal evidence suggesting it can help sell your property faster and for a better price.
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      6. Don’t Get emotionally involved
Thinking with your heart, not your head, can often lead to hasty decisions when selling. It is important to detach yourself emotionally and start viewing your home as though you were a potential buyer. Choose an experienced and reputable real estate agent and be prepared to take their advice on board and allow them to lead negotiations with potential buyers.
Contact us to find out what lending options exist to help guide your way through the process of buying and selling.
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Studies show that Properties make Money

3/7/2016

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If there’s any doubt in your mind about the value of property as a creator of wealth, new research from CoreLogic RP Data has found that you can’t go past property when looking for a profitable long term investment.

Researchers used an automated valuation process to obtain current property valuation estimates, and from there calculated equity levels for homes around the country.

The results clearly showed that in Australia, the average property is now worth almost double the amount of debt against it. This means property owners in either city or regional areas with a mortgage have accumulated 48.4% equity in their properties on average, which is the equivalent of $242,642.

New South Wales and Victoria have the highest average level of home equity at 56.6% and 49.3% respectively.  The ACT came next at 42.8%, Queensland at 39.9% and South Australia at 39.4%.

Even the lowest equity level, in Tasmania, was still an impressive 32.7%, worth $95,427.

The research confirms what many property investors have long believed, that property is a solid basis for any wealth creation strategy.
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To find out more about your property’s potential, give us a call. We can help you work out how to access and use your property’s equity to expand your property portfolio or pursue your financial goals.
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