The Federal Budget 2018 – 2019 released and effects on property buyers and property investors

The Federal Budget 2018 – 2019 released and effects on property buyers and property investors

The Federal Budget 2018 – 2019 released and effects on property buyers and property investors

Published on June 30th, 2018

Milan Tojcic I Property investor and enthusiast

Director of Expert Mortgage Brokers I Head Finance Broker

 

Given the already proposed Budget that will be implemented since 1st July 2018 is not the most relevant and will not make much impact on investors but more so to first home buyers. It might be worth going through the changes anyway. Besides some small tax cuts to low to middle income earners, there are major changes to affordable housing. Whilst improving affordable housing Budget 18 – 19 will cut vacant land holders claiming interest costs where land is not genuinely held for earning assessable income. This year’s budget involves instant tax write off for small businesses for purchases under $20,000 extension.

 

Budget will largely focus on Aged care and mostly infrastructure improvement. Melbourne improvements to be funded for a rail line to Melbourne Airport. Some 14,000 Aussies will get their homecare packages with $1.6 billion to be used over 4 following years. In attempt to ease the congestion in Melbourne and other states, primarily focusing reliving commuters to Melbourne airport. There is $24.5 billion to be provided to infrastructure around Australia and about $5 billion towards rail line in Melbourne Airport. Hence the infrastructure is believed to improve property value in the somewhat near future potentially causing some property price hikes.

 

Most importantly this foundation of tax cuts is primarily funded by a crack down onto illicit tobacco, money laundering and certain sectors known to avoid paying tax like foreign companies using loopholes avoiding the tax office. So, the main foundation to this year’s tax cut will not be out of the Australians pockets but from ‘other avenues’.

 

The new budget will provide tax relief targeting low to middle income earners. So, the main winners in this budget will benefit from just over $10 per week or $530 per year that can only be claimed after June 2019. But in which tax bracket exactly? If you are earning up to $37,000 per year there could be up to $200 back in your pocket. Anyone on and up to $90,000 income bracket will get a maximum of $530 per year. The other tax savings changes will be the bracket not up to $87,000 but up to $90,000 and that rate is now 32.5% and not what used to be 37%. The 37% tax rate will be applied from the $90,000 income bracket. Some great tax benefits that can be used to incorporate to save for the first home buyers along with affordable housing in the following.

 

Housing with measures to improve affordable housing are on track with $1 billion to be provided for National Housing Finance and Investment Corporation and release of more land for affordable housing development. In attempt to address affordable housing concerns the new budget will focus on claw-backs via people claiming interest costs relating holding vacant land where land is not genuinely held for earning assessable income.

 

Hence, the overall budget will not be the most significant to property buyers, property investors and especially the first home buyers. However, in some instance the expansion and focus on affordable housing can improve the household savings. That is to provide a chance for first home buyers to save for their first house by paying cheaper rent.

 

Once you’re ready to further inquire about a loan and if you like to further discuss the new Federal Budget, a mortgage broker can help you make a more informed decision about which loan to choose. With a lot more, loan products than ever before on offer from a variety of lenders – you can receive loan information that will provide you with a much more informative position and make your decision easier when the time comes. So, contact your local Expert Mortgage Broker and enquire within.

A hidden significance, white-label loans are a lot more than just a good rate loan

A hidden significance, white-label loans are a lot more than just a good rate loan

A hidden significance, white-label loans are a lot more than just a good rate loan

Published on June 11, 2018

Milan Tojcic I Investor Enthusiast

Director of Expert Mortgage Brokers I Head Finance Broker

 

For those unfamiliar with white label loans, a hidden significance, greater than is first apparent – in essence a white-label loan is basically a home-branded loan. Like any of your favourite home-branded products you can find in supermarket aisles there is a hidden significance – the white-label loan is more than a low rate loan. White-label products are high quality and are usually developed by the most influential of lenders in the markets – they are just packaged with less and hence appear with less significance but, do come with a very sharp and competitive offer.

 

White-label loans, like any while label grocery product is available in supermarkets, are available through mortgage brokers. Popularity of while label loans has grown mainly in the last decade. Their popularity has grown so much that majority of brokers offer while label loans. And, as white label loans have grown in demand, that’s slowly reflected onto the quality of their product and service overall in the market. Hence, white label loans have developed over time into something much more than price, with high focus on flexibility, service and quality of the product.

 

Elasticity – White label will offer choice

Like in range offered by big four majors in white-label offers variable interest rate, fixed or combination of both rate loans. Their suitability will range for many home-buyers looking for a no frills, simple mortgage product. White-label mortgage products will offer access to loan features like redraw, debit card access and internet banking facility. That way there is no need to be concerned with paying for all the extras that many borrowers will never need in home loans.

 

Facility – White label loans offer swift and professional service

Customer service is what distinguishes the products in white-label home loan market. Deciding on which home loan to choose available can be the biggest financial decision in a life time. Hence, who better to go to than a mortgage broker. Nevertheless, some still feel that if there is no face to face person than customer service is slower and not as professional. With white-label loans, brokers have knowledge and access to the white-label lender support and can offer, in most cases, quicker support than a lender might. Most of the time an unconditional approval can be obtained with a broker through white-label product than any other major lender in the market. That way dealing with a broker can result in quicker and more suitable loan product, not to mention quicker service levels with having the expert on your side.

 

Value – White-label loans offer like any lender might with lower cost involved

Basically, white-label features offer the same facilities as any bank-lender might, only with lower cost. Products value, elasticity and facilities involved remains the same, and not to mention the popularity of white-label loans growing only goes to say that borrowers are getting the opportunity and benefits of this loan product.

 

Once you’re ready to further inquire about a loan and if white-label something you are considering, a mortgage broker can help you make a more informed decision about which loan to choose. With over a lot more loan products on offer from a variety of lenders – you can receive loan information that will provide you with a much more informative position and make your decision easier when the time comes. So, contact your local Expert Mortgage Broker and enquire within.

First Home Buyers and new 2017-18 Federal Budget – How will the Federal Budget 2017-18 affect the first home buyers?

First Home Buyers and new 2017-18 Federal Budget – How will the Federal Budget 2017-18 affect the first home buyers?

By Milan Tojcic

“Smallest step in the right direction will end up being the biggest. Well, we’ll tip toe with you in the process until you start walking.” (Expert Mortgage Brokers)

This is where I’d like to put a picture of something, like houses or something. First home buyers or just a basic picture of houses in an unknown street. Or just a couple purchasing a house.

The federal budget 2017-18, again like budget 2016-17, shows no immediate fixes for the process of quick-fix housing affordability. However, with short term changes to budget, the First Home Super Saver Scheme, the long-term results may be different.

The issue with the first home buyers getting into the market “these days” has become evident with such high housing prices. Increasing degree of difficulty to save for a deposit resulting with Aussies entering the housing market much later than their parents and grandparents.

Generally, as the federal budgets change over time, in attempt to ease the entry into the market for first home buyers, most recent budget hasn’t made an immediate fix for the group. However, Since the last year’s financial budget that hasn’t changed much in favour of the first home buyers, budget 2017-18 has made a slightly bigger improvement.

So, what are the alternatives for the first home buyers by the new budget?

From 1 July 2017, Australian first home buyers may be able to salary sacrifice up to $15,000 per year and a lifetime limit total of $30,000 into their super. Once they are ready to use their savings as a deposit to purchase a property, at least a year later, that is in 1 July 2018, they can withdraw the funds from their super and use them to purchase their first home.

For couples who are trying save their first home purchase, this is ideal because they may both be able to take advantage of this scheme and contribute up to $60,000 into their super. Although the couple may not have an immediate fix to the matter, they may have a good chunk they can use to contribute their purchase of the first property with a higher deposit.

As good as it sounds, the scheme will not escape the “super tax department”. Salary sacrificed savings will be something that will be taxed by the “super tax department”, so to speak. However, the saving will be greater than in a deposit account as the amount salary sacrificed will be exposed to “concessional tax rates”. Hence a better way to save for a first home purchase than keeping the deposit in a savings account.

What does this mean for businesses wanting to purchase their first home?

Businesses are also able to benefit by allowing them to claim a tax deduction on personal contributions they can make and that way benefit as well. Alternatively using their pre-tax income as a benefit to contribute to a higher deposit for their first home purchase.

Want to find out some more information about the first home buyer super options and talk about the current market climate trends. Contact a professional financial adviser, or speak with an Expert Mortgage Broker.

Therefore, biggest decisions in life should be done right, choose nothing but the experts on your side.