Marrickville - punching above it’s weight

Marrickville - the home of the fighter Jeff Fenech is punching above its weight

The gentrification of  Marrickville and surrounds has resulted in it being top growth suburb in Sydney growing by over 8% this year! (CoreLogic - see graph)

Ev Foley agrees and shares her view on the market in API magazine

The young professionals, artists and musicians have moved in giving it a  bohemian atmosphere.

Baba’s place - a warehouse converted into  a Lebanese restaurant meeting place  - round the corner from Messina and  “the Factory” hosting sydney fringe festival epitomises the grunge trendiness gives a taste of the vibe of the suburb 

Marrickville’s achieved rockstar status says Aris Dendrinos Richardson and Wrench, who  has just sold a three-bedroom, one bath property on Renwick Street in July for $2.1 million, well above the median dwelling price of $1.7 million.

It seems as if Marrickville will continue to outperform the market !!

Marrickville - A good place to buy? 

API magazine

Below is September’s property outlook - by CoreLogic

If you are interested in a free discovery consultation to see whether you are maximising your property portfolio , leverage index and getting the best mortgage solution - feel free to connect with me - connect with me here 

https://www.bsifinance.com.au/

Interest rates are likely at peak days the banks

New RBA governor Michele Bullock assumed the role yesterday (18 September) following Mr Lowe’s departure after his seven-year tenure.

She assumes the role at a time where all the bank economists are of the view that inflation is now under control and interest rates have peaked or close to peaking.

Commonwealth Bank of Australia (CBA) economist Stephen Wu - CBA’s view that the current cash rate of 4.1 per cent is likely the apex of the cycle

Westpac chief economist Bill Evans the current cash rate of 4.1% looks to be “sustained for the remainder of the cycle”

ANZ economist  Adam Boyton is if the view that  the cash rate should have an extended pause

The NAB Group economics team bekieved there will be a final cash rate hike forward to November from December, to a peak of 4.35 per cent.

Source 

Mortgage business

Time to buy property in Sydney?

Auction activity is buzzing with Sydneys busiest week since early April

Sydney and Melbourne, have recorded their busiest end to winter in over 10 years, with listings up around 20%.

CoreLogic’s Property Market Indicator for the week ending 17 September 2023 has revealed a rise of 2.6 per cent in Sydney’s  auction activity (2,334)

Clearance rate was only  70.1% - not bad when compared to  60.1% 2022 (not as good as in past)

According to PropTracks senior economist Angus Moore, new listings increased year on year since August 2022 - with new listings on realestate.com.au up 20.5 per cent nationally in August and up 4.1 per cent compared to the same time last year. 

He said that they are expecting this activity is likely to continue increasing over the spring selling season, reaching the “typical peak in October and November”.

Home prices nationally have continued to recover, posting their eighth consecutive month of growth in August reaching their previous peak 

Is it time to buy? 

A unit or a house? 

Inspired from mortgage business 

A 10X return - the power of leverage

Imagine buying a property worth $1m with a $100k investment and getting a 10X return! 

With leverage, a 7% return per annum  or more per annum can become a 24% return per annum over 10 years. 

💥100k can give you $1m 

That's a huge difference! 

On the above assumption of property increasing by 7pc pa , a $100k investment with 90% gearing can give you $1m - a 10X return! 

💥The investment 

- a 10% deposit of $100k for a $1m property 

- a shortfall of circa $1500 per month 

(on a $1m property at 6% interest, giving a net rent of $30k pa. 

The risk - if property goes down in 10 years  - you lose more than your initial investment …. So you are making a call that property will either increase or decrease in 10 years) 

#investment #realestate #leverage  

Vote here 

#Leverage is the one word that can transform your investment game! 

Investment in Shares long term for capital growth is a good strategy - how does it compare to property?

The above graph shows that investing in shares long term is a good thing - and has been generating 7-10pc per annum since 1993 (for the past 30 years)

So 10k invested in 1993 would generate between 138k and 176k.

So why is property so much better if it only increases by 5pc per annum?

One word !!!!!!

LEVERAGE 

Using other people’s money 💰 💴 - gives you exponential returns….. and it seems so much safer borrowing against bricks and mortar than shares …..

If you put down 20k and borrowed 100k to buy a house - and property doubled every 15 years less than a 5pc return pa)

your return on $20k borrowed would have generated 400k !!!

What am I missing? 

Interest rates are rising and yet house prices continue to rise !! Why?

Homeownership is the Australian dream - and it seems that it’s becoming  harder and harder to buy a home! 

Those looking to enter the property market face a triple whammy of 

• high prices, 
• costly mortgages and 
• lack of supply 

making owning your own home  deeply unaffordable, with little sign of relief on the horizon. 

Mortgage rates soared from less than 3% to more than 6%. 

For the median family buying the median home, mortgage payments doubled from roughly 14% of monthly household income in 2020 to nearly 29% in June, the highest since 1985!

And yet prices continue to rise!!

Why?

 There are still buyers out there. They have very few options 

• Each house needs just one buyer 
• Lack of supply 
• Rents increasing 
• Net Migration 
• Australia is the best place to live 
• People feel secure if they own a home 

A strong housing-market contributes to the well-being feeling of a person, family, city and nation. 

The hope 

Let’s hope the property continues to increase - and that our children will still be able to afford to become homeowners ! 

It sounds like inflation - and it feels like growth  and growth is good? 

What am I missing ?

I remember buying our house when property prices were at 17pc . 

$200k sounded beyond affordable - yet we did it - and that property is now worth 10x -or $2m . 

• property increased , interest rates reduced, wages stayed the same - property still affordable 

• property increases  , interest rates rise , wages stayed the same - how can people afford to buy? 

A solution ?

• Maybe but to rent vs buy to live in - Australians become a nation of investors ?

https://www.economist.com/finance-and-economics/2023/08/30/how-can-american-house-prices-still-be-risingHow can American house prices still be rising? from TheEconomist

Solving the wicked problem of a housing crisis on Oz

A wicked problem in Oz that the Labour Government is trying to address 

- a housing and rental crisis - there is a lack of supply - and there is a push to increase migration - 

For skilled  people 

To cater for asylum seekers  

What are things government can do to solve the wicked problem of the rental and housing  crisis? 

Build more houses so that supply equals demand.

The government is looking to add $3.5 billion of incentives to  achieve 1.2 million homes over five years over 5 years - or an average of 20,000 homes for 60 consecutive months 

This has  never been accomplished

The monthly average is 15,986. 

20,000 has only been reached seven times in the past 180 months. 

What are things that can be done ?

Will property in Oz continue to rise?

How do we support those who can’t afford (frontline workers ) and disadvantaged to have their own home?

- share your ideas in comments below  and vote  below