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We hope you had a lovely Christmas. We’re now a few weeks into 2024 and there’s been plenty of big news:
My Finance Agent Annual Retreat
Property prices rise 8.1%
How to unlock your best financial year yet
Investor borrowing up 18%
Building approvals rise
Read more below.
My Finance Agent Annual Retreat
For My Finance Agent, January kicked off with our annual planning and goal-setting retreat, this year in Newcastle. When we weren't in meeting sessions, we were breaking into banks and out of Alcatraz (escape rooms) and solving a murder mystery at the circus. Watch out 2024 - here we come!
National property prices rose 8.1% last year
Australia's median property price reached a record $757,746 at the end of 2023, after another year of growth.
The median price rose 3.0% during the pandemic year of 2020, surged 24.5% in 2021, contracted 4.9% in 2022 and then climbed another 8.1% in 2023, according to CoreLogic.
The median price for the combined capitals ended 2023 at record levels, while the combined regions were just 1.5% off peak.
December was the 11th consecutive month of price gains (see graph) – however, as CoreLogic research director Tim Lawless noted, it was also the smallest of those monthly gains, at 0.4%.
“After monthly growth in home values peaked in May at 1.3%, a rate hike in June and another in November, along with persistent cost of living pressures, worsening affordability challenges, rising advertised stock levels and low consumer sentiment, have progressively taken some heat out of the market through the second half of the year,” he said.
As interest rates move up and down, so does the average person's borrowing power. Borrowing power tended to decline in 2023 and is likely to change again in 2024 as rates evolve. The other point worth mentioning is that your borrowing power can vary significantly from lender to lender. The good news is that we can match you with a bank that wants to lend to someone with your situation.
Unlock your best financial year yet: the power of an effective money management system
Imagine if this could be the year you achieve your financial dreams effortlessly. What if the key to reaching your financial goals is simpler than you think? If you're ready to explore new possibilities, read on because these insights might transform your finances.
Let's talk about financial habits
If we agree that our achievements are mostly the sum of our behaviours, it's important to choose our financial habits consciously. How frequently do you assess your spending patterns? Check your superannuation balance? Track your savings? Stay abreast of the shifts in your net wealth? Chances are, not as often as you wish. Why? Because adopting these habits is often easier said than done.
Our individual financial data tends to be spread across various platforms. Many of us manage multiple accounts across various institutions, not to mention dealing with investments, loans, superannuation, assets, insurance, and more.
What you really want is a system where an automated dashboard keeps your goals and good financial fitness habits at the forefront of your mind...
Keep reading
Investors commit to $9.72 bn of home loans
Every state has recorded a rise in property investor borrowing over the past year, with Western Australia leading the way.
Throughout Australia, investors took out $9.72 billion of home loans in November 2023, which was 18.0% higher than the year before, according to the most recent data from the Australian Bureau of Statistics.
Looking at the individual states, the year-on-year increases in investor borrowing ranged from 3.5% in Victoria to 42.1% in Western Australia.
This strong increase in property investor activity might be because investors are enjoying a double wealth gain right now: during 2023, investors enjoyed increases in both the national median property price (by 8.1%) and national median rent (by 8.3%), according to CoreLogic.
One of the key things to remember with investor loans is that your outcomes can vary significantly from lender to lender. Depending on your financial position and the property you want to buy, different lenders will offer you different loan products, loan sizes, and interest rates. As your broker, we will compare the market for you and shortlist lenders that suit someone with your specific scenario.
Home building approvals trending higher
More owners and developers are planning to construct new homes and renovate existing properties, according to the latest home building approvals data.
In January 2023, only 12,185 building approvals were issued. But after trending higher throughout the year, the number of approvals reached 14,529 in November, an increase of 19.2%.
Please contact us before you start a building or renovation project, so we can explain how the finance works.
Unlike with a regular home loan, where you receive the money in a lump sum, a construction loan involves a series of progress payments (typically five) as your project proceeds. The advantage of this approach is that instead of paying interest on the whole loan amount, you pay interest only on the portion received.
Another difference is that construction loans typically start as interest-only; you can then switch to paying principal and interest once the project is complete.
Take the next step
Talk with one of our business finance experts who can guide you through the process and help find the best solution tailored to your needs.
Call us on (02) 8313-8400 or request a call back.
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