Australia remains a hot market for investors in Asia, a new study reveals, but a second study shows an increase in pessimism about the market among us all. Add an increase in fixed mortgage rates to that nervousness, and a new survey showing we consider ourselves to be more conservative investors than the global average. Property prices appear to have hit a growth plateau in April, according to commentators, while investment properties create almost $8 billion in losses every year for property owners.
Asia investors taking their time, despite hot market
A semi-annual sentiment survey of Asian investors shows rising demand for foreign real estate from Hong Kong buyers, while demand has stalled in Singapore and is falling in Malaysia.
The iProperty Asia Market Sentiment report shows investors still look to Australia, Singapore and the UK as main targets, and are more likely to purchase in the medium-term, rather than the long-term – a shift in sentiment from six months ago. Affordability remains a major concern, and market cooling measures mean a tough year ahead, says Shaun Di Gregorio, Chief Executive Officer of the iProperty Group. Read the full story here.
Tax report reveals huge negative gearing losses for rental properties
Figures for 2011-2012 released by the Australian Taxation Office (ATO) show 15 per cent of taxpayers own rental properties with a combined $7.86 billion of losses. Despite $34 billion in rental income, the average income loss for all property investors in 2011-12 was $4,146 while the average income loss for all negatively geared property investors in 2011-12 was $10,895. More than one in seven taxpayers are a property investor and some must be looking at these figures to support calls to end negative gearing tax breaks. Read the full story here.
Most Australians feel now is the right time to buy … but the numbers are slipping
The March RP Data-Nine Rewards housing market sentiment survey of expectations in Australia’s property market over the next six to twelve months shows 68 per cent of potential homebuyers think it is a good time to purchase a home. That’s lower than the 80 per cent posted a year ago, reflecting the current ‘seller’s market’ conditions. About half of survey respondents expect home values to rise over the next six months compared with 41 per cent a year ago. Only 6% expect a fall. Read the full story here.
Financial Times: Austerity is coming
An audit report prepared by the “razor gang” will give the government some political cover for implementing the deepest budget cuts in a generation. A deficit levy – a one-off tax on income to help repair the budget – may be part of the package and is roiling Liberal backbenchers opposed to tax rises. Still, the recent improvement in economic figures leads to questions about how troubled the federal budget may actually be. Read the full story here.
Real estate growth starts to slow in April
RP Data’s director of research, Tim Lawless, cites figures for April showing slower growth in dwelling values nationally – a rise of only 0.3 per cent – as evidence of a market slowdown. All capitals except Melbourne showed some rise in dwelling values during April, but the lower rate of growth, especially in Sydney and Melbourne, “may signal that these markets are moving through the peak of their growth cycle,” he said. Read the full story here.
Australian investors are comparatively conservative and pessimistic
Legg Mason’s international survey of investors revealed that 77 per cent of Australians consider themselves 'conservative' on risk tolerance, compared with a global average of 65 per cent. And only four in 10 have increased their exposure to overseas markets over the last five years, compared to 75 per cent globally. The results also show Australians to be more pessimistic than average about their financial future. Read the full story here.
Fixed rate mortgages increasingly common
Mortgage Choice’s latest home loan approval figures showed an increase in fixed-rate mortgages, to 26.49 per cent through April from 24.22 percent in March. Demand increased everywhere except Queensland and South Australia, with NSW writing the highest portion fixed rate loans – 33.60 per cent. Read the full story here.
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