We knew it already, but now it’s official. The significant impact COVID-19 is having on Australian businesses has been brought home in new data released by the Australian Bureau of Statistics (ABS).  Released on Tuesday, the figures from the ABS reveal that 66% of Australian businesses are already reporting either lower turnover or cash flow as a result of the fallout from coronavirus. Furthermore, 47% of businesses have been required to make changes to their normal workforce arrangements including altering working hours for their staff, facilitating working from home setups or placing staff on leave. RELATED: Guide to Australia’s coronavirus financial support for small businesses “The Covid 19 situation is unprecedented and is challenging all aspects of the Australian Economy,” said David Rose, Chief Financial Officer at Scottish Pacific.  “For most, the challenge will be the same. Finding a way to manage operational cash flows and working capital in a period of falling revenues, […]

Amid the spread of coronavirus, the past few weeks have seen increased expectations of an Australian recession, a slowdown in business activity and trillions of dollars wiped off global share markets. It has many asking what the impact of the coronavirus would be on Australian residential property.  This note explores fundamentals of housing to better understand outcomes in the current climate. It is found:Housing has performed relatively well against negative economic shocks, but the unique conditions of a pandemic-induced economic slowdown must be considered;Housing is an illiquid asset and a consumption good, which shows far less volatility and decline than share markets;In the coming weeks, property transactions may fall significantly,  but the impact on values is unclear; and,Existing economic headwinds, including high household debt, make the property market particularly susceptible to a fall in demand. However, Australia does not have ‘one’ property market, and a decline in demand will be […]

I was recently a guest on Rebecca Rossi’s podcast Let’s Talk Building. We had a great time talking about everything building and buying homes! Click here to listen to it on Spotify or search “Let’s Talk Building” on Apple Podcasts.

We live in unconventional times. The Australian economy has borne the fallout of the pandemic spread of Covid-19. And in response, the Reserve Bank has made an out-of-schedule cut in interest rates to a record low 0.25 per cent, as well as making significant steps towards implementing a program of quantitative easing. “Before the coronavirus hit, we were expecting to make progress towards full employment and the inflation target, although that progress was expected to be only very gradual,” Reserve Bank governor Philip Lowe said while announcing the emergency cut.. “Recent events have obviously changed the situation.” As part of Thursday’s speech, Lowe revealed that the RBA are setting up a three-year funding facility aimed at providing loans for Australian banks – so they can in turn supply $90 billion worth of cheap credit to affected small and medium-sized businesses. And the RBA have also begun buying Government bonds in […]

Back in the day taking out a mortgage was like a marriage – till death do us part. But in a highly competitive home loan market, more and more Australians are breaking up with their loans by refinancing to a better deal. When was the last time you reviewed your home loan? Five years ago? Ten years ago? Never? Gone are the days when we stayed with one lender for the full 25-30 year loan term. Australians are savvy shoppers and we are continually seeking a better deal and rate. In fact, the average Australian homeowner changes their loan every four to five years. Refinancing your home loan can provide low-cost funds for a whole variety of purposes. Some of the main reasons include: To consolidate debt. If you have a car loan, small personal loan and/or owe money on your credit card, you can combine the debt into a new […]

Published by MFAA Offset accounts and redraw facilities work in similar ways; they both allow you to reduce the balance of your home loan, and therefore the interest charged, by applying extra money to your debt. Redraw facilities allow you to deposit spare income into your home loan account, allowing you to redraw a sum equal to the extra repayment amounts in future. In the meantime, the extra money paid will lower the amount of interest charged while still giving you access to your money. However, there may be restrictions on how much money can be withdrawn and when. “For redraw, it depends on whether the facility applies to a fixed-rate or variable loan,” a lender expert says. “Most institutions only allow redraw from a variable-rate loan, or fixed-rate loan but with limited access.” It is important to find out how a loan’s redraw facility works before taking it on, as the […]