According to RP Data-Rismark Daily home value index 2012, the average gross rental yeild accross the country is a dismal 4.3% for a median price of $470,000.  So from this you can see why negative gearing is still so popular.  In working with some key property investment partners for the past 12 months we have been going against this trend by being proactive and creating a higher yield in markets that on face value don’t exist.

Despite this very low national average there have been some outstanding returns for a number of years in what I refer to as ‘turbo charged’ markets.  The demand for resources even with its ebbs and flows has created mini boom towns all accross the country.  In a former business I travelled the country on a regular basis and my work took me to the farthest reaches of this sunburnt land where I saw first hand the unbelievable rental incomes people were earning in some of these towns to produce yeilds in excess of 10-15%.  But this obviously comes with a high degree of risk as many of these locations are heavily reliant on key industries to support this hyper inflated position in the market.

So instead of going for what already existed – I started to work closely with one of my key property partners to CREATE.  And today we are finally putting together small investment opportunities for our clients in the safer, larger more established cities wth yields well above the avereage for the area.  We can even create day 1 capital gain with a positive cashflow!

I work with clients in a consultative way towards achieving this outcome for them.  These projects don’t sit on a real estate agents stock list but rather through careful consultation with my clients I set about to CREATE the right property to suit their needs.  Contact us TODAY to find out how YOU  can start this process. You may be surprised to realise that you CAN afford to do this NOW and could end up with a PROFIT in your hand each week!

Whilst many industry analysts are giving their opinions on what the next move will be no one really knows the answer to this question.  But can we look deeper into the past and identify cerrtain economic indicators that when present; usually provide the best environment to ‘lock in’ just before the rates begin to rise again?  The good news is that YES, we tend to operate in certain cycles but unfortunately, there is no clear pattern to discern one way or the other regardless of what the so called experts claim in the media.  Common sense should always prevail for you,as a consumer to look at this question in very simple terms.  You should be weighing up the benefits of a fixed rate for a fixed term at very low rates.  With each drop we are becoming less and less likely to drop again and are one step closer to the bottom before the rise.  I recently locked in a fixed rate on some of my own mortgages and although this is now slightly higher than the current discounted variable rate available in the market, I am happy as I made the choice based on the situation at the time.

In the end you have to take a leap of faith and hope that whatever you decide on will work the best for you.  A mortgage broker can help you understand the benefits and restrictions and then you can decide what to do.  So whether you put your money on red or black, either way it is a gamble because you never know which one will turn up.

Growth in the world economy picked up in the early months of 2012, having slowed in the second half of 2011. But more recent indicators suggest further weakening in Europe and some further moderation in growth in China. Conditions in other parts of Asia have largely recovered from the effects of last year’s natural disasters, but the ongoing trend is unclear and could be dampened by slower Chinese growth. The United States continues to grow at a moderate pace. Commodity prices have declined lately, though they are mostly still high. Australia’s terms of trade similarly peaked about six months ago, though they remain historically high.

Financial market sentiment has deteriorated over the past month. The Board has noted previously that Europe would remain a potential source of adverse shocks. Europe’s economic and financial prospects have again been clouded by weakening growth, heightened political uncertainty and concerns about fiscal sustainability and the strength of some banks. Capital markets remain open to corporations and well-rated banks, but spreads have increased. Long-term interest rates faced by highly rated sovereigns, including Australia, have fallen to exceptionally low levels. Share markets have declined.

In Australia, available indicators suggest modest growth continued in the first part of 2012, with significant variation across sectors. Overall labour market conditions firmed a little, notwithstanding job shedding in some industries, and the rate of unemployment remains low. Nonetheless, both households and businesses continue to exhibit a degree of precautionary behaviour, which may continue in the near term.

There have been no new data for inflation since the previous meeting. Over the coming one to two years, and abstracting from the effects of the carbon price, inflation is expected to be in the 2–3 per cent range. In the near term, it is likely to be in the lower part of that range, though maintaining low inflation over the longer term will require growth in domestic costs to slow as the effects of the earlier high exchange rate wane.

As a result of earlier changes to monetary policy, interest rates for borrowers have declined to be a little below their medium-term averages. Business credit has increased more strongly in recent months, though credit growth remains modest overall. Housing prices had shown some signs of stabilising around the turn of the year, but have recently declined again. Generally, the housing market remains subdued. The exchange rate has declined over recent weeks, reflecting lower commodity prices, heightened risk aversion and expectations of lower interest rates.

At today’s meeting, the Board judged that, with modest domestic growth and a weaker and more uncertain international environment, the outlook for inflation afforded scope for a more accommodative stance of monetary policy.

A recent study on house prices in the area has revealed an average increase of 16.5 per cent during the 12-month period between March 2011 and 2012. While the Real Estate Institute of Queensland’s (REIQ) March quarter median house price report, released on the 19th of May, saw positive results for the sunshine state’s property market, with the general trend showing increased sales numbers during the March quarter. REIQ chief executive officer Anton Kardash believes the report bodes well for the future of real estate prices in Queensland: “We predicted at the time that the March quarter data would be even more positive and it certainly is that.” “Property prices have grown in most areas and some regions have also experienced substantial increases in sales activity,” said Kardash.

In addition to the 16.5 per cent rise in Gladstone, the report also showed median price increases for Brisbane, Bundaberg and Rockhampton during the March quarter. Overall, the Fraser Coast was the top performer amongst the major regions, seeing growth of 7.8 per cent over the same period. As a resource centre, experts often look to Gladstone and other major mining and LNG hubs as early indications of the direction of the state’s property market as a whole.

“Historically, it has been our resource centres that have led the charge during Queensland property cycles, closely followed by Brisbane, then our tourism centres and this pattern does seem to be repeating,” said Kardash. Kardash added that while it was too early to make any definitive comments on the future direction of the market, he believes there a number of positive factors that could lead to further growth.

Meanwhile, there’s more good news for those with an eye on the Gladstone market, with the announcement on the 23rd of May of plans to begin construction on a new private haul road for Gladstone quarry. Jeff Seeney, deputy premier and minister for state development, infrastructure and planning says the road is a necessary investment. “Removing the existing heavy vehicle access directly from the main road and providing a new access from a Council-controlled road is a clear safety benefit for the community,” said the minister. Seeney believes the new road is a necessary development for the continued growth of the fast-growing township.

Great news for property investors looking to gain their next property in Qld with the Deputy Premier and Treasurer Andrew Fraser saying “Industry has come to me asking for an extension to the Boost and that’s what we’ll provide,”  Mr Fraser also went on the say “An end date of April 30 will give developers and builders and extra three months to market the Boost and give the housing industry the kickstart it needs.”

The Building Boost grant has not had the take up originally expected with a budget of $140 million or 14,000 grants as at the 11 Jan 2012 only 3,728 applications have been awarded.  It is to be expected that the momentum will increase on the back of the 2 interest rate drops last year.  Don’t delay as to qualify for the grant you must enter into a contract before the 30th April 2012 and at PI Finance we can help you to select the right property with the help of our property partners and assist with the finance structure and strategy for your ‘wealth realisation’!

Contact PI Finance today to see how we can get you back on track and help you with some of your New Years resolutions once and for all.

Call us now to take advanatge of the $10,000 Qld Building Boost before it runs out!

If you are thinking of buying an investment property and enter into a contract to buy or build your new property before the 31st January 2012, then you may qualify to receive a $10,000 cash payment from the Qld Treasury.  This is called the Qld Building Boost Grant and you can confirm your eligibility on their website.  This payment can be used for anything you like and is a cash payment to you!  So if you think you deserve a gift back from the governement, then you need to contact PI Finance now to see how this can work for you.