Malaysian developer <a href="https://www.apartments.com.au/developers/s-p-setia">SP Setia</a> is the latest to jump into St Leonards booming Transport Oriented Development precinct.

The developer, which has previously delivered Sapphire by the Gardens apartment development in Melbourne, identified the Atchison Street site in 2023. It filed a Scoping Report around 12 months ago, and now has revealed the designs for the new&nbsp;40-storey mixed-use tower.

The State Significant Development Application covers <a href="https://next-portal.urban.com.au/projects/14650/summary">20-22 Atchison Street</a>, a 1,374 sqm site positioned between St Leonards Station and the new Crows Nest Metro station.

Designed by <a href="https://www.apartments.com.au/architects/cox-architecture">COX Architecture</a>, the project would deliver 181 apartments, above a four-storey commercial podium, five basement levels, and new public domain works along Mitchell Street. The apartment mix comprises 35 one-bedroom apartments, 39 one-bedroom-plus-study apartments, 85 two-bedroom apartments, and 22 three-bedroom residences.

The proposal has been lodged as a shop-top housing development under the NSW Government’s TOD planning pathway, which allows increased density around key transport infrastructure. The site sits within the recently rezoned Crows Nest Accelerated TOD Precinct.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="b799673d-48e2-46b0-801a-0e33a9330100" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/atchinson%20site.png?VersionId=dPh0UfwfaHpbFL1R7H1cbZNbIW0CHbCC" />

SP Setia acquired the Atchison Street site as part of its continued expansion into the Australian apartment market. In comments made to City &amp; Country (The Edge Malaysia) in 2023, SP Setia President and CEO Datuk Choong Kai Wai described the acquisition as “a strategic move” aligned with the group’s post-pandemic market recovery strategy.

“Our target for this exceptional development is local and overseas buyers, including first-home buyers, downsizers and investors,” Choong said.

The tower has been designed as a slender vertical form rising from a mixed-use podium, with COX Architecture positioning the development as a response to the evolving St Leonards and Crows Nest skyline.

“The purpose of the project is to facilitate the delivery of high-quality housing at a strategically located site and deliver a built tower outcome that is consistent with the desired future character of St Leonards and aligns with the TOD controls,” the design report stated.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="b1a85eee-76f7-436c-a6da-73ba827b9b13" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/atchinson%20entry.png?VersionId=dA9jHGPMcm.dDbwk4QfxqWiY5bfh3UVt" />

The podium would incorporate retail uses fronting Atchison Street, commercial tenancies, landscaped communal areas, and pedestrian improvements along Mitchell Street. Vehicle access and loading would be consolidated via Atchison Lane.

Residents would have access to more than 665 sqm of communal indoor and outdoor spaces, while the development proposes 96 parking spaces across five basement levels.

The proposal also includes a commitment for 10 per cent of residential floor space to be allocated toward affordable housing through a monetary contribution.

COX said the tower form responds directly to the emerging high-density character of the precinct while seeking to maximise solar access, cross ventilation, and outlook from apartments.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="2163f85c-f63b-4be3-aafa-f8763976cec5" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Article%20Feature%20Image%20%28Grid%29_5.png?VersionId=WiAmtIKJ6.ZQ41EtYEQ1fol7AeorKBlL" />

“The building is orientated towards north,” the Apartment Design Guide compliance report noted, adding that the tower’s slim form was driven by the constrained inner-urban site dimensions.

The design also incorporates landscaped setbacks and communal open space at podium level, intended to soften the interface with surrounding streets and improve pedestrian amenity.

The project adds to a growing wave of redevelopment proposals reshaping St Leonards and Crows Nest following the opening of the Sydney Metro City line and the NSW Government’s push for higher-density housing around major transport nodes.

Last week Stockland filed plans just down the road. They want to build a <a href="https://www.apartments.com.au/new-apartments/601-pacific-highway-st-leonards-nsw-2065">52-storey tower on Pacific Highway</a>.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-stockland-plans-52-storey-538-apartment-st-leonards-tower">First look: Stockland plans 52-storey, 538-apartment St Leonards tower&nbsp;</a>

Joel Robinson

First look: SP Setia targets St Leonards skyline with 40-storey TOD tower

<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a> has revealed plans for a new mixed-use tower at 10 Dangar Street, Wickham, advancing a proposal that would reshape the southern gateway to Newcastle’s city centre with one of the city’s tallest residential buildings.

The State Significant Development proposal, now on exhibition, seeks approval for a <a href="https://www.apartments.com.au/new-apartments/bowline-10-dangar-street-wickham-nsw-2293">43-storey tower</a> immediately adjacent to the Newcastle Interchange. The project would deliver around 200 apartments, including 42 affordable housing dwellings, alongside 99 co-living units, a 171-room hotel, retail space, and new public domain integrated through the site.

The scheme marks a significant escalation of plans previously approved for the site. Urban Property Group took over the prominent 2,904 sqm parcel, where excavation and demolition had already commenced under an earlier consent for a 14-storey mixed-use development.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="58a96dd9-407f-4d20-86b4-94e4bfeef74b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20podium.png?VersionId=LGlf08pdFGAZDzvx_CXC4XakHNZRuEE0" />

Designed by <a href="https://www.apartments.com.au/architects/sjb-architects">SJB</a>, the tower has been conceived as a landmark transit-oriented development anchored to the Newcastle Interchange precinct. The proposal includes 245 build-to-sell apartments across a mix of one, two, and three-bedroom residences, as well as two penthouses. Fifteen apartments and one operational unit are earmarked for NDIS housing. The co-living component would add a further 99 units, while the podium would accommodate retail uses and hotel facilities.

SJB said the site presents “a valuable opportunity to anchor the precinct by setting the standard for design, active ground planes and character at the key southern gateway.”

The architecture responds directly to the site’s position beside major transport infrastructure and within one of Newcastle’s fastest-evolving urban renewal precincts. The tower form sits above a sculpted podium designed to frame new public spaces, including a through-site pedestrian link connecting Station Street to Hannell Street, landscaped plazas, and activated retail edges.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="a7bd6ff0-f7db-4ce8-a6dc-ea56e72c6149" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20lanne.png?VersionId=xzf39VADyhj7zBQY2I9fx9vI62u2tuSb" />

The design report describes the project as part of the broader transition of Wickham into “a vibrant, high-quality mixed-use urban precinct” that leverages proximity to the station, open space, and regional connectivity.

A detailed public art strategy has also been prepared for the development. The strategy positions the project as “a transit-oriented development of state significance at the gateway to Newcastle’s city centre” and outlines a series of integrated artworks responding to Newcastle’s industrial and transport heritage.

Creative Road’s curatorial framework for the project, titled Unveil, draws on “stratified surfaces, carved volumes, and light-filled apertures” while referencing Newcastle’s transformation from an industrial city into a contemporary education and technology hub.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="77a882bb-14b1-4d28-99ff-9438e39508c0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20site.png?VersionId=cevgo_vN0eKPK78P8YcEu3mKPLkpFqE7" />

The proposal is being advanced through the NSW Housing Delivery Authority pathway after being declared State Significant Development in June 2025. The accompanying scoping report states the development aims to “maximise the site’s proximity to the Newcastle Interchange by delivering transit-oriented development” while increasing housing supply and affordable housing provision within the Newcastle LGA.

Urban Property Group’s plans align with the long-term strategic vision established under the Wickham Master Plan, which identified the interchange precinct as suitable for substantial uplift in height and density. The current proposal would significantly intensify that vision, positioning the tower among the tallest developments proposed for Newcastle.

The site sits immediately north of the Newcastle Interchange, bounded by Dangar Street, Hannell Street, and Charles Street. It is surrounded by a rapidly growing cluster of residential towers and mixed-use projects that have emerged following the completion of the light rail and transport interchange.

First look: Urban Property Group unveils Newcastle’s latest tower at Wickham interchange

Bottega House has completed settlement of a landmark riverfront site in Macquarie Street, St Lucia, representing its first major Brisbane development.&nbsp;

Positioned on the banks of the Brisbane River, the <a href="https://www.apartments.com.au/new-apartments/180-macquarie-street-st-lucia-qld-4067">premium site at 180 Macquarie Street</a> features uninterrupted river frontage in one of Brisbane’s most tightly held residential precincts.&nbsp;

The proposed development, currently under assessment with Brisbane City Council, has been designed by <a href="https://www.apartments.com.au/architects/plus-studio">Plus Studio</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/mim-design">Mim Design</a> and will deliver a boutique collection of premium residences positioned specifically for owner occupiers and downsizers.&nbsp;

The residences are set to redefine luxury apartment living in the area, with a focus on architectural quality, refined finishes, landscape integration and elevated amenities including curated wellness facilities, resort-style pools and recreation spaces rarely seen in the local market.&nbsp;

Exclusive sales for the project will be led by Keenan &amp; Byrne, ahead of an anticipated launch later this year.&nbsp;

Bottega House Managing Director Nick Malloch said the project reflects the group’s ambition to deliver a highly curated residential offering within one of Brisbane’s most tightly held precincts.&nbsp;

“This is an incredibly rare riverfront opportunity and one we have approached with a long-term perspective,” Malloch said.&nbsp;

“Our vision from the outset was to create a boutique collection of residences that feel more like private homes than traditional apartments, with generous proportions, refined finishes and exceptional amenity throughout."

Malloch says there is a&nbsp;lack of premium owner-occupier stock of this quality in the market, particularly for downsizers wanting space, privacy and a true lifestyle offering without compromise.&nbsp;

"Demand is expected to be strong given the scarcity of premium riverfront opportunities of this nature within Brisbane’s inner-west."&nbsp;

Bottega House secures landmark riverfront site in St Lucia 

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The arrival of the first piling rig officially marks the commencement of construction at SIERA’s new beachside apartment development, Exhale, in Northcliffe.

<a href="https://www.apartments.com.au/new-apartments/exhale-surfers-paradise-8-enderley-avenue-surfers-paradise-qld-4217">Exhale</a>, a glass-encased tower featuring 54 large-scale apartments at 8 Enderley Avenue, is SIERA’s third Gold Coast development. It follows the recently completed PIPIS Bilinga beachfront project, which achieved suburb-record prices, and the soon-to-be-completed Chevron Island development, Tapestry.

[smartcode_project:default project_id=112661 project_image_fid=359603]

<a href="https://www.apartments.com.au/developers/siera">SIERA</a> Founder and Managing Director Brent Thompson said the arrival of the piling rig represented a significant milestone for the development, which is scheduled for completion in late 2028.

Over the next month, around 260 piles are expected to be installed as work progresses on the basement structure. The building is anticipated to rise above ground level early next year, before unveiling its sculptural glass curtain wall, developed in collaboration with specialist façade engineers.

“The façade was designed to maximise panoramic coastal views while creating a distinctive architectural identity,” Thompson said.

[smartcode_project:default project_id=112661 project_image_fid=355935]

Designed by BDA Architecture, Exhale will comprise just 54 two- and three-bedroom residences across 26 levels, a level of low-density living rarely delivered in this beachside pocket between Surfers Paradise and Broadbeach.

The project has been conceived as a resident-only building, with no short-stay accommodation permitted. SIERA says the model is intended to appeal to long-term owner-occupiers rather than transient holiday demand.

[smartcode_project:default project_id=112661 project_image_fid=361052]

Residences have been designed with large-format layouts and expansive glazing, with most apartments featuring more than 30 metres of glass frontage to maximise natural light and ocean views.

The amenity offering spans two levels and centres on wellness and lifestyle, including a heated magnesium pool, sauna, yoga and Pilates studio, gymnasium, private dining facilities, cinema lounge, and dedicated surfcraft storage.

[smartcode_project:default project_id=112661 project_image_fid=359607]

More than half of the apartments have already sold. SIERA has also opened a sales gallery for Exhale at its Chevron Island commercial premises, near its Tapestry tower and the site of its second Chevron Island apartment development, which is slated to launch in early 2027.
</section>
</section>

[smartcode_project_cta:default project_id=112661]

SIERA kicks off construction at Northcliffe tower Exhale

Local Little Bay residents, along with buyers from premium postcodes across Sydney’s affluent Eastern Suburbs, have dominated purchases in developer-builder Urban Property Group’s first Eastern Suburbs apartment development, <a href="https://www.apartments.com.au/new-apartments/este-little-bay-jennifer-street-little-bay-nsw-2036">ESTE Little Bay</a>.

The $250 million coastal project, one of the first new developments in the area in several years, has proven particularly popular with downsizers, especially those from Coogee and Bondi. One Double Bay downsizer paid $4.7 million for a four-bedroom penthouse, setting a new local apartment price record in the process.

Buyers have been attracted to the combination of coastal tranquillity, premium design and amenity-rich neighbourhood living. The walkable village setting, along with proximity to three of Sydney’s leading golf courses, New South Wales Golf Club, St Michael’s Golf Club and The Coast Golf Club, has also been a key drawcard.

[smartcode_project:default project_id=112343 project_image_fid=352689]

Built across two low-rise buildings designed by <a href="https://www.apartments.com.au/architects/hill-thalis-architecture-urban-projects-pty-ltd">Hill Thalis</a> and set along a lush, landscaped green spine, designed by leading landscape architect <a href="https://www.apartments.com.au/landscape-architect/arcadia-landscape-architecture">Arcadia</a>, ESTE Little Bay offers a collection of one, two, three and four-bedroom residences with interiors by Richards Stanisich.

<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a> Sales Director, Tom McIvor said the response to ESTE has been "nothing short of extraordinary."

“Buyers have been quick to recognise ESTE as a rare opportunity to invest in a coastal sanctuary that offers both seclusion and connectivity to the heart of Sydney,” McIvor said.

[smartcode_project:default project_id=112343 project_image_fid=352687]

<a href="https://www.apartments.com.au/project-marketer/srm-residential">SRM Residential</a> Senior Director, <a href="https://www.apartments.com.au/project-marketer/srm-residential">Clayton Ross</a> said the local market has responded incredibly well, driven by ESTE’s exceptional location and the rarity it offers.

“We’ve seen strong interest from a variety of buyer groups, all of whom are drawn to the exclusivity and quality of the build and construction by the 4.5-star iCIRT-rated builder / developer, Urban Property Group. There’s truly nothing else like it along Sydney’s coastline.”

[smartcode_project:default project_id=112343 project_image_fid=352690]

The project also includes robust buyer protections, including Resilience Insurance’s Latent Defects Insurance, providing 10 years of structural cover, and an independent iCIRT-rating of the developer.

“The iCIRT-rating adds another layer of confidence,” Ross added. “Buyers see it as a safeguard for their investment and their lifestyle.” A highlight of ESTE’s offering is its exclusive wellness amenities, including a heated rooftop infinity pool and outdoor heated spa, a state-of-the-art Technogym fitness centre, and a sauna.

<a href="https://www.apartments.com.au/new-apartments/este-little-bay-jennifer-street-little-bay-nsw-2036">ESTE Little Bay</a> is topped out and is on track to complete towards the end of 2026, with residents moving in before Christmas.

[smartcode_project_cta:default project_id=112343]

Eastern Suburbs buyers snap up ESTE Little Bay apartments

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

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Business owners have traditionally endured a premium pricing on their overdrafts even when the security they put up is the lowest risk short of government bonds: residential property.
This has created the situation where a tradie or a retailer is paying 6.7% for the mortgage on their family home, yet they are paying 9% on their business overdraft.
So the banks are virtually de-risking the overdraft they write for their business customer but then re-pricing the facility so it boasts a greater margin than is charged on the security itself. In the case of the overdraft, almost twice the margin charged on your mortgage.
There are many reasons given by the banks for this practice. They say business overdrafts involve higher administration costs, that the loan amounts are too small, and that business owners have greater income volatility than employees.
However, the technology now exists to reduce the admin costs of business lending; and the volatility of business owner income is precisely why they need working capital.
So, in reality, the ‘business premium’ is a penalty on the business owner for not being an employee.
I have a problem with this. Firstly, the security is the security. If the security you take on a business is residential property, then that is the security. And residential property risk is valued by the market at 6.7%, not 9%.
I’m also troubled by the mentality where a bank says it has more concern about a business owner who has been trading successfully for 20 years than it does with a person who has had a job for 13 months.
It’s particularly troubling when you consider how penalised some sectors are. Construction is consistently the most popular sector for Australia’s 2.1 million businesses. Mostly, this means tradies.
These people experience tight cashflows because they carry overheads on shorter cycles than they can bill a client. Your average tradie has to pay employees, buy materials, run vehicles and pay insurance on shorter cycles than they are paid. Yet they can also generate large annual incomes through early starts, long hours and working weekends.
To carry this, they need working capital – an overdraft, typically – and they pay a premium rate even though they put up their home as security.
This is unfair and makes no economic sense: small business accounts for 95% of all Australian businesses and employs more than half of the work force.
When you look at how a national economy could operate more efficiently, premium charges for business finance are a logical start. Especially if there’s no reason for the premium in most cases.
I believe there is room for change in the method and the pricing of business debt. Powerful technologies, new funding arrangements and an innovative product will give business owners more choice.
However, as in any competitive market, the lender can only offer a product at a certain price: then it’s up to the borrower to make the decision.
Mark Bouris is executive chairman of <a href="https://www.ybr.com.au/" rel="nofollow" target="_blank">Yellow Brick Road</a>, a financial services company offering home loans, financial planning, accounting and tax, and insurance.
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mbouris-tauSvXGAM2

'Business premium' bank loan pricing unfair, epecially with residential property as security

<html><body>
By the smallest majority, economists polled by Bloomberg are still tipping the RBA to leave the cash rate on hold when it meets for the last time this year on December 4.
Of the 25 economists polled this week, 13 expect the cash rate to remain at 3.25% with 12 expecting it to fall to 3%.
ANZ chief economist Warren Hogan (the only of the major bank economists to correctly tip a rate hold on Melbourne Cup Day) and Westpac’s Bill Evans expect the RBA to cut the cash rate on December 4 while the Commonwealth Bank’s Michael Blythe and NAB’s Alan Oster favour the RBA pausing until at least February next year.
Economists will get a better sense of the RBA's thinking on the December rate decision when the minutes of the November 6 monetary policy meetingare released on Tuesday (December 20) while on the same day RBA governor Glenn Stevens will deliver a speech to CEDA (The Committee for Economic Development of Australia) with the topic not yet known.
“The board minutes are always worth a look, but comments are likely to be similar to those in the latest statement on monetary policy,” says CommSec chief economist Craig James.
“The speech by the Reserve Bank governor should provide more interest. At this time there is no topic set for the speech, but if the governor wants to send a message – perhaps on the Aussie dollar, wage growth or views on the global economy – this will be the opportunity,” he says.
James, who was not part of the economists surveyed by Bloomberg. He is expecting the RBA to hold rates in December, but still maintain an easing bias and to cut early in 2013.
Looking beyond December – should the RBA hold the cash rate - consensus among economists is for one more rate cut in 2013 with the second quarter of the year (April to June) the most likely period the cash rate could fall. However there is wide divergence in individual economists’ rate expectations.
For the first quarter of 2013, there are six economists tipping the cash rate to fall to  2.75% including Brian Redican from Macquarie Bank, Stephen Koukoulas from Market Economics alongside economist from 4 Cast Ltd, BNP Paribas, Deutsche Bank, J.P. Morgan and Merrill Lynch.
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lschlesinger-FZcF9M3vE6

Economists remain divided on December 4 RBA cash rate cut: Bloomberg

<html><body>
The resurgence of mortgage brokers after the GFC has been confirmed in the latest Mortgage Professional Australia (MPA) Top 100, which ranks the brokers that have written the highest value of loans over the past financial year.
In 2012 the combined sales of loans arranged by Australia’s Top 100 brokers was a cumulative $6.7 billion, compared with three years of sub-$6 billion sales following the GFC in 2008.
While Aussie brokers did not place in the top 10, a remarkable one out of every four brokers (26) on this year’s Top 100 list operate under the John Symond-founded brand, compared with just 15 in 2009, the year following the GFC.
This was also the second year in a row that Aussie placed more brokers in the Top 100 than other broking firm, ranking ahead of AFG, a non-branded aggregator where brokers operate under their own brand names, which had 19 brokers in the Top 100.
The Ray White-owned Loan Market Group was well represented, with six brokers in the top 100, with <a target="_blank" href="https://daniel-esposito.loanmarket.com.au/">Daniel Esposito of Loan Market Manningham</a> in <a target="_blank" href="/news">Bulleen</a>, Melbourne, ranking 14th overall ($86 million in loans).
Two brokers from Mark Bouris’s Yellow Brick Road ranked in the top 10 (<a target="_blank" href="https://www.ybr.com.au/branches/VIC/Frankston.cfm">Ross Laurenson, Yellow Brick Road, Frankston</a> ranked 28th with $72 million in loans) while <a target="_blank" href="https://www.esmartmove.com.au/">Smartmove Professional Mortgage Advisers</a> had three brokers in the 100.
James Symond, nephew of John Symond and an executive director at Aussie, says the 2012 results "underpin Aussie’s commitment to the thorough training, development and ongoing company support to every broker who works with the Aussie brand.”
Aussie became the first branded mortgage broker to require all its brokers to obtain a diploma in financial services, with the aim of raising the professional bar.
In addition to the diploma requirement, Aussie brokers must also obtain membership of the Mortgage and Finance Association of Australia  and are supported with additional training, coaching and marketing support.
The success of Aussie’s broking model is also testament to the foresight of John Symond, who shifted the business from a non-bank lender in 2002, when it offered its own home loans, to a mortgage broking model offering a range of home loans.
The top-ranking Aussie broker was <a target="_blank" href="https://www.aussie.com.au/find-broker/aussie-mortgage-broker.htm?BrokerID=402012">Glenn English based in Carnegie, Melbourne</a>, who managed to write 220 loans with a value of $82.6 million, ranking him 18th overall.
 
<hr class="system-pagebreak">
The post-GFC resurgence recorded in the Top 10o results was confirmed in the most recent JP Morgan Australian Mortgage Industry report (volume 16), which noted that about 45% of all loans are arranged through brokers, approaching pre-GFC levels. NAB in particular engages more with the broker channel to grow its mortgage book.
However, the same JP Morgan report notes that profitability has not risen in tune with brokers' growing share of the distribution pie – currently sitting at about two-thirds of pre-GFC levels  – while "participants continuing to exit the market as a consequence”.
According the most recent MISC (Market Intelligence Strategy Centre) report on the broker market, the number of broking firms and aggregators has shrunk to 119, the lowest recorded number of active broker firms since MISC began measuring this figure in 2001.
National regulation of the mortgage broking industry in 2010 raised the compliance costs and professional standards of the industry, with many part-time brokers quitting the industry alongside other full-time brokers struggling to earn a living as a result of the GFC slowdown. 
This compliance burden was highlighted in the responses of brokers that ranked in the top 10, <a href="https://www.mortgagesolutionsaustralia.com.au/">with Colin Lamb of Mortgage Solutions Australia</a> (10th with $102 million worth of loans) saying “tighter legislation” was the biggest challenge facing the industry, which “we embrace and are proactive about, including in our systems and approach”.
Other challenges noted by top 10 brokers include competition generated by the banks through their different channels.
“On one hand [banks] understand that 50% of their business comes from brokers, and on the other hand, they create models like UBank that undercut and undermine everything they’ve tried to create in the broker channel,” says <a target="_blank" href="https://www.brokernews.com.au/mpa/article/rael-bricker-businessman-and-broker-126229.aspx">Rael Bricker from House+Homeloans in Perth</a>, who ranked fourth with $141 million in loans.
Other concerns were the ageing workforce, education of brokers and finding new staff.
Within in these industry dynamics, the Top 100 reveals those brokers that have risen to (or remain at) the top. Brokers who appeared in the 2009 list and in the 2012 list include ACT broker <a target="_blank" href="https://www.tiffenandco.com/gerard_t">Gerald Tiffen from Tiffen &amp; Co and the Mortgage Detective</a> (ninth this year and ninth in 2009) and <a href="https://www.intelligentfinance.com.au/" target="_blank">Justin Doobov from Bondi Junction-based Intelligent Finance </a>(fifth in 2012 and eighth in 2009)
Top spot for the second year running went to another Melbourne mortgage broker, Mark Davis from the <a target="_blank" href="https://www.alic.com.au/">Australian Lending &amp; Investment Centre</a> (ALIC), who settled $169.6 million in 2012 writing an astonishing 474 loans in 12 months – more than a loan day.
ALIC has picked up a host of industry awards over the last few years, with Davis putting his success down to “continuing to change what I do daily and challenge my own processes as well as banking processes.”
“If you keep evolving with the customer and what their needs are, you stay ahead of the race.”
Mortgage broking remains a male-dominated profession at the upper echelons of the profession, with only 13 brokers in the Top 100 – almost the same number since 2009.
However, women have ranked highly in the past, with <a href="https://www.mortgagechoice.com.au/wendy.higgins">Mortgage Choice’ Wendy Higgins</a> from <a href="/news">Glenelg East</a> in Adelaide ranking number one in the MPA Top 100 in 2009 and 2010.
This year’s top-ranking woman broker is a stalwart of the industry, <a href="https://www.mortgagesuccess.com.au/">Katrina Rowlands of Mortgage Success in Wollongong</a> who ranked eighth, writing 343 loans worth $106.5 million. Rowlands has ranked in the Top 100 every year since its inception in 2005 and says she has sustained her business by “continuing to focus on the client’s best outcome”.
“I continue to believe I can make a difference. That’s the secret; knowing you can make a difference and taking control of the process to make that difference. I can’t tell you the number of times I’ve had a bank say that their turnaround times have changed to four or five days, and I’ve had to say, 'That may be OK, but not for my clients'."
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John Symond’s Aussie mortgage brokers rise to the top as industry resurgence gathers pace among Top 100

<html><body>
<img src="/images/stories/2012/11/1.gif">
Are you licensed to recommend credit? All mortgage brokers are required to hold an ASIC credit licence (ACL) or operate as a credit representative under a licence holder. Ask to see evidence and do you or own checking on the ASIC website using its “professional registers” search engine.
 
<hr>
 
<img src="/images/stories/2012/11/2.gif">
Are you a member of the Mortgage and Finance Association of Australia (MFAA) or Finance Brokers Association of Australia (FBAA)? Industry body membership is not mandatory, but all reputable brokers should be a member of one of these organisations. Membership requires higher education benchmarks and other professional and ethical requirements.
 
<hr>
 
<img src="/images/stories/2012/11/3.gif">
What lenders are on your lending panel? A broker’s lending panel is the lenders they are accredited with to recommend loans. Get a list of a broker's lenders and do some research. Most reputable brokers would offer a mix of banks, non-banks and mutual lenders. Be wary of broker who only has a few unknown lenders  as the broker may have failed to gain accreditation with some of the bigger lenders.
 
<hr>
 
<img src="/images/stories/2012/11/4.gif">
How many lenders are you likely to recommend? Most mortgage brokers will have at least a dozen lenders on their “panel” and sometimes as many as 30. However, they are unlikely to be able to recommend loans from all these lenders, so you should find out which lenders they are most familiar with and ensure you are comfortable with this selection.
 
<hr>
 
<img src="/images/stories/2012/11/5.gif">
How long have you been a mortgage broker for and how many loans have you written? It’s important to gauge the level of experience of your broker. If he's a rookie, his knowledge may be limited and you may feel more comfortable with someone who has more experience. It's also worth asking how business is going and if he's been busy.
 
<hr>
 
<img src="/images/stories/2012/11/6.gif">
Which is your favourite lender and why? Brokers are required by lawyer not to recommend unsuitable loans to borrowers. Many, though, will have a lender they recommend more than others, and you should find out why. Valid answers could range from lowest rates and fees to excellent customer service. Brokers are paid by commission and other incentives (such as volume of business), so make sure you’re not just making up the numbers for them.
 
<hr>
 
<img src="/images/stories/2012/11/7.gif">
How do you make your recommendations? Many brokers will input your information into some kind of software program to come up with a list of suggested lenders and loans. However, it is also the duty of a mortgage broker to consider your holistic financial needs and your personal circumstances. A broker should have good product and market knowledge and good people skills and should not just rely on their computer software to come up with recommendations.
 
<hr>
 
 
<img src="/images/stories/2012/11/8.gif">
Can I speak to one or two of your clients? This is a great way to assess a broker's performance for yourself and whether previous clients were satisfied with the service they received. You can also check a broker's website for testimonials and do a Google search to see if her name pops up in relation to a dispute or if they have made the news for the wrong reasons.
 
<hr>
 
<img src="/images/stories/2012/11/9.gif">
Do you charge a fee? Most brokers are free as they are paid by lenders, but some do charge upfront fees for their mortgage advice. A broker should disclose these fees upfront, but it’s worth checking. And if they do charge any fees these should be for additional services above and beyond determining a suitable loan for your needs.
 
<hr>
 
<img src="/images/stories/2012/11/10.gif">
What service do you provide post settlement? A broker should provide continuing service to her client after the loan has settled. Brokers who “set and forget” will leave you high and dry if you run into problems. Most lenders pay brokers a monthly trail commission as an incentive to provide good post-settlement customer service, but even if they don’t a good broker relies on word-of-mouth referrals and recommendations to grow her  business.
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po-LsXgBTHBmX

The 10 questions you should ask to ensure you choose a reputable mortgage broker 

<html><body>
The value of home loans taken out by owner occupiers rose by a better than expected 1.5% over September to $13.9 billion, according to the latest ABS housing finance figures.
This was the second consecutive monthly rise in the value of owner occupier commitments following a 1.3% rise in August.
In July the value of owner occupier commitments slumped 1.4%.
The number of loans to owner occupiers rose 0.9% to 46,395 in September following a 1.8% rise in August - economists polled by Bloomberg had tipped a 1% rise over September.
Housing finance commitments by investors increased by 8.6% to $7.3 billion following a small 0.8% fall in August and a 2.7% drop in July.
The total value of dwelling commitments – owner occupiers and investors – rose 3.8% to $21.2 billion.
Westpac noted that gains were reported across the eastern states - Queensland (0.6%), NSW (1.6%) and Victoria(2.3%). This was offset by a dip in WA and a fall in SA.
"FHBs share of finance increased, rising to 19.3%. Further gains are in prospect," says Westpac.
The rise in September suggests -as mentioned by the RBA - that previous rate cuts are starting to flow through into the economy.
</body></html>

Owner-occupier mortgage lending up 1.5% in September as first-home buyers reach 19.3%: ABS

<html><body>
The smallest majority of economists tip the RBA to leave the cash rate unchanged on December 4, according to the latest Bloomberg survey.
Out of the 25 economists surveyed today, 13 tip the cash rate to remain at 3.25%, while 12 expect it to fall  3.00%.
The major banks are neatly divided, with ANZ and Westpac tipping a rate cut and Commonwealth Bank and NAB expecting the RBA to hold firm.
Westpac chief economist Bill Evans says it’s the bank’s view that “lower interest rates will be required to ensure that the non-mining sector plays its part in compensating for the more modest contribution from mining”.
“The decision for December seems to be very much live.
“It must be tempting for the board to increase the chances of the uplift in growth from non-mining by easing rates further,” says Evans.
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Economists and major banks divided on December rate cut: Bloomberg

<html><body>
Macquarie Bank, the new mortgage funding partner of Mark Bouris’s Yellow Brick Road franchise business, has more than doubled its investor loan book over the first nine months of the year, Property Observer analysis of APRA banking figures shows.
Macquarie Bank’s investor loan book has soared from $846 million at the end of 2011 to almost $2 billion – nine month growth of 119%.
In June Property Observer reported that Macquarie’s investor home loan book <a href="/news">was up 33%</a> on the first four months of the year, with a spokesperson saying the bank had been ramping up its lending since returning to the mortgage market in 2010.
Macquarie Bank, the financial services arm of Macquarie Group, is now competing strongly with the major banks for new investor loans, with NAB (the smallest of the major banks in terms of new investor mortgage lending) originating $1.26 billion in new investor loans over the first nine months of the year, compared with Macquarie Bank’s $1.04 billion.
<a href="/news">Macquarie </a>is currently offering a one-year discount of 100 basis points on all its variable rate home loans, with a competitive rate of 5.65%.
It also offers a self-managed super fund loan tailored at property investors who are investing by borrowing against their DIY super funds at a rate of 6.65%.
The figures also show strong growth among the customer-owned mutual institutions with the ME Bank’s investor loan book up 33% over the first nine months of the year to $1.6 billion and Heritage Bank growing its investor loan by 14% to $1.4 billion.
In absolute terms, Westpac is the bank of choice for property investors, originating more than $6 billion in new loans over the first nine months of the year, well ahead of the Commonwealth Bank/Bankwest with $4.4 billion in new mortgages.
Investor lending for the first nine months of 2012 (Jan - Sept)
<table width="360" cellpadding="0" cellspacing="0" border="0"><tbody>
<tr>
<td valign="bottom" nowrap width="114">
Lender
</td>
<td valign="bottom" nowrap width="85">
Loan book Sept 12($m)
</td>
<td valign="bottom" nowrap width="76">
Loan book Dec 11 ($m)
</td>
<td valign="bottom" nowrap width="85">
Investor loans growth %
</td>
</tr>
<tr>
<td nowrap width="114">
Macquarie Bank Limited
</td>
<td nowrap width="85">
1,916
</td>
<td valign="bottom" nowrap width="76">
876
</td>
<td valign="bottom" nowrap width="85">
118.72
</td>
</tr>
<tr>
<td nowrap width="114">
Members Equity Bank Pty Limited
</td>
<td nowrap width="85">
1,556
</td>
<td valign="bottom" nowrap width="76">
1,168
</td>
<td valign="bottom" nowrap width="85">
33.16
</td>
</tr>
<tr>
<td nowrap width="114">
Heritage Bank Limited
</td>
<td nowrap width="85">
1,356
</td>
<td valign="bottom" nowrap width="76">
1,187
</td>
<td valign="bottom" nowrap width="85">
14.25
</td>
</tr>
<tr>
<td nowrap width="114">
Bendigo and Adelaide Bank Limited
</td>
<td nowrap width="85">
9,434
</td>
<td valign="bottom" nowrap width="76">
8,553
</td>
<td valign="bottom" nowrap width="85">
10.29
</td>
</tr>
<tr>
<td nowrap width="114">
Citigroup Pty Limited
</td>
<td nowrap width="85">
2,638
</td>
<td valign="bottom" nowrap width="76">
2,401
</td>
<td valign="bottom" nowrap width="85">
9.89
</td>
</tr>
<tr>
<td nowrap width="114">
Bank of Western Australia Ltd
</td>
<td nowrap width="85">
10,897
</td>
<td valign="bottom" nowrap width="76">
9,943
</td>
<td valign="bottom" nowrap width="85">
9.59
</td>
</tr>
<tr>
<td nowrap width="114">
Suncorp-Metway Limited
</td>
<td nowrap width="85">
8,901
</td>
<td valign="bottom" nowrap width="76">
8,179
</td>
<td valign="bottom" nowrap width="85">
8.83
</td>
</tr>
<tr>
<td nowrap width="114">
Bank of Queensland Limited
</td>
<td nowrap width="85">
10,355
</td>
<td valign="bottom" nowrap width="76">
9,672
</td>
<td valign="bottom" nowrap width="85">
7.06
</td>
</tr>
<tr>
<td nowrap width="114">
Australia and New Zealand Banking Group Limited
</td>
<td nowrap width="85">
47,104
</td>
<td valign="bottom" nowrap width="76">
44,549
</td>
<td valign="bottom" nowrap width="85">
5.74
</td>
</tr>
<tr>
<td nowrap width="114">
Westpac
</td>
<td nowrap width="85">
124,548
</td>
<td valign="bottom" nowrap width="76">
118,380
</td>
<td valign="bottom" nowrap width="85">
5.21
</td>
</tr>
<tr>
<td nowrap width="114">
Commonwealth Bank of Australia
</td>
<td nowrap width="85">
83,377
</td>
<td valign="bottom" nowrap width="76">
79,926
</td>
<td valign="bottom" nowrap width="85">
4.32
</td>
</tr>
<tr>
<td nowrap width="114">
HSBC Bank Australia Limited
</td>
<td nowrap width="85">
3,970
</td>
<td valign="bottom" nowrap width="76">
3,843
</td>
<td valign="bottom" nowrap width="85">
3.29
</td>
</tr>
<tr>
<td nowrap width="114">
NAB
</td>
<td nowrap width="85">
52,969
</td>
<td valign="bottom" nowrap width="76">
51,710
</td>
<td valign="bottom" nowrap width="85">
2.44
</td>
</tr>
<tr>
<td nowrap width="114">
ING Bank (Australia)
</td>
<td nowrap width="85">
9,624
</td>
<td valign="bottom" nowrap width="76">
9,469
</td>
<td valign="bottom" nowrap width="85">
1.64
</td>
</tr>
</tbody></table>
 
Source: APRA
</body></html>

Macquarie Bank doubles loans to investors in first nine months of 2012: APRA figures

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ANZ has left its standard variable rate unchanged at 6.6% per annum following its November interest rate review.
The decision follows the RBA leaving the cash rate unchanged at 3.25% on Melbourne Cup Day (November 6).
Since January, the bank has being carrying out monthly independent interest rate review on the second Friday of every month on the basis that "bank funding costs are now largely unrelated to movements in the Reserve Bank’s official cash rate. 
It's the seventh month in a row that the bank has not adjusted its variable mortgage rates independently of an RBA announcement since moving out of the step with the RBA in January.
On April 13 the bank lifted variable mortgage rates by 0.06 percentage points after the RBA left rates unchanged at its April 4 meeting.
“Despite intense competition for business deposits” the bank says its variable small business lending rates will also remain unchanged.
</body></html>

ANZ leaves variable mortgage rates unchanged in independent review

<html><body>
PRDnationwide estate agents will give home buyers the chance of discussing their mortgage needs with online non-bank lender eMoney following the signing of a referral partnership agreement between the two businesses.
PRDnationwide operates 120 franchise offices, all of which will have the option to refer on clients to eMoney.
Real estate firm tie-ups with lenders and mortgage brokers have become a fairly common feature of the industry over the past decade.
McGrath Estate Agents set up mortgage broker Oxygen Home Loans in 2004 to provide home loan services to clients. Oxygen Home Loans sub-aggregates under AFG. It was named major brokerage of the year at the 2012 Australian Broker Awards in August.
Ray White acquired mortgage broker Loan Market Group in 2009, which has 600 mortgage brokers across Australian and New Zealand and writes around $600 million in loans per month.
Century 21 has its own mortgage broker franchise, Century 21 Home Loans, as does Raine &amp; Horne with its broker offering Raine &amp; Horne Financial Services.
Under the arrangement with PRDnationwide, eMoney receives major bank wholesale funding and currently offers a standard variable rate home loan rate of 5.65% and a three-year fixed rate home loan from 5.25%. Lower rates are available for borrowers who can stump up a 25% deposit.
It consistently offers among the lowest variable and fixed-rate offerings in the market and says it is able to do so because it does not have the added cost of expensive overheads due to its online business model.
Tony Brasier, chairman and managing director of PRDnationwide, says the firm had a number of pre-requisites in its search for a home loan partner.
“The first was an online solution. We wanted to ensure our potential clients were referred to efficiently with a guaranteed response.
“The second was access to innovative and competitive financial products, and the third was to find a financial company that was honest with an exemplary reputation in the marketplace; eMoney ticked all the boxes for us,” he says.
Commenting on the tie-up with PRDnationwide, Neil Manuel, general manager of eMoney, says buyers will benefit through PRDnationwide’s expertise in the property market and eMoney’s competitively low variable home loan rate.
“It is important for buyers to shop around before they commit to a home loan and if a buyer is looking to purchase a home through a PRDnationwide franchise, they should speak to their agent and arrange a phone call with an eMoney consultant before signing on the dotted line with their current lender,” says Manuel.
“A simple phone call to get a better rate can potentially save thousands of dollars in future interest repayments.”
Manual says choosing an eMoney home loan at a variable rate of 5.5% could save a buyer up to $221 a month in repayments on a $300,000 mortgage over 25 years.
“That’s a saving of over $2,600 in mortgage repayments a year, and rather than giving your hard-earned cash to the bank, this spare coin could be used to take your family on a holiday,” he says.
</body></html>

PRDnationwide sets up home loan referral partnership with online lender eMoney

<html><body>
Wealth management company <a href="/news">Yellow Brick Road and Macquarie Bank</a> have foreshadowed some sort of relationship that will provide a “much-needed alternative for Australian consumers”, with the first step being a new mortgage product.
Challenges to the big four banks' dominance of the mortgage market are welcome (even though this writer has shares in those banks, and also in Macquarie). But there is a lot more information needed before the positive spike in YBR’s share price following the announcement could be seen as warranted.
While as an academic researcher I do not believe it appropriate to generally comment on business strategies of specific companies, I don’t think my social conscience can let this one pass.
Take the following description in YBR’s <a href="https://www.asx.com.au/asxpdf/20121107/pdf/42b1g692g3vrs6.pdf">two-page announcement</a> to the Australian Securities Exchange. It reads:
<blockquote>
“Yellow Brick Road’s opening move is a 1.15% discount off the base rate of 6.65% for the first 12 months on residential home loan products.
After that, a discount off the base rate of up to 0.86% is guaranteed for the life of the loan… All successful applicants will get the discounted rate irrespective of their status."
</blockquote>
Now, it may just be a drafting error, but “up to 0.86%” is not the same as “of 0.86%”. “Up to” could include zero! But even more relevant is the question of how the base rate is determined.
It may be 6.65% today, but what will it be in a year’s time? A quick search of the YBR website provided no information to answer this question – even among the list of FAQs provided. A discount on a base rate that might exceed the standard rates offered by other lenders would be a “Clayton’s discount” (for those who can remember the ads for “the drink you have when you’re not having a drink”).
Now, it maybe that the tie-up between YBR and Macquarie will enable funds to be raised at a rate to finance mortgages which means that the YBR base rate is competitive with loan rates of the big four and other lenders – although how is not clear. But more fundamental (or maybe it’s semantic) is the issue of what is meant by a base rate which no one pays? All successful applicants, it is stated, get the discounted rate.
I can imagine the possibility that a relationship between a wealth management company such as YBR and Macquarie Bank could yield potential economies and efficiencies. And I look forward to more information to assess that.
But a two-page news release with the sort of information contained is really no news at all – even if it was listed on the ASX announcements as being a “price-sensitive” announcement.
Kevin Davis is research director at <a href="https://www.australiancentre.com.au/" target="_blank">Australian Centre for Financial Studies</a>
This article originally appeared on <a href="https://theconversation.edu.au/" target="_blank">The Conversation.</a>
</body></html>

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