Sam’s Weekly Reading List for the week of August 19th through 23rd

August 22, 2013 Sam Saggers

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As savvy property investors it’s important to keep on top of events and changes which can have an impact on our property investments. There are so many analyses, opinions and articles about investing in property out there that it can be tough trying to keep up with what’s happening in property.

I’d like to take a moment to share some of the more interesting articles I’ve come across this week.

mark-bourisIn a departure from sharing articles solely about property investing, I’d like to share the following helpful advice from Mark Bouris in his Property Observer article titled, “Five tips to get the most out of a low interest rate environment”.

While a low interest rate is very beneficial to both homebuyers and property investors in terms of lower mortgage payments, it can prove difficult finding ways to help your savings to grow.

Bouris offers up useful advice for savers in search of a way to make the most of their cash:

  • “Know your goal” – The plan you establish will depend upon what you want to do with your cash.
  • “Shop around” – Don’t jump on the first savings option you come across. Says Bouris, “When the cash rate is so low, a difference of .05% can be important and you’ll only be aware of the difference if you stay informed.”
  • “Spread the money” – Having your funds in “at least two places” will help you “offset poor performance in one…”
  • “Understand your actions” – Read all of the fine print and understand exactly what you’re getting into.
  • “Don’t cheat yourself” – “The yields for term deposits are typically between 3.75 and 4% right now. That spread can cost you several thousand dollars a year on large balances, so make sure you’re closer to the high end of the interest rate spread”.

For a more detailed explanation of these topics, read the full article here.

 
 

Terry-Ryder-Photo-e1331599789255Terry Ryder of hotspotting.com.au provides a thorough explanation of why all of the talk of a property bubble is not based in fact:

“For the past three years headline-writers at metropolitan newspapers have been in despair. They have been cruelly denied the opportunity to put “bubble” in a headline.

“With capital city prices mostly in decline since 2010, even a species willing to use fabrication when sensationalism won’t do has been unable to conjure a bubble out of our property markets.

“Now, with capital city prices up a moderate 5% on average, a peephole of opportunity has appeared.

“Sub-editors have, as willing accomplices, a gaggle of chattering economists and sharemarket analysts who see an opportunity for a bit of personal limelight while pontificating on a subject outside their sphere expertise.

“That’s all it takes in this country to turn a nothing into a sensational issue.

“Auction rates signal boom at hand, shouts the Sydney Morning Herald.

“Fears of bust as property runs hot, squeals The Australian.

“Hallelujah, the bubble is back.”

Read more of Terry’s entertaining and informative article here.

 
 

No doubt you’ve heard of the Reserve Bank of New Zealand’s home loan restrictions and perhaps wondered if Australia will face the same issue.
Jonathan Chancellor, in his Property Observer article titled “RBA unlikely to follow Reserve Bank of New Zealand on home loan lending restrictions” details why Australia won’t follow this same path:
“Australia is not set get any cap on loan-to-value ratios (LVRs) under the RBA governorship of Glenn Stephens.
“Indeed the RBA has actually cautioned against a cap on loan-to-valuation ratios (LVRs) for mortgages, which could be varied from time to time, as has been adopted in some countries including New Zealand from October this year.

For more information, read the full article here.

Have a great weekend, and if you enjoyed this list, please share it with your friends by clicking a social link button to the left of this article.

By the way…

Positive Real estate has been in the news of late. Take a look at what we’ve been up to:

Competition in Sydney’s West Heats Up

Property Market on the Brink

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