A luxury beachfront apartment at Rainbow Bay has more than doubled in value since it sold off the plan six years ago, setting a new local apartment record in the process.

The three-bedroom apartment in the Flow development on Petrie Street, the first of four new projects locally by Paul Gedoun's S&amp;S Projects, has sold for $7.4 million, after originally selling for $3.27 million when the project launched in 2020.

The seventh-floor apartment, comprising 187 sqm of internal living space and a 54 sqm balcony overlooking Froggies Beach and Snapper Rocks, was purchased by a local family.

The transaction was negotiated by Pezet Matheson director Kerry Pezet and equates to more than $30,000 per sqm.

Pezet said the sale reflected the limited opportunities to buy into the boutique beachfront development.

"The sale highlights the rarity of opportunities within the boutique beachfront development, where residences seldom become available," Pezet said.

"Flow is one of the Gold Coast's most tightly held buildings. Buyers from our database move quickly when residences become available, and achieving an off-market sale at $7.4 million demonstrates the depth of demand for property of this calibre."

<img alt="Flow" data-entity-type="file" data-entity-uuid="c585b206-2130-4eee-a50c-3f27c51a7c70" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-06%20at%208.33.25%E2%80%AFPM.png?VersionId=m3pHRDV62Y3fvN.XQuQHq.52ilTWpRLf" />

Flow was the first of four luxury apartment developments delivered by Paul Gedoun's S&amp;S Projects at Rainbow Bay and was completed in 2023.

Positioned on the beachfront overlooking Snapper Rocks, the residence includes three bedrooms, three bathrooms, a powder room and views stretching north along the coastline towards Surfers Paradise.

Pezet Matheson Residential principal Mitchell Lambert said buyers continued to prioritise quality beachfront apartments in tightly held locations.

"Flow Residences offers a rare combination of elevated beachfront positioning, architectural excellence, comprehensive resident amenity and premium finishes, which is exactly what discerning purchasers are seeking," Lambert said.

"The transaction further reinforces Rainbow Bay's reputation as one of Australia's premier coastal lifestyle destinations, where limited supply and growing demand continue to support strong market performance."

Pezet Matheson originally marketed and sold out Flow off the plan, making the latest transaction a return to one of the project's original buyers.

Paul Gedoun is selling his third project, <a href="https://www.apartments.com.au/new-apartments/radia-rainbow-bay-271-boundary-street-coolangatta-qld-4225">Radia Rainbow Bay</a>, after recently completing, and selling out, <a href="https://www.apartments.com.au/buildings/esprit-217-227-boundary-street-coolangatta-qld-4225">Esprit</a>. He has plans for a <a href="https://www.apartments.com.au/news/qld/first-look-s-s-projects-proposes-88-apartment-wellness-tower-at-coolangattas-boundary-street">fourth building</a>, 88 apartments on <a href="https://www.apartments.com.au/new-apartments/209-213-boundary-street-coolangatta-qld-4225">Boundary Street</a>.

Joel Robinson

Rainbow Bay apartment doubles in price since off the plan sale during pandemic

The long-planned transformation of Brisbane's historic Shafston Estate has taken another major step, with Capella Hotel Group announced as the luxury hospitality partner behind what will become Brisbane's first branded residences.

The project, to be known as Capella Residences Brisbane, is being delivered by Verso Projects at the landmark Kangaroo Point riverfront estate, with completion targeted for 2029.

The announcement follows a series of planning changes to the project over recent years. The site was originally approved in 2023 for a 15-level, 37-apartment development designed by Rothelowman for Burgundy Group before Verso Projects took over the 10,070 sqm riverfront holding and lodged revised plans with Kerry Hill Architects to increase the development to a 25-level tower with 51 apartments.

The latest announcement confirms Capella Hotel Group will bring its branded residential offering to the project, marking just the second Capella Residences development globally after Seoul, and the group's first branded residential project in Australia.

The <a href="https://www.apartments.com.au/new-apartments/23-castlebar-street-kangaroo-point-qld-4169">Castlebar Street development</a> will centre around the restoration of the heritage-listed Shafston House, one of Brisbane's oldest residences, originally constructed in 1851 by Reverend Robert Creyke as a single-storey cottage known as Ravenscott.

<img alt="Capella" data-entity-type="file" data-entity-uuid="2b9f4ce5-638f-4d6b-8082-3ca7e4b75fca" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-09%20at%207.20.41%E2%80%AFAM.png?VersionId=f7aeqsW_DzOJI4FymWb3lD8NptSfsP7q" />

Capella said the project aligns with its focus on heritage-led developments, with the Brisbane estate combining the restored historic residence with a new luxury apartment tower and hospitality-inspired resident amenities.

Residents will have access to the Capella Living Room, a concierge-led communal space inspired by the group's luxury hotels, alongside landscaped gardens, six swimming pools, wellness and recreation facilities.

The broader estate will also include two riverfront homes, a six-berth private marina, porte cochère arrival experience, secure basement parking and a new section of public riverwalk along the Brisbane River frontage.

The heritage Postal Depot Building will also be retained and repurposed as a guest house, in line with the revised development plans.

The project represents another evolution for the site, which Kerry Hill Architects previously described as a rare opportunity to restore one of Brisbane's most significant heritage estates while creating a new benchmark for apartment living.

"The Shafston Estate provides a once-in-a-generation opportunity to restore one of Brisbane's finest heritage precincts and to reinstate residential use as a unique site perched on the edge of Kangaroo Point," Kerry Hill Architects said in its Urban Context Report accompanying the planning submission.

"The project will celebrate excellence in sub-tropical residential design, setting a new benchmark for vertical living in Brisbane."

Verso Projects, which now has an $8.5 billion development pipeline spanning more than 6,000 dwellings across apartments, townhouses, retail and commercial projects, said the partnership with Capella would elevate the development beyond a traditional residential project.

"We feel honoured to be restoring Shafston Estate to its former glory, elevating it to new heights of luxury and excellence underpinned by Capella's distinctive service ethos and design philosophy, and making it a standout landmark in Brisbane," Verso Projects CEO Steve Laffey said.

"By partnering with Capella, globally recognised for its refined approach to luxury hospitality and deep respect for cultural and historical context, we will elevate this project beyond a residential offering into a world-class destination."

Capella Hotel Group President Roland Fasel said Brisbane's emergence as a global city made it the right location for the company's Australian residential debut.

"Brisbane is a city on the cusp of something remarkable, and Capella Residences is our commitment to being part of that story," Fasel said.

"The Capella residential experience is more than luxury. It is about a sense of belonging to a place with deep meaning."

Private appointments have now opened for the project, with a display suite expected to open in late 2026 ahead of the planned 2029 completion.

Capella to launch Brisbane's first branded residences at Shafston House, Kangaroo Point

Lewis Land's latest apartment release within its <a href="https://www.apartments.com.au/new-apartments/harbour-shores-biggera-waters-564-oxley-drive-biggera-waters-qld-4216">Harbour Shores</a> masterplan is targeting one of the Gold Coast's fastest-growing buyer groups, with almost a third of apartments at Solis priced below $1 million.

The seven-storey building at Biggera Waters will comprise 91 apartments, including 24 one-bedroom residences starting from $778,000, a price point Lewis Land says is aimed squarely at first home buyers struggling to enter the Gold Coast market.

<img alt="Harbour Shires" data-entity-type="file" data-entity-uuid="e7486e37-22f6-4c92-b212-9b0622070b8f" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-08%20at%209.09.34%E2%80%AFAM.png?VersionId=W8MJwJUCf6HkIyl_EVSksnd.QI6MZryY" />

<a href="https://www.apartments.com.au/developers/lewis-land-group">Lewis Land</a> Head of Development Michael Long said the developer deliberately allocated a significant proportion of the project to more affordable apartment types.

"First home buyers have been priced out of many parts of the Gold Coast, and we saw a clear opportunity to address this and play our part in a longer-term housing solution," Long said.

"That's why 24 of the 91 apartments being delivered at Solis have been designed and priced for the city's next generation of homeowners, quality one-bedroom apartments, half of which include an additional multipurpose room to maximise space and flexibility.

"This approach places 30 per cent of apartments in Solis under $1 million, and with close proximity to Harbour Town's future light rail extension connecting residents to the city's major employment and knowledge hubs, it's a win for buyers looking to secure their first property."

<img alt="Sores" data-entity-type="file" data-entity-uuid="550526d3-73ba-4710-9739-c5f4294a30ef" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-07-08%20at%209.09.29%E2%80%AFAM.png?VersionId=cQQdXHt9wS0UXwZEm5Py5bH_3kAmzyhu" />

Designed by BDA Architecture, Solis will deliver a mix of one, two and three-bedroom apartments, with residences ranging up to 232 sqm. Apartments feature generous balconies and contemporary finishes, while residents will have access to Harbour Shores' lagoon pool, clubhouse, tennis court, gym, yoga studio and sauna.

The focus on first home buyers resonated with purchaser Holly Humphreys, who said she and her boyfriend spent more than a year searching for their first property before shifting their attention from houses to apartments.

"We fell in love with the first house we bid on and got our hopes up, but after repeated knockbacks we learned not to get too attached," Humphreys said.

"We offered at the high end of price guides, but sales kept going even higher. That's where we really struggled and we needed to re-evaluate our budget and our expectations. Standalone houses were off the table, and we pivoted to apartments and townhouses."

Humphreys said it was encouraging to see developers recognising the growing demand from first home buyers.

"There's a growing number of young buyers looking to enter the market earlier because they understand that getting in now can make a real difference as prices continue to rise," she said.

"It's fantastic to see a developer recognise this and then actively take measures to deliver an apartment with us in mind."

Solis is the first development planned within the second stage of the Harbour Shores masterplan, with early works expected to commence in September 2026.

[smartcode_project_cta:default project_id=113271]

Lewis Land targets first home buyers at latest Harbour Shores release, Solis

Luxury apartment developer Abadeen has recorded $19.25 million in apartment sales across two of its Lower North Shore developments in the lead-up to the end of the financial year, headlined by the sale of a $6.75 million penthouse at <a href="https://www.apartments.com.au/buildings/koyo-crows-nest-5-rodborough-avenue-crows-nest-nsw-2065">KOYO in Crows Nest.</a>

The transactions also included the sale of a newly completed three-bedroom apartment at <a href="https://www.apartments.com.au/buildings/park-residences-cremorne-2-sutherland-street-cremorne-nsw-2090">Park Residences in Cremorne</a> for $6.35 million, with the residence selling shortly after the project's first public inspections following completion.

The sales come as completed, owner-occupier-focused apartments continue to attract strong demand across Sydney's Lower North Shore, particularly from buyers looking for certainty and immediate occupancy.

The penthouse at KOYO spans 491 sqm across a single level and was designed by architect Koichi Takada. The development is one of Abadeen's flagship boutique projects in Crows Nest.

[smartcode_project:default project_id=108800 project_image_fid=370093]

Abadeen Executive Chairman and Founder Justin Brown said buyer activity lifted noticeably in the lead-up to the end of the financial year.

"We saw a clear increase in enquiry levels, inspection numbers and buyer engagement across our completed projects leading into the end of the financial year," Brown said.

"Buyers have become far more decisive over the past six months. The combination of improving confidence, limited supply and the ability to physically inspect completed residences is creating strong competition for premium apartments in the best locations."

Brown says the&nbsp;response to Park Residences following completion has been particularly strong.

"Buyers want certainty and are responding positively to the opportunity to walk through a finished product, inspect the quality firsthand and move in immediately," Brown suggested.

"Projects such as Park Residences and KOYO demonstrate that when the product is exceptional and the location is irreplaceable, buyers are prepared to act quickly."

[smartcode_project:default project_id=114246 project_image_fid=370116]

Abadeen CEO Joe Tack said quality continued to differentiate projects in the current market.

"Today's buyers are incredibly discerning," Tack said.

"They are seeking larger floorplans, premium finishes, walkability, lifestyle amenity and confidence in the developer delivering the project. Well-designed boutique developments continue to outperform because they offer something genuinely difficult to replace.

"The enquiry we are seeing across our completed and recently completed Lower North Shore portfolio is very encouraging, and we expect this momentum to continue into spring."

The sales follow increased enquiry across Abadeen's Lower North Shore portfolio which also includes <a href="https://www.apartments.com.au/buildings/northcote-collective-naremburn-2-northcote-street-naremburn-nsw-2065">Northcote Collective in Naremburn</a> which also completed recently.

KOYO penthouse headlines Abadeen's $19.25 million EOFY sales flurry

The City of Sydney has approved plans for <a href="https://www.apartments.com.au/developers/billbergia">Billbergia Group</a> and Metrics Credit Partners’ $3.5 billion Castlereagh Place project in the heart of the Sydney CBD

The towers will be among the tallest in <a href="https://www.apartments.com.au/developments/sydney-nsw-2000">Sydney</a>'s CBD, with more floors than any other residential tower in the city.&nbsp;

The 6,000 sqm site was acquired by the joint venture partners in 2024. It is the largest amalgamated land parcel in the Sydney CBD and comprises eight individual sites fronting Castlereagh, Pitt and Liverpool Streets.&nbsp;

<a href="https://www.apartments.com.au/new-apartments/castlereagh-place-sydney-324-348-pitt-street-sydney-nsw-2000">Castlereagh Place</a> will transform an underutilised city block into a landmark mixed-use destination, anchored by two 82-storey towers comprising 607 luxury residences above an 8-level podium housing a 209-room luxury hotel. A 1,000 square metre civic park on ground level features a curated mix of food, beverage and retail.

The plans have been refined over the past year to rebalance the residential and hotel offering, and reconfigure the retail footprint to create a stronger, more dynamic dining experience.

A three-level flagship building on the prominent corner of Pitt and Liverpool Streets will be the gateway to the Castlereagh Place lifestyle precinct. Set to become a Sydney icon, the building is capable of housing multiple hospitality venues.

“Castlereagh Place is designed to be the City's next great urban oasis - an energetic mixed-use precinct that pulses with life, day and night,"&nbsp;said Joseph Kinsella, Group Director of Billbergia.

"It will bring the vibrancy of places like Barangaroo and Darling Quarter into a more accessible, central destination at the very heart of Sydney."

Kinsella said the project will build on&nbsp;Sydney’s growing laneway culture with the City’s largest network of new activated lanes - an expanded, next-generation take on precincts like Angel Place, Palings Lane and Ash Street in Wynyard.

[smartcode_project:default project_id=134477 project_image_fid=374401]

Castlereagh Place has been designed by architects <a href="https://www.apartments.com.au/architects/fjc-studio">fjcstudio</a> in collaboration with Trias Studio, Aileen Sage and Polly Harbison Design, joint winners of an international design competition in 2018.&nbsp;

Signature design elements from the original scheme remain unchanged, while the public domain has been significantly enhanced, delivering 60 per cent more open-to-sky space.

Pedestrian access will also be enhanced through new laneways linking Pitt, Liverpool and Castlereagh Streets, drawing people into a new civic park with outdoor seating, landscaping and integrated public art.

With activated laneways supported by strong hospitality offerings, Castlereagh Place is tipped to become a vibrant new dining destination in the heart of Sydney’s CBD.

It marks the largest undertaking to date for the Billbergia and Metrics Credit Partners partnership. Together they are developing other underutilised Sydney sites into mixed-use precincts, including the $2.2 billion Concord Central and the $1.3 billion Chatswood Grand Residences.

Metrics Managing Partner and Group CEO Andrew Lockhart said Castlereagh Place is a landmark project that will redefine Sydney’s skyline.

"As the tallest residential high-rise development, the revitalised site will offer panoramic views across the CBD and surrounds. We are excited to partner with Billbergia to reinvigorate an underutilised site and create a sophisticated and contemporary mixed-use offering situated in the heart of Sydney.”

Total apartments within the towers have increased to 607 dwellings, with a focus on larger floorplans. Aligned to growing market demand, Castlereagh Place now comprises 299 three-plus-bedroom apartments, 198 two-bedroom units and 110 one-bedroom configurations.

[smartcode_project:default project_id=134477 project_image_fid=374402]

Resident amenities will include an exclusive residents club containing a gym, rooftop pool, dining rooms, co-working spaces, library, golf simulator, games room, cinema room, and access to an exclusive concierge service. There will be around 500 basement car spaces below the towers.

The development will also include a state-of-the-art wellness centre, set to feature a bathhouse with magnesium pools, hot/cold plunge pools and premium amenities.

&nbsp;

According to fjcstudio, the towers will feature distinctive yet elegant architectural design reflecting Sydney’s geometry and urban character, with a network of through-site links and intimate public spaces activating the streetscape.

"Castlereagh Place is a city-making project of significant scale and ambition," said Richard Francis-Jones, Design Director at fjcstudio.

"It will create a rich urban complex of public open spaces, landscaped gardens, and vibrant laneways. Defining these new public spaces and the important streetscape of Castlereagh Street is a sequence of fine-grained, diverse retail and hotel architecture designed in collaboration with Aileen Sage, Polly Harbison Design and Trias.

“Rising above the tree-lined, human-scale streetscape are two slender residential towers that will transform the city skyline and look towards the Harbour, Hyde Park, and the Royal Botanic Garden.”

Demolition and early construction works have commenced onsite at Castlereagh Place.

[smartcode_project_cta:default project_id=134477]

Billbergia, Metrics, approved for $3.5 billion Sydney skyscrapers

National Australia Bank (NAB) has brought forward the timing of the first RBA cash rate cut by three months.

NAB is now expecting a cut in February, in line with ANZ and Westpac, having initially thought a cut wouldn't come until May.

Commonwealth Bank, the nation's largest lender, still thinks the first cut will come in December.

NAB changed its call following the August monthly inflation figures that were released at the end of September, showing it had dropped to 2.7 per cent.

"The risk has been skewed to a first cut earlier in 2025, and today’s change acknowledges the balance of risks has likely shifted sufficiently for the RBA to feel comfortable cutting a little sooner than we earlier expected," NAB noted in its latest update.

They added that the cadence of the cuts may be faster than its central profile.

"Domestic inflation pressures are cooling, but only gradually, and we continue to expect the conditions for a cut will not be in place this year.

NAB believes the easing cycle will end at 3.1 per cent by early 2026, which is five cuts from the current 4.35 per cent cash rate.&nbsp;

CBA also thinks 3.1 per cent will mark the end of the cutting cycle, while Westpac is forecasting 3.35 per cent, and ANZ is the most pessimistic at 3.6 per cent, which would be just three interest rate cuts.

<h2>What would a rate cut in February look like for borrowers?</h2>

According to&nbsp;<a data-saferedirecturl="https://www.google.com/url?q=https://link.mediaoutreach.meltwater.com/ls/click?upn%3Du001.IVvjJ-2BPT0A8C3VxtqKc6e3bj5hBuw27WFEYqovsYs7kPsgFulYrdOzeP8gI7CybJOya3_RgrM7qq-2BfK-2FtAHeRBLv5Qrb-2Bii5fzjLeKcP4w-2FkNgJPXygpiRhVUan3WV3QEggcf617UC8Z60RjQJZAqx7PiO7FtVJQSn0D46Zc3iTVP0kAhTTzG51cPpa5hrqz1OkSA-2BiXAxUajQ686MTtiseWBIdMdknd83aB7cOVgXlVTeHCGf3-2BcMHwfvI8TYlkUovqEhn4dj0KXf2eJGpb9-2BBv20hPXdLlPP9yD7DvFFDBM5yrTqxvcCiMfAsW1onD-2FcriL628eYdhNQE7bwzYrxcOYnmaYfRhGl-2FEHQ6eK2uQcLxs6Cbu6Dx0bYvpi5A6enmxMWU5TkcRYrP6Z8GbXZYtc5qSoKu6eWFBQR9K7fsjXwHMmby3D3X6Yx-2BxcDcdRruTG&amp;source=gmail&amp;ust=1727774368149000&amp;usg=AOvVaw2vK2ujS77CHs9VRvSSXzLC" href="https://link.mediaoutreach.meltwater.com/ls/click?upn=u001.IVvjJ-2BPT0A8C3VxtqKc6e3bj5hBuw27WFEYqovsYs7kPsgFulYrdOzeP8gI7CybJOya3_RgrM7qq-2BfK-2FtAHeRBLv5Qrb-2Bii5fzjLeKcP4w-2FkNgJPXygpiRhVUan3WV3QEggcf617UC8Z60RjQJZAqx7PiO7FtVJQSn0D46Zc3iTVP0kAhTTzG51cPpa5hrqz1OkSA-2BiXAxUajQ686MTtiseWBIdMdknd83aB7cOVgXlVTeHCGf3-2BcMHwfvI8TYlkUovqEhn4dj0KXf2eJGpb9-2BBv20hPXdLlPP9yD7DvFFDBM5yrTqxvcCiMfAsW1onD-2FcriL628eYdhNQE7bwzYrxcOYnmaYfRhGl-2FEHQ6eK2uQcLxs6Cbu6Dx0bYvpi5A6enmxMWU5TkcRYrP6Z8GbXZYtc5qSoKu6eWFBQR9K7fsjXwHMmby3D3X6Yx-2BxcDcdRruTG" target="_blank">Canstar</a>, if there is a cut in February, a borrower with a $600,000 loan today and 25 years remaining would see their monthly repayments drop by $92.&nbsp;

<table border="1" cellpadding="0" cellspacing="0">
	<tbody>
		<tr>
			<td colspan="3">
			Impact of 0.25% pt cut in February 2025
			</td>
		</tr>
		<tr>
			<td>
			Current loan size
			</td>
			<td>
			Drop in monthly repayment
			</td>
			<td>
			New monthly repayment
			</td>
		</tr>
		<tr>
			<td>
			$600,000
			</td>
			<td>
			-$92
			</td>
			<td>
			$3,907
			</td>
		</tr>
		<tr>
			<td>
			$750,000
			</td>
			<td>
			-$114
			</td>
			<td>
			$4,884
			</td>
		</tr>
		<tr>
			<td>
			$1M
			</td>
			<td>
			-$153
			</td>
			<td>
			$6,512
			</td>
		</tr>
		<tr>
			<td colspan="3">
			Source:&nbsp;<a data-saferedirecturl="https://www.google.com/url?q=https://link.mediaoutreach.meltwater.com/ls/click?upn%3Du001.xWMOP9hChsvn-2BC9O-2FebBihXIZ4cEzbiuENdxm-2Bx3-2FYEEgYMhZlKWNj5Zzy1YZ56RuASD_RgrM7qq-2BfK-2FtAHeRBLv5Qrb-2Bii5fzjLeKcP4w-2FkNgJPXygpiRhVUan3WV3QEggcf617UC8Z60RjQJZAqx7PiO7FtVJQSn0D46Zc3iTVP0kAhTTzG51cPpa5hrqz1OkSA-2BiXAxUajQ686MTtiseWBIdMdknd83aB7cOVgXlVTeHCGf3-2BcMHwfvI8TYlkUovqEhn4dj0KXf2eJGpb9-2BBv20v2akwr6-2BqLyRrlEgkJ4J-2BCCyY0x189xEHZA4Ylf8c7ChBqNIkhmftZzoFuZKFn43pw3oJVg2o1gumrpdA-2B7MB-2FBtmL2rFCI-2FXORATQHySCLVOMg7Vywv-2BqnnQUAtDz6XkvpwxdHFXh70VwKazzhJsICilEYOvP4ju0sIfi5g6TL&amp;source=gmail&amp;ust=1727774368149000&amp;usg=AOvVaw2qVnp6oqATgqDUi2Frm22q" href="https://link.mediaoutreach.meltwater.com/ls/click?upn=u001.xWMOP9hChsvn-2BC9O-2FebBihXIZ4cEzbiuENdxm-2Bx3-2FYEEgYMhZlKWNj5Zzy1YZ56RuASD_RgrM7qq-2BfK-2FtAHeRBLv5Qrb-2Bii5fzjLeKcP4w-2FkNgJPXygpiRhVUan3WV3QEggcf617UC8Z60RjQJZAqx7PiO7FtVJQSn0D46Zc3iTVP0kAhTTzG51cPpa5hrqz1OkSA-2BiXAxUajQ686MTtiseWBIdMdknd83aB7cOVgXlVTeHCGf3-2BcMHwfvI8TYlkUovqEhn4dj0KXf2eJGpb9-2BBv20v2akwr6-2BqLyRrlEgkJ4J-2BCCyY0x189xEHZA4Ylf8c7ChBqNIkhmftZzoFuZKFn43pw3oJVg2o1gumrpdA-2B7MB-2FBtmL2rFCI-2FXORATQHySCLVOMg7Vywv-2BqnnQUAtDz6XkvpwxdHFXh70VwKazzhJsICilEYOvP4ju0sIfi5g6TL" target="_blank">www.canstar.com.au</a>. Starting rate is the RBA existing average owner-occupier variable rate of 6.36%. Assumes banks pass the cash rate cut on in full the month after the meeting.
			</td>
		</tr>
	</tbody>
</table>

Canstar Data Insights Director, Sally Tindall, says if core inflation continues to track in the right direction, or unemployment starts to accelerate significantly, we could well see a cash rate cut as early as February of next year.

“All four big banks now believe the RBA will be ready to cut the cash rate in just over four months’ time, if not before, in the case of CBA.

“However, the outlook for both inflation and unemployment is still highly uncertain. A couple of wobbly sets of inflation data could see the RBA holding for longer, particularly if unemployment remains relatively steady."

&nbsp;

Commonwealth Bank, the nation's largest lender, still thinks the first cut will come in December.

NAB bring forward first RBA cut to February 2025

<html><body>
Big four bank standard savings accounts
These accounts have no ongoing terms and conditions. They typically include an introductory period which offers bonus interest for several months, before dropping to a low ongoing rate.
<table border="0" cellspacing="0" cellpadding="0"><tbody>
<tr>
<td valign="bottom" nowrap width="81">
Bank
</td>
<td valign="bottom" nowrap width="110">
Product Name
</td>
<td valign="bottom" nowrap width="81">
Base Rate
</td>
<td valign="bottom" nowrap width="81">
Intro Rate 
</td>
<td valign="bottom" nowrap width="81">
Max Rate
</td>
<td valign="bottom" nowrap width="83">
 
</td>
</tr>
<tr>
<td valign="bottom" nowrap width="81">
CBA
</td>
<td valign="bottom" nowrap width="110">
Net Bank Saver
</td>
<td valign="bottom" nowrap width="81">
0.10%
</td>
<td valign="bottom" nowrap width="81">
1.55%
</td>
<td valign="bottom" nowrap width="81">
1.65%
</td>
<td valign="bottom" nowrap width="83">
 
</td>
</tr>
<tr>
<td valign="bottom" nowrap width="81">
Westpac
</td>
<td valign="bottom" nowrap width="110">
eSaver
</td>
<td valign="bottom" nowrap width="81">
0.10%
</td>
<td valign="bottom" nowrap width="81">
1.56%
</td>
<td valign="bottom" nowrap width="81">
1.66%
</td>
<td valign="bottom" nowrap width="83">
 
</td>
</tr>
<tr>
<td valign="bottom" nowrap width="81">
NAB
</td>
<td valign="bottom" nowrap width="110">
iSaver
</td>
<td valign="bottom" nowrap width="81">
0.11%
</td>
<td valign="bottom" nowrap width="81">
1.44%
</td>
<td valign="bottom" nowrap width="81">
1.55%
</td>
<td valign="bottom" nowrap width="83">
 
</td>
</tr>
<tr>
<td valign="bottom" nowrap width="81">
ANZ
</td>
<td valign="bottom" nowrap width="110">
Online Saver
</td>
<td valign="bottom" nowrap width="81">
0.10%
</td>
<td valign="bottom" nowrap width="81">
1.50%
</td>
<td valign="bottom" nowrap width="81">
1.60%
</td>
<td valign="bottom" nowrap width="83">
 
</td>
</tr>
</tbody></table>
Note: Max rate is the base and bonus added together 
Big four bank conditional savings accounts
These accounts require you to meet certain terms and conditions, such as one deposit a month and no withdrawals, in order to qualify for the bonus interest that month.
<table border="0" cellspacing="0" cellpadding="0"><tbody>
<tr>
<td valign="bottom" nowrap>
Bank
</td>
<td valign="bottom" nowrap>
Product
</td>
<td valign="bottom" nowrap>
Base Rate 
</td>
<td valign="bottom" nowrap>
Bonus Rate 
</td>
<td valign="bottom" nowrap>
Max Rate
</td>
<td valign="bottom" nowrap>
 
</td>
<td valign="bottom" nowrap> </td>
</tr>
<tr>
<td valign="bottom" nowrap>
CBA
</td>
<td valign="bottom" nowrap>
Goal Saver
</td>
<td valign="bottom" nowrap>
0.01%
</td>
<td valign="bottom" nowrap>
0.89%
</td>
<td valign="bottom" nowrap>
0.90%
</td>
<td valign="bottom" nowrap>
 
</td>
<td valign="bottom" nowrap> </td>
</tr>
<tr>
<td valign="bottom" nowrap>
Westpac
</td>
<td valign="bottom" nowrap>
Life
</td>
<td valign="bottom" nowrap>
0.45%
</td>
<td valign="bottom" nowrap>
1.20%
</td>
<td valign="bottom" nowrap>
1.65%
</td>
<td valign="bottom" nowrap>
 
</td>
<td valign="bottom" nowrap> </td>
</tr>
<tr>
<td valign="bottom" nowrap>
NAB
</td>
<td valign="bottom" nowrap>
Reward Saver
</td>
<td valign="bottom" nowrap>
0.11%
</td>
<td valign="bottom" nowrap>
1.39%
</td>
<td valign="bottom" nowrap>
1.50%
</td>
<td valign="bottom" nowrap>
 
</td>
<td valign="bottom" nowrap> </td>
</tr>
<tr>
<td valign="bottom" nowrap>
ANZ
</td>
<td valign="bottom" nowrap>
Progress Saver
</td>
<td valign="bottom" nowrap>
0.01%
</td>
<td valign="bottom" nowrap>
1.59%
</td>
<td valign="bottom" nowrap>
1.60%
</td>
<td valign="bottom" nowrap>
 
</td>
<td valign="bottom" nowrap> </td>
</tr>
</tbody></table>
Note: Note: Max rate is base and bonus added together
Rates based on balances less than $50,000. The Commonwealth Bank of Australia offers higher rates for larger deposits.
Highest ongoing savings rates on <a href="http://ratecity.com.au/" target="_blank" rel="noopener noreferrer" data-auth="NotApplicable">RateCity.com.au</a>
<table border="0" cellspacing="0" cellpadding="0"><tbody>
<tr>
<td valign="bottom" nowrap width="195">
Bank
</td>
<td nowrap width="91">
Max rate
</td>
<td nowrap width="251">
Conditions
</td>
</tr>
<tr>
<td nowrap width="195">
Xinja
</td>
<td valign="bottom" nowrap width="91">
2.25%
</td>
<td valign="bottom" nowrap width="251">
Must have linked bank account
</td>
</tr>
<tr>
<td nowrap width="195">
Up
</td>
<td valign="bottom" nowrap width="91">
2.25%
</td>
<td valign="bottom" nowrap width="251">
4 card purchases from everyday acct
</td>
</tr>
<tr>
<td nowrap width="195">
86 400
</td>
<td valign="bottom" nowrap width="91">
2.25%
</td>
<td valign="bottom" nowrap width="251">
Deposit of $1000 in everyday acct
</td>
</tr>
<tr>
<td nowrap width="195">
BOQ
</td>
<td valign="bottom" nowrap width="91">
2.15%
</td>
<td valign="bottom" nowrap width="251">
Deposit of $1000 in everyday acct
</td>
</tr>
<tr>
<td nowrap width="195">
UBank
</td>
<td valign="bottom" nowrap width="91">
2.10%
</td>
<td valign="bottom" nowrap width="251">
Deposit of $250 in transaction acct
</td>
</tr>
</tbody></table>
Note: excludes kids savers and introductory rates.
</body></html>

j.ballantyne1990-6AQqhLzZaK

Best saving rates amongst Australian banks, RateCity reveals 

<html><body>
Westpac has made interest rate cuts of between 0.19% and 0.50% to its package fixed rate investment loans across all terms for both interest only and principal and interest repayments.
Westpac’s 0.50% interest rate cut puts its 5-year fixed rate loan for investment lending with principal and interest payments at 3.19%.
It is now the lowest rate of its kind, according to Canstar.com.au and Westpac has positioned itself in the lowest priced 10 loans in the market in all fixed investment loan categories.
<img src="https://www.urban.com.au/images/2020/1/22/Westpac%20rate%20cuts%201.JPG" alt="">
Canstar finance expert, Steve Mickenbecker said, "you know the home loan market has become competitive when a loan from a major bank has the top rate in its category."
“The investment lending market has remained sluggish, as lending to owner occupiers has shown recovery, and Westpac is clearly working to lift its share of that market.
“While Westpac’s new rates are competitive, the comparison rates are much higher, incorporating the $395 package fee and with a higher rate attaching when the loan moves to variable interest after the fixed rate period," he said.
<img src="https://www.urban.com.au/images/2020/1/22/Westpac%20rate%20cuts%202.JPG" alt="">
"Investors will have to be on their toes at the end of the fixed rate period to assure a competitive rate, he warned.
</body></html>

Westpac makes big cuts to fixed rate loans

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La Trobe Financial established a Disaster Relief Package which will pay loan interest and charges for 12 months for those who lost their homes to the bushfires.
They will also provide access to interest-free loans to help cover any gap between insurance payouts and the cost of rebuilding, and allow fee-free withdrawals from investments in the La Trobe Australian Credit Fund.
La Trobe Financial President &amp; CEO Greg O’Neill OAM says: “true to our philosophy of others before self, we are determined to look out for our customers and offer meaningful support to those affected through this very challenging time.”
For other customers experiencing hardship because of the bushfires, La Trobe Financial will defer loan repayments for up to 12 months, help with finance on discounted terms to cover property repair costs or support a small business, and make it easier to access investments in the La Trobe Australian Credit Fund without incurring fees.
For customers who are volunteer firefighters, La Trobe Financial will also offer financial help including deferral of home loan repayments for up to six months.
The Disaster Relief Package is in addition to La Trobe Financial’s recent $1 million donation to assist people affected by the bushfires across Australia.
The donation was split between The Salvation Army Disaster Appeal and the Australian Red Cross Disaster Relief and Recovery Fund.
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wdavis-8cCN98p7xp

La Trobe Financial to pay loan interest for homes lost in the bushfires for a year

<html><body>
Lending to households building and purchasing new homes remained soft in November, with construction loans sliding 8.4 per cent, according to figures released from the ABS.
The seasonally adjusted figures saw first home buyer loans decline 0.9 per cent over the month, but remain 3.4 per cent up over the year.
HIA senior economist Georgan Murray said the weakness in construction lending in November is largely a legacy of the soft sales volumes that home builders were experiencing during the first half of the year. 
To enlarge, <a href="https://www.propertyobserver.com.au/images/2020/1/16/New%20Loan%20Commitments%20ABS.jpg" target="_blank">click here</a>.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2020/1/16/New%20Loan%20Commitments%20ABS.jpg" alt="">
Number of new loan commitments in November. Source: ABS
"As conditions in the broader housing market recovered during the second half of 2019 lending to households purchasing established homes improved", Murray said.
"Lending to owner-occupiers purchasing established homes held steady in November, recording 0.1 per cent increase."
Despite the decline in lending to new homes, there was more positive news for the value of new home loans.
The value of new housing loan commitments rose again in November, up 1.6 per cent to take the annual gains to 10 per cent.
To enlarge, <a href="https://www.propertyobserver.com.au/images/2020/1/16/Value%20loan%20commitments.jpg" target="_blank">click here</a>.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2020/1/16/Value%20loan%20commitments.jpg" alt="">
Value of new loan commitments in November. Source: ABS
There was a further increase of investor activity, with a 2.2 per cent increase in value of home loans written for investors, however they are still 3.2 per cent down on the year.
The figure is around 10 per cent higher than the lowest point registered earlier in the year.
Despite the number of first home buyer loans declining 0.9 per cent, the value of loans for first home buyers rose by 2.1 per cent to be nearly 20 per cent up on the year as the market bounces back from its June low.
Paul Marshall, chief executive of RateCity.com.au, said first home buyers were taking the bull by the horns.
“First home buyers have made a comeback in the past year, with close to 20 per cent more borrowing compared to the year before, as the stars aligned for them,” he said. 
“Three RBA rate cuts, a housing market that had lost some steam, and changes to serviceability increased the borrowing capacity for some people – a perfect storm for first homebuyers.
“November saw the highest level of new borrowing on record since October 2009 – around the same time the governments’ first home owner boost ended.
“While we haven’t returned to the peak of first home buyer levels, we’re likely to see more buyers continue to surge into the market this year, particularly helped along by the first home loan deposit scheme,” Marshall said.
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jrobinson-rf4aSBido9

New home lending falls in November, but value of home loans rises

<html><body>
GUEST OBSERVATION

A Victorian court decision that an Airbnb agreement had the status of a lease has profound implications for guests and hosts.

With summer holidays around the corner, many Victorians may be thinking about offering their homes through a home-share platform, such as Airbnb, while they get away themselves. Airbnb’s terms of service describe home-share arrangements as a “<a href="https://www.airbnb.com.au/terms" target="_blank">licence</a>”. Legally, a licence can be terminated at any time and a guest who does not leave is a trespasser.

However, in 2016 the <a href="https://www.propertyobserver.com.au/http://www6.austlii.edu.au/cgi-bin/viewdoc/au/cases/vic/VSC/2016/313" target="_blank">Victorian Supreme Court decided</a> home-share arrangements may constitute a lease. This decision indicates residential tenancy law may apply to all home-share arrangements where the host is away from the premises.

This would impose significant legal obligations on hosts, who would be regarded as landlords. Guests, if considered tenants, would have all the associated legal protections.

[smartcode_project:default project_id=8032]

For example, if a guest refuses to leave the premises, the host/landlord would have to follow the eviction process required by tenancy law. This has happened in <a href="https://www.businessinsider.com/airbnb-host-cant-get-squatter-to-leave-2014-7/commerce-on-business-insider/?r=AU&amp;IR=T" target="_blank">California</a>. Australian courts will eventually have to decide this issue.

How did the court arrive at its decision?

The court’s decision involved a tenant who offered the premises to guests on Airbnb. The court decided the tenant had breached the terms of the lease by subletting the premises. The tenant was evicted, as tenants cannot sublet without the landlord’s consent under <a href="http://www6.austlii.edu.au/cgi-bin/viewdoc/au/legis/vic/consol_act/rta1997207/s81" target="_blank">tenancy law</a>.

The court focused on the relationship between the tenant and the guest and determined that the host had given “exclusive possession” of the premises to guests. In Victorian tenancy law, exclusive possession is required to create a lease.

The court said it did not matter that each guest’s stay was only a few days, or that the Airbnb terms described the arrangement as a “licence” rather than a lease.

Although the court’s decision applied to tenants in this case, logically the decision applies to all whole-of-premises home-share arrangements, including where the host owns the premises. This is because the legal test for creating a lease is the same as that for creating a sublease.

The decision is controversial because home sharing on Airbnb is similar to boarding arrangements (where the host provides accommodation and services such as cleaning), hotel rooms and serviced apartments. These arrangements are usually regarded as a licence, not a lease. This is because the host has access to the property during the guest’s stay (for example, to do cleaning), so exclusive possession is not given to the guest.

In fact, Airbnb arrangements are unlike typical tenancy agreements. They specify check-in and check-out times, furniture, linen and towels are usually provided, and “house rules” (for example, on noise levels and smoking) may restrict the guest’s use of the premises.

In addition, Victorian residential tenancy laws <a href="http://www5.austlii.edu.au/au/legis/vic/consol_act/rta1997207/s10" target="_blank">do not apply to premises ordinarily used for holidays</a>. Potentially, this could exclude premises used for home sharing.

The situation may be different in other Australian states and territories, which, unlike Victoria, exclude from residential tenancies legislation agreements for the purpose of a holiday. However, not all home sharing is done for holiday purposes. For example, it’s also used for travel for business.

Legal uncertainty remains

The court’s decision means tenants who provide rented premises on Airbnb without the landlord’s consent may breach their own tenancy agreement and be evicted. However, the court stated that the particular circumstances of each case must be examined.

For example, hosts who provide only part of the premises (such as a bedroom and shared used of a kitchen) but who continue to reside in the premises will not be subletting. This is because they have not provided exclusive use of the premises.

However, if the host is away from the premises, then residential tenancy law may regulate home-share arrangements. This would give guests (now considered a tenant) stronger legal protections, including protection from eviction. The decision shows a court can ignore the description of the arrangement in an agreement if it determines exclusive possession has been provided.

Airbnb provides support to hosts and guests in the case of a dispute over a stay. It also provides compensation to hosts (akin to insurance) if guests damage the property or cause the host financial loss. However, if a host is found to have obligations under residential tenancy law, these obligations belong to the host/landlord, not to Airbnb.

The contentious aspect of the Supreme Court’s decision is its treatment of short-term hotel-like accommodation as a lease. However, it strongly suggests that <a href="https://www.propertyobserver.com.au/http://classic.austlii.edu.au/au/journals/AdelLawRw/2018/10">residential tenancy law may regulate</a> whole-of-premises home-share arrangements. That’s likely to come as a shock to Airbnb hosts - owners and renters alike.<img alt="The Conversation" height="1" src="https://counter.theconversation.com/content/128051/count.gif?distributor=republish-lightbox-basic" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" width="1">

<a href="https://theconversation.com/profiles/bill-john-swannie-161231">Bill John Swannie</a>, Lecturer in College of Law and Justice, <a href="http://theconversation.com/institutions/victoria-university-1175">Victoria University</a> and <a href="https://theconversation.com/profiles/chris-martin-203935">Chris Martin</a>, Research Fellow, City Futures Research Centre, <a href="http://theconversation.com/institutions/unsw-1414">UNSW</a>

This article is republished from <a href="http://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/your-airbnb-guest-could-be-a-tenant-until-the-law-is-cleared-up-hosts-are-in-limbo-128051">original article</a>.
</body></html>

Airbnb guests could be tenants: Until the law is clear hosts are in limbo

<html><body>
There have been 27 lenders endorsed to participate in the First Home Loan Deposit Scheme which kicks in at the beginning of next year.
There will no doubt be a huge amount of first home buyers looking to secure one of only 10,000 opportunities across to country to access the extra lending.
Some 100,000 first home buyers are forecast to be entering the market in 2020, <a href="https://www.propertyobserver.com.au/forward-planning/investment-strategy/65-first-home-buyers/105815-20-000-fhbs-set-to-take-up-the-low-deposit-scheme-in-2020" target="_blank">however 2020 will see 20,000 home loans written</a> for the scheme given the cut off dates in the future will be July 1.
The scheme will enable first home buyers <a href="/expert-insights/buying/how-to-buy-your-first-home-with-5-percent-deposit">who have only been able to save five per cent deposit</a> to gain a further 15 percent to take them to the 20 per cent mark, forgoing lenders mortgage insurance.
Commonwealth Bank have joined the NAB as the only two major lenders <a href="/news/westpac-ditched-from-government-s-first-home-loan-deposit-scheme">after Westpac were dumped</a> following their recent scandal.
The full list of lenders are:
<table class="gmail-MsoTableGrid" border="0" cellspacing="0" cellpadding="0"><tbody>
<tr>
<td colspan="3" valign="top" width="614">
Major bank lenders
</td>
</tr>
<tr>
<td valign="top" width="198">
National Australia Bank
</td>
<td colspan="2" valign="top" width="415">
Commonwealth Bank of Australia
</td>
</tr>
<tr>
<td colspan="3" valign="top" width="614">
Non-major lenders
</td>
</tr>
<tr>
<td valign="top" width="198">
Australian Military Bank
</td>
<td valign="top" width="246">
Auswide Bank
</td>
<td valign="top" width="170">
Bank Australia
</td>
</tr>
<tr>
<td valign="top" width="198">
Bank First
</td>
<td valign="top" width="246">
Bank of us
</td>
<td valign="top" width="170">
Bendigo Bank
</td>
</tr>
<tr>
<td valign="top" width="198">
Beyond Bank Australia
</td>
<td valign="top" width="246">
Community First Credit Union
</td>
<td valign="top" width="170">
CUA
</td>
</tr>
<tr>
<td valign="top" width="198">
Defence Bank
</td>
<td valign="top" width="246">
Gateway Bank
</td>
<td valign="top" width="170">
G&amp;C Mutual Bank
</td>
</tr>
<tr>
<td valign="top" width="198">
Indigenous Business Australia
</td>
<td valign="top" width="246">
Mortgageport
</td>
<td valign="top" width="170">
MyState Bank
</td>
</tr>
<tr>
<td valign="top" width="198">
People’s Choice Credit Union
</td>
<td valign="top" width="246">
Police Bank (including the Border Bank and Bank of Heritage Isle)
</td>
<td valign="top" width="170">
P&amp;N Bank
</td>
</tr>
<tr>
<td valign="top" width="198">
QBANK
</td>
<td valign="top" width="246">
Queensland Country Credit Union
</td>
<td valign="top" width="170">
Regional Australia Bank
</td>
</tr>
<tr>
<td valign="top" width="198">
Sydney Mutual Bank and Endeavour Mutual Bank (divisions of Australian Mutual Bank Ltd)
</td>
<td valign="top" width="246">
Teachers Mutual Bank Limited (including Firefighters Mutual Bank, Health Professionals Bank, Teachers Mutual Bank and UniBank)
</td>
<td valign="top" width="170">
The Mutual Bank
</td>
</tr>
<tr>
<td valign="top" width="198">
WAW Credit Union
</td>
<td valign="top" width="246">
 
</td>
<td valign="top" width="170">
 
 
</td>
</tr>
</tbody></table>
All lenders have committed not to charge eligible customers higher interest rates than equivalent customers outside of the Scheme.
Michael Sukkar, the minister for housing and the assistant treasurer, said the Morrison Coalition Government is committed to helping make home ownership a reality for more Australians and to get them into the property market sooner.
 "The Scheme has been warmly welcomed by major industry peak bodies, and the composition of the initial lending panel reflects the industry’s confidence in the Morrison Coalition Government’s plan to assist first home buyers", Sukkar said.
"Further, the Scheme has been deliberately designed to ensure strong representation of smaller lenders on the panel. This will promote competition between the large and small banks, and ensure the Scheme has broad geographic reach, including in regional and remote communities.
Graham Wolfe, managing director at The Housing Industry Association, said it's encouraging to see so many lenders wanting to be involved.
“The Government’s commitment to involve a range of lenders in the Scheme is important in ensuring that first home buyers have a genuine choice from whom they obtain their home loan,” said HIA Managing Director, Graham Wolfe.
"Their commitment to offer the same interest rates to participants in the Scheme is also critical", Wolfe said.
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<div class="column">
“Home ownership provides people with stability in so many aspects of their life. Housing supply needs to remain a national priority to stem the decline in home ownership rates in Australia in the last 25 years.
“HIA has long argued for a national approach to addressing the added costs that affect the final price of a home for many first home buyers. 
“The time it takes to save a 20 per cent deposit, along with the added upfront cost of mortgage insurance, along with stamp duty and securing finance, remains one of the main barriers to people’s home ownership aspiration. 
“Helping 10,000 first home buyers a year achieve their home ownership dream sooner by providing a guarantee under this Scheme to remove one of these added costs will make a real difference. 
“With the house price caps and lenders panel now locked in, people saving for their first home can begin to make a choice about whether to take up the opportunity in the new year and get into their first home sooner.” 
</div>
</div>
</div>
Applicants will be subject to eligibility criteria, including having taxable incomes up to $125,000 per annum for singles and up to $200,000 per annum for couples and eligible dwelling price thresholds.
 
</body></html>

Commonwealth Bank among 27 lenders endorsed for the First Home Loan Deposit Scheme

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Australian Finance Group Ltd (AFG) has unveiled a new standard that summarises crucial mortgage information in a consumer-friendly format for home loan customers.
Home loans within the AFG network now require both the customer and the mortgage broker to approve a one-page summary that clearly explains why the home loan product is appropriate for the customer.
The concise one-page document spells out to the customer their requirements and objectives, the recommended product, the reasons why the product was selected and any remuneration to be paid by the lender. The document also provides similar material about other products considered before settling on the final product selection.
A new one-page disclosure will be included at the top of the existing AFG National Consumer Credit Protection documents.
The move comes ahead of the Federal Government’s best interests duty laws currently in the parliament.
AFG Chief Executive Officer David Bailey said ASIC challenged the mortgage broking sector to source the information and present it objectively and transparently so that customers clearly understand their options.
He said, “AFG is not waiting for others to set our agenda. The reality is the new obligations under the proposed best interests duty don’t come as a surprise to most mortgage brokers."
One in every 11 home loans in Australia last year was arranged through AFG’s 3000-strong national network of brokers, with settlements of more than $31 billion in the 2018-19 financial year.
“Now that AFG has lifted the bar to further demonstrate our customers are first and foremost, we are looking forward to working with ASIC and the rest of the industry on a regulatory guide to formalise the framework for the best interests duty,”
</body></html>

AFG make pre-emptive move on home loan transparency

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GUEST OBSERVATION
Governor Phillip Lowe has laid out in very clear terms the circumstances in which the bank would resort to quantitative easing and the way in which it would implement it.
Quantitative easing is simply a change in the way it eases monetary policy when the official interest rate approaches zero.
Usually it does it by cutting the so-called <a href="https://www.rba.gov.au/education/resources/explainers/how-rba-implements-monetary-policy" target="_blank">cash rate</a>, which is the rate banks pay each other for money deposited overnight.
Eight years ago the cash rate was 4.5%. Three years ago it was 1.5%. After the most recent three cuts in June, July and October, it is just 0.75%
<hr>
<a href="https://images.theconversation.com/files/303837/original/file-20191126-112484-iegrak.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/303837/original/file-20191126-112484-iegrak.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
<a class="source" href="https://www.rba.gov.au/statistics/cash-rate/" target="_blank">Source: RBA</a>
Last night, Governor Lowe said the <a href="https://www.rba.gov.au/speeches/2019/sp-gov-2019-11-26" target="_blank">effective lower bound was 0.25%</a>. Rather than let the cash rate get any lower or negative (an option he explicitly ruled out), the bank will push down other longer-term rates by buying government bonds.
It’s the “quantitative easing” approach adopted by the US Federal Reserve between 2009 and 2014.
Government bonds are sold by governments in return for money, a means of borrowing. The buyer gets guaranteed interest payments and a guarantee that their money will be returned in full after three, five, 10 or even 20 years depending on the length of the bond.
Once issued, bonds can be traded on a market, and the price at which they change hands can be expressed as an implied interest rate, which becomes the risk-free rate against which all other interest rates are benchmarked.
How quantitative easing would work
Buying bonds from investors would push down that risk-free rate, pushing down the entire structure of long-term interest rates.
All other things being equal, this should also push down the exchange rate by reducing the return on Australian dollar denominated financial investments.
Governor Lowe indicated he might buy state government bonds as well as Commonwealth bonds.
Importantly, he argued that although the bank would be mindful of the need to ensure private banks had enough access to the bonds they needed to hold for regulatory purposes, those holdings would not be an impediment to quantitative easing.
He ruled out buying residential mortgage-backed securities and other private assets given that those markets are currently functioning well and Reserve Bank purchases could distort them.
The approach borrows heavily from the US Fed.
As in the US, Lowe says quantitative easing would be complemented by “forward guidance”, where the Reserve Bank would signal early how long-term interest rates would be kept low and the circumstances in which it expected to raise them again.
The guidance is designed to influence market expectations for future interest rates, enhancing the effectiveness of cuts in long term interest rates.
When it would happen
In addition to “how”, Governor Lowe spelled out “when” – the economic circumstances in which the bank would resort to quantitative easing.
It would do it when the cash rate was at 0.25% and inflation and unemployment were moving away from its objectives.
The bank targets 2-3% inflation on average over time and has recently identified 4.5% as the “full employment” unemployment rate.
Importantly, Lowe emphasised that the Australian economy has not yet reached the point where a cash rate as low as 0.25% would be needed and argued quantitative easing was unlikely to be needed in future.
The cash rate is at present 0.75%. Setting 0.25% as the effective lower bound gives the Governor 0.5 percentage points left to cut before implementing quantitative easing.
Implicitly, Governor Lowe is saying that those cuts of 0.5 percentage points will be enough to stabilise the economy.
A pause for a breath at 0.25%
Lowe also indicated the bank would not seamlessly transition to quantitative easing.
He implied there was an additional hurdle or threshold that would need to be crossed, suggesting he would be reluctant to make the transition.
His big problem is that neither inflation nor the unemployment rate are moving in the right direction.
The bank has undershot its inflation target since the end of 2014, giving the economy a weak starting point going into an emerging global downturn.
My <a href="https://www.ussc.edu.au/analysis/lessons-from-quantitative-easing-in-the-united-states-a-guide-for-australian-policymakers" target="_blank">research</a> on the US experience for the United States Studies Centre shows that the main problem with is quantitative easing was that it was not done soon enough or aggressively enough.
It might be better to be bold
While quantitative easing was effective, it could have been made more so had what was going to happen been made clearer.
The Fed went out of its way to limit the transmission of quantitative easing to the rest of the economy, fearful it would be too potent and lead to excessive inflation.
Those concerns proved misplaced. By pulling its punches, the Fed ended up being less effective and having to pursue quantitative easing for longer than if it had used it more aggressively.
Governor Lowe’s very obvious reluctance to go down the quantitative easing route suggests the Reserve Bank is in danger of making the same mistake, but it is not too late to learn from what happened in the US.<img src="https://counter.theconversation.com/content/127697/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
Stephen Kirchner, Program Director, Trade and Investment, United States Studies Centre, University of Sydney.
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/now-we-know-the-reserve-bank-has-spelled-out-what-it-will-do-when-rates-approach-zero-127697" target="_blank">original article</a>.
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The Reserve Bank has spelled out what it will do when rates approach zero: Stephen Kirchner

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ASIC has commenced civil proceedings in the Federal Court against Mustafa Mohammed, Mahek Mustafa, Mubashir Mohammed, MyWealth Manager Financial Services Pty Ltd (trading as MyWealth Manager), MyWealth Protection Pty Ltd, 3M Financial Planning Pty Ltd (trading as MCube Planners) and Secure Investments Pty Ltd (together the Defendants).
ASIC is seeking declarations from the Federal Court that the Defendants have contravened the Corporations Act by operating an unregistered managed investment scheme called ‘MyWealth Manager’. ASIC alleges the scheme should have been registered and that the Defendants operated the scheme without holding an Australian Financial Services (AFS) licence.
On 21 November 2019, ASIC obtained interim orders in relation to the Defendants, including orders:
1. appointing Tim Norman and Rob Woods of Deloitte as Receivers and Managers of MyWealth Manager Financial Services Pty Ltd and 3M Financial Planning Pty Ltd; 2. restraining the assets of the remaining Defendants; 3. restraining the Defendants from carrying on a financial services business in this jurisdiction without an AFS licence; 4. restraining the Defendants from managing, directing, controlling or otherwise operating the unregistered scheme; and 5. restraining the Defendants receiving, soliciting, transferring or disposing of investor funds received in connection with the unregistered scheme. 6. ASIC alleges Mustafa Mohammed operated My Wealth Manager from February 2017and targeted consumers from certain ethnic and cultural backgrounds.
ASIC alleges the scheme has raised approximately $7 million from more than 55 investors where investors were encouraged to roll over their externally managed superannuation into newly created self-managed superannuation funds (SMSFs) and then invest the SMSF monies, by way of a loan, in MyWealth Manager.
ASIC also alleges that the Defendants used investor funds for their own personal use, including substantial payments to friends and family members and the promotion of cryptocurrency.
ASIC said their investigation is continuing.
The hearing has been adjourned to a date to be fixed after 5 December 2019.
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ASIC takes civil action against former Financial Adviser Mustafa Mohammed and Co

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The NAB have forecast a rate cut for June 2020, following an already predicted cut in February.
The two cuts will take the official cash rate down to 0.25 per cent. It already sits at a historic low 0.75 per cent.
"At this point, we see an increased risk of a move to ‘unconventional’ policy in H2 2020 should the labour market deteriorate more significantly than we forecast, with low inflation posing little constraint to further easing," NAB group chief economist Alan Oster advised.
"Previously, we had pencilled in only a further 25bp cut to the cash rate and hoped to see a material support from fiscal policy, which now looks unlikely in the required timeframe.
"Our forecasts of below-trend growth, a deterioration in the unemployment rate and inflation firmly below the RBA’s target band are broadly unchanged, but clearly imply the need for policy makers to do more."
In November NAB <a href="/expert-insights/finance/nab-pushes-next-rate-cut-out-to-february-2020-nabs-alan-oster">pushed their next cut forecast</a> to February.
They suggest June will be the final cut before quantitative easing begins.
NAB believe employment growth will be slow and unemployment will drift further above the non-accelerating inflation rate of unemployment.
"Indeed, our forecasts for the household sector and business investment are notably weaker than the RBA’s, although we remain more optimistic on public spending," Oster added.
"Should the data turn out weaker than our forecasts, there is a real prospect the RBA moves to unconventional policy in H2 2020."
 
 
 
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