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The Mercury Real Estate Guide : November 22nd 2012
MERCURY Thursday, November 22, 2012 --- 49 MERCURY MORTGAGE WATCH Fixed Rates Standard Variable Home Institution Phone Intro rate Intro Term Rate Equity rate 1 Yr Term 3 Yr Term 5 Yr Term Application Fee AMP 133030 5.49f 12 6.7 6.9 5.49 5.49 5.99 $295-895 ANZ 131314 - - 6.6 6.75 5.54 5.54 5.84 $600 Aussie 131 333 - - 6.68 6.68 5.39 5.39 5.69 $00-100 B&E Personal Banking 1300 306 716 6.19f 12 6.59 6.59 6.59 6.09 7.09 $650 bankmecu 132 888 - - 6.19 6.29 5.53 5.53 - $595 Citibank 132484 - - 6.89 7.26 5.35 5.35 5.59 $649 Commonwealth Bank 132 221 5.34f 12 6.6 6.75 5.49 5.54 5.84 $600 CUA 133 282 5.67v 12 6.05 6.55 5.3 5.3 5.79 $795 ING DIRECT 133 464 - - 6.09 6.57 5.59 5.54 5.94 $220-719 Members Equity Bank Pty Ltd 13 15 63 - - 6.08 - 5.39 5.39 5.99 $300 MyRate.com.au 1300 663 558 - - 5.92 6.4 5.8 5.9 6.3 NAB 131312 - - 6.58 6.06 5.44 5.49 5.94 Nationwide Mortgage (02) 9265 1700 - - 5.82 7.53 - - - $150-730 QuickDirect 1300 79 69 80 - - 5.85 - 5.44 5.54 6.32 Resi Home Loans 136 126 5.76v 24 5.96 6.25 5.64 5.49 6.27 $660 St.George 133330 5.39f 12 6.69 6.84 5.54 5.54 5.94 $00-800 Suncorp Bank 131175 - - 6.69 6.69 5.6 5.52 5.65 $600 Westpac 132 032 - - 6.71 6.86 5.69 5.59 5.89 $60 The introductory rate reverts to the standard variable rate after the initail term f=fixed c = capped Source: www.infochoice.com.au money matters Stay a while before planning your exit ANTHONY KEANE REVOLVING doors and real Westate should never mix. If you're going to walk into the world of property, either as an investor or an owner-occupier, you have to be prepared to stick around. Otherwise, the high trans- action costs -- particularly that mongrel of a thing called stamp duty -- can turn a good invest- ment decision into a dizzying, loss-making failure. The best gains in property come to the patient, those people who invest for at least five-to-10 years, preferably longer. If it's less than five years it's just speculation. However, even if you plan to hold a property for decades, you still need to think about how you will eventually say goodbye. You don't have to write down an exit plan, but just thinking about it will help you decide the best way to buy and structure the ownership of the property. For example, a common strat- egy in the past has been for the high-income earner of a couple to put an investment property in their name to get tax benefits from negative gearing in the early years of the investment. That may work for some cou- ples, but what if the property is held for many years? Then the negative gearing becomes posi- tive gearing and the higher- income earner pays more tax on the rental income. Plus they suffer from a crunching capital- gains-tax bill at the eventual sale because the property's owner- ship is not split with their lower- income spouse. Another example is self- managed superannuation, a hot topic among property investors who have shunned shares and pumped their nest egg savings into real estate. Putting a residential invest- ment property into a self- managed super fund can work wonderfully well if you sell it after retiring, because you pay zero capital gains tax. However, you can run into problems if you're going to rely on it for income and your tenant moves out. The property may no longer be able to pay you the retirement income it is supposed to, and you can't just sell off the bathroom. There are many other scen- arios where failure to have an exit plan can cost you dearly. Investors and owners always need to consider tax, stamp du- ties, their investment time frame and their future needs. Of course, plans can always change, but it won't be so detri- mental if you know the conse- quences well in advance. Anthony Keane is editor of Your Money, which appears in the Mercury on Mondays. best laid plans WHAT CAN AFFECT YOUR EXIT PLAN Property market booms and busts Changes in tax laws or income tax rates Interest rate rises and falls Relationship breakdowns Centrelink pension income and assets tests Put the sale before the buy ANDREW WINTER SOME people can afford to buy before they sell their existing home, but not all of us are in these happy circumstances. And the real risk in buying prior to selling can be the long time it may take to sell. Or you may sell easily, but not achieve the price you had expected and budgeted for when purchasing the new home. The most common mistake sellers make is the presumption that they will sell easily and for the price they require. That means that for the vast majority of us whose current home is already financed, there are considerable risks. The pros of not selling are that you are able to secure your next home without hassle and pressure and negotiate from a position of strength, providing your finances are in place first. This allows you time to plan the move and renovations. You may be able to buy at today's prices and sell at tomorrow's. However that only works in a rising market. And you don't have to find any temporary accommodation between homes. The cons however are that you could buy the home and discover between the time you bought and eventually sell, the price you paid may have been too much. Sometimes buying without selling is associated with impulse buys, decisions get rushed and mistakes get made. There is a massive financial risk -- you have the costs of the new home plus the existing cost of your current home running side by side for who knows how long? Another major con is that you are committing to a purchase price without knowing your selling price. You may sell for the right price, but if that takes six months can you cover those costs easily? I hear from so many home owners in this dilemma and my advice is always that unless you are financially comfortable to undertake this scenario, avoid the risk. When you sell first, yes, you may have to move out before your new home is ready, or even located. But isn't it less stressful to take a holiday or move in with Mum? Andrew Winter is a real estate consumer champion and the host of Selling Houses Australian on the Lifestyle Channel. goodmanconveyancing CONVEYANCING Fixed Price Conveyancing Personalised Service Obtain a free quote at www.goodconvey.com or call us on 6223 3888 100A Collins Street Hobart
November 15th 2012
November 29th 2012