SSS – Jan/Feb 2017

G’day All,

Interest Rates
Official rate remains on hold at 1.5%. Expect this to remain for most of the year. Actual mortgage rates however will be increased by the banks. If you’ve got relatively high debt spread across multiple assets, you’ve probably got until the end of the year to lock in a decent 2-5 year fixed rate at sub-5%. If you’re still in acquisition though and have ample buffer funds, then fixing may not be required. Get in touch if you’d like to discuss further.

DHOAS
Some NAB DHOAS loans have come down to a 4.07% variable rate. If you’re currently paying more than this, it won’t hurt to call NAB and seek a pricing request.

Market
South-east Queensland still remains prime for investment. New estates to watch are within Sunshine Coast and Moreton Bay to the north and new estates east of the Ipswich CBD. Population is steadily increasing together with land price, rents and sales volumes. We still have packages available in the mid-$400K bracket that satisfy our investing and TWO-50-TEN™ strategy criteria.

The Brisbane median house price is now also half that of Sydney at $540,758. With a strengthening commodities market (gas, iron ore and coal), and some major public and private projects (Adani coal mine and Queen Street Wharf upgrade), there is plenty of upside potential to be had, especially when the law of economic-rent is understood.

Strategy
The Defencewealth strategy of TWO-50-TEN™ is based on acquiring a $2million portfolio at 90% LVR over a 6-8 year timeframe. Once acquired we work to reduce the LVR to 50% over the next 4-7 years using a combination of capital growth, offset accounts and principal repayments. Once at 50% LVR, you will have some serious financial options but it will take time (10-15 years) to achieve. The types of properties we recommend are investment-grade based on experience and results and are selected for their balance in anticipated cash flow, capital growth and risk.

Quote
Any intelligent fool can make things bigger, more complex, and more violent. It takes a touch of genius – and a lot of courage – to move in the opposite direction – Albert Einstein

https://www.theurbandeveloper.com/ripley-valley-town-centre

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