#130: The F to K of property success: "First" home buyers & how to get purchase ready, how to approach "Goal" setting, "Houses" vs apartments, why mortgage strategy is more important than "Interest" rate, "Just" do it & "Knowledge" and how to acquire it
Manage episode 311238050 series 2905854
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In this week's episode Dave, Cate and Pete take you through:
1. Only a few weekends left to capitalise on a pre-Christmas purchase
Auctions have been booked for each weekend all the way up to the 18th of December and mid-week auctions scheduled as well, as vendors look to sell prior to Christmas. Although some buyers may drop out of the race to purchase due to property search fatigue and holiday planning distraction, while others may suddenly pivot from one property to another. Agents are finding the task of predicting buyer numbers quite challenging at present. Stock on the market will take a seasonal dip in January, meaning that buyers who have missed out will most likely need to wait till February to purchase, amplifying the mad dash to secure a property prior to Christmas.
2. Interest only loans will get more expensive in the wake of APRA announcements
In the last week, APRA has announced that banks need to hold more in cash reserves for every dollar loaned on an interest only loan. This means that lending interest only loans to consumers will become more expensive for the banks and the cost is expected to be passed on to consumers. APRA’s direction to the banks will come into force from January 2023 and we are likely to see the margin between interest only rates and principal and interest rates increase as that happens. APRA’s requirements were more stringent than expected, perhaps being employed as a tool to take the heat out of the market.
3. Queensland and regions benefit from population movements
The REA Group has published a report revealing the interstate and intrastate population movements in the 12 months leading up to March 2021. Queensland is the biggest benefactor of this period, with some 30,000 people moving to the sunshine state. Over the same period, Sydney has lost 31,000 and Melbourne 32,000 people, but not all have moved to Queensland. Regional New South Wales saw an increase of 13,000 and regional Victoria a similar increase of 14,000. Considering that the population of both Melbourne and Sydney is over five million, it seems a wonder that a few thousand people can make a big impact. The trio discuss the significance of these population movements and their impact on regional price growth.
The F to K of property success
F - First Home Buyers and what do they need to do to be organised
Purchasing your first home can be a daunting task, as you’ve never done it before. Whether you should purchase a home or an investment can be a bigger conundrum as first home buyers are often in an earlier stage of life, where they may not be established or settled yet. The trio discuss arranging and understanding finance, government and parental assistance, what first home buyers often overlook and what can trip up a good strategy.
G - Goal Setting
Taking time out to set goals will help you immensely, not only on your property journey but in your life journey as well. Determining goals will help you gain clarity on your property strategy and selection, whether you want to: retire richer, retire earlier, make a little bit more money right now, or make regular extra money so you can scale back work or give up your day job. The trio discuss how to approach goal setting and some common mistakes to avoid.
H – Houses (not apartments)
If capital growth is your aim, buying a property with a good land to asset ratio is essential. The trio discuss what denotes the difference between houses and units, and how the lack of uniformity can cause great confusion. Plus, buyers beware! Houses are not always a superior asset to units. Tune in to find out why.
I – Why mortgage strategy is more important than interest rate
The trio discuss how people can get sucked into focusing on rates, as it’s the easiest aspect of mortgages to understand. There will always be a lower interest rate somewhere in the next week, month or year and you can tie yourself in knots on focusing on the rate. First and foremost, you need to decide on your mortgage strategy. The Property Planner explains how this can make a significant impact to your bottom line at retirement.
J - “Just do it”
What causes analysis paralysis? Inaction can mean that you start your property journey five years later than you could have, making a massive impact to your nest egg due to the power of compound growth. The trio discuss the personality types that are more prone to inaction for fear of making a wrong decision and how to overcome this.
K – Knowledge and where to acquire it
The trio share their gold nuggets on how you can acquire great advice that will help you sleep well knowing that you are on the right path.
Visit the show notes - https://propertyplanning.com.au/the-f-to-k-of-property-success-first-home-buyers-and-how-to-get-your-ducks-in-a-row-how-to-approach-goal-setting-houses-vs-apartments-why-mort/