ISSUE FIVE: SEPTEMBER 2011
TAX FORUM: REIA GIVES A VOICE TO THE REAL ESTATE PROFESSION
ALSO IN THIS ISSUE: REIA REPORTS REIA RELEASES JUNE QUARTER REPORTS AUCTIONEERING CHAMPIONSHIPS WHO WILL TAKE THE TITLE? MANDATORY DISCLOSURE OF EERS REIA PUTS FORWARD A SUBMISSION PORTABILITY OF BANK ACCOUNTS FROM JULY 2012 NEGATIVE GEARING AND HOUSING INVESTMENTS
WANT TO FIND OUT MORE ABOUT PROMOTING YOUR BRAND IN REIA NEWS? CONTACT REIA MANAGER COMMUNICATIONS RHIANNON MCCLELLAND ON 02 6282 4277 OR AT RHIANNON.MCCLELLAND@REIA.COM.AU FOR FURTHER INFORMATION.
PRESIDENT’S REPORT WELCOME FROM REIA’S ACTING PRESIDENT which recorded a 1.2 per cent increase in house prices. This supports REIA’s recent comments that the housing market maintains strength. We are presenting this message in our media releases and reminding homebuyers that now is the optimum time to buy a home before house prices start creeping up again.
Despite more needing to done to improve housing affordability, with interest rates on hold and the housing market gaining strength, we could see a spring/ summer resurgence. The REIA released our Real Estate Market Facts report yesterday
Both myself and our CEO Amanda Lynch are frequently asked to comment on the state of the housing market and we are making a point of spreading the message to first home buyers that you don’t need a mansion to get started, you just need to get your foot in the door so you can start building some equity and tradeup in the future. This month, I attended REIT’s Awards for Excellence and Conference which were superbly run. I would like to thank REIT for
their hospitality and congratulate all the winners on their achievements. I would also like to congratulate all winners at the REINT and REIWA Awards for Excellence. This edition, we have also detailed this month’s big event; the NAB REI Australasian Auctioneering Championships. We have some great competition and are hoping Australia can hold on to the trophy. On a final note, REIA is extremely pleased that our lobbying efforts have secured us a seat at the Tax Forum. Our feature story will provide you with further information about what this will mean for the profession and the suggestions we are putting to the Government on your behalf. Ms Pamela Bennett REIA Acting President
ON THE COVER TAX FORUM
REIA GIVES A VOICE TO THE REAL ESTATE PROFESSION The Treasurer has invited the REIA to participate in the Tax Forum at Parliament House on 4 and 5 October this year. This will provide an opportunity for the REIA to put its position regarding property taxation, in particular, the need for reform of state property taxes. The Government announcement in early April that it will hold a Tax Forum stems from a commitment tied to the support of Independents to form a minority Government, following the 2010 election and follows on from the comprehensive review of Australia’s Future Tax System (Henry Review) that was commissioned by the incoming Government in 2007.
“The Henry Review noted that statebased property taxes are highly inefficient and an unstable source of revenue...” The Henry Review noted that state-based property taxes are highly inefficient and an unstable source of revenue for states and should be replaced by an alternative broad-based tax such as a land tax. Additionally, according to the review, stamp duties are highly inequitable because they discourage transactions of residential property and people from changing their place of residence as their personal circumstances alter.
Further, people who need to move more frequently bear more tax in the form of stamp duty, irrespective of their income or wealth. The review contained a number of recommendations regarding property, including: • the replacement of negative gearing and capital gains taxes with the introduction of a 40 per cent discount for income from rental properties • the replacement of the current Capital Gains Tax (CGT) arrangements with an accrual-based system • owner-occupied housing should be tax exempt. The Government, in its response to the Henry Review, did not accept any of its recommendations relating to property and specifically rejected:
• introducing a land tax on the family home • reducing the CGT discount • applying a discount to negative gearing deductions. REIA has been lobbying Government with evidence that state-based property taxes are inequitable, inefficient and an unstable source of revenue and has suggested that replacing property taxes with other more efficient taxes would provide considerable economic benefits for some time. Since our submission to the Henry Review, REIA has taken every opportunity to emphasise the point. Stamp duties represent additional costs to property transactions, thereby discouraging turnover of housing and distorting choices between renting and buying, and between moving house and renovating.
“Stamp duties represent additional costs to property transactions...” Individuals who move more frequently would pay more taxes than those who move less. These distortions lead to sub-optimal outcomes and reduce investment in the property market. An Australian National University research paper by academic and Federal Labour MP Andrew Leigh titled, How do stamp duties affect the housing market shows that increases in stamp duties lower turnover in the short and medium run. Specifically, a 10 per cent increase in stamp duty diminished housing turnover by between 2 and 5 percent.
An OECD report, Going for Growth in 2011 also notes that lower transaction costs such as stamp duties encourage mobility. Research that the REIA has been involved in shows that by removing conveyancing and insurance duties and reducing land tax, GDP growth of 1.7 per cent would result. This is muchneeded growth in our two-speed economy. The REIA will be seeking a commitment from Government to a process for the implementation of future tax reform of state taxes as well as the retention of current arrangements for negative gearing of property investments, no capital gains taxes on the family home and no increase in capital gains tax on property investments. REIA’s position statement is available at www. futuretax.gov.au/content/ Content.aspx?doc=home.htm.
INDUSTRY ARTICLE AUSTRALIANS INVEST IN PROPERTY BEYOND STATE BORDERS Australian investors are “thinking outside the state” and purchasing rental properties beyond their home state borders. Figures from Terri Scheer Insurance show that Australia-wide, 20 per cent of its insured landlords own rental property outside the state or territory in which they currently live. Queensland is their preferred destination, with more than half – 51 per cent – of interstate investors owning rental property in the sunshine state.
The Australian Capital Territory and Tasmania have the highest proportion of investors who own interstate rental properties.
Queensland and South Australia have the lowest proportion of landlords with interstate properties at 9 per cent and 10 per cent respectively.
“More than half of all ACT-based landlords own property outside ACT borders...”
These figures show that today’s property investors are not afraid to ‘think outside the state’.
More than half of all ACTbased landlords – 57 per cent – own property outside ACT borders, while 50 per cent of all Tasmanian-based landlords own rental properties on the mainland. This is followed by landlords in the Northern Territory (39 per cent), New South Wales (28 per cent), Western Australia (27 per cent) and Victoria (23 per cent).
They are very astute and not limiting themselves to properties within their home state or territory borders. This suggests that investors are doing their homework and choosing rental properties in areas they believe will give them the best returns, regardless of where they live.
“This suggests that investors are doing their homework...”
Whatever the reason for owning interstate rental property, there are important risk management implications to consider. Terri Scheer Insurance encourages landlords to appoint a property manager who can give their
investment the hands-on attention it needs. Tailored landlord insurance is also worth considering. Even the best tenant can accidentally damage a rental property or suffer financial hardship that leaves them unable to pay the rent.
If a landlord is required to travel interstate to inspect tenant damage, the last thing they want is to pay for the cost of that damage from their own pocket. For further information, visit www.terrischeer.com.au or call 1800 804 016.
Proportion of Australian landlords who own rental properties outside their home state:
Of the 20% of Australian landlords who own rental property in a state other than where they reside:
• • • • • • • •
• • • • • • • •
Australian Capital Territory – 57% of landlords Tasmania – 50% of landlords Northern Territory – 39% of landlords New South Wales – 28% of landlords Western Australia – 27% of landlords Victoria – 23% of landlords South Australia – 10% of landlords Queensland – 9% of landlords
Source: Terri Scheer Insurance
2% invest in the Australian Capital Territory 51% invest in Queensland 14% invest in Victoria 12% invest in New South Wales 11% invest in South Australia 5% invest in Western Australia 3% invest in the Northern Territory 2% invest in Tasmania
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REIA REPORTS REIA MARKET FACTS HOUSE PRICES INCREASE The June quarter Real Estate Market Facts data shows an improved performance in the Australian residential property market compared to the previous quarter. House and other dwelling median prices increased by 1.2% to $541,188 and 0.5% $430,230 respectively. These are the largest increases recorded since the September quarter of 2010. Canberra, Sydney and Melbourne recorded the highest median house prices while the lowest were evident in Brisbane, Adelaide and Hobart. Melbourne showed the greatest improvement over the quarter with the median price increasing 5.4% to $590,000.
The largest decline was evident in Darwin with the median price down 6.4% to $515,000. Over the year, the weighted average capital city median house price increased 0.9%. Decreases were evident in Brisbane, Darwin, Perth and Adelaide. In the June quarter of 2011, all Australian capital cities, with the exception of Perth, Melbourne and Hobart, recorded decreases in median prices for other dwellings. The other dwelling median price for Perth remained unchanged while the Hobart median for other dwellings declined 3.4%; the largest increased recorded over the quarter. Melbourne saw the greatest increase in other dwelling median prices over the quarter and the year, taking the figure to $474,500.
Rents for three bedroom houses remained unchanged in most capital cities, with the exception of Hobart and Darwin where median rents for three bedroom houses declined 8.3% and increased 2.7%, respectively. Rents for two bedroom other dwellings showed varied results across Australia: rents in Adelaide, Perth, Hobart and Darwin declined, rents in Sydney and Canberra increased while rents in Melbourne and Brisbane remained unchanged. For further information about the REIA Real Estate Market Facts report, please contact Rhiannon McClelland on 02 6282 4277 or at rhiannon. firstname.lastname@example.org.
REIA REPORTS DEPOSIT POWER HOUSING AFFORDABILITY REPORT IMPROVEMENT IN AFFORDABILITY SHORT-LIVED When housing affordability improved slightly during the March quarter of 2011 for the first time in more than two years, the Real Estate Institute of Australia (REIA) expressed caution not to get too excited about the 1.1 percentage point change. As expected, the brief improvement was short-lived. In June 2011 affordability deteriorated once again, with an increase of 0.4 percentage points in the proportion of income required to meet loan repayments. This brings affordability in line with where it was twelve months ago with 34.6% of the average family
income going towards loan repayments. Despite a slightly subdued housing market, it maintains underlying strength. With loans to first home buyers down 2.1% in the past twelve months, we would encourage action from Government to look at ways it can assist home buyers in entering the property market and achieving the dream of home ownership. REIA’s recommendations for assisting first home buyers are outlined in the Pre-Budget Submission, available by clicking here. For further information about the Deposit Power Housing Affordability Report, please contact Rhiannon McClelland on 02 6282 4277 or at rhiannon. email@example.com.
National manager of Deposit Power says, “Confidence in the sector is subdued; the Government needs to provide home buyers, particularly first home buyers, with a sign that the property market is strong.” “The Australian property market will always experience increases and decreases in growth, however, given Australians generally take out a 25-30 year mortgages, property is a secure long-term investment.”
NAB AUSTRALASIAN REAL ESTATE INSTITUTES’ AUCTIONEERING CHAMPIONSHIP 19–21 SEPTEMBER 2011 SOFITEL MELBOURNE ON COLLINS 25 COLLINS STREET MELBOURNE
The NAB Australasian Real Estate Institutes’ Auctioneering Championship brings together the winner and runner-up of each of the Australian State REI Auctioneering competitions and the winner and runner-up of the national REINZ Auctioneering competition.
Who will win this year?
The Program of Events
To celebrate the profession and art of auctioneering, the REIV is offering a number of options to both Victorian and interstate auctioneers as part of the NAB Australasian Real Estate Institutes’ Auctioneering Championship in 2011.
Friday 16 September 5.30pm– 6.30pm
The Packages Pick the package that suits you best
Monday 19 September 10.00am–2.00pm Auction Master Class 5.30pm–6.30pm Contestant briefing 6.30pm–7.30pm Cocktail party, including competition draw
Delegate Package This package includes: • Welcome cocktail party and competition draw • Full catering for the Auction Heats, including morning and afternoon tea & buffet lunch • Catering for the Auction Finals, including lunch & afternoon tea • Reservation at the Gala Presentation Dinner Cost: $365 REI Members & non-Members
Gala Presentation Dinner Package Single ticket $120 REI Members $150 non-Members Table of 10 $1100 REI Members $1400 non-Members Presentation Dinner includes three-course meal with premium beverages
Accommodation Sofitel Melbourne on Collins
Auction Study Tour Package This package includes: • Delegate Package • Auction Master Class
Delegate room rate: $295 (without breakfast) per night $325 (with 1 breakfast) per night $355 (with 2 breakfasts) per night
Welcome drinks for Auction Study Tour delegates
Saturday 17 September 9.00am–3.00pm Auction Study Tour of Melbourne auctions 6.30pm–9.30pm Auction Study Tour dinner
Tuesday 20 September 10.00am–4.15pm Auction Heats Wednesday 21 September 9.00am–11.00am Property viewing – finalists 1.30pm–3.00pm Auction Finals 7pm–midnight Gala Presentation Dinner
Auction Master Class What could you learn from the three most recent winners of the Australasian Real Estate Institutes’ Auctioneering Championship? This is a rare opportunity to be up close and personal with three of the modern legends of auctioneering:
• Saturday tour of Melbourne auctions
Mark Sumich Winner 2007 & 2008
• Tour dinner – evening 17 September
Phil McGoldrick Winner 2009
Cost: $995 REI Members $1095 non-Members
Jason Andrew Winner 2010
Also presenting is professional voice coach, Jenny Kent. Jenny has over 10 years’ experience in helping actors, presenters, journalists and auctioneers find their voice and use it in the most effective and productive way. The Auction Master Class can be taken as a stand-alone option or included with the Delegate Package. Stand-alone cost: $450 REI Members $550 non-Members
For more information visit www.reiv.com.au or follow us on Facebook
AUCTIONEERING CHAMPIONSHIPS WHO WILL BE THE BEST AUCTIONEER IN AUSTRALASIA? The NAB Australasian Real Estate Institutes’ Auctioneering Championship will be held in Melbourne between 19 and 21 September. Neil Laws, Chairperson of the Steering Committee, said that this is the most prestigious auctioneering competition in Australia and New Zealand. “The competitors represent the most professional, skilled and entertaining auctioneers that each state and New Zealand has to offer.” “Over two days they will compete to determine the best auctioneer in Australia and New Zealand.” “To win, the auctioneer needs to conduct an auction that is both technically perfect and entertaining,” Mr Laws concluded.
The winner last year was Jason Andrew from Queensland. The 2011 competitors are: • Victoria – Matthew Young and Adrian Butera • Queensland – David Treloar and Les Moriarty • South Australia – Michael Fenn and Nick Baranikow • Western Australia – Frank Lawrence and Rob Mason • Tasmania – Blake Shepherd • New South Wales – Peter Matthews and Charlie Powell • ACT – Jason Roses and Tim Burke • Northern Territory – TBA • New Zealand – Mark Sumich and Andrew North.
JOIN THE STUDY TOUR TO MELBOURNE
_________________ To coincide with the REI Australasian Auctioneering Championships, a Melbourne study tour has been organised. Prices for the delegation are below: Auction Study Tour Package • $995 for REI members • $1095 for non-members If you would like to find out more, please contact Erin Livingston on (03) 9205 6604 or email elivingston@ reiv.com.au.
MANDATORY DISCLOSURE OF EERS: REIA PUTS FORWARD SUBMISSION The Real Estate Institute of Australia (REIA) has put forward a submission to the Consultation Regulation Impact Statement (RIS) on Mandatory Disclosure of Residential Building, Energy, Greenhouse and Water Performance.
assessment through to a checklist approach and a voluntary scheme. It also considered the options of disclosure at point of sale only versus point of sale and lease.
In July 2009, COAG agreed to introduce a national home environmental rating scheme. The scheme would require homeowners that sell or rent houses and apartments to provide information to prospective buyers and renters about the energy, greenhouse and water performance of the home.
“REIA’s position challenges the premise of the RIS...”
The RIS modelled six options – from technically detailed
REIA’s submission supported Option 5; a non-regulatory approach across all jurisdictions, with the implementation of national licensing for the real estate profession just over 12 months away from October 1.
REIA’s position challenges the premise of the RIS; that Energy Efficiency Ratings (EERs) are important to consumers at the time of sale or lease. The current practice of disclosing EERs in the
ACT tells us this is not so. A non-regulatory approach means consumers and real estate agents will not carry the unnecessary burden and costs of mandatory disclosure of EERs. REIA will continue to keep the profession up to date with outcomes. To obtain a copy of the REIA’s submission to the Consultation Regulations Impact Statement on Mandatory Disclosure of Residential Building, Energy, Greenhouse and Water Performance, click here.
JUST TICK AND FLICK TO CHANGE BANKS Last month, the Government announced a new ‘tick and flick’ initiative which will give Australians the freedom to switch deposit accounts with the stroke of a pen. Treasurer Wayne Swan said the changes will make it much easier to walk down the road and get a better deal. The new ‘tick and flick’ service will remove the burden of having to change the details of automatic debit and credit transactions.
DO YOU HAVE THE MOST UP TO DATE PROPERTY STATISTICS?
__________________ TO SUBSCRIBE, CONTACT PETA MOORE ON 02 6282 4277 OR AT PETA.MOORE@REIA.COM.AU FOR FURTHER INFORMATION.
Instead, customers will sign just one form that authorises their new financial institution to do all the heavy lifting for them. Mr Swan also announced the introduction of a mandatory one-page fact sheet to help consumers understand the costs and benefits of lenders’ mortgage insurance when they take out a home loan.
Mr Swan released the report, Banking Services: Cost-Effective Switching Arrangements, and accepted the recommendations in full. The report can be found at http://www. bankingreforms.gov.au.
REIQ.COM The Australian property market has earned a new star.
REIWA.COM The NABERS rating scale now extended to 6 stars. NABERS is the industry standard for measuring the environmental performance of Australian buildings, helping building owners and tenants make real reductions in environmental impacts and running costs. Now the bar has been raised higher. Buildings may now qualify for 6 stars, recognising them as market leaders with 50% lower emissions than a 5 star building. It’s a big advance for the property industry and a great win for our environment.
For more details, visit nabers.com.au
PORTABILITY OF BANK ACCOUNTS: FROM JULY 2012 A report released in July by the former Reserve Bank Governor, Bernie Fraser recommends a process that will lead to account portability of an individual’s bank accounts – deposit accounts and mortgages - by filling in one form with their new institution. The scheme is expected to commence in July 2012. Mr Fraser was asked to conduct a comprehensive feasibility study into the issues surrounding Australia’s progress towards full account feasibility and options for providing greater transferability
for customers. The study was a component of the Government’s Competitive and Sustainable Banking System package announced in December 2010.
carry all their automated transactions to the new institution, would be far too expensive. It was “akin to taking a gold sledge hammer to crack what is really quite a small nut.”
“Mr Fraser was asked to conduct a comprehensive feasibility study...”
The major obstacle to full portability using a unique identifier was Australia’s branch identifier-based system (BSB numbers) and the existing account number issuing practices.
The Government’s presumption was that improved arrangements for account switching would encourage competition among financial institutions and lead to lower prices and other benefits to consumers. According to Mr Fraser’s report implementing full portability, where a customer could take a unique identifier that would
“The Government’s presumption was that improved arrangements would encourage competition...”
This article is brought to you by REIA Manager Policy, Jock Kreitals. Jock can be contacted at firstname.lastname@example.org
While BSBs were unique, individual account numbers were not necessarily unique identifiers.
wanting to switch.” The report noted that the 6000 switches since 2008 under that scheme “has been miniscule”.
The scheme recommended by Mr Fraser and endorsed by the Treasurer will require customers to fill in just one form and lodge it with their new institution rather than the one they are leaving. The new institution would also inform associated creditors and debtors of the new account details.
”The proposal replaces a bank switching package introduced in 2008...”
The proposal replaces a bank switching package introduced in 2008 which was considered by Mr Fraser to be “fundamentally flawed” as it “relied on the old bank, the losing bank, to play the game and assist the customer to quickly move to another bank. And it was bureaucratic and cumbersome for customers
A Working Party, to be lead by the Treasury, will consult with stakeholders to resolve the many details that remain to be settled so that the new arrangements can be implemented and be operative by 1 July 2012.
NEGATIVE GEARING: AND HOUSING INVESTMENTS In conjunction with other property tax arrangements, negative gearing is perceived by some as a distorting factor that favours housing investment.
declined to 5.4 percent of the GDP from 10.0 percent in the September 2003 quarter. During the same period, commercial finance as a proportion of GDP also declined from 33.5 percent in the September 2003 quarter to 26.4 percent in the March
It is often argued that the presence of tax expenditures such as the capital gains tax exemption of the family home, non-taxation of imputed rent, the exemption of imputed rent from the GST, and the ability of property investors to deduct rental losses from other sources of income, generate a misallocation of investment toward less productive assets such as housing.
Housing investment as proportion of GDP, % September quarter 2003 - March quarter 2011
Nevertheless, housing investment as a proportion of gross domestic product (GDP) has been declining since the September quarter of 2003. In the March quarter 2011, the share of housing investment
Source: ABS 5609.0 Housing finance, REIA calculations
2011 quarter. Although both commercial finance and housing investment decreased during this period, there is no evidence of over-investment in housing. The decrease in housing investment has affected vacancy
rates and has intensified the shortage of housing. Any attempt to remove negative gearing, therefore, would only aggravate dwelling supply problems. Vacancy rates decreased across Australia during the last decade and almost all capital cities had rates below the 3.0 percent market benchmark in the March quarter 2011. The National Housing Supply Council (NHSC) estimates the dwelling supply-demand gap was 202,400 dwellings in 2010 and will increase steadily in the next thirty years. Despite the absence of evidence on housing over-investment, negative gearing is unfairly cited as the cause of the sharp increase in property prices. Particularly during the last decade, when house prices increased around 140 percent, arguments against negative gearing grew in number. The property price boom issue,
however, is mostly attributable to the pronounced inflexibility of housing supply to respond adequately in periods of high immigration, low interest rates, and favourable economic conditions. The land release and development processes, including residential development taxes, fees and charges hinder supply to respond flexibly to demand. The NHSC estimates that a greenfield residential development started in 2009 will generally take between 6 and 15 years to progress from raw land made available for urban use to dwellings for sale in a new suburb. The Productivity Commission has observed that planning systems across Australia suffer from ‘objectives overload’ which affect the delivery of timely decisions by local councils.
FAREWELL TO JOHANN
_________________ The September edition of REIA News is the last article that will be published by REIA’s Johann Rojas as he moves on to a new position within the Department of Innovation in Canberra. The REIA would like to wish Johann well in his new endeavours and thank him for his contribution to the organisation and to REIA News.
Industry news from around Australia
ACT - REIACT appoints new general manager The REIACT has appointed Ms Penny Lithgow as the new general manager of the institute. REIA would like to congratulate Ms Lithgow on her appointment. _________________________
NSW - Government makes changes to stamp duty From January 1, first home buyers will no longer have their stamp duty paid by the state government unless they buy a newly constructed home. The measure was unveiled by Treasurer Mike Baird in the Coalition’s first budget in office, in order to get savings of $1.1 billion over four years and in an
attempt to stimulate new housing construction. The change to stamp duty arrangements in NSW will now cost the average home buyer (buying a home up to the value of $600,000), an additional $20-$30-000 in stamp duty; this decision comes after seven years of first homebuyers receiving the exemption. _________________________
QLD - REIQ.com launched Queensland consumers now have easier access to REIQ accredited agencies and their property listings, following the launch of the new-look reiq.com this month. The REIQ has spent the past 12 months updating its website to better assist consumers and its members with reiq.com now
featuring more consumer information, more property data for suburbs across the state, and – for the first time - residential and commercial property listings by REIQ accredited agencies. For further information, click here. _________________________
WA - New anti-theft laws for property The Western Australian government has introduced new rules that aim to better protect land owners against property theft after a number of recent property fraud cases in WA, one of which involved the sale of a property without the owner’s knowledge. For further information, click here.
Making News General national news
Business growth stagnates The Black Ink® survey of small to medium accounting and legal practices has revealed a stagnation of business growth amongst SMEs, with only 3.8% of respondents saying their clients’ had experienced business growth during the preceding three months, down from 45.1% in June 2010. Partner and National Leader of Deloitte’s Black Ink® program, Neil Cussen, said the result showed the middle market was struggling and that the road to financial recovery could take longer than expected for some sectors of the economy. SMEs are increasingly coming under pressure from a range of international and domestic economic influences - sovereign debt issues, falling consumer
sentiment, increased regulatory changes at home and the spate of natural disasters have all conspired to have a detrimental impact on many businesses. For further information, click here. __________________________
The first consumerowned bank This month it was announced that Australia would have its first consumer-owned bank. Australians can now choose to be part of the nation’s first customer-owned bank bankmecu. Incoming bankmecu CEO Damien Walsh said mecu Limited - one of Australia’s largest and strongest mutual financial institutions - would today adopt the new trading
name bankmecu, after receiving permission from APRA and the RBA to call itself a bank. “By being a bank we believe we can compete with the big banks on their own turf, while retaining our unique customer ownership,” Mr Walsh said. bankmecu will continue to offer customers a more responsible approach to banking. For further information, click here. _________________________
SBCC/ACCC survey The Small Business Consultative Committee and the ACCC are conducting a survey in relation to small business engagement with government. If you are able to participate, please email Andrew Conway by clicking here.
Information and news from government
ASIC releases new exit fee guidelines This month, ASIC released a new version of Regulatory Guide 220 Early Termination Fees for Residential Loans: Unconscionable Fees and Unfair Contract Terms (RG 220). The updated guide takes into account the effect of the National Consumer Credit Protection Regulations 2010 which prohibit termination fees for residential loans, subject to some exceptions. The effect of the regulations on RG 220 is that the RG 220 is now only relevant to credit contracts for residential loans: with early termination fees, that were entered into before 1 July 2011, or that contain early termination fees which are not prohibited by the regulations (eg break fees).
Government moves to protect tenants as well as property owners The ACT Legislative Assembly has this month passed a Bill that will help property owners protect their investments and provide greater rights to tenants to prevent unfair listings on residential tenancy databases, Attorney General, Simon Corbell said, “This legislation clearly sets out what breaches of a residential tenancy agreement can result in a former tenant being listed in a database, providing the tenant with greater protections against an unfair listings.” “The new laws also clarify how a person who has been listed can have the listing amended or removed, consistent with the Commonwealth Privacy Act provisions.”
This Bill also introduces new requirements on real estate agents and lessors to disclose to tenancy applicants the details of any databases used by the agency or the lessor, and to inform a tenancy applicant if he or she is found in a tenancy __________________________
New online tool gives the facts about land and housing supply WA Planning Minister John Day launched a new online application which is a one-stop shop for land and housing supply statistics. Mr Day said the new Urban Development Program Online: State of Land and Housing Supply combined information from industry and government to provide a clear picture of the planning and development pipeline that any individual
Information and news from government
organisation could not produce in isolation. It is important that people have access to the correct and latest information so they can make the most informed decision before they buy a residential lot or a house, he said. For further information, click here. __________________________
Battellino’s speech to The Economist’s Bellwether Series An audio webcast and downloadable MP3 file of Mr Ric Battellino’s speech to The Economist’s Bellwether Series titled The RBA’s Thinking on the Economy Over the Past Year are available on the website . To download the files, click here. __________________________
Small business to receive cash flow benefit Australia’s 2.7 million small businesses will benefit from a package of tax law amendments that will improve cash flow and reduce compliance costs by simplifying the small business depreciation rules. The Assistant Treasurer, Bill Shorten, and Minister for Small Business, Senator Nick Sherry, yesterday released for public consultation exposure draft legislation and explanatory materials for the amendments. The Exposure Draft and related material is available by clicking here. __________________________
Analytical Living Cost Indexes for Selected Australian Household Types The ABS has released the Analytical Living Cost Indexes for Selected Australian Household Types publication. This ABS publication presents analytical living cost indexes for selected Australian household types. These price indexes are designed specifically to measure the impact of changes in prices on the out-of-pocket living costs experienced by four household types; employee households, age pensioner households, other government transfer recipient households and self-funded retiree households. For further information, click here.
Property news from around the world
FR: French market bubbly According to the Wall Street Journal, The French residential real-estate market has withstood the euro-zone financial crisis, but some economists and market professionals warn that it shouldn’t necessarily be seen as a haven of guaranteed returns, far from financial market turmoil. France’s housing market has stood out over the past few years. As Spanish and U.S. real-estate markets collapsed following the fall of Lehman Brothers Holdings Inc. in 2008, French house prices fell only slightly and not for long. Prices quickly began to recover at the end of 2009, led by a surge in Paris. Prices for existing homes began to fall in the third quarter of 2008, data from national statistics agency Insee shows. Using the
fourth quarter of 2000 as a base, Insee’s index hit a low of 188.7 in the second quarter of 2009 and rose above pre-Lehman highs in the fourth quarter of 2010. The provisional reading for the second quarter of this year is 215.4. ___________________________
CH: China’s overhang poses problems Forbes magazine says that China’s overhang of an estimated 28 million unsold property units following a building boom represents a “very real” problem in its economy. The Chinese surplus – which is about four times the number of unsold units on the market in the US – will be more difficult to resolve because American real estate is more affordable for buyers.
Reducing the overhang will be a “great challenge” facing China’ s government in the future __________________________
IN: US’s Mumbai properties According to The Times of India, The US government has given its consulates the nod to consolidate their real estate across India, estimated to be worth around Rs 5,000 crore. The consulate put up sale notices on two prime properties estimated to be worth Rs 1,000 crore: the sea-facing Lincoln House at Breach Candy and the three-storey Washington House at Altamont Road. The annoucement reportedly has the real estate industry buzzing with excitement.
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