Friday, December 29, 2023

Home Support for Essential Workers - Shared Equity Home Buyer Scheme


The NSW’s shared-equity scheme can help make owning a home easier for lower-income single parents, older singles and essential workers.


You only need a deposit of 2% or more of the purchase price, and the government will contribute towards the purchase price in exchange for an equivalent interest in the property .

 

The contribution is a percentage of the purchase price. The maximum amount is:

  • 40% for new homes
  • 30% for existing home

What Are The Benefits Of The NSW Shared-Equity Scheme?

  • You buy your home with a smaller deposit (only 2%)
  • You save money, as you don’t have to pay Lenders Mortgage Insurance (LMI) which is usually applicable when you’re borrowing more than 80%
  • Your monthly repayments are lower since you’re borrowing a smaller amount . There are no repayments, no rent and no interest charged on the governent’s shared equity portion of the property.
  • You can pay off the NSW Government and increase your ownership share.

 

Who Can Apply For NSW’s Shared-Equity Scheme?


You can apply for the Shared Equity Home Buyer Helper if you are:

  • A single parent of a child or children
  • A single person who is over 50 years of age
  • A first-home buyer who is a key worker

The key workers who can apply are nurses, midwives, paramedics, teachers, early childhood educators and police officers.


NSW Shared-Equity Scheme Lenders


Two lenders offer the Shared Equity Home Buyer Helper:

  • Bendigo Bank
  • Unity Bank

Please note that these lenders are not part of our lending panel . However, we would be delighted to help you purchase your own property!!! 


Other government support programmes include 

What Are The Eligibility Requirements?

  • You are 18 years of age or older.
  • You are either an Australian citizen, permanent resident or New Zealand citizen.
  • You have a deposit of at least 2% of the purchase price.
  • You will occupy the property as your principal place of residence.
  • The gross income limit for singles is $90,000; for couples, $120,000 or less.
  • As a single parent or older single applicant, you cannot own an interest in any land or property at the time of settlement.
  • As a first-home buyer and key worker, you and/or your partner must not have previously owned an interest in any land or property in Australia.
  • You have the funds to cover the upfront cost of buying a home, including conveyancing, legal costs, any inspections and stamp duty.
  • Your financial assets are under:
    • 30% of the total property price if your annual income is more than $93,200
    • 45% of the total property price if your annual income is up to $93,200
    • 65% of the total property price if you are a single person 50 years of age or older

Is There A Maximum Property Price?

Yes. The maximum property prices depend on where you buy in NSW:

  • $950,000: Sydney and major regional centres (Newcastle & Lake Macquarie, Illawarra, Central Coast and North Coast of NSW)
  • $600,000: Other regional areas of NSW.

 

What Are My Ongoing Obligations If I Qualify?

After qualifying as a participant for the scheme, you need to fulfil certain obligations to maintain your eligibility. You must:

  • Pass annual reviews by providing supporting information
  • Get approval from the NSW Government to make any modifications or renovations so that the value of such changes factors into the final sale price of the property
  • Maintain the property and keep everything in good working condition
  • Take care of recurring property costs, such as water and home loan repayments.

You do not need to satisfy the key worker or single parent of dependent children status on an ongoing basis.

 

Is NSW’s Shared Equity Home Buyer Helper The Same As Help To Buy?


The main concept of NSW’s Shared Equity Home Buyer Helper is the same as the federal government’s Help To Buy scheme. Both offer the same relief through equity contribution, both do not charge rent, and both allow homebuyers to gain ownership whenever they can afford it.


However, there are differences between them:

  • Help To Buy is a nationwide scheme, while the Shared-Equity Home Buyer Helper is only for NSW.
  • Help to buy is intending to start in 2024 - not yet started 
  • Help To Buy does not specifically focus on groups, whereas NSW’s shared-equity scheme specifies groups like single parents, key workers, and people over 50.
  • Help To Buy is available only to Australian citizens, whereas the shared-equity scheme is available to Australian citizens, New Zealand citizens and Australian permanent residents.
  • 10,000 places will be available for the Help to Buy scheme annually, and 3,000 places a year will be available for NSW’s shared equity scheme.
  •  



Frequently Asked Questions: NSW Shared Equity Home Buyer Helper 


Contact me on link below and I will be delighted to explore whether there is an opportunity to assist you with your purchase


Can I Apply For The Home Buyer Helper And Help To Buy?

How Many Places Are Available?

What If I Currently Own Property?

What Types Of Properties Can I Buy?

As A First-Home Buyer, Can I Get Stamp -Duty Exemptions When I Apply For NSW’s Home Buyer Helper?

How Do I Buy Back The Government’s Share Of The Equity?

What Happens When I Sell The Property?


contact me on www.bsifinance.com.au 



 

The steps to get approval for The Shared Equity Scheme In NSW?

  • You must contact a participating lender to assess your eligibility before you lodge an application with Revenue NSW.
  • Once you’re successful, you will be informed of the maximum contribution amount from the government. The participating lender will then process your application and offer pre-approval. You will then have three months to find and purchase a home.
  • To get final approval, you must provide the participating lender with evidence of eligibility and prove that the government contribution is necessary for you to buy the property.
  • Once you have final approval, you will get a written confirmation from Revenue NSW to purchase your home.

Tuesday, December 26, 2023

So, what is the prediction for Sydney property prices in 2024 and beyond ?


The big 4 banks predict house prices will grow by 5pc in 2024 after growing a whopping 10.4pc  per cent  (CoreLogic data ) in 2023! 


This growth is despite  the pundits predicting a dire year in 2023 and 13 rate hikes -which affected buyers serviceability and added thousands to mortgage repayments. 

Why did property rise in 2023? 

  • the strong return of international migration 
  • Lack of supply resulting in a highly competitive rental market
  • help from the bank of mum and dad - inheritance and generational transfer from baby boomers 
  • existing equity in property 
  • saving buffers built up during COVID-19 lockdowns. 
  • First home buyer grants and deals for front line  workers 

What do you think will happen to Sydney property prices in 2024? 

So , what does Ivan Kaye from BSI finance predict ? 

“The graph of Sydney property for the past 50 years shows a steady growth. There may be dips and one shouldn’t look at what happens in one year.  Ivan Kaye predicts a solid return over the next 5 years of more than 20pc! 


Property is not a short term investment.  If you do your research, and buy well, property has been and we believe will continue to be a solid investment - especially with the ability to leverage with a 30 year loan! 


For more information on rates and information about buying or refinancing a property - go to www.bsi finance.com.au

www.bsi finance.com.au

Saturday, December 23, 2023

A Christmas present

Bill Mclellan - from our #bbg NEXTTECH Transformation Forum - referred a friend who was getting the run around from a number of banks - to get a mortgage for a house that he had put a deposit down and wanted to move in by Christmas! 

In a week - we got unconditional approval for the client - and he has moved into his new home! 





Thursday, December 7, 2023

BSI Finance is on the move




From 1 January 2024 - BSI Finance is moving to an amazing heritage listed building - Level 1  243 George Street - opposite the post office and at the end of Martin Place ! 

I believe it used to be the offices of Atlassian !!

Onwards and upwards !

Be sure to visit us - or go to our webpage at www.bsi finance.com.au


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

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 
  • 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.
So, to summarise, negative economic news like a war might make you uncomfortable temporarily, but as long as you have a solid plan and a long-term perspective, it's unlikely to change the fundamental value of your investments.

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