Chinese can get a big property in Australia with a big backyard and pool for the same price of a small littel apartment in Shanghai and so property in Australia is definitely a good bargain for some Chinese who have the spare ca$h

Local aspiring homeowners  and investors are complaining that they are being priced out by foreigners who have no intention of living in their new properties and making worse the situation for them to own their dream home by these buyers inflating the prices of property in Australia. Real estate agents like J P DIXON from Melbourne are exploiting this interest by chines buyers by recently going to china to participate in the “China International Luxury Property Show”  recently

As per  Treasury.gov Currently, all temporary residents and non-residents including businesses must notify the Government of their intention to acquire residential real estate, and must comply with post-purchase conditions on its use, development and resale.

Under Goverment rules for property buying for foreigners

Foreign nationals to buy are able to buy second hand dwellings if they hold a temporary visa

New laws dictate that foreigners can no longer buy existing Australian homes as investments.

Temporary residents may buy one existing home to live in, but must apply first with the Foreign Investment  Review Board. Then they must sell their property when they leave Australia.

Foreign investors can continue to buy new or off-the-plan properties without limitation.

International students who become permanent residents can buy property

These recent changes have made it easier for foreign companies and temporary residents, such as 12-month business visa holders, foreign students, and their parents, to invest.

Exemptions for real estate buying in Australia

Certain acquisitions do not require notification or approval under the Foreign Acquisitions and Takeovers Act 1975 (also referred to as exempt acquisitions)

1. You are purchasing new dwelling(s) from the developer, where the developer has pre-approval to sell those dwellings to foreign person
2. You hold a permanent resident visa and you are purchasing residential property
3. You are purchasing property from the Government (Commonwealth, State or Territory, or local)

Check out more exemptions here -> property buying exemptions and for more detailed legilation and policy , rules for foreign ownership in Australia you can visit the goverment website here

Raids On Prime Australian Agricultural land and farms by overseas Investors

These raid on Australia’s prime agricultural land is strategic and systematic. Many countries like the Chinese and Singapore government have increased their  investments in Australia. Countries such as Qatar in the Middle East have even set up government departments dedicated to securing future food sources, with the easiest solution being to buy foreign farms. As per normal rules unless a sale is worth more than $231 million, the Federal Government does not have to know about it

The biggest foreign raiders are actually the Americans, plunging over $39 billion into Australia, followed by the UK, China, Japan and Switzerland

Links:

• Additional detail is on the Foreign Investment Review Board website at www.firb.gov.au.
• Australias-properties-for-sale/

• Foreign government investments in Australia

• China accused of land grab

• 50 Australian resources projects worth more than $500 million that are majority foreign controlled

The other benefit from owning  real estate  which can be  appreciation of value of  your property plus possibly a regular income flow  but also significant tax benefits.  some tips to benefit from property ownership during tax time.

Tax deductions for property *

If you own a property  and you are getting rental income from it you can qualify for certain tax deductions based on your circumstances. Some standard claimable deductions are listed below.

• Advertising costs ( To find tenants)
• Agents Commission (To collect the rent)
• Rates and Land Taxes
• Depreciation
• Travel costs to inspect property
• Repairs
• Security costs
• Insurance on buildings
• Water and sewage
• Interest on borrowings

Rent and rental expenses

Tax needs to be taken out from rent received by you  when its received into or credited into your account. Rental expenses claimed can be disallowed  if you are renting a house or property to a relative or family and you are not charging them the going commercial rate in the market.

Capital gains Reductions

If you sell a investment property  12 months  after you buy it only 50% is taxable. This can apply to Land as well as Holiday homes.

Residence  exemption

Claiming tips

Keeping a separate account for your property income and expenses can ease the pain of record keeping.

 

It is not necessary for you to get a Australian Business Number (ABN)  if you want to lease a residential property.

 

Keep all your receipts for expenses for yuour tax deductible expenses to be easily verified.

More technical property deductions

In some cases  a building write off deduction can also be claimed  at the rate of 2.5 % per year

If you make a capital gain after you retire and turn 60  from the sale of the property , the gain could be tax free if  that property  was owned by your self managed superfund and would be not included in your taxable income.

Capital gains can be reduced on sale of holiday homes  by holding on to receipts of non –deductible expenses incurred while maintaining the house.

In some cases depreciation schedule will be necessary to maximise your allowable tax deductions on any property that you own as an investment.

* Before claiming deductions it is advised to see a professional accountant or tax agent  to verify that you are correctly claiming the  deductions that are allowed to be claimed without incurring any penalties in the future.

1.Managing Your Investment Property: The Essential Guide to Property Management in Australia and New Zealand -Rachel Barnes

Book –> Managing Your Investment Property: The Essential Guide to Property Management in Australia and New Zealand - > Full review here

2. The Australian Dream and $1 Properties

BooK – > The Australian Dream and Properties

3. Mastering the Australian Housing Market

Book –> Mastering the Australian Housing Market - > Full review here

4. Buying a Home in Australia: A Survival Handbook

Get the book –> Buying a Home in Australia: A Survival Handbook - > Full review here

5.How to Create an Income for Life – Margaret lomas

Get the book –> How to Create an Income for Life - > Full Property Investment books review here

Its a busy time for property investors as they near the end of the financial year. There aren’t many investors in the current property market, due to people being cautious about property investment.

But this might be about to change as rental vacancy rates across Perth are falling. Rising rents are also an indication that we are entering another phase of the property cycle. Currently its a buyers market with more than 17800 properties for sale on the market.

There is still reasonably tight vacancy rate that assures the investor a large selection of keen tenants. This definitely is getting renewed interest from investors in buying rental properties to cash-in on the favourable rental market.

Tips For Property Investors

• Better investments are more preferred in suburbs which have a consistent population growth, such as near the city or fast growing regional centres.
• Prospective investment properties should be easy to maintain.
• Close to public transport, shops and schools. The potential of educational institutions and community infrastructure can increase the value of the investment property.
• An ideal investment location is where the demand for rental properties exceeds the supply. But investors need also to balance the cost of the purchase with the return on investment based on the rent in that location.
• If a property is chosen with prospects of good grow in value, it can be an added bonus of capital growth to the property in addition to the negative gearing (tax deduction) you can receive.
• Another tip to good property investment, is to look for under valued houses in a pricy suburb or in a suburb close to a established suburb.
• Re-developing properties is another good way to maximise your property investment. Choosing one block with re-development   potential for multiple blocks can maximise your return.

Data and research in relation to making these important property investment decisions could always be sourced from websites like Realestate.com.au, Rpdata, Rismark and REIWA. Make sure you always discuss plans with your bank, mortgage broker and financial planner first.

Deep in debt ?

Too many loans you cant keep up repayments with  ?

In trouble with credit card debts ?

Debt Consolidation – Life saver or  Rip off

Go to any bank or  financial consultant   with his kind of problems and it is likely they will mention a solution called “Debt consolidation”. True  Debt consolidation can be a savior for some , but It surely can also put many people in a financial situation worse off than they already are.

How you may ask , is that possible ?

Lets take a  simple example with  without any figures or loan repayment percentages to make it easy to understand ?

Say you got  three debts

1.Credit card  – Term  Rolling

2.Car loan –  Term  5 years

3.Personal loan  – Term  5 years

Taking an example of the above loans getting consolidated into a (Home loan –  Term 30 years )

Now given that these above  3 loans that  you have taken  are for short terms ( rolling and 5years) and you are paying interest only for a shorter period,  this totally changes when you lump it together with your (Not so Short ) 30 year Home loan. which means  Now you  are paying interest  for a 30 year term on those loans  instead of 5years, which can make you repayments go for thirty years instead of five , which in many circumstances  you can end up paying much more than you intended too.

Debt consolidation with refinancing loans

With debt consolidation loans  or refinancing loans the lender can end up charging you higher interest rates than you’re paying now — as high as 21% or 22%. “Your monthly payment may be lower” with one of these loans, “but you’ll end up paying more,” Personal unsecured debt consolidation loans carry high interest rates, sometimes higher than credit cards.

Help :

http://www.nfcc.org/

You can get help from an organization like National Foundation for Credit Counseling (see link to left). NFCC has branches throughout the country; they are a non-profit, community organization that provides free and confidential debt management advice to anyone who needs it. You can even consult with them over the phone

Sometimes it is better to negotiate settle the debt  in a debt settlement strategy. Check out this book  which describe a easy way to get out of debt. There are some softwares for reducing and managing debt as well that is available on the market

Links:

Avoid-the-trap-of-debt-consolidation/

http://moneycentral.msn.com/content/savinganddebt.asp

1. Paint The house -

This is a great way to make your house stand out from many others around it. A fresh new paint coat will give it a clean cut look that any potential buyer or tenant is looking for. And when choosing a paint color, don’t just choose the cheapest. Use sound judgment in your choice of contemporary colors or appropriate colors for the age and style of the house.

Make sure that you don’t just paint everything the same color either. Use contrasting colors on the window frames, doors, and shutters.

2. Change the mail box –

This is a very  simple fix but can pay big dividends and make a difference to the entrance of th house and creat a good first impression . It is part of creating curb appeal. You want to draw the buyer or tenant toward the house not drive them away. Mail boxes are usually made of cheap material which can deteriorate quite quickly and look bad. Reinstalling a sturdy plastic box seems to be the best choice over metal boxes which can dent and rust.

Sticking the house numbers on the new box is also a plus

3.  Landscape -

There are many simple things outside the house,  in terms of landscaping  and designing that can be done to draw potential tenants or buyers to your property. The first thing that can be done is simple , just dig some beds in the front of the house and around the perimeter and throw down some mulch. Plant some good looking shrubs or small trees like barberries or spirals next to the front steps or entry.

Plant them in some type of symmetrical order to maintain the neatness of the property. Flowers can also be planted in those areas like bulbs along the side of the house or various types of flowers among the shrubbery in the front. Keep the grass cut and looking neat.

Fill in bare spots with soil and seed and keep moist to make sure it will take root. A manicured lawn can work wonders on the overall appearance!

4. Install a garbage disposal

in the kitchen sink! Not long ago,  it may have been considered a luxury to have one but these days more and more people are wondering how they could do without one. Again, you are thinking about an addition that costs a relatively small amount of cash relative to the return it will generate with a potential buyer or tenant.

5. Install a dishwasher-

Again, as with the installation of a garbage disposal, a dishwasher is now a modern convenience that few know how to get along without. If your property does not have one, you can install one fairly inexpensively to enhance the facilities and therefore value. This in turn will attract more potential tenants or buyers at a much higher rate, you will be able use this to depreciate this asset so it creates a tax benefit, and the general value of your property will rise.

Following these  tips will definitely help add value to your property. You must think about the value added when performing these various  tasks. If you take this advise, you will not be disappointed at the value this will create for yourself and the happy buyer  and your potential buyer or tenant will be more likely to choose your property over another.

In addition to his managing your property well can also benefit you , check out this book which might help you get a few tips.

Did you find this article helpful. If so then go to the following

link which I believe is a tremendous value for any investor or property owner. Go to http://www.virtualdealfactory.com/r/rmerrick

Article Source: http://EzineArticles.com/?expert=Ryan_Merrick

Switching  Your mortgage provider ( Bank)

Many smaller mortgage providers and smaller banks ( ING , ANZ ) have come out with offers  to switch to them  from the bigger banks, but obviously people will have to do their research ( and math’s) before switching if its going to be good for them in the long term.

Break Fees and Exit fees

Exit fees are widely considered a major hurdle for borrowers who want to change banks because the fees can outweigh the benefits of lower interest rates at a competing institution.

Ing has a offer on the market already to grab some market share of the loan market. Don from ING says “the deal is, $1000 dollars to switch your bank, move with your feet, come to ING direct.

There has been a huge media blitz recently over bank  rates and people wanting to  shift their home loans to different more cheaper providers and also great offers coming through for people to switch with exit fees being borne by the receiving bank and similar offers. What no one  has talked about and which can be equally important is the “Break fees” for a mortgage loan.

Break fees more than EXIT fees

So what are break fees ?

The dollar amount owed to the bank if you pay out a fixed-interest home loan before the term is up is called a break cost.  .

Break fees are only applicable for fixed rate loans . This is incurred when you have a fixed rate home loan and want to terminate you loan or then refinance you loan with another provider. With break fees,  the longer the time remaining on your fixed loan, the larger the break cost can be. It is very important that you check with your home loan provider  how much you “break fees or costs” would be  before you decide to change your home loan to another provider or pay out the loan

Break fees can also be known as termination fees , prepayment economic cost, Early repayment fee, Early repayment adjustment.

EXIT FEES CAN CONTAIN ALL THE THREE COMPONENTS COSTS AS BELOW

1. Early Termination Fees

Early termination fees may or may not be charged, depending on how long you have had the loan. This fee typically applies for the first five years from the settlement day.

2. Break Costs ( Applicable for fixed loans)

Break fees or Break costs  may or may not be charged, depending on current interest rate situation relative to original interest rate at the time you took out the loan.

3. Other Fees

These include discharge fee, administration fee and any other fees associated with closing your loan.

Julia Gillard has confirmed the corporate regulator, the Australian Securities and Investments Commission (ASIC), will  seek to publish new rules banning the imposition of unfair bank exit fees on mortgages. Mortgage exit fees, which cost customers upward of $900, could soon be scrapped by the banks to increase their competitiveness.

How Break fees work  and calculations

When a bank provides a fixed rate loan they borrow money from the wholesale money markets.Their interest rate is locked in at the same time as your home loan is taken. If interest rates drop and you pay out your fixed loan the bank cannot lend that money again at that higher rate, thus they are losing the difference in interest rate drop. Therefore this cost is passed on to you.

Each bank uses their own complex formula to calculate the break fee but the general concept for the calculation is as follows

Break Cost  =  Amount of loan remaining  X  Loan term left  X  Drop in wholesale interest rates.

The resultant break fee can be thousands of dollars. Therefore it’s very important to make the correct decision  or then check out the break fees with your bank  while termination or refinancing a loan.

Ref:

http://www.canstar.com.au/exit-fees/

Fixed Interest Loans – Break Fees

Mortgage exit fees are fair, say bankers

Investing in the property market is an effective wealth creation strategy and method that many Australians use to get ahead financially and secure their future While managed funds and shares and other type of investments also offer opportunities to increase your wealth, some experts will say that real estate is your best bet in the current market.

Property Vs shares

There are so many reasons to invest in property, including the fact that you’re buying a real and tangible asset (an actual bricks and mortar asset ) which will be always be in demand and can be sold in the market . Stocks and companies and shares, on the other hand can lose all of their value in a day or even get liquidated or closed down. We all have l heard the horror stories, of companies falling over an stock market crashes and your money disappearing in a flash.

 

But as long as there is an increasing population, people will always need a place to live in , which makes property a more stable and attractive option.

Why property investment is better than the stock market and shares investment

Receive possibly two income’s

If you plan your investment right, you could have two income sooner than you think. A property bought at a lower price in a mining area or a area that has suddenly shot up in value will possibly put you into positive gearing and earn you a second income. When you purchase a property at today’s market value, while you hold the investment it is likely to increase in value over time, due to a favourable economy, and population growth. However, you don’t need to sell this asset to make money, you can continue to earn income from the property while you hold it and leverage of it if you want to make further investments or then just keep renting it and let it increase in value

Leveraging and using your property to grow

Property as an asset is much easier to leverage when compared with other investment options like shares due to its volatile and rapid share market fluctuations and volatility. Banks are generally comfortable to lend more for property than a share portfolio as they consider it as a low-risk investment option, and they’re also confident that they can recoup the cost as prices for property and land have historically only gone up wards.

Gain from your tax refund and save money

An investment property is tax deductible, so the Australian Taxation Office (ATO) will allow you to claim a tax deduction for most of the expenses you incur when buying and managing your investment property. If you experience a financial loss from this property. Which means that the yearly costs of owning your investment property exceed the annual rental income you receive – you can offset these losses against your income tax.

This strategy is known as negative gearing. Normally, you would receive this tax amount back at the end of the financial year when you complete your tax return, but it is also possible to receive this money in your regular pay thus giving you the added advantage that you need not even pay the difference in the mortgage repayments and rent amounts received. In other words, you can receive the tax saving during the course of the year to provide better cash flow for your daily expenses.

Long-term investment rewards for property Investment

Property values sometimes fall slightly in the short-term, but historically over the long term it always increases in value. It is also less time consuming as investors don’t need to keep up to date with daily share markets

Albany: Lifestyle features, government decisions, urban renewal

Broome: Lifestyle features, boom town, government decisions

Bunbury: Transport infrastructure, boom town, lifestyle features

Geraldton: Boom town, government decisions, transport infrastructure

Joondalup: Government decisions, lifestyle features, transport infrastructure
Karratha: Boom town, government decisions, lifestyle features
Merredin: Boom town, government decisions
Port Hedland: Boom town, government decisions
Rockingham: Ugly ducklings, government decisions, transport infrastructure, lifestyle features
Waroona: Boom town, transport infrastructure

The recently introduced New South Wales Spending spending budget packages out a number of of the most strategic property related initiatives seen to date, along with incentives targeted at enhancing housing supply and affordability instead of simply throwing money at the symptoms.

Stamp duty  Axed in NSW

The most crucial story was that stamp duty, largely considered as the single most inequitable and inefficient taxes around, has become axed for anyone people purchasing a home ‘off the plan’ and under $600,000.
An ‘off the plan’ purchase essentially means buying the house before construction is completed.
At a consumer level the advantage is clearly in the stamp duty savings which could equate up to $22,490 on a home purchase.
Links:
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