Weekend reads – Must read articles from the last week

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.

The weekend will be over before you know it, so enjoy some interesting reading.

First-home buyers, investors and upgraders push new lending higher in June, ABS

There is a push for new lending from investors, first-home buyer, and upgraders.

This article on Realestate.com.au explains what’s going on.

Investors, first-home buyer and upgraders were all more active in June, with the latest data showing an uptick in new housing finance. First Home Buyer

The latest housing finance data for June 2020 looks very counter-intuitive.

Although the value of total housing finance commitments fell slightly in March 2020, it rose in the months thereafter before falling -2.4 per cent in June.

A closer look at the data shows that the recent strength in the housing finance data has largely been driven by refinance activity.

With attractive mortgage rates on offer, particularly fixed rates, many with a home loan have been rushing to refinance since the pandemic started, while new lending has been reducing.

The total value of refinanced housing finance commitments was $13.3 billion in June 2020 and although that was higher than the April 2020 figure, it was -11.7 per cent lower than its record high in May.economy-property-market-grow-wealth-house-dream-first-home

However, the total value of new home loan commitments in June was $17.4 billion, which was 6.2 per cent higher than the May figure, but still lower than the value of commitments during any other month since August 2019.

Looking at new housing finance commitments the $17.4 billion in June consisted of $4.4 billion to investors, $3.8 billion to owner-occupier first home buyers and $9.2 billion to owner-occupier subsequent purchasers.

The value of new lending to investors rose 8.8 per cent in June ,while lending to owner-occupier first home buyers was 3.3 per cent higher and lending to owner-occupier subsequent purchasers lifted by 6.5 per cent.

Despite the increase in the value of new lending over the month, the June values were lower than the April values across each of the three categories highlighting that although there was an increase the total value remained low.

Read the full article here

Homebuyers returning, but not in Victoria

Homebuyers are set to return to the market, everywhere except for Victoria.

In this Blog, Pete Wargen gives his thoughts.

Housing finance rebounds, but…

There was a resurgence in homebuyer finance in June, but not in Victoria, where finance commitments dropped sharply.

Unfortunately for Melbourne, this trend will only continue through July and August…and into September.

Owner Occupier

 

 

First homebuyer commitments zipped higher, but there was another sharp 9 per cent drop in Victoria, following on from a similar decline in the month of May.

Read the full article here

Sydney clearance rate holds steady as auction volumes rise during July

Auction volumes continue to rise in Sydney.

This article from Domain.com.au looks at the results.

Sydney’s auction market is proving resilient, with the clearance rate holding steady last month despite a surge in new listings that have been described as a “test of buyer appetite”.

The latest Domain auction report card, released Wednesday, showed Sydney recorded a clearance rate of 58.2 per cent in July from almost 2200 scheduled auctions,

“We saw an influx of auction listings which tested buyer appetite,” said Domain senior research analyst Nicola Powell.

The clearance rate did fall marginally month-on-month, dropping 0.1 percentage points, but this was off the back of a 14 per cent increase in homes scheduled for auction.

“The fact we’ve seen clearance rates hold over July indicates stability in the market.

Clearance rates have been holding consistently in the high-50s for three months now.”

Auction numbers were up 83 per cent from May and 64 per cent year-on-year, making it the busiest July since 2017.

Clearance rate Collection rate
Sydney 58.2% 97.1%
Houses 60.2% 98.6%
Units 54.5% 94.4%

While some home-owners may be bringing forward plans to sell in spring, Dr Powell said, the busier than usual winter months were largely due to the pause in sales activity earlier this year. Sydney+suburbs

“In July, we’ve seen those homes that were meant to hit the market in April and May coming on,” she said.

Houses performed stronger than units over the month, with respective clearance rates of 60.2 per cent and 54.5 per cent – the steepest difference favouring houses in more than two decades.

Units typically tended to perform better at auction, Dr Powell said, but houses had been stronger for two consecutive months and the gap appeared to be accelerating, which she attributed to the dominance of owner-occupiers in the market.

Ray White NSW chief auctioneer Alex Pattaro said hesitation from first-home buyers — who were more likely to purchase a unit — was also a factor.

Meanwhile, families looking to upsize were less wary of the current economic uncertainty as they were happy to buy and sell in the same market.

Read the full article here

1 in 9 Australians have frozen their mortgage, but few are ready to restart repayments on $195 billion worth of debt anytime soon

$195 billion worth of home loans have been frozen – but are Aussie’s ready to restart payments?

This article from Business Insider looks at what’s going on.

Next to the federal government’s JobKeeper wage subsidy, mortgage holidays have been crucial to pressing pause on the Australian economic fallout from the coronavirus. House Model On Top Of Stack Of Money As Growth Of Mortgage Credit, Concept Of Property Management. Invesment And Risk Management.

An incredible $195 billion worth of home loans have been frozen, according to the latest APRA figures out on Tuesday.

It’s no small feat, with one in nine mortgages included in the hardship program designed for those unable to make their repayments.

Throw into the mix some $55 billion worth of small business loans and there was $274 billion that has been deferred as of as of June 3.

However, as the country enters the backend of the year the major concern is what is to happen to all that debt when it does eventually need to be paid back in January 2021, pending another extension.

The figures show that relatively few people have been opting back into repayments since banks began trying to coax them back.

In May just $2 billion was thawed out by customers. In June that number spiked to a more encouraging $18 billion.

Weekend reads - Must read articles from the last weekMomentum remains firmly in one direction.

Still, it’s small change compared to the mountain being held by the banks, incurring interest if not attracting payments.

It’s also just a fraction of the $40 billion in new loans that were added to the deferment heap over the month. piggy bank

While banks have boasted they’re in productive conversations with customers, it’s clear most customers are simply not in a position to shell out the extra expense.

As stage four restrictions threaten to derail Victoria’s job recovery, there’s also no guarantee they will be in one come January either.

Certainly, it could see another wave of Australians opt-in and stymie the growing steam out.

With little inclination to see defaults rise, and with APRA instructing them to keep capital on hand, Australia’s banks could again kick the can down the road once again.

Read the full article here

Good News Stories From Around the World That Will Brighten Your Day

There’s no doubt that news headlines are less than positive these days, but that doesn’t mean there are no ‘good news’ stories we can smile about.

An article on readersdigest.ca looks at some good news stories from around the world to brighten up your day.

Good news - green living childPHOTO: SHUTTERSTOCK

Finnish town’s push towards zero waste starts with kids

A small Finnish town is bidding to become the world’s first zero-waste town—with the help of its youngest residents.

Since 2012 the town of Ii has invested heavily in geothermal, solar and wind energy projects, halving its CO2 emissions from 2007 to 2015.

Among other measures, Ii’s 10,000 residents are switching to electric cars and use smart metres, but they believe the key to continuing success is education from a very young age.

At school, children monitor water, heat and electricity consumption, classroom temperature and check that all electrical devices are switched off when not being used.

Today, Ii has an energy surplus, producing up to 10 times more than it consumes. Taxes have been reduced and $2.5 million saved from the annual budget.

“It’s the end for fossil fuels,” says town mayor Ari Alatossava. “If we can do it in a small town with few resources and benefit so much from it, no one has an excuse anymore.” [Source: BBC News]

Good News - Russia children in classroomPHOTO: SHUTTERSTOCK

High-flyers helicoptered in to help Russia’s rural schools

Top-tier Russian university graduates are helping to address the poor educational standards in their country’s remote villages.

Started by two St Petersburg graduates, the Teacher For Russia program sends graduates on two-year teaching stints, supplementing their rural teacher’s basic wage.

The idea, says co-founder Alena Makovich, is that the teachers make a contribution to society and develop personal skills, while inspiring pupils to widen their horizons. “One of our objectives is to ‘rebrand’ this profession so it is perceived as prestigious,” she says.

Each year 2,000 graduates apply for the scheme, and for those selected the experience can prove to be an eye-opener, particularly when confronting antiquated teaching methods. As 25-year-old law graduate Yulia Ignatyeva from Moscow observes: “We are trying to improve a lot of things.” [Source: Deutsche Welle]

Good news - donkey rights in SpainPHOTO: SHUTTERSTOCK

Donkeys Win Better Welfare

Spain is often criticized for an appalling attitude towards animal welfare, particularly in Andalucia. But attitudes are changing. The picturesque village of Mijas, near Malaga, has introduced regulations to protect the donkeys that give tourists rides. These include a limit on the weight they can be made to carry, mandatory rest periods and improvements in living conditions.

“The new laws are important to present a modern society that respects animals,” says local councillor Nicolás Cruz. Bullfighting in the famous 120 year old bullring has not, however, yet been tackled. [Source: El País]

Good news - cleaning up litterPHOTO: SHUTTERSTOCK

Neighbourhood Clear-Up Project Sparks Viral Craze

Members of a youth charity in a north Paris suburb that is known for gang violence were amazed when their efforts to clean up their neighbourhood inspired a national clean-up campaign.

Hind Ayadi, founder of the arts charity Espoir et Création in Garges-lès-Gonesse, got 40 young people picking up litter and trash to raise awareness of environmental issues and encourage them to take pride in their neighbourhood.

“Teenagers don’t always feel preoccupied by environmental issues but this time they wanted to get involved,” she says.

The volunteers then used social media to challenge the city of Marseille to make a similar effort. To their surprise, Marseille accepted the challenge, and in turn challenged Montpellier. The challenge spread virally from city to city, including Nice, Perpignan and 25 other towns.

Back in Garges-lès-Gonesse, 16-year-old volunteer Adil Nazir, says: “It’s rewarding to see we’ve reached so many people. Now, we’re fully committed to keeping our city clean.” [Source: The Guardian]

Good news - Belgian malinois shepherd dogPHOTO: SHUTTERSTOCK

Dogs Show a Nose for Archaeology

The scent-tracking ability of dogs has helped archaeologists discover Iron Age tombs in Croatia dating back nearly 3,000 years.

Vedrana Glavaš, an archaeologist at the University of Zadar, used Belgian malinois (above) and German shepherd dogs that had previously been taught to sniff out graves in criminal investigations. The dogs were able to locate several burial chests containing human bones and artefacts in a hilltop fort in the Velebit mountains on the Adriatic coast.

“Dogs’ noses don’t make mistakes,” she says. “Many archaeologists are looking for burial sites of settlements. I think dogs can solve their problems.” [Source: The Guardian]

Find out the world’s smartest dog breeds—ranked.

Read the full article here

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Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and his opinions are regularly featured in the media. Visit Metropole.com.au


'Weekend reads – Must read articles from the last week' have 2 comments

    Avatar

    February 15, 2020 Jackline

    Hi Michael,

    Love reading your posts, however there is a correction that needs to be made. In the “12 of the Most Unusual and Beautiful Homes in Australia” article, Cliff House is a concept, it doesn’t physically exist at this point in time in Australia. Maybe someone will get inspiration and have the deep pockets to make it a reality. 🙂

    Thank you for your teachings and sharing your knowledge in the property/investing world.

    Kind Regards,

    Jackline

    Reply

      Michael Yardney

      February 15, 2020 Michael Yardney

      Thanks Jackline – as you know we were just quoting some of the interesting articles we read this week

      Reply


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