30 Jul Sound News July
1. Brisbane Forecast for 20% Growth 2019-2020
House prices in Brisbane are expected to rise up to 20% over the next three years according to BIS Oxford Economics. Brisbane’s strong economic growth underpins buying in the city’s relatively affordable residential stock. A 14% rise in median unit prices is forecasted over the same time frame.
Sydney and Melbourne can anticipate a moderate recovery, with house prices forecast to rise 6 per cent and 7 per cent over the same period.
The Residential Property Prospects 2019 to 2022 report findings show that despite signs of improvement for the residential markets, if tightness in lending policy continues a high supply of new dwellings will remain a drag on price growth for now.
2. APRA Remove Servicing Buffers
Australian Prudential Regulation Authority (APRA) chairman Wayne Byres announced its decision to remove the 7 per cent serviceability floor on borrowers effective immediately in a move that is expected to increase borrowing capacity by up to 14 per cent.
UBS undertook an analyse that showed a couple earning a combined $200,000 with two children paying a comparison rate of 3.5 per cent will have an additional $150,000 borrowing capacity.
Mr Byres said after careful consideration the regulator had decided to remove the buffer that forced banks to assess every loan against the borrower’s ability to repay it at 7 per cent. It is the third lending benchmark to be relaxed by APRA in the last 12 months.
3. Holiday Inn For The Sunshine Coast
The Sunshine Coast will get its first new hotel in decades, the new Holiday Inn Express in Maroochydore will open by the end of 2020 according to fund manager, developer and operator Pro-invest.
The 167-room Holiday Inn Express & Suites will form an integral part of the $2.1 billion Maroochydore Town Centre development across 53 hectares features 150,000 square metres of commercial space as well as retail and high- and medium-density residential development.
According to Colliers International Report last year the region ranked the third most popular regional destination and has also witnessed a 20 per cent increase in visitor spending.
4. Rate Drop for 2nd Consecutive Month
In a desperate attempt to breathe life into the Australian economy the Reserve Bank of Australia is spending its ammunition, cutting interest rates to just 1 per cent in July.
In response to the Reserve Bank’s second interest rate cut in as many months, the ‘Big Four’ banks have lowered their own variable mortgage rates. Westpac has cut its standard loan by 0.2 per cent to 4.98 per cent. ANZ Bank passed on the full quarter-percent cut, their variable mortgage rate now sits at 4.93 per cent. The Commonwealth and National Australia Bank both moved lower by 0.19 per cent. NAB is currently offering the lowest rate of the major banks at 4.92 per cent interest.
5. Triguboff’s Meriton Hits Canberra
Harry Triguboff’s Meriton empire has made its first move into the Canberra market after 56 years in the business, acquiring a site to build a 17-level, five-star hotel in the city’s CBD.
The arrival of Canberra’s international airport in 2016, and with it an increase in overseas tourists and business travellers, has helped to absorb the wave of new supply in the market.
“It’s ranked third by Lonely Planet among its best cities in the world
to visit and has international flights arriving daily,” Meriton Suites general manager Matthew Thomas said.
Mr Thomas said the proposed Canberra casino redevelopment, which is on the same street, would be also be positive for the tourism and leisure markets.
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