Whats up about interest rates ?

Given the Reserve bank has raised rates again, whats likely in the future? Lets read the RBA summary, basically they are increasing optimistic into the future. Let us remember its an election year. There are many key state elections before a federal election. Thus the temporary Government stimulus is only  going to be withdrawn gradually.
More of the same unfortunately, with  coking coal agreements up 80% on last year and the “spot” market for iron ore up 300% , on last year. The iron ore agreements are not yet released. The steaming coal agreements are also likely to be up strongly.  It is increasingly looking like a two speed economy, stronger for the mining areas and flat for the rest. Minerals and coal are Australia’s key exports, both in value and rising volume terms.

The futures markets give probably the best indication for interest rates, expecting a rise of around 100 basis (1%) points over this year. The interest rates risks might be seen as upside, especially if the USA economy starts to recover! There is even early talk of potentially an “overheating ” effect in the Australian economy within three years.What would a prudent man do? Potentially fix a portion of loans and keep a portion variable. This way if interest rates soar one is slightly protected. If rates fall and one has a windfall gain, one can pay off a portion of the loan without penalty.
Consult your advisor.  So much more like a  FREE ebook at website easyhomerenovating.com

When should I home renovate ?

Well I suggest just as soon as you are ready. Why the hurry to start work on home renovating ? Well close to 85% of the homes in Melbourne required for the next 25 years have already been built. Given Melbourne is such a large city with so many homes on large blocks, subdivision and retrofitting like renovating will be huge!
Given the decline in government welfare support, such as the aged pension and other benefits.  Only about 10 % of Australians retire on a comfortable living standard. Only 1% percent retire onto a very good living standards. We are all supposed to have made excellent provisioning  through the Super Guarantee Levy. But this takes no account of erratic and casual wages jobs: let alone the self employed.
In the past, investors might have relied on the  sharemarket or fixed interest investments. But given the great volatility of shares and the harsh tax treatment on fixed interest incomes:Investors need both higher and more secure returns.
The expected slower growth of USA and Europe for the next ten years means many investors will be looking for high returns elsewhere.
But isn t China, India, Brazil, Russia and Asia going to rescue world growth and boost Australia ? Answer, well who knows?, but we dont have to gamble on vicarious success.
I am certainly looking to buy, renovate and upgrade a home. One can start on your private home. If you can upgrade and revalue your home dramatically : you will have the equity profit to proceed with an investment home. Create your own deal with a good profit margin.
So much more in the FREE ebook, check it out! Its easy to access the info !

Where is the Home Market going right now?

Well talk about confusion!
Never seen so much smoke and mirrors:plenty of countervailing currents here. Many reports say a home in Sydney and Melbourne are amongst the worlds most unaffordable compared to income. Interest rates are on the rise. More land is released on the fringes of Melbourne. Some of the First Home grant incentives are being wound back.
Mark Armstong, CEO of Property Planning Instiute says, The use of Median figures, as indicators of affordability greatly over simplifies the property market. A Sydney home  appparently ranks second most unaffordable compared to incomes right behind Vancouver.
AMP’s Economist, Oliver says continued “under building” of around 45,000 to 50,000 homes a year. ANZ Bank is also very optimistic, for the home market. What can it all mean?

Lets keep it simple. I argue, if Australia is raising interest rates this will be only be after careful consideration of the world economic data. We simply cannot afford a slowdown or recession in an election year. In the USA, current data and reports suggest onterest rates will remain low for the foreseeable short term future. Thus I say interest rates are a likely laggard. If Australia continues to grow as seems likely, there will be more numbers of people employed and for longer hours, thus leading to higher family incomes. latest figures show some extra 160,000 employed in the last 6 months. I prefer to see the home market as “prices up side risk”.
So much more from the FREE ebook , go for it !

Cooperative Banking, or the Vietnamese Banking model?

Some 20 years ago, I happened to be driving through the inner city suburb of Burnley, in Inner Melbourne. I noticed about 25 Asian men  leaving a small terrace in the early morning.  I wondered, What is going on here?
This seems like a large number of men in  just one small house.
After some enquiries. I discovered that in the Vietnamese world. If the men don’t have jobs and the banks aren’t keen to lend.
The men work a cooperative banking system. This is where they pool their social security payments each week. Then “Jackpot ” it once a year. The winner is required to employ one of the contributors in a business that he buys, say a hot bread business. Then each year the  pooling of contributions and the “Jackpot” is continued, until they all have a business.

In this manner they are running their own bank.
What has this got to do with  easy home renovating? Well, it just highlights the ability of some people to cooperate to achieve their goals. In Australia, after this latest banking crisis, Banks will be demanding tighter credit criteria. Options still exist like the “Shared Equity “Home Loan fron the Bendigo Bank.
Of course, there is so much more at the FREE ebook site

Latest re the Environmental star Rating!

The recent upcoming C.O.A.G. , Council of Australian Government report will be introducing mandatory Environmental ratings for all homes for Sale or Let , both new and second hand homes. Every home on the market will require an Environmental assessment report.    This  system has been operating for many years in ACT and Queensland. It will rate the home for features like, Windows shades, Swimming pool, Air conditioning, Rainwater tanks,Wall and roof insulation, Window orientation,and heating system. These factors influence the energy efficiency of the home.
One way to is to think of it, as similar to the  Energy Star ratings on electrical goods. These reports will cost between $150 and $500.   It is expected that buyers and renters will be valuing homes for their Energy efficiency and comfort in the future. The system has been in place for new homes for a while, currently rated at 5 Stars, but to move gradually to 7 Stars. Contrast this to  the United Kingdom, currently rating new homes at ten Stars. I anticipate these reports will be popular as, I expect energy, particularly electricity prices to go through the the roof !!! In Victoria we are just becoming aware of the deregulated electricity prices. The OECD are recommending total deregulation across all the Australian states,(sic) just what we need from Meddling European bureaucrats.!!
Mainly, to pay for dubious Desalination plants and CPRS Carbon taxes. While the Desla plants are cheap to build , they are very energy intensive, read expensive to run.
So much more to read at the  FREE ebook site !! !!

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