| Friday 17 June 2011 Brace yourself for a grand cause  IT IS winter and cold, a downtime in your garden, but there is plenty of work to do in preparation for spring-summer. 1. Affordability improves
Housing became just a little more affordable in the early months of this year, according to a report released this week by the Real Estate Institute of Australia (REIA). The REIA Deposit Power Housing Affordability Report for the March 2011 quarter shows a small improvement of 1.1 per cent in the level of housing affordability over the quarter. REIA President David Airey remarked, however, that the news not good enough to get excited about. "What needs to be highlighted is that the reduction in the proportion of family income required to meet loan repayments is explained by a decline in the average monthly loan repayment of 1.9 per cent and an increase of 1.2 per cent in the median family income over the March quarter," David Airey said. Over the year, the level of affordability in Australia declined with the proportion of income to meet home loan repayments increasing 1.6 percentage points. New South Wales remained the least affordable state or territory in which to own a home, with the proportion of income required to meet loan repayments decreasing to 37.2% - 3.0 percentage points above the national average. "The Australian Capital Territory has now been the most affordable state or territory in which to own a home for over five years and New South Wales has held its position as least affordable for more than fifteen years," Mr Airey continued. Despite the improvement in housing affordability in the first quarter of 2011, the total number of loans continued a downward trend that has been observed since the June quarter 2009, reaching the lowest quarterly level seen since the March quarter 1999. The number of loans to first home buyers continued to decline, bringing the participation level of first home buyers in the market to the lowest quarterly level since September 1994. "The slight improvement in affordability over the quarter is positive but a lot more still needs to be done to make owning a home in Australia achievable," concluded Mr Airey. 2. Appreciating depreciation at tax time As the end of another financial year rapidly closes in on us, property investors are being advised to make note of all the relevant tax deductions that can be claimed, such as depreciation and `wear and tear' of the property. Property related expenses that can be claimed at tax time include: - Interest Bradley Beer, a Quantity Surveyor* from BMT Tax Depreciation, says that he is still coming across investors who are not claiming depreciation deductions. "Unfortunately, depreciation is the most commonly missed deduction because it is a non cash deduction - the investor does not need to spend money to claim it, however it can still be claimed", Mr Beer said. "It is incredibly important that investors understand the `ins and outs' of property depreciation in helping to achieve additional cash flow for their investment property", he added. The following points need to be considered by every property investor: As a property ages, items within it depreciate in value and the Australian Taxation Office (ATO) allows property investors to claim tax back for this depreciation. Any owner of an income-producing property can make this claim, Beer says. The same goes for a building's structure, which wears out over time and therefore that loss can be claimed. This is commonly known as `building write-off'. Every owner of an investment property, new or old, commercial or residential should be claiming the maximum depreciation entitlements. *Specialist depreciation focused Quantity Surveyors prepare Capital Allowance and Tax Depreciation Reports for investors outlining deductions available per financial year for 40 years. Mr Beer added that a Capital Allowance and Tax Depreciation Report can also be submitted in retrospect, to allow a property investor to recover missed depreciation benefits by amending previous tax returns. Obtaining a property depreciation report from a specialist Quantity Surveying firm is important to ensure that investors are claiming all of the items they are entitled to, and not claiming anything they shouldn't be claiming. "This will keep their accountant and the ATO happy", Mr Beer concluded. 3. Housing finance lifts
The building industry welcomed housing commitment data this week showing a rise in April in the number of loans for construction or purchase of a new dwelling. Figures released by the Australian Bureau of Statistics show that loans to buy a new dwelling increased by a healthy 8.9 per cent in April 2011, while lending to build new homes posted a relatively flat result (0.4 per cent). In seasonally adjusted terms, the number of loans for new housing in the month of April 2011 improved by 2.0 per cent in New South Wales, by 3.8 per cent in Victoria, 9.3 per cent in South Australia, 4.3 per cent in Western Australia, 13.3 per cent in Tasmania, 18.0 per cent in the Northern Territory and 30.4 per cent in the Australian Capital Territory. Queensland was the exception to the broad-based monthly improvement where loans fell a further 5.7 per cent. It was a different story over the three months to April 2011 where in seasonally adjusted terms the number of owner-occupier loans for new housing fell across all states and territories. New housing loans fell by 11.9 per cent in New South Wales and were down by 13.1 per cent in Victoria, 3.7 per cent in Queensland, 9.1 per cent in South Australia, 8.1 per cent in Western Australia, 6.1 per cent in Tasmania, 5.8 per cent in the Northern Territory, and 9.8 per cent in the Australian Capital Territory. Peter Jones, Chief Economist for peak building and construction organisation Master Builders Australia, remarked that the bounce in finance in April may be a precursor to a resumption in the much-needed housing recovery. "The housing finance numbers show that the decline suffered in 2009-10 has been arrested, but given the headwinds, the pace of recovery will be slow", he cautioned. 4. Freedom from fear As a nation, Australia is often known as the friendly neighbour. As individuals we're always happy for a chat, willing to lend our possessions and welcome people into our homes. Australia accepts and assimilates numbers of refugees every year, helping people from troubled countries forge new lives in a safer environment, and although it happens frequently, it's easy to have it be a fleeting news headline without any understanding of what that actually means. When refugees flee, they are forced to abandon everything they know, often becoming separated from family members and belongings, being left with little or no money. This coming Sunday marks the start of Refugee Week (June 19 - 25), coinciding with World Refugee Day (June 20), where a focus is drawn to the positive contributions made by refugees to Australian society. Refugee Week aims to educate the Australian public about who refugees are and why they have come to Australia, helping people to understand the many challenges refugees face coming to Australia while celebrating the contribution they make to our community. This year's theme, "Freedom from Fear", hopes to draw attention not just to the fear that compels refugees to run, but the relief they feel when they are welcomed into another country and given the opportunity to rebuild their lives. For further information and events details, visit www.refugeeweek.org.au. 5. A lamp that rocks
Taking that comforting motion, design group Young & Battaglia have created a range of lights to relax any room setting. Made from Beech wood stands and white cotton shades, Rocking Lamps are just as the name suggests - a lamp with the body of a tiny rocking chair, so they function both as a steady and gently moving light sources. 6. High sights for the future Good news for anyone who shared a dream of going to space when they grew up. Real estate developer Robert Bigelow has been working away furiously so that you have somewhere to stay when you get there. Forbes magazine recently ran an article on the entrepreneur, who operates Bigelow Aerospace from the Mojave Desert near Las Vegas in the US. Having made a personal fortune in previous years through his own chain of hotels, Bigelow has since turned his sights sky high and beyond. The high-tech, low-cost inflatable space stations he's developing will one day be, if things go to plan, orbiting hotels 367km above sea level. Inflatable space habitats may sound far fetched, but Forbes reports the technology is real - Bigelow's prototypes have been orbiting Earth since 2006. By 2016 Bigelow expects to have a fully functioning station in orbit, ready for tenants. Prices are said to start at $28,750,000 per astronaut for a 30-day tour. |
For newborns, octogenarians and most of us in-between, there's something inherently comforting about the motion of gently rocking back and forth.
