Mital shah - Mortgage Broker

Mital shah - Mortgage Broker We cater all kind of mortgage, financial planning with vast knowledge and experience in industry

Three reasons property prices are still rising Despite the Reserve Bank of Australia (RBA) raising the cash rate at a re...
01/08/2023

Three reasons property prices are still rising



Despite the Reserve Bank of Australia (RBA) raising the cash rate at a record pace, property prices have managed to shrug off the higher borrowing costs and again started to increase.

There are several factors as to why property prices rise, but at a national level, it’s clear the supply and demand fundamentals are still bullish for property.
Tight supply
One of the common themes we’ve seen over the past few years has been the tight level of supply. During COVID, listings were tight and demand remained strong. As interest rates started to climb, some of the demand started falling away, however, listings didn’t rise.

According to CoreLogic, the number of capital city homes advertised for sale is almost 20%
lower than this time last year and 26.4% below the long-term average. Regional listings are also sharply lower, tracking 32.9% below the previous five-year average.

The tight supply levels have been one of the main factors that has propped up prices over the past few months. Demand for high-quality listings remains higher and is leading to strong competition for properties.
Record immigration
Immigration levels fell away dramatically when the government closed the borders. Prior to COVID, the government would typically bring in between 200,000-250,000 migrants every single year.

Since late 2022, the government has increased that number to 400,000-500,000 which is leading to a record increase in demand for property. These numbers have also been inflated by the huge increase in students coming to Australia to study.

This has dramatically increased the level of demand for homes, as new arrivals add to the pool of buyers.
Tight rental markets
The surge in immigration has also put rental markets under more and more pressure. Across the country, vacancy rates in many states are sitting at or near all-time lows.

The demand from overseas migrants is incredibly high, and these people will typically rent before they buy. This is leading to upward pressure on rents in most locations, with the latest data from CoreLogic showing that rents have surged 11.5% in the past 12 months.

Normally rental growth leads to property price growth. As renters who are having trouble finding a suitable rental property will look to buy if it is more financially viable to do so. This leads to upward pressure on property prices.

For the most part, the surge in property price growth has been led by people simply looking for a home to live in. With few choices on the market and ever-increasing numbers of people in Australia, this will continue to put upward pressure on property values.
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20/04/2023

Why you need to plan ahead to get a home loan



Throughout our lives we all experience changes, including switching jobs, starting families, and buying things like new cars. However, when we make big life decisions, most people don’t think about the impact that could have on their ability to get a home loan or refinance.

A recent survey found that 75 per cent of borrowers could find themselves unable to refinance because of life decisions that they were preparing to make. That’s why you need to plan ahead to avoid any negative financial implications from changes to your personal situation.
Changing jobs
One of the most common issues that impact your ability to get a home loan is a drop in income. Whether it's due to a job loss, a change in employment status or a reduction in work hours, any fall in income can make it harder to qualify for a loan or refinance an existing one. If you're self-employed or work on a commission basis, fluctuations in income can be particularly challenging. Even just changing jobs could make it more difficult to secure finance, especially if you’re changing the industry you work in. It is usually worth speaking to a mortgage broker ahead of time if you want to get a home loan in the future and also change jobs.

New debts
Another potential issue when trying to get a home loan or refinance is taking out additional loans or incurring new debts. For example, buying a new car or taking out a personal loan can increase your monthly expenses and affect your debt-to-income ratio, which is an important factor in determining your eligibility for a home loan or refinancing.
Family changes
Changes in your personal life can also impact your financial situation, such as having a baby or getting a divorce. These changes can affect your expenses, savings, and overall financial stability, which can all impact your ability to secure a loan or refinance. If you’re a single person, your monthly expenses are assessed differently than if you’re a couple. That changes again when you start having children. Make sure you’re aware of the implications of your family situation and how it might impact your borrowing capacity.
Reducing the impact of change
When it comes to securing a home loan or refinancing, it's important to plan ahead for life and employment changes. There are other steps you can take to reduce the impact, including having a larger deposit, working to improve your credit score by paying debts and bills early and avoiding taking out any new loans.

10/03/2023

Sydney and Melbourne to be investment hotspots
Sydney and Melbourne are becoming hotspots for worldwide capital looking to invest in commercial property, according to an ANREV survey.

Sydney was the top preference for 86 per cent of investors, while Melbourne was the preferred destination for 83 per cent.

According to the survey, Australia is an attractive destination for investors because of the positive outlook for the country’s economy compared to others in 2023 and 2024.

Australia’s population growth is forecast to be one of the fastest of the major advanced economies, which will help underpin demand for commercial real estate and housing.

On top of that, the Australian build-to-rent sector is immature, which provides investors with an attractive opportunity for growth in the market.

Australia’s population growth is forecast to be one of the fastest of the major advanced economies, which will help underpin demand for commercial real estate and housing.

On top of that, the Australian build-to-rent sector is immature, which provides investors with an attractive opportunity for growth in the market.

20/02/2023

How to save for a deposit as living costs surge
Record high inflation has gripped the entire world and rising living costs are making it extremely difficult to save for a first home. Fortunately, there are some things you can do to make it easier to put away money for a new house.

Set up recurring deposits – Every time you get a paycheque, immediately transfer a portion to your savings account.

High-interest accounts – Just like you would compare your home loan options, it’s worth comparing different savings accounts and term deposits.

Change your living arrangements – If you’re trying to get a home of your own, it could be worth living in a share house and taking on housemates, or even downsizing your rental to help you get ahead.

Pay down debts – It’s hard to save when you’re paying interest. Get your financials in order and pay down any high-interest debt like credit cards.

15/12/2022

How to improve your credit score

If you’re trying to increase your borrowing capacity, it could help to improve your credit score. Lenders will assess your credit score to determine what type of borrower you might be. Typically, the lower your score, the higher your interest rate.

Some of the most effective ways to improve your credit score include:

● Paying off any existing debt

● Lowering your credit card limit

● Paying bills as soon as you receive them

● Stop applying for credit or credit cards

● Paying credit cards on time

● Making sure there are no errors on your credit report

04/12/2022

What are the advantages of buying property with equity?

There are a lot of great reasons to own real estate, but one of the most powerful is the ability to use equity to purchase another property.

If you’ve owned a home for a number of years, you might be able to access some of the equity to use as a deposit for another home.

Here are some of the advantages of using equity:

No need for another deposit

The most important element of accessing equity is that it removes the need to save for another deposit. Often times, it’s first home buyers who have the hardest time getting into the market as they typically have low savings and modest incomes.

However, after seeing a few years of capital growth, you might find you’ve been able to build up enough equity in your first home to continue growing your property portfolio. This could be an investment property or one that you want to live in at some point. Either way, the fact that you didn’t have to save the second deposit can really make this next step a lot easier.

Speeds up the growth of your portfolio

After you’ve built up that equity base, the path to growing your portfolio becomes a lot easier. Once you have tapped into the equity on your first home, you can then purchase a second property. With both of these properties potentially growing in value simultaneously, you can generate even more equity down the track.

If you were to try and save for every deposit instead, it would take a lot longer.

Not getting left behind

If you’re wanting to try and eventually get into your dream home, it’s going to take some time. As house prices continue to rise, it is getting harder and harder for many to get over the deposit hurdle.

By using equity and growing an investment portfolio, you’re building capital in line with the market. So, not only will you not be left behind, you’ll actually be ahead when the time comes to try and buy that dream home.

While it’s great that you’re building equity, it is also important to remember that you will still need to be able to service any loans that you take out based on your financial circumstances

27/11/2022

how you can boost your equity:

The more equity you can build up in your property, the stronger financial position you’re going to be in. You can use that equity to continue growing your property, or adding to your investment portfolio.

Add Value – the most common way to add value is through renovation. This can be a small cosmetic renovation, like painting walls and putting in new floor coverings. It can also be something more substantial, like redoing the kitchen or adding an extension to the property. It’s also possible to add value through things like subdivisions.

Reduce Debt – another way to increase your equity is reducing your mortgage. You can do this with products like offset accounts, or by consolidating debts and improving your overall financial position.

19/11/2022

What are the benefits of paying down your home loan sooner?



Being mortgage free is something all homeowners aspire to. While clearing the debt might take some time, there are still some benefits to cutting down the principal component as much as possible.

Less interest – the shorter the length of the loan, the less interest you’ll ultimately pay.

You’ll build equity faster – if you can quickly reduce your debt, that means you have more equity in your home. You can use this equity to upgrade your property or purchase an investment.

Positive cash flow – if you’re an investor, the more principal you can pay down, the more cash flow you’re able to generate over time.

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