Recently there’s a new development which I thought ought to be mentioned as given the price points and location, it is good value for money and may suit you if you are venturing into Aussie property investment for the first time and looking for something that will settle within the next 12 months.

Craigieburn is a suburb situated 24km north of Melbourne CBD. Central Park Terraces is located within a delfin lend lease masterplanned community under the Melbourne 2030 Urban Growth Boundaries. If you are familiar with Delfin, you would know they are one of the best in the field of planning for a community. Of course when there’s Delfin, there’s a lake. As far as Central Park Terraces are concerned, there is a fantastic lake and only a cluster of townhouses are facing the lake and these are to be completed by April 2009. Imagine your tenant inspecting your homes, I couldn’t see why they would reject signing a year lease or more to secure their tenancy.

A check with real estate agents and on the internet showed homes in the area asking for $310-340 per week, so it is quite safe to say these townhouses will be rented out between $320-$330 per week when they are completed next year. Only 10 left up for grabs, and no surprises for guessing who bought up so far - Australians….because they knew where the value lies.

If you want more information about how these can fit into your investment portfolio, please email me at info@pagreal.com

Lately, some Aussie property investors asked me if it is advisable to take out a loan in SGD since the AUDSGD has plunged to below 1.0000 on several occasions. It remains to be seen if the AUD will rebound in the short term. Analysts from major banks and even bloomberg has given some indications and as far as I am concerned, I feel there is still pretty much a lot of uncertainty in the market.

To make an objective statement; if you are savvy with how financing in an alternative currency works and you are confident of keeping a close watch on the market and you have strategies to know when you should switch, then go for it. If you are a professional who is busy with daily work routines and meetings, the last thing you want is for the banks to call you for a margin call.

Banks in Australia has taken some initiative to safeguard their position given the volatility of the market. e.g. some banks have lowered their LVR to 65% in the light of the AUDSGD fluctuations. This is strictly for residential properties only.

If I am first time investor, I would settle my property with 75% LVR in AUD. With an expected rate cut in Nov by another 50 basis points, interest rate is coming down. There is very little risks since AUD has taken a dive and with a weakening global economy and weak commodity price, it is quite prudent to take up an AUD loan. Once the dust settles, I would switch at an appropriate time. I cannot be more conservative….

I have written an ebook to help some of investors to tide through this period with some strategies. It’s the first version and at the time of writing this blog post, I am already preparing for second version of the ebook. If you wish to know more about the opportunities and risks involved in multi-currency loans, do drop me an email with your name.

I will advise the steps accordingly so that you can download the ebook.

Over the last two weeks, I have got calls from investors who asked if there were any projects worth investing in. Here’s something that I think would suit an investor who are looking at the following:

1. Portfolio builders looking at settlement time of about 24 months
2. You have average to good BC and looking to expand your portfolio
3. A great deal - prices quoted in this development are as if they are completed today! (drop me a line or two if you don’t believe!)

Situated on the southern side of Victoria Street and surrounded by famous Victorian reserves, this development consist of 4 four storey buildings of which only 2 are released at the stage. All units have sensible floor plans and are bigger than normal specs of 1 and 2 bedders that are seen in the market.

In my opinion, it’s a development where prices are spot on (at today’s completed prices) and the combination of good usage of space and sensible layout make it even more attractive for investors and own-occupiers alike.

For more information, you may drop me an email.

Australian bank deposits will be protected during the global financial crisis, Prime Minister Kevin Rudd said, while Opposition Leader Malcolm Turnbull called for an expansion of the proposed government-backed deposit guarantee scheme.

The Australian Prudential Regulatory Authority (APRA), which supervises deposit taking institutions, would ensure bank balance sheets were in good condition, he said.

“We are different to banks around the world, our banks are in a strong position,” Mr Rudd told reporters in Sydney today.

He said Australians had long had access to a “depositors first scheme”.

“If ever any bank got into trouble at any time, the depositors would have first recourse,” he said.

Mr Rudd said the Australian government put forward a proposal for a new financial claims scheme some months ago, before the financial crisis.

“Once that’s concluded, very soon we will be introducing legislation for a new financial claims scheme,” he said.
Mr Turnbull said the government should expand a proposed government-backed deposit guarantee scheme to cover savings of up to at least $100,000 per depositor - up from the planned amount of $20,000.

He also wants investment in AAA-rated Residential Mortgage Backed Securities to be raised to at least $10 billion, more than double the government’s proposed $4 billion investment, to boost confidence in the local housing market.

“We are dealing with great economic changes, and they call for leadership and they call for action and they call for decisions,” Mr Turnbull told reporters at his Sydney office today.

“We are proposing three actions the government can take immediately which will strengthen the Australian economy in the face of this economic crisis and add confidence to Australian householders and Australian business.”

One of those steps would be to announce a delay to the start of an emissions trading scheme in Australia, he said.

Article extracted from Sydney Morning Herald, www.smh.com.au

The Aussie dollar gave me a big heart attack today. The AUD nose dived against SGD by at least 1000 basis points from yesterday. My phone was flooded with calls from investors who are on SGD loan. They were all concerned about banks asking for ‘top-ups’.

My advice is first calm yourself down. If you have some spare cash, buy some AUD. If you are asked for top-up, take it as a sum of money tucked away for fixed deposit (interest rate is still pretty good). Given the financial turmoil, lots of ‘technical analysis’ went beyond logical explanation. Supports and resistance may no longer be effective indicators right now. Brace yourself and see the ‘opportunities’ availabe instead of focusing on what went wrong.

It will take a while before the market ‘decides its direction’. I would have posted the 1hr AUD/SGD candle if I have access to it. You will see the the ‘dramatic dive’. In any case, property is a long term investment, so to all Aussie property investors - don’t panic and stay cool…I’ll be buying more AUD if the rate stablizes tomorrow.

In what was a surprise to everyone, the Reserve Bank of Australia(RBA), they have announced a 1 per cent rate cut at 2:30pm today to lower the Federal cash Rate to 6%. At the time of writing this post, none of the big 4 Australian banks have decided if they will pass the interest savings to consumers.

It is the single biggest rate cut since May 1992.

The RBA is clearly forwarding looking. In light of what’s happening in US and Europe and the worsening of the financial crisis, the last thing the central bank wants is to go through the nightmare their counterparts in US have gone through. I applaud their bold decision. With borrowing costs reportedly to have increased ten times, this piece of news couldn’t have come more timely. Let’s see what happens next…

The AUD/SGD has nosedived to 1.0650 spot at 10:05am (GMT+8). It means it is cheaper now to acquire Aussie properties. On the other hand, those with SGD loans, do watch out for calls from your RM for top-ups for your loans.

If your Australian property is due for settlement anytime now, I suggest you set aside more funds for any extra equity. This post couldn’t have come at a more appropriate time. Valuers in regional areas have valued properties so conservatively that investors are forced to inject more equity because the values just didn’t stack up to purchase price. One of my good mate in Gold Coast has stayed away from these areas because the values just won’t hold. Now having said that, I don’t necessarily agree with what the valuers have done. Anyone who does developments would know the level of replacement cost and how the purchase price. Unfortunately that’s not how the valuers see it.

Banks have panel of valuers, internally and externally. I suspect banks have issued a ‘warning’ sign to these valuers about being too overly liberal over values of new properties. Some of the cases I have seen are outrageously ridiculous.

Last two weeks, I was completely pissed with a long time friend cum investor. In my own capacity, I have done whatever I could to help him out and he has the audacity to point his fingers at the credit crunch at me. I was so pissed that I raised my voice. I am fiercely competitive and I don’t deal with mediocre investors who don’t understand what’s going on in the market place. He maintained his own opinions but unfortunately the market has changed and he reacted too slowly. In short, he did himself in. It will the last time I deal with jackass like him. Call me an arrogant guy and I admit I am. I have done nothing against my conscience. I am not in the business to please people. Those who value who I do, thank you very much! Those who don’t, please piss off…I mean it! Get the hell out of my life. I don’t have to deal with people who hang on to their ideals, oblivious of what’s going on in the world…

I should stop all these nonsensical thoughts because it’s not going to help the cause at all. I am passionate about property investing and I am even more passionate about my investors. Like my forex guru and great pal, Koon Lip believes, we are the BEST in our business. I want to thank all of you who has given me support, emotionally and professionally. I couldn’t have gone this far without you…

Beat the market because if you don’t, the market will beat you!

What a week it has been for the world at large. Australia reported a drop in $63bn worth of shares since the request by the US government for a $700bn bailout for all its troubled entities has been rejected.

Analysts have expected the RBA to cut rate by 50 basis points as soon as next Tuesday. However Treasurer Wayne Swan has warned homeowners that banks may not follow suit following a global credit crunch and increased borrowing costs. The bank of England is also tipped to cut rate the current 5% when it meets next week.

How the rate cut is going to impact the Australian economy remains to be seen. Whilst the tight financial market, share market losses and low housing affordability were spurning a downturn in the Australian housing market, the fundamentals remain strong with population growth in capital city like Melbourne experiencing unprecedented levels of population explosion. In the year to August, building approvals fell 8.6%, which was the biggest annual decline since May 2006, one can expect the rental market to remain strong.

I am excited by the opportunities that is coming up. Keep yourself updated by bookmarking this page or subsribing to RSS feeds. The challenge is to be able to spot opportunities others can’t see…don’t get to cloud out by negative sentiments…