There are more interesting articles, commentaries and analyst reports on the Web every week than anyone could read in a month.
Each Saturday morning I like to share some of the ones I’ve read during the week.
So pour yourself a mug of strong brew, settle into your favorite easy chair, and get ready for some weekend reading ….and please forward to your friends by clicking a social link buttons on the left.
A generation of renters?
Your Investment Property noted that escalating dwelling values are making it more and more difficult for renters to move into home ownership.
Twenty years ago, 95.4% of capital city house sales were below $400,000, according to CoreLogic RP Data’s Property Pulse. Three percent of sales were between $400,000 and $600,000, 1.2% were between $600,000 and $1 million, and only 0.4% were over $1 million.
Fast forward to 2014 and just 22.2% of house sales were below $400,000, 33.4% were between $400,000 and $600,000, 28.1% between $600,000 and $1 million and a massive 16.2% were above $1 million.
In housing hot spot, Sydney, the $1 million to $2 million price bracket accounted for the greatest amount of sales – with almost a third of all house sales in 2014 (31.6%) over $1 million. In Melbourne, 15.7% of sales were over $1 million, compared to 10.7% in Perth and 5.5% in Brisbane.
CoreLogic RP Data research analyst Cameron Kusher says Australia’s escalating home values is making it increasingly difficult for renters to afford to buy.
“The sharp decline in sales below $400,000 over the past 20 years reflects the overall growth in household debt which is attributable to housing,” said Kusher.
“It also highlights that a large proportion of Australian’s choose to build their wealth by investing in residential property. Of course, this is a good thing if you own a home but many Australian’s don’t. The sharp rise in home values leading to a decline in more affordable homes available for sale makes it more difficult for those renting to save up necessary deposits to enter in to home ownership.”
2015 so far | Signs of a Spruiker | Depreciation and property | Tasmanian housing market | Get the best deals | Bias in investing
Details of this week’s show:
Last week we asked what is standing between you and property investing success. Michael Yardney introduced you to the concept that there are a number of biases that can significantly impact your investment decisions. Today we look at a few more that may be holding you back from reaching your investment goals and dreams
There is good news for the Tasmanian market and Hobart in particular, from Louis Christopher but he balances that with some sobering figures from the west.
Dr Andrew Wilson reflects on the first 2 months of 2015 and says that lower interest rates have boosted investor confidence and dispels a common myth that investors only chase capital gains and good returns.
Brad Beer explains what depreciation is all about and how you can unlock thousands of dollars in your investment. What properties can benefit and when you should be getting one done. Is it ever too late if you have never done one? Brad has the answer.
Margaret Lomas details how she “keeps the bastards honest”. Of course we are talking about spruikers. What are the signs? Hear Margaret speak passionately about what she is doing.
We answer a common question about how to find the best deals. We talk to deal maker – Nhan Nguyen and he gives us some examples.
Australians’ super savings soar 10pc to $1.93 trillion
The Australian reports that the superannuation savings of Australians are just months away from hitting the $2 trillion mark, having jumped almost 10 per cent last year.
The new savings total of $1.93 trillion — up from $1.77 trillion — is significantly more than Australia’s gross domestic product (around $1.5 trillion) or the total value of all the shares listed on Australia’s stock exchanges.
Australia’s super pool is about the fourth biggest in the world, after the US, UK and Japan.
Here’s a great take on loss aversion from Andre Agassi, tweeted by Ben Carlson:
Property boom won’t stop further rate cuts
The Reserve Bank of Australia has admitted that while Sydney house price growth is “concerning”, it is not strong enough to deter further easing of monitory policy. Smart Property Investment writes:
In his opening statement to the House of Representatives Standing Committee on Economics on Friday, RBA governor Glenn Stevens noted that price rises in Sydney are “very strong, and they are pretty solid in Melbourne”.
“On the other hand they are much more mixed elsewhere,” Mr Stevens said.
“Excluding Sydney, the rise for Australia as a whole over the past year was about five per cent. That is a healthy pace but not alarming, and some cities have seen price falls,” he said.
“Developments in the Sydney market remain concerning, but in the end we did not see these trends as an overwhelming case for a further easing in monetary policy that was made on more general grounds.”
Mr Stevens noted that APRA has announced its supervisory approach to managing the potential risks posed by the rise in lending to investors in housing, which involves more intense scrutiny of investor loan portfolios growing at over 10 per cent per year, with the possibility of additional capital being required if APRA deems it necessary.
APRA has also reiterated its expectations for other elements of lending standards such as interest rate buffers and floors, he said.
“ASIC has begun a review of interest-only lending in the context of consumer protection legislation,” Mr Stevens added, noting that the central bank welcomed the steps and would keep working with other regulators in these areas.
The future of the super system and how your SMSF will fare
Kristen Rob quoted the David Murray Enquiry in SmartCompany saying that an ageing population, distrust in the super system and a dependency on foreign debt will put significant strain on Australia’s retirement income system over the next 40 years and will potentially leave Aussies without enough super to retire on.
We all know the figures. Of $1.85 trillion invested in superannuation at 30 June 2014, $560 billion is in SMSFs,” said Slattery.
“That’s 31% of all superannuation funds, with SMSFs now representing the majority of those that are self-sufficient in their retirement with 93% of members drawing income streams in the retirement phase.”
Slattery also pointed to “sobering” statistics that show approximately 84% of Australians are currently retiring on $21,000 or less a year through APRA-regulated funds.
Weekend video: Amazing Facts to Blow Your Mind
Time for some interesting facts to make your head explode! Now you can sound even smarter around your friends with these simple but super fun facts about life!
Blogs you may have missed this week:
If you didn’t have a chance to read my daily blog, here’s a list of some of the blogs you missed this week:
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