Welcome to the second edition of Finance For Tomorrow.

This e-newsletter has been designed to focus on updating you on changes in the Finance Industry.

Enjoy this edition of Finance For Tomorrow.

Kind Regards,




Alan Johnston
Lending Manager

Property market gears up for bumper season Tip of the month Breaking news this month

Property market gears up for bumper season

The property market is gearing up for a bumper season thanks to an influx of stock and the warmer spring weather encouraging buyers to investigate properties and attend open homes and auctions on the weekend. The level of real estate agent activity has risen by 17 percent since the start of June and is 31 percent higher than the same time last year, figures from RP Data revealed.

RP Data's director of property research Tim Lawless told Mortgage Business that rental rates have recorded declines in every capital city, except Darwin, over the last three months.

"The recent fall in rental rates can be attributed to an end in demand as more renters look to buy, take advantage of low interest rates and the boost to the First Home Owners Grant, " Mr Lawless said.

"With vacancy rates across the nation's capital cities generally below 2.5 per cent, it is highly likely the recent fall in weekly rents will be short lived. Such low vacancies will continue to place upwards pressure on rents over the longer term.

"The number of new properties being added to the market place is up 11 per cent since mid-June as the spring selling season starts to ramp up. Over the last month there have been just short of 160,000 individual properties advertised for sale equating to $126 billion of housing stock on the market.

'The number of properties being advertised for sale is actually lower than the same time last year reflecting the buildup of stock last year and the subsequent absorbing of stock throughout the second and third quarters of 2009." he said.

If rates rise, should I move to a Fixed Rate Mortgage? No necessarily From the moment you take out a Mortgage, you'll take a much keener interest in Australian interest rates. Should you be on a Variable Rate Mortgage or a Fixed Rate Mortgage? Here we look at your Home Loan refinancing options as interest rates rise and fall. When interest rates drop If you took out a Variable Rate Mortgage, you were effectively taking a view that interest rates in future would be steady or fall. So when the Reserve Bank announces a quarter or half point drop, you'll be feeling pretty clever. But how should you respond? Live it up? If your interest rate falls, you could simply lower your repayments and enjoy an improved lifestyle. That's very tempting but not necessarily the way to go.  Pay off more It might be smarter to take advantage of the lower interest rate to pay off more of your loan. Remember, Lenders tend to load the interest on the earlier years of a loan, so paying more now could significantly reduce your interest charges over the term of the loan - if rates remain low. When interest rates rise If you have a Variable Rate Mortgage, an interest rate rise is not great news. However, as always, you have options. Refinancing to a Fixed Rate Mortgage The instinctive response for most people when they hear rates have gone up is to switch from a Variable Rate to a Fixed Rate Mortgage. That's understandable. Unfortunately, Lenders in a climate of rising rates will make you pay for that interest rate certainty. Also, you don't have the flexibility of paying off your Mortgage sooner with a Fixed Rate Mortgage. There is another option. Increasing your Mortgage Repayments Mortgage Refinancing is generally about one thing: reducing the overall cost of your Home Loan in the long term. If you're going to be paying a higher interest rate, one way to reduce the interest charge is to reduce the amount you owe by actually increasing your monthly repayments - if that's possible. For help with your Mortgage Refinancing contact Cutcher & Neale, your MFAA member, today.

Building approvals soar Residential building approvals have risen for the second consecutive month highlighting a strengthening economy and the increased demand for property. Click here to read more.

Brokers not to blame for errors
Borrowers who use brokers experience less problems with their loan accounts than those who use bank or non-bank lenders, according to the latest BankWest/MFAA Home Finance Index. Click here to read more.  

More signs of global banking revival
Indications that the collapse in banking confidence at the epicenter of the GFC is starting to turn around continue to emerge as more banks announce global expansion plans. Click here to read more.

Bankwest launches capped mortgage product
In a move that Bankwest believes will shake up competition in the mortgage market, Bankwest has today unveiled plans to introduce a new capped rate home loan. Click here to read more.

Small businesses: Glass half full
Small business optimism about the country's economic outlook hit a 13-year high according to the Sensis Business survey released today, but confidence is outstripping improvements in actual performance. Click here to read more.

Rate hike expected: Is it too late to fix your loan?
The RBA may have left cash rate at 3% for the last five months but it could rise as soon as October following new figures that the economy grew 0.6 per cent in the last quarter - the second quarter of positive growth this year. Click here to read more.