Saturday, December 9, 2023
Thursday, December 7, 2023
BSI Finance is on the move
I believe it used to be the offices of Atlassian !!
Onwards and upwards !
Monday, November 20, 2023
”Your Mortgage Or Your Life” - My Mortgage Broker, Ivan Kaye, Talks Me Off The Ledge
Hi Ivan,
Thank you for being so amazing on the podcast this week. You spoke so well and I know it’ll help so many people.
Here is a link to listen on Apple Podcasts: https://podcasts.apple.com/au/podcast/self-care-ish-divorce-dating-doing-you/id1681043804?i=1000635351642
A link to listen on Spotify: https://open.spotify.com/episode/6gGSexD31OifwrZieNiU8M?si=9205d626a08a48d5
And a link to listen on Youtube: https://youtu.be/MU-mS_QwUBM?feature=shared
Now, let’s get a mortgage! Haha.
Meghan
Meghan Loneragan
hello@selfcare-ish.com.au
+61427356125
Some questions
- do you feel like you are laying yourself bare - with your mortgage broker ? Do you feel they are Judging you on your finances and financial position … .How do you compare with others?
- Mortgage broker or direct with bank?
- How do you know which mortgage broker to chose ?
- Interest rate rises - is this the right time to buy property
- What property to buy - an investment property? Your own home?
Some insights
Getting divorced can be likened to being an entrepreneur who is leaving a stable job - and going full time into a start up - welcome to Club Fear - with challenges , financial issues , juggling of children, finding a place to live …..
Your legs turning to jelly ….
A mortgage brokers job is to assess where you are , what you’ve got and what you get - they are professionals - not there to judge but to help you through your journey to lend money to buy assets and help you with your finances.
You are the ceo of your own life - finance 101 - draw a triangle - 1. Cash flow - lifestyle 2. Assets - those create income Assets - you - take care of you , property , shares , business, super 3. Risk can happen - take care of risk - minimise the investment in you 4. Leverage opm - other People’s money - exponential returns
Mortgage brokers - why a mortgage broker - you can go to your bank and 60 other employees - get best rate, best mortgage for you , independent , choice ! Can go back to your existing bank with other
It’s all about trust - trust your banker , trust your mortgage broker . Surround yourself with people that are great at what they do and who you know like and trust
Friday, October 20, 2023
Ark Monthly Update - October 2023
Market Summary
Israel/Palestine Conflict
We're going to start with the conflict in Israel and Palestine today, as many of you have asked about the impact of this on your superannuation and investments. Sadly, the tensions between these two groups has ramped up significantly over the last two weeks, and as of last count about 4,200 people have lost their lives.
Putting aside the tragic cost this has had on the families and communities of those who have passed away, today we'll assess the likely impact of this conflict on business and share prices.
To start, the market has largely shrugged off the economic impact of this conflict, with share markets unchanged since the escalation two weeks ago.
There may be impacts on the price of oil however. In fact, oil prices began to rise again in the aftermath of the Hamas attack due to fears of the involvement of other countries in the conflict.
Obviously, the Middle East is a very volatile region, and a very large producer of crude oil, so the fears of other countries becoming involved in the conflict are pushing prices up in anticipation.
As you can see in the table below, of the top 9 oil producing countries in the world, 5 are located in the Middle East so it is a very important region to fund the world's energy needs.
The rationale for this is simple, let's say Iran becomes involved in the conflict, which at this stage is a realistic scenario. War involves effort and resources, and every resource that goes into fighting a war is one less resource that can focus on producing oil, Iran's largest export.
This might result in a reduction in the amount of oil that Iran can produce, and due to supply and demand will push prices up.
So the price of oil has already started to increase in anticipation of this.
That being said, as you can see in the chart below, oil is a very volatile asset to begin with. Over the last 10 years it has endured some wild swings, and the price has already increased significantly over the last few months as you can see on the far right.
So there's a strong argument to say that the oil price reaction is just within the realm of ordinary volatility, and may not be affected in the long term by this conflict.
The below graph shows the nominal price of oil compared to the price of oil in the oil crisis of 1979. As you can see, the price of oil in real terms are still below the highs of 1979 and are in line with the mid-2000's.
How will this affect the share market?
Okay, so how are shares likely to react?
As I mentioned earlier, shares are largely unchanged over the last two weeks.
The notable exception to this is of course the Israel stock market, which is down 10% in the last two weeks, as measured by the Tel Aviv 125, their primary stock index.
That being said, Israeli shares make up such a small portion of global shares (0.4% to be precise) that it's not going to have a material affect on your portfolio.
Oil shocks in the Middle East are also relatively common. The below graph shows the price of oil after various geopolitical events and how long oil prices were raised.
So why are share prices unchanged? The simple reason is that stock markets are essentially just a bunch of businesses at the end of the day.
These businesses are valued on the profits they generate, and the conflict in Israel simply isn't going to affect the profits of Apple, Microsoft and Google (nor BHP, Commonwealth Bank and CSL in the Australian index) in any material way.
To illustrate this point, one of my favourite charts (there's a few) is the Wall of Worry.
As I've explained to many of you in the past, there is always something for investors to worry about. Whether that's wars, recessions, terrorist attacks, or even a few pandemics there's always going to be something going on in the world for investors to be concerned.
As you can see though, despite these many negative events occurring over the last 120 years, the Australian Share market has returned 11.70% p.a. since 1900 which is a fantastic result.
For those doing the maths, if you had invested $1 into the sharemarket back in 1900, and lived to the ripe old age of 123, you'd now have $813,842 for your efforts.
So the key take away here is that worries are normal around the economy and investments, and sometimes they become intense, and have a very real impact on markets, but they eventually pass and the stock market just keeps rising.
To use an analogy, negative economic news can be like stormy weather in the world of investments. Just as bad weather doesn't change the fact that you own a sturdy house, negative economic news doesn't change the value of a good long-term investment.
This is why I recommend focusing on what you can control, which are the factors below:
Please keep in mind this in General Advice only, for personal advice specific to you please get in touch over the phone or email.
Regards,
Chris Magnus
- In August 2021 the ASX 200 hit an all time high of 7,632, but has dropped over this time to a low of 6,407 in October. Over the last 12 months the ASX has traded within a limited range, and is now 6,985 today.
- Global shares have followed the same path, with the S&P 500 (the US Stock Index) hitting a peak of 4,818 before dropping down to 3,636 at the lows. It has then since recovered back to 4,314 today.
Israel/Palestine Conflict
We're going to start with the conflict in Israel and Palestine today, as many of you have asked about the impact of this on your superannuation and investments. Sadly, the tensions between these two groups has ramped up significantly over the last two weeks, and as of last count about 4,200 people have lost their lives.
Putting aside the tragic cost this has had on the families and communities of those who have passed away, today we'll assess the likely impact of this conflict on business and share prices.
To start, the market has largely shrugged off the economic impact of this conflict, with share markets unchanged since the escalation two weeks ago.
There may be impacts on the price of oil however. In fact, oil prices began to rise again in the aftermath of the Hamas attack due to fears of the involvement of other countries in the conflict.
Obviously, the Middle East is a very volatile region, and a very large producer of crude oil, so the fears of other countries becoming involved in the conflict are pushing prices up in anticipation.
As you can see in the table below, of the top 9 oil producing countries in the world, 5 are located in the Middle East so it is a very important region to fund the world's energy needs.
The rationale for this is simple, let's say Iran becomes involved in the conflict, which at this stage is a realistic scenario. War involves effort and resources, and every resource that goes into fighting a war is one less resource that can focus on producing oil, Iran's largest export.
This might result in a reduction in the amount of oil that Iran can produce, and due to supply and demand will push prices up.
So the price of oil has already started to increase in anticipation of this.
That being said, as you can see in the chart below, oil is a very volatile asset to begin with. Over the last 10 years it has endured some wild swings, and the price has already increased significantly over the last few months as you can see on the far right.
So there's a strong argument to say that the oil price reaction is just within the realm of ordinary volatility, and may not be affected in the long term by this conflict.
The below graph shows the nominal price of oil compared to the price of oil in the oil crisis of 1979. As you can see, the price of oil in real terms are still below the highs of 1979 and are in line with the mid-2000's.
How will this affect the share market?
Okay, so how are shares likely to react?
As I mentioned earlier, shares are largely unchanged over the last two weeks.
The notable exception to this is of course the Israel stock market, which is down 10% in the last two weeks, as measured by the Tel Aviv 125, their primary stock index.
That being said, Israeli shares make up such a small portion of global shares (0.4% to be precise) that it's not going to have a material affect on your portfolio.
Oil shocks in the Middle East are also relatively common. The below graph shows the price of oil after various geopolitical events and how long oil prices were raised.
So why are share prices unchanged? The simple reason is that stock markets are essentially just a bunch of businesses at the end of the day.
These businesses are valued on the profits they generate, and the conflict in Israel simply isn't going to affect the profits of Apple, Microsoft and Google (nor BHP, Commonwealth Bank and CSL in the Australian index) in any material way.
To illustrate this point, one of my favourite charts (there's a few) is the Wall of Worry.
As I've explained to many of you in the past, there is always something for investors to worry about. Whether that's wars, recessions, terrorist attacks, or even a few pandemics there's always going to be something going on in the world for investors to be concerned.
As you can see though, despite these many negative events occurring over the last 120 years, the Australian Share market has returned 11.70% p.a. since 1900 which is a fantastic result.
For those doing the maths, if you had invested $1 into the sharemarket back in 1900, and lived to the ripe old age of 123, you'd now have $813,842 for your efforts.
So the key take away here is that worries are normal around the economy and investments, and sometimes they become intense, and have a very real impact on markets, but they eventually pass and the stock market just keeps rising.
To use an analogy, negative economic news can be like stormy weather in the world of investments. Just as bad weather doesn't change the fact that you own a sturdy house, negative economic news doesn't change the value of a good long-term investment.
This is why I recommend focusing on what you can control, which are the factors below:
- Long-Term Perspective: When you're investing for the long term, you're focusing on the big picture. Economic conditions can go up and down, but history shows that economies tend to grow over time. Just like weather patterns change, economic conditions are not static.
- Diversification: They say diversification is the only 'free lunch' in investing. This means spreading your investments across different types of assets. By doing this, you reduce the impact of negative news on any single investment.
- Time Averages Out Fluctuations: The stock market, for example, can have daily or even yearly ups and downs. But over the long run, it tends to go up. Negative news can cause temporary drops, but if you have time on your side, these short-term fluctuations become less important.
- Buy Low, Sell High: Negative economic news can sometimes create opportunities to buy investments at lower prices. When others are worried and selling, you might find good deals. Over time, as the economy recovers, the value of your investments can rise.
- Emotional Decision-Making: If you react to every piece of negative news, you might make hasty decisions that harm your long-term goals. A relaxed approach can help you stay the course and avoid impulsive moves.
Please keep in mind this in General Advice only, for personal advice specific to you please get in touch over the phone or email.
Regards,
Chris Magnus
Monday, October 2, 2023
House Prices are increasing and people getting gazumped time and again!
Housing values keep increasing, and is now more than the peak recorded in April 2022 - at this rate of growth should be passed before end of year!
In Oz - most city recorded price growth over both the month and quarter, except for Hobart. Perth and Adelaide are experiencing record-high prices, while Brisbane is likely to set a new record!
People are getting gazumped everywhere .
3 things you can do to prevent from getting gazumped
1. Maybe use a property buyer ?
It is a very ‘active’ market. Having boots on the ground will give you a big advantage.
Buyers agents rely on the relationships they build and their reputation. A good buyers agent have their client’s interests (the buyer) at heart - not the seller
Remember the real estate agent is getting paid by the seller - and will do all in their power to maximise their price - they are not your friend!
2. Make sure you have the conveyancer can immediately review the contract
3. Organise home loan pre-approval - 100% free
Putting in an offer on a property and then spending weeks trying to arrange a mortgage can leave you open to a more prepared bidder. Instead, ensure you have conditional pre-approval for a home loan. That will give you a good idea of your available budget so you can negotiate with confidence.
What is loan pre-approval?
A loan pre-approval means that a lender has agreed – in principle – to lend you an amount of money towards the purchase, subject to certain conditions being fulfilled. While a pre-approval is not a full or final approval,it allows you to know your maximum available funds so you can narrow your search, negotiate with more certainty and bid with more confidence if you're going to buy at auction.
A pre-approval is a valuable step in getting you closer to your new family home or investment property. It's not a requirement in the home buying process, but it can make life easier.
You should take note of the required documentation and make sure that it’s all provided. This could include things like:
- proof of identification,
- recent payslips,
- Bank account statements, and
- Credit card statements.
- Serviceability - Identification of maximum amount you can afford and that banks will lend to you
- Work out which best bank to use taking into account interest rates and policies that suit you
If you’re successful in obtaining pre-approval (congrats!), it is usually valid for 90 days.
Monday, September 25, 2023
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?
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
Tuesday, September 19, 2023
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
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