Newsletter 20 - Save The Date, CoreLogic HVI, Tax Deadline, Expat Borrowing Power, RBA Interest Rate Rise.
Save the Date
Director of Australian Expatriate Finance and TE Mortgage Specialist Adam Kingston and Head of Accounting at Stanford Brown Dean Crossingham will be in Singapore, Dubai and Abu Dhabi.
Singapore
Thu, 27 Oct 20229:00 am Sat, 29 Oct 20225:00 pm
Dubai and Abu Dhabi
Sun, 30 Oct 20229:00 am Wed, 2 Nov 2022 5:00 pm
Topics for Discussion
Australian Budget is announced
Headwinds and Tailwinds
Changes to the Tax system
Australian Interest Rates - How high will they go?
When to buy, key factors affecting borrowing capacity for Expats.
Controversial 45-Day Tax Rule for Australian Expatriates
Discuss the significant, proposed changes to Australia’s tax residency laws.
Your Questions Answered
This is your opportunity to pick the brains of industry experts.
Register Your interest Visit Our Contact Page.
CoreLogic Australia has released the September Data for the Home Value Index Report
Housing Value declines have eased in September, according to the CoreLogic Home Value Index September report. The spring season saw a national Home Value Index (HVI) decline of -1.4% in September, this shows there is an easing of the rate of decline from a -1.6% fall in August.
Tim Lawless, Executive, Research Director, Asia-Pacific
CoreLogic’s research director, Tim Lawless, says it is probably too early to suggest the housing market has moved through the worst of the downturn. “It’s possible we have seen the initial shock of a rapid rise in interest rates pass through the market, and most borrowers and prospective home buyers have now ‘priced in’ further rate hikes. However, if interest rates continue to rise as rapidly as they have since May, we could see the rate of decline in housing values accelerate once again.”
Tim Lawless CoreLogic Australia, Executive, Research Director, Asia-Pacific
This week we saw the fifth consecutive rise in interest rate rises since May, to now being 2.6% however, we saw an easing in the aggressive action the RBA has taken to help limit inflation and the RBA raised interest rates by .25% with the total Cash Rate Increase this year thus far being 2.5%.
How high will interest rates go? We can ask our Mortgage Specialist Adam Kingston from Australian Expatriate Finance. Adam wrote a blog on the 14th of September, here is a snippet below;
What is interesting is where fixed rates are currently. This morning (14th September) I looked at the rates of one lender (which is a good representation of where most are at) and noticed something quite unusual, something that I don’t recall ever seeing before.
The rates I on offer from a lender (fixed rates for an Investment loan) are:
1yr = 5.54%
2yr = 5.44%
3yr = 5.29%
It's not often you see a 1 yr higher than a 2 yr that is higher than a 3yr rate!
Hopefully, this is an indication there is positive news ahead.
This brings us to Adam’s next blog;
When to buy, key factors affecting the borrowing capacity of an Aussie Expat?
The first factor is interest rates. Interest rates affect the cost of the loan; when applying for a loan, the lender will apply a cost to the debt; the cost is governed by the actual rate of the loan PLUS a notional buffer of 2.75 to 3% on top of the rate.
The second factor that I’d like to highlight is currency exchange rates. As you will have seen, over the past number of months, the AU$ has dropped against the US$, now with many of the Expat currencies pegged to the US$, this has had the effect of increasing the value of your income!
From a borrowing perspective, this is a definitive win!
If we go back to 6th April 2022, before the interest rates started to rise, the US$1 was buying AU$1.31. However, the value of the AU$ has dropped against the US$ over the past six months, and today the same US$1 is now buying AU$1.57 (27th September 2022), that’s an increase of almost 20%!
So, what does this all mean?
Claim Every Dollar and beat the October 31 Tax Deadline
Our Tax Depreciation Specialist Bradley Beer wants us to remind our Australian Expatriate Community that the dreaded October 31st Tax Deadline is just around the corner. It’s time to get a head start on your tax for 2022-2023 and finalise your tax for 2021 - 2022 period. If you need assistance with your Tax Depreciation for your investment property, reach out to Bradley and the BMT Tax Depreciation Team.
The Expatriate always tries to make sure all information is accurate. However, when reading our website, please always consider our Disclaimer policy.
