<p>Perth’s new apartment market recorded its strongest quarter of sales since Q4 2021, with 412 apartments sold in Q1 2026 and a record quarterly sold value of $537 million, according to Urbis’ latest Apartment Essentials results.</p>

<p>Urbis said the March quarter result reflects strong, highly product‑specific demand across both ends of the market, from more attainable projects delivering at scale, through to premium stock being absorbed by equity‑rich downsizers.&nbsp;</p>

<p>David Cresp, Partner at Urbis, said the key story in Perth is not demand, it is the market’s ability to convert demand into delivered housing.&nbsp;</p>

<p>“This is the strongest sales quarter since Q4 2021, and it reinforces that demand in Perth is real and it’s local,” David Cresp said. “But the task now is delivery, turning that demand into projects that can actually be built and completed.”&nbsp;</p>

<p>[smartcode_project:default project_id=110291 project_image_fid=302785]</p>

<h2>Affordable product leads, premium demand remains resilient</h2>

<p>Sales in Q1 were led by more affordable projects, with The Boulevard (SKS Group) recording 115 sales in the quarter, the presentation noting this is only the second time a single project has surpassed 100 quarterly sales. The project was able to offer more affordable housing product right next to a train station.&nbsp;</p>

<p>Palmyra West (Finbar) also delivered strong results with 28 sales in Q1, following 84 sales in Q4, with an average price of under $800,000, underscoring depth of demand for well‑located, attainable new stock.&nbsp;</p>

<p>At the premium end, Urbis said downsizer demand is continuing, with the results highlighting Romeo (Applecross, Finbar) recording 75 sales and reaching almost 50% sold in one quarter.</p>

<p>Jual (Shenton Park, Celsius Property) also posted a strong quarter with 28 sales, reaching 39% sold in one quarter.</p>

<p>Urbis noted that Perth apartment demand is not speculative, not investor‑led, and not uniform, describing it as localised, often equity‑driven and highly product‑specific, a pattern reflected in the polarisation between strong “attainable” performers and premium downsizer product.&nbsp;</p>

<p>[smartcode_project:default project_id=148957 project_image_fid=364102]</p>

<h2>Prices underpinned by costs, and the delivery risk is growing</h2>

<p>Urbis said pricing pressure is cost not demand‑driven: construction costs and delivery risk are now a central constraint, with the results noting build costs remain elevated and volatile, and that energy, fuel and labour uncertainty weigh on feasibility.</p>

<p>David Cresp said a growing challenge for private Build‑to‑Sell developers is simply securing a builder in the current environment.</p>

<p>“Developers are really feeling the pressure from a building market that was operating at capacity and securing a builder is challenging,” David Cresp said, adding that even where a builder can be secured, “trying to get to the price that makes the development financially viable is incredibly challenging in the current market.”&nbsp;</p>

<p>Urbis’ broader WA commentary also notes that industry remains at or above capacity with lot and housing creation, and that many builders are limiting new sales to manage stretched workforces and fixed‑price contract pressures, conditions that flow directly into apartment feasibility and delivery timing.</p>

<p>[smartcode_project:default project_id=108869 project_image_fid=317905]</p>

<h2>Supply: improving later, but still constrained, and Perth lags eastern benchmarks</h2>

<p>While near‑term supply remains constrained, Urbis’ forecast shows completions lifting “Supply is forecast to be back above 1,500 apartments per annum for the first time since 2019”, with 1,775 completions forecast for 2026, and volumes remaining above that level over the following years.&nbsp;</p>

<p>Looking further ahead, completions are forecast to reach 2,500 in 2028, with the report noting 32% of that total is social/affordable, reflecting the role of government‑supported delivery in rebuilding the pipeline.&nbsp;</p>

<p>However, Urbis said Perth remains behind comparable markets on pipeline scale. In a national comparison of projects under construction, the report shows under construction Perth Build‑to‑Sell (BTS) at 3,446 apartments versus the Gold Coast at 7,922. Mr Cresp said “The challenge for Perth is how to we grow the delivery pipeline”.</p>

<p>Urbis’ conclusion is that Perth’s market is increasingly defined by product discipline and delivery certainty, with the research identifying “delivery certainty is key” and calling out builder risk and procurement models as core success factors, alongside “timing and staging”.&nbsp;</p>


Joel Robinson

Perth apartment sales hit strongest pace since late 2021 as builder capacity tightens

<p><a href="https://www.apartments.com.au/developers/sammut-developments">Sammut Group</a> has secured development approval for its latest Brisbane apartment project, marking the Sydney developer’s next step in expanding its Queensland pipeline following the success of its debut Gold Coast development, Coast.</p>

<p>The approved project at <a href="https://www.apartments.com.au/new-apartments/44-glen-road-toowong-qld-4066">44 Glen Road, </a><a href="https://www.apartments.com.au/developments/toowong-qld-4066">Toowong</a> will deliver a 15-storey riverfront apartment building with 42 residences, significantly increasing the scale of the site’s previous approval for a smaller luxury scheme. Designed by Bureau^proberts, the development will comprise a mix of predominantly four-bedroom and two-bedroom apartments positioned to maximise Brisbane River and city views.</p>

<p>Sammut Director Julian Sammut said the group had been actively searching Brisbane for several years before identifying Toowong as the right fit.</p>

<p>“Brisbane was the right step for Sammut,” Sammut said.</p>

<p>“With the success of Coast we thought we should definitely look to do more in Queensland alone. We then pushed up to look at Brisbane. We've been looking for I'd say two to three years actually and it was hard to find the right location.”</p>

<p><img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_75/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Screenshot%202025-12-23%20at%203.27.14%E2%80%AFPM.png?VersionId=dYAVIL7qdcGA8ojvkslSrLjczXFejSSx" /></p>

<p>Sammut said suburbs including New Farm and Teneriffe were considered before the group ultimately focused on Toowong due to its strong downsizer demographic and limited supply of developable riverfront land.</p>

<p>The site was acquired off-market after what Sammut described as a lengthy negotiation and planning process, with the developer pursuing an uplift to the original approval.</p>

<p>“We are DA approved now which is very exciting,” Sammut said.</p>

<p>“We've had our change approval come through and we've obviously doubled the height, 15 storeys plus rooftop. We've got 42 amazing apartments that are going to be coming to market soon.”</p>

<p><img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-12-23%20at%203.27.26%E2%80%AFPM.png?VersionId=ohkRkY0dIZlqdfME2EZePsCQavRiBadE" /></p>

<p>Bureau^proberts said the design responds to Toowong’s evolving urban character, balancing contemporary apartment living with the area’s established residential identity.</p>

<p>“A place where traditional Queensland living has taken place for centuries; Toowong is seeing a shift of contemporary influence, commercial and retail hubs mixed with well-considered residential offerings – all the while maintaining its character and charm,” the architect noted in planning documents submitted to Brisbane City Council.</p>

<p>The architecture practice said the project’s form was shaped by its riverfront setting, flood considerations, neighbouring building scales, and view corridors.</p>

<p>“They said the mix of four and two-bedroom apartments capture the ‘fundamental qualities of Queenslander living,’ translated into the context of a contemporary subtropical building.”</p>

<p>The development sits just off Coronation Drive within walking distance of Toowong’s retail precinct and the upgraded Regatta ferry terminal, while also benefiting from proximity to the incoming green bridge connection to West End. Sammut said the accessibility and amenity offering were central to the site’s appeal.</p>

<p>The approval adds to growing residential activity along the Toowong riverfront, joining nearby projects including Consolidated Properties’ Monarch Residences and Spyre Group’s ARC Residences.</p>


Sammut secures approval for debut Brisbane apartment development in Toowong

<p>Developer Lanevick is heading back into Sydney’s apartment market after focusing more heavily on the luxury townhouse and terrace sector in recent years.</p>

<p>Lanevick, founded and directed by Steve Maroun, is expecting to receive approval in the coming months for a new apartment development in Gladesville, with the aim to launch it to the market later this year.</p>

<p>The 51-apartment project, designed by Studio Johnston, will comprise a mix of one-, two-, and three-bedroom apartments positioned toward the Hunters Hill downsizer market.</p>

<p>“Traditionally it’s been difficult for people in that market to downsize because there just hasn’t been the right product available,” Maroun said.</p>

<p>“We’re targeting buyers who might have 30 to 40 per cent of their house value sitting in the bank after downsizing.</p>

<p>“They still want good spacious entertaining areas, they still want quality design, but they also want flexibility and the ability to enjoy life a bit more after working hard for a long time.”</p>

<p>The project sits near Boronia Park and within close proximity to the Parramatta River foreshore, an area Maroun says offers more of a Hunters Hill lifestyle than a traditional apartment precinct.</p>

<p>“From a lifestyle perspective, it’s really more Hunters Hill than Gladesville,” Maroun said. “You’re close to the foreshore, close to parklands, and still connected back into the village precinct.”</p>

<p>From level four and above, apartments will capture water views&nbsp;toward Sydney Harbour. Communal amenity will include rooftop entertaining areas, wellness spaces, and a gym tailored toward owner-occupier buyers.</p>

<p>“We’ve really designed these apartments around that buyer coming from the Hunters Hill LGA and what they’re actually looking for in their next chapter.”</p>

<p>The proposed development has also been designed to respond to the changing character of the broader Gladesville town centre, where a growing number of mixed-use and residential proposals are expected to emerge over the coming years.</p>

<p>“Gladesville presented a rare opportunity to deliver a genuinely design-led residential project within an evolving lifestyle precinct, just moments from the growing Gladesville town centre, and we’ve approached the project with a strong focus on architecture, liveability and long-term community value,” Maroun said.</p>

<p>Maroun said Lanevick saw a first-mover advantage within the precinct as planning controls continue to evolve to accommodate greater housing density.</p>

<p>“We think there’s a real opportunity there that hasn’t really been serviced properly yet,” he said.</p>

<p>“There’s going to be a broader evolution of the whole Gladesville village precinct over time, particularly with more activation and mixed-use outcomes.”</p>

<p>The Venus Street proposal will include a commercial and retail component at ground level designed to contribute to that evolving streetscape activation.</p>

<p>“A big part of the thinking was how do you activate that area properly and create more vibrancy and amenity, which is what Hunters Hill has been looking for,” Maroun said.</p>

<p>Lanevick’s focus since 2020 has largely been on smaller-scale luxury townhouse and terrace developments. The developer recently completed Royale Randwick, also designed by Studio Johnston, where prices reached $3.65 million. The project was featured in the UDIA NSW 2026 Professional Development Prospectus and was also named a finalist for Development of the Year.</p>

<p>&nbsp;</p>


Lanevick to cater for Hunters Hill downsizers with new Gladesville apartment development

<p>Property developer One Living, backed by former Macquarie banker turned investment manager Chris Green’s investment firm, has unveiled plans to bring more institutional capital into housing to help address the national supply crisis.</p>

<p>The New York-based investor has focused his firm, GreenPoint Partners, on addressing the supply shortage hitting middle market housing in Australia.</p>

<p>It is backing the new One Living business to develop more than 1000 units along the eastern seaboard. The new firm is starting with a development on Mona Vale Road, on the border of Mona Vale and Pymble, in Sydney’s Northern Beaches, with around 140 apartments planned. They are eyeing off more sites across the city.</p>

<p>With cost pressures rising in the industry, One Living’s model is to be a vertically integrated developer-builder, so it can respond directly to the housing gap by removing the cost inefficiencies embedded in traditional residential delivery.</p>

<p>“We are building a platform designed to operate at scale and starting in a market where there’s a clear need for quality, attainable housing,” One Living joint managing director Joseph Scuderi said.</p>

<p>“It’s that missing middle – it’s that attainable end of housing… that’s what most Australians invest into and what Australians can actually afford.”</p>

<p><img alt="Mona Vale" data-entity-type="file" data-entity-uuid="798dfa93-4941-4db6-a696-31e9dc18e81c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.31.50%E2%80%AFPM.png?VersionId=mKBqi5C_DmeiXS.AtJkcR8LQIxqCqmFi" /></p>

<p>GreenPoint Partners brings years of experience assembling and scaling real estate operating businesses across major markets. And Green sees a big opportunity in Australia.</p>

<p>“For its size, sophistication and importance to the community, Australia’s living sector has remained largely under-institutionalised, which represents significant opportunity,” Green said. “GreenPoint identified that gap, assembled the right team, and is backing One Living to build a platform that is aligned to market needs.”</p>

<p>Green said being a builder-developer would give the company the capacity and flexibility it required to deliver reasonably-priced homes.</p>

<p>“We want it to be at that attainable level; not super high end luxury but at that attainable level,” he said.</p>

<p><img alt="Mona Vale" data-entity-type="file" data-entity-uuid="74a5344a-4b26-4d4a-ada3-056b1220be77" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.32.15%E2%80%AFPM.png?VersionId=vY8hXHO4reBMdO8ZXMWCNtGZJofUPQ3j" /></p>

<p>&nbsp;</p>

<p>One Living will undertake a component of affordable housing in its schemes, which it will own and operate, and it could also run build-to-rent on some sites.</p>

<p>Green praised local policy settings.</p>

<p>“The NSW government is being very supportive, strategic and pragmatic in terms of how do we generate more supply of housing,” he said. “We think it’s actually positive for development and the bit that’s been lacking at that attainable level is that it’s lots of relatively small private developers, whereas we want to create an institutional platform.”</p>

<p>One Living is also&nbsp;looking at high-density projects and could take on more institutional funding in the future.</p>

<p>“The way we will be able to achieve economies of scale is through size,” Green added.</p>


One Living enters Sydney's new apartment market with Northern Beaches site acquisition

<p>It's been several years since there's been an opportunity to buy a brand new townhome in Melbourne's coastal suburb of Mordialloc. Even apartment developments in recent times have been few and far between in the area.</p>

<p>Local developer LDS Property identified the gap in new housing, securing a site on White Street, directly opposite&nbsp;Woodlands Golf Club Mordialloc. They've recently launched&nbsp;<a href="https://www.apartments.com.au/new-townhouses/wm-residences-mordialloc-102-white-street-mordialloc-vic-3195">WM Residences</a>, just 13 townhouses which they have already started building.</p>

<p>Projects by Buxton Director Heath Thompson, who is selling WM Residences, says the townhouses x that perfect middle ground be</p>

<p data-end="683" data-start="511">"Mordialloc residents have had limited options to downsize within the suburb, often forcing them to look elsewhere despite long-standing ties to the area," Thompson says.</p>

<p data-end="882" data-start="690">"With very little comparable new supply coming to market, projects like WM Residences are well placed, particularly as buyers look to capitalise on current conditions amid constrained supply."</p>

<p data-end="882" data-start="690">[smartcode_project:default project_id=134646 project_image_fid=6109]</p>

<p>The development, designed by regarded architecture firm&nbsp;<a href="https://www.apartments.com.au/architects/ewert-leaf">Ewert Leaf</a>,&nbsp;adopts a deliberately restrained architectural approach, focusing on simplicity, durability and liveability rather than overt design gestures.</p>

<p>The boutique scale is central to the offering. With only 13 three-bedroom residences, each home is configured to prioritise functional layouts and everyday use, supported by private terraces and secure two-car garages.</p>

<p>Ewert Leaf’s design response leans into a calm, neutral material palette. Interiors are defined by oak flooring, white walls and soft finishes, creating a consistent and understated backdrop. The approach avoids trend-driven detailing in favour of longevity, with an emphasis on natural light and spatial clarity.</p>

<p>[smartcode_project:default project_id=134646 project_image_fid=6110]</p>

<p>Beyond aesthetics, the homes are designed to meet contemporary performance expectations. Each residence targets a minimum 6-star energy rating, incorporating double glazing, comprehensive insulation and all-electric Bosch appliances.</p>

<p>The project’s location supports a walkable coastal lifestyle, sitting within close proximity to Mordialloc’s foreshore, Main Street retail strip and the train station. Local cafés and dining venues, including Suburbia Deli and Hendriks Café, are within a short walk, reinforcing the area’s established neighbourhood character.</p>

<p>[smartcode_project:default project_id=134646 project_image_fid=6116]</p>

<p data-end="247" data-is-last-node="" data-is-only-node="" data-start="0">While <a href="https://www.apartments.com.au/developments/mordialloc-vic-3195">Mordialloc</a> is often defined by its beach and pier, the project taps into other areas of day to day living, offering easy access to local food, casual dining and transport, rather than positioning itself purely as a lifestyle retreat.</p>

<p>WM Residences reflects a continued trend across Melbourne’s coastal suburbs towards smaller-scale, design-led townhouse developments, particularly on infill sites where proximity to amenity is already established.</p>

<p>With construction commenced prior to its market entry, the project aligns with a growing preference among buyers for developments with visible progress and defined delivery timeframes.</p>

<p>[smartcode_project_cta:default project_id=134646]</p>


WM Residences fills gap in Mordialloc townhouse market

Mortgages

<html><body>
<div><span>Given that APRA's crackdown on investor lending has skimmed so many high loan-to-value ratio (LVR) investors out of the property market, it was always going to take a super-human 1Q 2016 investor update from Genworth Mortgage Insurance (GMA) to keep its share price buoyant.</span></div>
<div> </div>
<div><span>In the event, GMA reported statutory net profit after tax (NPAT) of $67.3 million and underlying NPAT of $61.8 million for the quarter ended 31 March 2016.</span></div>
<div><span> </span></div>
<div><span>Overall this was a solid set of results given that Gross Written Premium was down by a thumping 33.4 per cent from 1Q 2015, having declined dramatically from $127.7 million to $85 million.</span></div>
<div> </div>
<div>This statistic is a fabulous measure of the impact of the regulatory intervention - the riskier loans have largely been crimped out of the property market.</div>
<div><strong><span style="text-decoration: underline;"><br>Delinquencies</span></strong></div>
<div> </div>
<div>Genworth's portfolio delinquency rate was marginally higher at 0.40 per cent, up from 0.36 per cent in 1Q 2015.</div>
<div> </div>
<div>Overall mortgage delinquencies remain remarkably low, and can realistically only move in one direction from here, particularly given that numerous resources towns in regional Queensland have effectively become ghost towns.</div>
<div> </div>
<div>Unfortunately many investors were sucked in to buying in mining towns and regions lured by superficially "stronger" yields, but unfortunately in many cases there is now nobody to rent the houses to, and as equity turns negative foreclosure rates will inevitably rise.</div>
<div> </div>
<div>The lesson here is that "yield" and "income" are not the same thing, and that as an abstract spot calculation yield is largely useless as an indicator of future returns. This applies to all asset classes.</div>
<div> </div>
<div>Even in some of the larger conurbations there are likely to be some severe challenges ahead, with unemployment in Townsville having risen to a <a href="https://petewargent.blogspot.com.au/2016/04/townsville-unemployment-at-13-year-high" target="_blank">13 year high</a> last month.</div>
<div> </div>
<div>Despite these bleak statistics, overall delinquency developments have shaped up quite favourably since 2009, with mortgage delinquencies by book year having cascaded lower over time. </div>
<div> </div>
<div>The 2008 book year saw heightened mortgage stress among self-employed borrowers as a result of the financial crisis (0.98 per cent), while flooding in Queensland saw elevated delinquency rates in the 2011 book year.</div>
<p><a href="/images/2016/05/02/GMA.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/05/02/GMA.jpg" alt=""></p>
<p> </p>
<div>At the state level delinquency rates are incredibly low in New South Wales (0.29 per cent).</div>
<div> </div>
<div>Delinquency rates are notably higher in Queensland (0.55 per cent), in part due to mining town foreclosures, and largely related to the literal wash-up from the severe 2011 flooding in the state.</div>
<div> </div>
<div>The largest year-on-year rise in delinquency rates of 16 basis points was seen in resources rich Western Australia, where portfolio delinquencies have increased to 0.53 per cent.</div>
<div> </div>
<div>Nevertheless, Genworth sees the mortgage market remaining strong in aggregate, reporting in its investor update:</div>
<div> </div>
<div><em>"The outlook for the Australian residential mortgage market remains strong, supported by sound fundamentals including low unemployment, record-low interest rates and a continued focus by regulators on lending standards."</em></div>
<div> </div>
<div>And notably Genworth expects further constraints on high LVR lending in 2016 and beyond:</div>
<div>
<br><em>"The high LVR market continues to be constrained in 2016 and Genworth continues to expect GWP to decline by approximately 20 per cent due to these market conditions."</em>
</div>
<div><em> </em></div>
<div>Share market analysts were fairly unmoved on the news, the share price steady at around $2.39.</div>
<div> </div>
<div>
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
</div>
</body></html>

pwargent-M4siyDbqQY

Genworth mortgage insurance update: Pete Wargent

<html><body>
<div>Monoline mortgage insurer Genworth Mortgage Insurance Australia (GMA) released its FY15 results late last week, with new CEO (and fellow former Deloittian) Georgette Nicholas taking the helm for its latest investor presentation.</div>
<div> </div>
<div>As expected following the loss of a key contract gross written premium was down by 20 per cent from FY14, largely due to Westpac canning its Lenders Mortgage Insurance (LMI) deal with Genworth in February 2015, but underlying earnings performance remained resilient.</div>
<p><a href="/images/2016/02/08/GMA1.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/02/08/GMA1.jpg" alt=""></p>
<div> </div>
<div>The number of paid claims was well down to 616 in 2H15 from 664 in the prior corresponding period of 2H14 (and way down from 1,091 in 2H13) although the average paid claim increased year-on-year to $63,500 from $54,400.</div>
<p><a href="/images/2016/02/08/GMA2.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/02/08/GMA2.jpg" alt=""></p>
<p><br><strong><span style="text-decoration: underline;">Delinquencies very low</span></strong></p>
<div> </div>
<div>Genworth's ASX releases are perhaps most interesting for their ongoing insights into mortgage delinquencies, and the latest presentation showed that delinquencies remain at a very low level of just 0.38 per cent nationally. </div>
<div> </div>
<div>Queensland has the highest delinquency rate of the states (0.53 per cent), in no small part thanks to the now discredited belief that house prices and vacancy rates in mining towns could emerge unscathed from the end of the resources construction boom. </div>
<div> </div>
<div>Queensland's delinquency rate has also been elevated since the 2011 book year when delinquency developments were exacerbated by flooding across huge swathes of the state.<br><br>Strip out those exceptional items and mortgage books in the remainder of the Sunshine State are in reasonably solid nick.</div>
<div> </div>
<div>South Australia is next in line at 0.51 per cent, perhaps unsurprising given the elevated rates of unemployment consistently being recorded in Adelaide and regional South Australia. </div>
<div> </div>
<div>Delinquency rates were exceptionally low in New South Wales for such a populous state at just 0.27 per cent.</div>
<div> </div>
<div class="separator"><a href="/images/2016/02/08/GMA3.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="/images/2016/02/08/GMA3.jpg" alt=""></div>
<div> </div>
<div>Mapping GMA's delinquency developments by book year shows how delinquency rates have cascaded handsomely lower since the particularly troublesome 2008 and 2009 book years. </div>
<p><a href="/images/2016/02/08/GMA4-1.jpg" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/02/08/GMA4-1.jpg" alt=""></p>
<div><strong><span style="text-decoration: underline;">Share price rebound</span></strong></div>
<div> </div>
<div>The share price responded positively to the FY15 investor presentation to trade up by +4.33 per cent by the market close yesterday at $2.65.</div>
<div>
<span style="line-height: 1.3em;"> </span><br><div class="separator"><a href="/images/2016/02/08/GMA6.jpg" target="_blank">Click to enlarge</a></div>
<div class="separator"><img src="/images/2016/02/08/GMA6.jpg" alt=""></div>
</div>
<div>If Genworth is perceived to be any kind of worthwhile bellwether for property market sentiment (commonly claimed when the market cap is down) then the 20 per cent recovery in the share price from $2.21 to $2.65 augurs well for the mortgage default outlook.<br><br>This is particularly so given that the share price dipped sharply in September as the APRA crackdown on property investors bit hard, adversely impacting expected volumes through 2016.<br><br>The Genworth share price had slumped to a 52 week low of $2.21 on September 2015 as the Glencore share price crash rocked commodities companies and share market confidence.</div>
<div> </div>
<div>
<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
</div>
</body></html>

Genworth's mortgage delinquencies remain low

<html><body>
<div>One of the easier trades you'll ever come across, with inflation missing market expectations yet gain.<br><br>Money for jam, here.<br><br>Rate hikes never were on the cards any time soon - as well documented here often enough - but that's even more obvious now with inflation missing (yet again!).<br><br>
</div>
<div>Both of the core measures came in at just +0.4 per cent for the December quarter.</div>
<div> </div>
<div>While underlying inflation rate ticked up to +1.9 per cent, the 6-month annualised pace is incredibly weak at just +1.6 per cent.<br><br>Inflation has now missed the 2-3 per cent target on the downside for 9 consecutive quarters, and the pulse looks to have weakened again. </div>
<p> </p>
<div><img src="https://1.bp.blogspot.com/-XlzLIPRQpu4/WnEZzIZqnVI/AAAAAAAAoJU/rzj9H0OJ5NUP_8uwQveXyc47vGd8NtzuQCLcBGAs/s640/A1.jpg" width="640" height="388" data-original-height="826" data-original-width="1359"></div>
<p><br>Tradables prices picked up a bit in the December quarter, but were negative over the year.<br><br></p>
<div><img src="https://4.bp.blogspot.com/-Kxw_kvG6T8g/WnEZzNT9e7I/AAAAAAAAoJQ/v0T7c3gZZmc6pjln-mpGi6LhcMFX1ryUACLcBGAs/s640/A3.jpg" width="640" height="392" data-original-height="826" data-original-width="1346"></div>
<div> </div>
<div>The headline result of +0.6 per cent for the quarter and +1.9 per cent for the year was pumped by a jump in fuel and fruit prices (someone needs to look up whether avocados and capsicums are fruits or vegetables, I have no idea). </div>
<div> </div>
<div>Overall, though, this was once again very weak underlying inflation, though importantly the result was not under the Reserve Bank's forecast for the end of the year.</div>
<div> </div>
<div>So that basically means that interest rates will be left on hold for a record length of time, barring a shock of some kind.</div>
<div> </div>
<div>Rents off the mat</div>
<div> </div>
<div>Rents began to rise moderately again in 2017, mainly thanks to Sydney (+2.4 per cent).</div>
<div> </div>
<div>Rents were negative in the December quarter in Brisbane, while in Perth rents are some 16 per cent below their peak. </div>
<p> </p>
<div><img src="https://3.bp.blogspot.com/-J1Hs5n8pTqQ/WnEZzEsmQuI/AAAAAAAAoJY/eC-Oyr-Y9sAcEVWZFcCAcaZ0rol-BOElQCLcBGAs/s640/A2.jpg" width="640" height="374" data-original-height="818" data-original-width="1398"></div>
<p><br>Sydney rents (+52 per cent) have doubled the of inflation (+27 per cent) over the past decade.</p>
<p> </p>
<div><img src="https://1.bp.blogspot.com/-h8w2l0xyyCI/WnEZzng4KmI/AAAAAAAAoJc/fbvJr9MBycYnJXjOM2wyCEImtv1Gv0T_QCLcBGAs/s640/A4.jpg" width="640" height="374" data-original-height="828" data-original-width="1411"></div>
<p> </p>
<div>The wrap</div>
<div> </div>
<div>The Reserve Bank's models already seemed to suggest that underlying inflation wouldn't get back to the mid-point of the target range at 2.5 per cent for years to come (possibly about 4 years!). </div>
<div> </div>
<div>And now this result has missed market expectations too, for the fifth consecutive quarter. </div>
<div> </div>
<div>The main takeaway is all the talk of imminent rate hikes was little more than wishful thinking.<br><br>Indeed, given the Reserve Bank's stated mandate, logically either the next move in rates should be down or the economy should returning to full employment.<br><br>Either way, there was little to fear in these numbers for mortgagees and housing market fanatics.</div>
<div> </div>
<div>PETE WARGENT is the co-founder of AllenWargent property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank">blogger</a>.</div>
</body></html>

Talk of imminent rate hikes was little more than wishful thinking: Pete Wargent

<html><body>
<p>Buying your first home can be both exciting and overwhelming – especially once the first mortgage bill comes through. However, for many buyers, the purchase of a property can be one of the most rewarding and valuable investments of their lives. If you've just bought your first property and are feeling nervous about the 20-30 year tenure of mortgage payments, we've compiled a simple guide with some tips that could help you to pay down your mortgage debt faster. </p>

<p>From negotiating new home loan rates to using an offset account or using savvy budgeting techniques, here are 23 ways you could secure a mortgage-free lifestyle sooner. </p>

<h2><strong>1. Purchase a home you can afford</strong></h2>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/shutterstock_1141644755_0.jpg" rel="gallery-all"><img alt="" class="image-article-full-width-580px" height="387" src="/s3/files/styles/article_full_width_580px/public/pictures/article-images/shutterstock_1141644755_0.jpg?itok=v0faBBD6" width="580"></a></figure><p>Look to <a href="/guides/how-much-should-you-spend-on-your-first-house-in-2020"><u><strong>purchase a home you can afford</strong></u></a>, as often you'll be required to attain prequalification first. Prequalification means your bank will investigate your financial circumstances and determine <a href="/guides/how-much-can-i-borrow-for-a-new-home"><u><strong>the loan that is most suitable for you</strong></u></a>. </p>

<p><em>Some questions to help determine whether you’re eligible or ready to take on a home loan are: </em></p>

<ul>
<li>Will you be debt-free for three to six months?</li>
	<li>Are you able to provide a 5%-20% down payment?</li>
	<li>Can you afford to take out a 15-30 year fixed-rate loan?</li>
	<li>Is the home repayment 25% less than monthly take-home pay?</li>
	<li>Are you financially able to cover the fee moving expenses and leaving your current residence? </li>
	<li>Can you afford the ongoing maintenance and utility bills for this home?</li>
	<li>Do you have enough funds saved for any emergencies? </li>
</ul>
<h2><strong>2. Consider refinancing your home loan</strong></h2>

<p>Renegotiating your current home loan rate with your mortgage lender, or shifting your home loan to a lender who offers a lower interest rate, may result in cost savings and could help reduce the tenure of your mortgage.</p>

<h2><strong>3. Consider an offset account</strong></h2>

<p>[smartcode_project:default project_id=7275]</p>

<p>An offset account is a savings or transaction account linked to a home loan account. The balance of the account is “offset” daily against the home loan balance, and therefore you are only charged interest on the difference between the total loan balance and the amount offset.</p>

<p>The money held within an offset account is not regarded as taxable income, as the account does not generate interest, which is beneficial for people who deposit large sums of money into the account.</p>

<p>Depositing money into the offset account with extra income from other sources of income such as bonuses and profits from investment can also help lower your interest repayments, as well as contribute to paying off your mortgage sooner. </p>

<p>Depending on the lender the money within the offset account also can be withdrawn twice or more in a year with <u><strong><a href="https://www.yourmortgage.com.au/home-loan-guide/redraw-facility-explained-with-tips-to-lower-your-mortgage/79077/">some lenders charging up to $50 per withdrawal</a></strong></u>. </p>

<h2><strong>4. Consider refinancing your home loan</strong></h2>

<p>Renegotiating your current home loan rate with your mortgage lender, or shifting your home loan to a lender who offers a lower interest rate, may result in cost savings and could help reduce the tenure of your mortgage.</p>

<h2><strong>4. Keep your credit card debts manageable </strong></h2>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/screen_shot_2020-02-07_at_4.26.48_pm.png" rel="gallery-all"><img alt="" class="image-article-full-width-580px" height="383" src="/s3/files/styles/article_full_width_580px/public/pictures/article-images/screen_shot_2020-02-07_at_4.26.48_pm.png?itok=0n7kFOF7" width="580"></a></figure><p>Aim to clear your credit card of debt each month, as the interest rates on your credit cards and personal loans are often much higher than the interest rate on your home loan. When you pay on time, you avoid paying extra interest or late fees and also help keep your credit score healthy.</p>

<p>Personal Loan: A personal loan sits between a home loan and a credit card loan, and provides a faster and easier process than taking out a mortgage. Unlike a credit card loan, to access the personal loan, you are also required to sign a formal contract. </p>

<p>Credit Card Rate: A credit card's interest rate is the price you pay for borrowing money. The interest rates, known as the annual percentage rate (APR) are stated as a yearly rate. With a credit card, paying interest on purchases can be avoided if the balance is paid in full each month by the due date. </p>

<p>Hire Purchase: Hire purchase is an arrangement for buying expensive consumer goods, in which the buyer provides an initial down payment and pays the balance plus interest in instalments. Hire purchase agreements state that the ownership of the merchandise is not officially transferred to the buyer until all the payments have been made.</p>

<h2><strong>5. Split your loan </strong></h2>

<p>You may choose to split your loan in half, with a portion fixed, and the rest variable. </p>

<p>A <a href="/guides/how-to-choose-the-right-home-loan"><u><strong>fixed-rate home loan</strong></u></a> ensures your loan repayments are charged at the same interest rate for the length of your loan period. If the loan is not repaid by the end of the period and you choose not to enter another fixed-term contract, the rate is reverted to a variable interest rate. </p>

<p>A <a href="/guides/how-to-choose-the-right-home-loan"><u><strong>variable interest rate</strong></u></a> is a loan where the interest rate charged on the outstanding balance fluctuates as market interest rates change. </p>

<p>To successfully split your loan in half you can contribute through fortnightly payments, a method which gives homeowners a sense of security as fixed payments will remain constant while variable payments will see interest rates rise and fall.  </p>

<h2><strong>6. Make repayments at a higher rate </strong></h2>

<p>[smartcode_project:default project_id=2439]</p>

<p>People that choose a loan which is set at the lowest interest rate available can add <a href="https://www.yourmortgage.com.au/home-loan-guide/24-ways-to-get-the-mortgage-monkey-off-your-back-faster/77843/"><u><strong>2-3 points to the repayment amount</strong></u></a>. For some, this may not make a drastic difference to their bank balance. </p>

<p>A good idea could be to align repayments with your pay cycle, prior to setting the amount you wish to repay each month. </p>

<h2><strong>7. Research into smaller lenders as well as big banks</strong></h2>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/shutterstock_425326012_1.jpg" rel="gallery-all"><img alt="" class="image-article-full-width-580px" height="387" src="/s3/files/styles/article_full_width_580px/public/pictures/article-images/shutterstock_425326012_1.jpg?itok=xkgYwL2C" width="580"></a></figure><p>There was <a href="https://www.domain.com.au/money-markets/why-borrowers-are-turning-away-from-the-big-banks-863960/"><u><strong>a period in 2019</strong></u></a> where homeowners were turning away from four major banks [in Australia] in favour of smaller lenders, as they provided more competitive rates. </p>

<p>Small lenders have been found to sometimes compete more persistently for your business and provide more personalised service. These companies may also offer home loan options such as longer loan terms, lower ongoing fees and lower interest rates. </p>

<h2><strong>8. Switch lenders </strong></h2>

<p>Finding a home loan at a lower rate can help you save money. However, always make sure to do your research before switching lenders or loans types. Always make sure to understand the rates and features of the loan, and don't be afraid to tell lenders the exact portion of your income you're prepared to allocate to mortgage repayments. </p>

<h2><strong>9. Find a package deal </strong></h2>

<p><a href="https://www.canstar.com.au/home-loans/packaged-home-loans/what-is-a-package/"><u><strong>Package deals</strong></u></a> or package home loans combine home loans and financial products, which can provide fee waivers for a transaction or offset accounts. Sometimes banks may waive annual credit card fees, provide discounts on insurance, discounted or free financial planning sessions and even discounted share trading. </p>

<h2><strong>10. Watch out for lenders who offer gifts </strong></h2>

<p>[smartcode_project:default project_id=6798]</p>

<p>Introductory rates are commonly referred to as ‘honeymoon rates’, as lenders can try to convince homeowners to select a lower rate for a period of 1-2 years. Although once the honeymoon period has ended or the lender switches to a high variable rate of interest, the person is expected to pay for a much larger rate over the next 20 years. </p>

<p>Some lenders may also charge costly cancellation penalties for those who opt-out after utilising the honeymoon rates. Don’t be afraid to discontinue business with a lender who is no longer giving you the best service available. </p>

<h2><strong>11. Portable loans can make moving house easier</strong></h2>

<p>The average home loan is between 25 to 30 years, which is why it is quite common for people to move house whilst still paying off a loan. If you decide to move houses, a portable loan on your existing house that carries to your new property, can save you the inconvenience of refinancing. However, you should be aware of the regulations around buying and selling homes, as there may be <a href="/guides/how-much-does-it-cost-to-sell-a-house-or-apartment"><u><strong>additional charges for the old house</strong></u></a> and the <a href="/guides/top-10-hidden-costs-of-buying-a-house-or-apartment-in-2021"><u><strong>establishment for the new house</strong></u></a>.</p>

<h2><strong>12. Pay all your mortgage fees and the charges upfront </strong></h2>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/shutterstock_701873641.jpg" rel="gallery-all"><img alt="" class="image-article-full-width-580px" height="387" src="/s3/files/styles/article_full_width_580px/public/pictures/article-images/shutterstock_701873641.jpg?itok=AzmNqrWE" width="580"></a></figure><p>When paying your mortgage fees upfront, it is sensible to pay with the money you already have, rather than borrowing money from the lender to pay fees and charges. </p>

<h2><strong>13. Pay your first instalment before it's due</strong></h2>

<p>The first instalment of your home loan may not be due for a month after the settlement. If your lender allows, you may be able to pay your first instalment on the settlement date, which can secure your position ahead of the lender for the term of your loan. </p>

<h2><strong>14. Pay off the principal</strong></h2>

<p>Every mortgage repayment you make attacks the capital which helps you pay a smaller amount of interest. <a href="/guides/how-to-choose-the-right-home-loan"><u><strong>You may want to avoid interest-only loans</strong></u></a>, as paying interest on your loan for a set period may result in the principal amount being charged at a higher propensity interest-only period.</p>

<h2><strong>15. Use your equity</strong></h2>

<p>[smartcode_project:default project_id=4939]</p>

<p>Equity is the difference between the current value of your property and the amount you owe the lender. If you have already paid a percentage of your home loan, then you would have equity. Some lenders will allow you to borrow money using your equity as collateral. <a href="/guides/how-does-equity-work-in-property"><u><strong>Using equity to improve your property</strong></u></a> also helps increase its value in the long run. </p>

<h2><strong>16. Discover what you could be entitled to</strong></h2>

<p>Some lenders <a href="https://www.homeloanexperts.com.au/waived-lmi/"><u><strong>may offer discounts and special conditions</strong></u></a> to those from specific professions, such as certified medical professionals. In these cases, a lender may waive or lend at a higher loan to value ratio before charging a Lenders Mortgage Insurance, which may provide you with a significant head start on paying off your loan.</p>

<h2><strong>17. Keep ahead of the game</strong></h2>

<p>Check the status of your <a href="/guides/how-to-choose-the-right-home-loan"><u><strong>home loan</strong></u></a> each year, as well as new home loan offers that you could be applicable for. <a href="/guides/housing-market-effect-on-wealth"><u><strong>Keeping yourself knowledgeable</strong></u></a> about this will help you to maintain a competitive mortgage rate, and avoid overpaying interest. </p>

<h2><strong>18. Budget</strong></h2>

<p>When trying to save money, a budget is a good way to organise your finances, balancing your home loan repayments as well as household bills. This will also help determine how much disposable income you have left over.</p>

<h2><strong>19. Know how much you’re spending on luxury items</strong></h2>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/shutterstock_507639565_0.jpg" rel="gallery-all"><img alt="" class="image-article-full-width-580px" height="348" src="/s3/files/styles/article_full_width_580px/public/pictures/article-images/shutterstock_507639565_0.jpg?itok=_2hu2Qoo" width="580"></a></figure><p>Keep a budget so that you can identify what you spend most of your earnings on. Perhaps limiting dining at a restaurant or cafe to once a week, and instead, cook meals at home. Reducing your power usage, changing energy providers and upgrading your old appliances can be a great way to ensure your home is more energy-efficient, which will also result in lower power bills. Avoid purchasing low-quality items that are likely to need replacing. For more tips on how to save money, <a href="/guides/how-to-buy-a-house-in-2021-a-guide-for-first-time-home-buyers"><u><strong>check our article</strong></u></a> about how you can save for a house deposit in a year. </p>

<h2><strong>20. Using gifted money towards your loan</strong></h2>

<p>If you receive any bonuses at work, cash gifts or inheritance and you’ve opted for a variable interest rate, then you could consider allocating a portion of the amount for your mortgage payments. </p>

<h2><strong>21. Rent out your home/spare rooms on Airbnb</strong></h2>

<p><a href="/guides/breezybnb-chooses-urban-s-5-best-brisbane-apartments-for-airbnb"><u><strong>Listing your home on Airbnb</strong></u></a> can be a great way to bring in some extra funds. Money earned from listing your home can also be put towards your loan repayment. Listing your home while you're away is also a great way to ensure your home is always occupied.</p>

<h2><strong>22. Use your tax refund</strong></h2>

<p>[smartcode_project:default project_id=22057]</p>

<p>Your tax refund can be a great way to make a bulk payment on your home loan. For those that choose to lease their home, the ongoing rental property cost <a href="/guides/18-ongoing-rental-property-costs-and-which-ones-are-tax-deductible"><u><strong>may be tax-deductible</strong></u></a>.</p>

<h2><strong>23. Seek additional work</strong></h2>

<p>Working a second job if possible, is a great way to save money quickly. Look for work with flexible hours, or casual opportunities that will fit around your schedule.</p>
</body></html>

Olivia Round

How to secure a mortgage-free lifestyle sooner

<html><body><div class="storysegment2 segmentContentFull">
<p>The RBA governor Philip Lowe said he was prepared to cut the cash rate further if it was needed to improve economic conditions in Australia.</p>
<p>And he maintains the recent cuts are working.</p>
<p><span>"Low interest rates are supporting jobs and overall income growth. </span></p>
<p><span>"At the same time, though, we recognise that monetary policy is not working in exactly the same way that it used to."</span></p>
<p>Lowe effectively repudiated former treasurers Paul Keating and Peter Costello's view that monetary policy has "run its race." </p>
<p>The former treasurers have both suggested that monetary policy was not useful any more after the three 0.25 percentage point interest rate cut.</p>
<div class="_3MT_w" data-experiment-target="paywallPrompt">The RBA has already lowered interest rates three times over the year to a record low 0.75 per cent. </div>
<p>“We are confident that these reductions are helping the Australian economy and supporting the gentle turning point in economic growth,” Dr Lowe said when he delivered the Sir Leslie Melville lecture in Canberra yesterday.</p>
<p>He noted<span> high levels of debt meant that "people are more careful with their spending and are less inclined to take on yet more debt. </span></p>
<p><span>"This is especially so when income growth has disappointed, as it has over recent times.</span></p>
<p><span>"In a number of countries, both government and households feel constrained by their previous decisions to borrow and are seeking to put their balance sheets on a sounder footing. </span></p>
<p><span>"One way they can do this is by spending less and saving more," he noted</span></p>
<p>“We also recognise that low interest rates hurt the finances of many people, particularly those relying on interest income. So there is a balancing act here,” he said.</p>
<p>“The board is prepared to ease monetary policy further if needed.</p>
<p>"Having said that, it is extraordinarily unlikely that we will see negative interest rates in Australia.</p>
<p>“It is likely though that we will require an extended period of low interest rates to reach full employment and for inflation to be consistent with the target.”</p>
<p>Lowe said it is the duty of the Reserve Bank Board to ensure that its policies are directed to the greatest advantage of the people of Australia so as to best contribute to:</p>
<ol>
<li>the stability of the currency of Australia;</li>
<li>the maintenance of full employment in Australia; and</li>
<li>the economic prosperity and welfare of the people of Australia.</li>
</ol>
</div></body></html>

j.ballantyne1990-6AQqhLzZaK

RBA governor Philip Lowe says low cash rate was working

<html><body>
<p>There was "an abundance of housing credit available,” the Commonwealth Bank’s CEO Matt Comyn said yesterday.</p>
<p>The CEO suggested the recent cuts by the Reserve Bank were contributing to a turnaround in the housing market.</p>
<p>“House prices are now rising in Sydney and Melbourne after having fallen for 18 months, and there are encouraging signs that the market has stabilised,” he said.</p>
<p>“While regulatory guidance has increased in recent years for home lending, these changes have improved lending standards across the industry and have further improved the resilience of the financial system.”</p>
<p>According to the CEO, CBA is “very clear” on the steps that must be taken to continue to deliver “in the current economic, regulatory and competitive environment.”</p>
<p>“Our results show the underlying strength of our core business, with home and business lending both up 4 percent,” he said.</p>
<p>The difference in mortgage pricing for new and existing customers is "substantially less" than the figure claimed by the ACCC, Comyn said.</p>
<p>The competition regulator identified a gap of 32 basis points in interest rates between the front and back books of the major banks, But he said it was significantly lower than 30 basis points at CBA.</p>
<div class="_3MT_w" data-experiment-target="paywallPrompt" data-optly-141991dcd6764670b007de1ca593193e=""> </div>
</body></html>

Abundance of housing credit available: CBA Matt Comyn

<html><body>
<p>The Reserve Bank has signalled that more cuts to the official interest rate could come although they advised of concerns of refuelling a property bubble in Sydney and Melbourne.</p>
<p>The October meeting saw the cash rate cut to a record low of 0.75 per cent.</p>
<p>The RBA board minutes noted "the housing market and other asset prices might be overly inflated by lower net interest rates".</p>
<p>"This assessment would need to be reviewed if rapidly increasing asset prices were accompanied by materially faster credit growth, weak lending standards and rising leverage," the minutes noted.</p>
<p>The members saw a limited risk of excessive borrowing.</p>
<p>Members acknowledged that asset prices were part of the transmission mechanism of policy, including by encouraging home building.</p>
<p>"By themselves, higher asset prices were considered unlikely to present a risk to macroeconomic and financial stability.</p>
<p>"This assessment would need to be reviewed if rapidly increasing asset prices were accompanied by materially faster credit growth, weak lending standards and rising leverage.</p>
<p>"Although household debt was still considered high, members saw only a limited risk of excessive borrowing at the current juncture: household disposable income growth (and thus borrowing capacity) is weak; the memory of recent housing price falls is still fresh; and banks are still quite cautious in their appetite to lend."</p>
<p>The RBA members assessed that close monitoring of this risk was warranted.</p>
<p>The RBA minutes warned that global asset prices being driven higher by record low rates were exposed to any potential global shock given high debt levels that had run up since the global financial crisis.</p>
<div>
<div>
<h2>
<a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2019-06-18/reserve-bank-must-consider-quantitative-easing,-economists-say/11218476" target="_self" title=""></a>"Any shock that caused markets to increase risk premiums or revise upwards expectations of future policy rates ... could see a broad range of asset prices fall," the minutes said.</h2>
</div>
</div>
<p>"A fall in asset prices could result in financial stress for some businesses and households, which could spill over into financial institutions."</p>
<p>Members also discussed the possibility that policy stimulus might be less effective than past experience suggests.</p>
<p>They recognised that some transmission channels, such as a pick-up in borrowing or the effect on the home-building sector, may not be operating in the same way as in the past, and that the negative effect of low interest rates on the income and confidence of savers might be more significant.</p>
</body></html>

Overly inflated Sydney and Melbourne housing prices concerns the RBA

<html><body>
<p><span><span>The Reserve Bank of Australia (RBA) is likely to cut the cash rate on Tuesday, according to Finder.com.au's RBA Cash Rate Survey.</span></span></p>
<p><span><span>More than half (55%, 25) of the 45 experts and economists surveyed expect the cash rate to drop to 0.75% on Tuesday. </span></span></p>
<p><span><span>Three-quarters (73%, 33) are predicting at least one cut will happen by November.</span></span></p>
<p><span><span>With three cuts in 2019 now a probability, there is a group of experts (13%, 6) who believe a fourth cut is possible this calendar year.</span></span></p>
<p><span><span>In fact, five economists expect the rate to go all the way to 0.25% with one predicting we get to 0%.</span></span></p>
<p><span><span><img src="https://gallery.mailchimp.com/cc5e9bce699fa1d71a67cf499/images/f1149f38-32a0-4fff-ac24-474dc397b4b8.png" data-imagetype="External"><br><br>Graham Cooke, insights manager at Finder, said 2020 could be the year of a negative cash rate, quantitative easing, or potentially both.<br><br>“As the RBA cuts the cash rate closer to zero, they are slowly diluting their power. An injection of cash may be the only option to stimulate the economy.<br><br>“This comes on the back of [RBA Governor] Philip Lowe saying last month that ‘unconventional’ options may be used if the economy warranted it, which seems to include both the potential of quantitative easing and a negative rate.<br><br>“We are looking at uncharted waters for Australia,” Cooke said.</span></span><br><br><span><span><img src="https://gallery.mailchimp.com/cc5e9bce699fa1d71a67cf499/images/b0a1017f-3b4b-44ee-b109-0ee71b7184fb.png" data-imagetype="External"><br></span></span></p>
</body></html>

Over half of economists surveyed predict cash rate cut: Finder

<html><body>
<p>Although housing credit growth declined further in June, approvals for new loans increased, the Reserve Bank of Australia has noted.</p>
<p>This increase in approvals was broadly based, across owner-occupiers and investors, across states and across different types of lenders.</p>
<p>The RBA noted it was also consistent with the improved conditions in housing markets evident in a range of indicators, such as auction clearance rates and housing price growth, particularly in New South Wales and Victoria.</p>
<p>"If housing conditions continue to improve in the coming months, we would expect to see a further rise in loan approvals," Christopher Kent, the assistant governor (Financial Markets) said in an a<a href="https://www.rba.gov.au/speeches/2019/sp-ag-2019-08-13" target="_blank">ddress to the Finance &amp; Treasury Association</a> this morning.</p>
<p>Kent noted l<span>enders have passed through most of the cash rate reductions to housing interest rates. </span></p>
<p><span>"Following the 50 basis point reduction in the cash rate from June to July, lenders lowered their standard variable rates (SVRs) on housing loans by an average of 44 basis points.</span></p>
<p><span>"The extent of pass-through was broadly consistent with the experience of the past decade."</span></p>
<p>Kent further noted the average interest rate actually paid on outstanding variable-rate housing loans in the Reserve Bank's Securitisation Dataset decreased by 23 basis points in June, the same as the average announced reduction in SVRs.</p>
<p>"Similar reductions in outstanding rates are expected to be recorded for July data.</p>
<p>"So the declines in SVRs are being pushed through to all existing borrowers, which make up the so called ‘back book’. Rates on new loans have also been lowered.</p>
<p>"Indeed, new borrowers, and those refinancing existing loans, continue to be offered interest rates that are on average well below those applying to existing loans.</p>
<p>"So customers who are actively looking around at what's on offer, are able to take advantage of the strong competition among lenders that is focused squarely on the ‘front book’."</p>
</body></html>

Improved housing market conditions evident: RBA

<html><body>
<p>GUEST OBSERVER</p>
<p>I've very much enjoyed reading James Glynn in my Wall Street Journal app this year, as one of the most informed commentators on Aussie monetary policy.</p>
<div>Always straight to the point and almost unerringly accurate. </div>
<div> </div>
<div>Yesterday in Glynn's take he argued that there's no point in the Reserve Bank delaying action, calling for another rate cut in July to an official cash rate of 1 per cent, followed by a possible further salvo of cuts towards the end of the year. </div>
<div class="separator"> </div>
<div class="separator"><img src="https://1.bp.blogspot.com/-kaxsG_b0V7s/XQnH5T_9v4I/AAAAAAAAwiU/uGam_SV7oQUZZyWYprmIuhBy5RBK4-mOACLcBGAs/s640/JG.jpg" width="640" height="132" data-original-height="153" data-original-width="736"></div>
<div> </div>
<div>Today's skilled job advertisements figures did little to dispel the notion, with another decline in May taking the trend year-on-year decline out to 6 per cent. </div>
<div> </div>
<div class="separator"><img src="https://1.bp.blogspot.com/-gCDidzrgTm0/XQnH5cjH_UI/AAAAAAAAwig/c2FdekaHDCATavQQd6jYrg8CphWXZmFkwCEwYBhgL/s640/DOE.jpg" width="640" height="366" data-original-height="790" data-original-width="1377"></div>
<div> </div>
<div>There were year-on-year declines across each of the three main states, and in 7 of the 8 major occupational groups. </div>
<div> </div>
<div>There's been some growth in white collar and professionals vacancies, but tellingly the construction and trades ads have dropped away sharply. </div>
<div> </div>
<div>Thus the strong jobs recovery rather looks set to die on its, erm, feet.<br><br>As the Aussie dollar scrabbles around at decade lows, benchmark iron ore spot prices have ballooned to multi-year highs across all the major grades.<br><br><div class="separator"><img src="https://1.bp.blogspot.com/-a6d3QotflxE/XQqd1spJ-vI/AAAAAAAAwjA/jI6_2cVIFakyjy2d2QeQvSTMAJnSekQfwCLcBGAs/s640/IO.jpg" width="640" height="358" data-original-height="803" data-original-width="1430"></div>
<br>I wanna see the receipts!</div>
<div> </div>
<div>
<em>PETE WARGENT is the co-founder of AllenWargent property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank">blogger</a>. </em> </div>
</body></html>

Mortgages

Editor's Picks

Have something to contribute?

Developments

New apartments

New townhouses

News

Mortgages

Editor's Picks

Receive the latest news stories to your inbox

Have something to contribute?

Developments

New apartments

New townhouses

News