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Loan Fundamentals – How to get the best deal for less without using math

If you’re beginning to venture down the road to independence, chances are high you’ll have to take out a loan at some point. Did you go to college? You probably have student loans! Further down the road, you’ll encounter car loans and home mortgages at some point too. But, don’t fear. Loans don’t have to be scary. They’re not Sharknados or pizza rats. They’re just loans and they’re easy to understand when you break them down to their basic principles. Whichever loan you choose will be easy to payback if you do your homework.

INTEREST RATES

This is how lenders make their money. There are two types of interest rates: fixed rates and variable, or adjustable, rates. They’re called this because they change (yes, kind of like an adjustable hat).

  • Fixed rates — Fixed rates never change. If your fixed interest is at 5%, it will remain at 5% for the duration of the loan. These loans are preferable because you’ll likely know what you’re getting into from day one and there are no surprises like waking up to find your cat using your TV as scratching post. When taking out a student loan, or any major loan, look for low fixed rate loans. Popular student loan programs like Stafford and Perkins have low interest rates, and the government pays the interest on subsidized Stafford loans and Perkins loans while you’re in school.
  • Variable rates — Variable rates change over time and are based on a standard market rate. These can be enticing because the initial interest rates can be very low. Keep in mind that they will fluctuate and as a result, your payments will vary. Variable rates may be presented to you at a smaller percentage and then rise over time. In general, keep an eye out for predatory loans and move on from them quickly like a bad wine.1

SECURITY COMPONENT

Loans are considered secured or unsecured. One requires collateral before you borrow. The other does not.

  • Secured loans — A secured loan means you have guaranteed that your lender will be repaid no matter what. This usually means you’ve given your lender permission to take specific assets of yours if you default or stop paying. The lender can seize any collateral offered in the loan agreement to recoup their investment. Guarantees like this allow lenders to charge low interest rates.
  • Unsecured loans — Unsecured loans for the most part have higher interest rates than secured loans. Often, the lender requires that an additional person co-signs for unsecured loans, or vows to repay the loan if the borrower cannot (time to call Mom and Dad). Luckily, student loans are collateral-free while having low interest rates.2

Paying more than your monthly minimum will reduce how much you pay in interest.

LOAN TERMS

The term of a loan is the length of time the borrower has in which to pay the loan back. Typically, longer term loans consist of higher interest rates. Remember this best practice: loans typically can be paid back before they are due without a penalty (although some loans may have a pre payment penalty). That’s right, Ace! So, if you pay a little more back than is required every month you are winning because you’re saving money on interest.

Common reasons to take out a personal loan include:

  • Consolidating debt
  • Paying off credit cards
  • Covering medical bills
  • Saving to renovate a home or apartment
  • Buying a car

Being an adult sometimes requires taking out a loan to get ahead. It happens when you’re too old to ask your parents for everything you need. It’s also empowering to make a responsible choice. Avoid the pitfalls of accepting the first loan that’s offered to you. Shopping around is essential and pay attention to the fine print. Don’t overlook any terms, and avoid borrowing more than you can afford.

MORTGAGES

When you break down a loan and take a good look at it you’ll be able to make an informed decision. This is a great skill to instill in yourself as you climb the ladder of life and begin to weigh larger purchases, like buying a home.

When you’re looking to buy a home you’re going to need a mortgage. Mortgage rates are formulated with the same basic tenets outlined above. However, there are great tools at your disposal to find one. Use this Mortgage Calculator to determine the best fit for you within your budget.

KEYS TO FINDING A LOAN

  • Loans don’t have to be scary—calculate what you can afford
  • Pay more than your monthly minimum if you can
  • Read the fine print

Proposed South-East QLD ‘Bullet Train’ – $100 million per kilometre

Exploration continues over high-speed rail connecting regional Queensland to Brisbane, however advocacy group RAIL Back on Track has quoted an ambitious high-speed rail plan for the south-east region at an astonishing figure just below $100-billion.

If the plan goes ahead you could commute from either the Sunshine or Gold Coasts to work in the Brisbane CBD in just 30 minutes.

The group’s administrator Robert Dow estimated that the Brisbane-Coolangatta section of the rail line would cost almost $30 billion including the Cross River Rail section for $15 billion.

The northern network from Brisbane to Bundaberg, including activation of the North-West transport corridor, to come at a cost of around $40 billion. Mr Dow said costings had been done at roughly $100 million per kilometre.

Other rail services across the world including a route linking Brisbane, Sydney, Melbourne and Canberra have been significantly less expensive than RAIL Back on Track’s vague estimates.

Beyond Zero Emissions an Australia-based, not-for-profit climate change solutions think-tank found that the 1799km network could be built with a total construction cost of about $84 billion.

By doing so It would open up job opportunities across the State from the south-east regions all the way to Bundy and the border. Major regional cities including Bundaberg, Gympie, Maryborough and Logan would benefit massively from the Brisbane to Gold and Sunshine coasts rail line by increased connectivity from the Very Fast Train proposal.

  • $2.5-Million business case for high speed rail network connecting the Sunshine Coast to the rest of Regional Queensland
  • Congestion Relief delivering new mobility while relieving congestion on the Bruce highway
  • 30-minute travel time between the Sunshine Coast and Brisbane
  • Elon Musk’s hyper loop will be considered in the upcoming business case
  • Employment, housing affordability would benefit massively from the network

World Renowned Hotels Lodge Expressions of Interest – Maroochydore CBD

A number of big name hotel groups have been said to be interested in developing a number of venues in the heart of the new Maroochydore CBD, announcements are to be made toward the tail end of this year as to who will be securing the designated locations.

Many leading brands have expressed a significant interest in the 1.4-hectare site located in precinct 3 according to SunCentral CEO John Knaggs. The $200-million deal could lead to the development of five super lots, including the new council chambers and University campus. It is also likely that the John Holland Group will be keep several commercial and retail spaces for future tenants.

Nothing has been set in stone yet, however negotiations continue with several hotel groups since the expression of interest opened in the core commercial precinct just a month ago.

“Confidential discussions are continuing but there is no doubt that this site has captured the attention of Australia’s business community including hotel operators,” he said.

“The new hotel will primarily be aimed at business clientele and there is widespread recognition that demand for such accommodation will grow significantly as the CBD takes shape.”

John also went on to support the expansion of the Sunshine Coast Airport would also increase international flight capacity, thus driving business travel to the region.

“Maroochydore is already the commercial heart of the entire region but the introduction of direct international flights from Asia to the Sunshine Coast will be a huge driver of business travel to our region,” Mr Knaggs said.

“We’ve seen an eight per cent increase in business travel to the Sunshine Coast in recent years and 230,000 people have attended business events in the region in the year ending March 2017.”

“All indications are that this growth will continue with improved access and infrastructure.”

Earlier this month Mayor Mark Jamieson revealed $450-million worth of development proposals had been lodged through the EOI process since the 35 blocks were taken to market.

He expects construction of the first significant stage of the CBD to start next year, and the entire project was set to include about $8 billion worth of construction over the course of the entire project.

What would you like to see in the new Maroochydore CBD?

The Developments Just Keep Coming

It is clear as day by now that the Sunshine Coast is changing, unless you live under a rock of course. However, the sandy beaches of the Coast are starting to gleam on a national level, with places like Sydney offering entry level houses at median prices of $1,080,000 it is really hard to imagine making any massive returns in a marketplace set up like that.

So moving forwards here on the coast, the investments in infrastructure really are starting to show signs of paying off. Our incredible stretch of Coastline has gone from being a destination for retirees escaping Brisbane for the weekend to now being the ninth largest Significant Urban Area in Australia by population.

With a 10.1% growth in population was experienced over a five-year period (2008-2013 the Sunshine Coast economy is one of the largest regional economies in Australia. Which is predicted to grow in a strong and sustainable pattern over the next 20 years to reach an astonishing $33billion in 2033. Closely following this trend is an increase in high-value employment, export and household income, providing an ever-expanding local workforce to meet the needs of new businesses as new investments takes place.

The changes in the region have been occurring for a number of years now, but really did begin to show since completion of the $1.8b Sunshine Coast University Hospital this year. The health hub is forecasted provide a $5.3b in direct expenditure to the local economy as well as providing 12,000 jobs upon completion. Not to mention that the Birtinya town centre is now no longer a concept, with site works under way Stockland’s neighbouring Bokarina Beach residential community is well underway.

Closely following is the new multi-million-dollar redevelopment of Kawana Shoppingworld, set to begin this month it promises to deliver what we have all been waiting for the Sunshine Coast’s very first Gold Class cinema.

Mirvac Retail plans to introduce a 6000-square metre multi-screen Event Cinema complex, complete with a VMAX and Gold Class cinema screens. Also, following this development is a new 595 space multi storey car park, as well as more casual dining tenancies and street-fronting retail stores.

Kawana Shoppingworld centre manager Claire Torkington said the redevelopment would provide about 200 new retail jobs when all stages were complete, and would also expand the centre’s offering and engage prospective tenant interest in the Sunshine Coast.

This not even scratching the surface as in Maroochydore we still have the new Maroochydore CBD on the 53-hectare greenfield site, less than 200m from Lendlease’s Sunshine Plaza shopping centre which is currently being upgraded at a cost of $350-million and will add a David Jones, 120 speciality shops and 1500 car parks.

Development is well and truly underway in the $5-billion Aura project in Caloundra South to facilitate a community of about 50,000 people. AVID Property Group have begun their $3-billion Harmony to be developed over the next 20 years at Palm view, with 4800 dwellings on 378-hectare site with its own town centre.

Arguably one of the most instrumental changes coming from the $347-million expansion of the Sunshine Coast Airport which will be providing an international gateway to the region and is scheduled to be ready for operation in 2020.

UPDATE: Whats to be included in the Maroochydore CBD town centre ?

As time ticks on, the Maroochydore CBD is beginning to take shape, a number of significant projects are being put forward in the early stages of the SunCentral town centre.

A large new Council building is being planned along with some other major projects from international developers. The Sunshine Coast Council will soon be revealing exactly what will be going on in the 53-hectare site, and this also includes the decisions being made regarding a new 15,000 square-meter city hall which would require a 10,000 square-metre as a key anchor tenant.The new building is expected to be used as a central location for all Sunshine Coast Council staff, particularly throughout the earlier stages of development of the Maroochydore CBD.

There have been multiple reports of the John Holland property group trying to secure at least 6-9 blocks within the new CBD, including the new council building.

According to the Sunshine Coast Daily the State Government is also closing in on securing a position in the CBD for new office buildings, while AVEO retirement villages is believed to be exploring two potential retirement village sites.

To further add to some of the major development sites, the University of the Sunshine Coast is said to be interested in having a presence within the new CBD as well.

SunCentral CEO John Knaggs’ said in a recent investor newsletter that the project was “progressing well” and construction of the first buildings would start in 2018.

“Construction of the first buildings will begin in 2018 and I will soon be able to announce some exciting news about that crucial stage of the project,” he wrote.

Sources have also indicated a high level of interest in the new Sunshine Coast Entertainment, Convention and Exhibition Centre, with a number of groups believed to have shown interest in developing that project. A 4500-seat auditorium is being suggested as the option moving forwards.
At present it’s beings said its unclear how many possible casino developments will be put into the CBD, however there remains a vacant casino licence. This license could however be utilised as part of an integrated development combined with retail, dining and entertainment facilities in the CBD.
It is still early days at this point, but it is great to see some progress moving forwards with some more clarity as to what will be housed in the new SunCentral Project

Bringing Power to the People.

A very exciting moment for the Sunshine Coast as an Australian-first solar farm goes live tomorrow, the electricity generated over one year will be enough to power the equivalent of 5000 homes.

The pioneering project has meant that the Sunshine Coast Council is the first local government to offset 100 per cent of its electricity consumption from a renewable source.

The site was developed by the Sunshine Coast Council at a cost of $50.4m, the site at Valdora just west of Coolum, was designed to deliver massive savings and sends is a clear sign about the area’s commitment to clean energy.

The facility will sell power harvested from it 57,960 solar panels to the grid for the best price it can achieve and buy it back at the cheapest.

Mayor Mark Jamieson said the forward-thinking Sunshine Coast Solar farm would begin feeding electricity into the power grid tomorrow in an exciting day for the region and its residents. The facility will certainly allow council to take ownership of its own electricity supply, assisting in the reduction of already rising power bills and to achieve a massive sustainability milestone.

“All power consumed at all of council’s facilities, including administration buildings, aquatic centres, community and performance venues, as well as holiday parks, libraries, art galleries and sporting facilities, will be offset with energy from a renewable source thanks to this nation-leading project,” Cr Jamison said.

“We are the first council in Australia to build and operate a 15MW utility scale solar farm which will deliver $22 million in savings, after all costs, for our ratepayers over the next 30 years,” he said.

“Our solar farm is the first, and will be the largest, to connect to the electricity grid in southeast Queensland. It is also the first in Australia to operate at 1500 volts DC which enables it to operate more efficiently.”

Such a project has not gone un-noticed, with considerable attention from 15 councils around the country already assessing how they can follow in the Sunshine Coast’s footsteps.

Cr Jamieson said the project had been developed and executed by the council, there was no assistance from the Federal or State governments, which is very different from many other solar farms being developed in Australia.

Energex Asset Manager Northern Steven Lynch congratulated Sunshine Coast Council for its vision and determination to deliver this clean green initiative.

“We have been very pleased to work with the Council to see this project come to reality,” Mr Lynch said. “Energex sees Grid Scale Projects like this as a key part of our low-carbon future.”

Diamond Energy was selected to provide retail electricity services to council. Managing director Tony Sennitt said it was a pleasure working with such a forward-thinking council and to see the ground-breaking project become a reality.

BUT WHAT DOES IT ALL MEAN:

  • The Sunshine Coast is the first Council in Australia to build a utility scale solar farm of 15MW capacity
  • The electricity generated over one year will be enough to power the equivalent of 5000 homes
  • At its peak, the facility will generate 15,000 kilowatts of electricity, which will go straight into the Energex network
  • It is the second largest solar farm built in Queensland, behind Barcaldine Solar farm (20MW), which is not council owned
  • The Sunshine Coast Solar Farm is the largest built in southeast Queensland

Crucial Changes to our Property Market as of July 1st 2017

So with July firmly upon us, a number of legislative changes have commenced. Always a touchy subject but is information we have to know. Coming from across federal, state and local government, four changes concern the current cost of living, three to taxation and two were relate to either superannuation or grant related according to QEAS director Nick Behrens.

The cost of living changes cover a wide basis, firstly the Major Bank Levy on NAB, ANZ, CBA, Westpac and Macquarie and anticipated flow on increases in home and commercial lending rates are now in place. Council rates are set to rise across Queensland with a recorded 2.3% for the Sunshine Coast, Gold Coast 1.8%, Brisbane 2.4% and anywhere from 1.75-3.99% for the remainder of regions in the state. Electricity bills in Regional Queensland are set to rise by 3.3% for households and 4.1% for small businesses, Water and sewerage charges will increase for example by 2.3% in Greater Brisbane (Queensland Urban Utilities) and 3%t in SEQ (Unity Water).

A number of tax changes will also be happening from a 1.5% surcharge to be introduced to absentee payers of land tax on holdings worth $350,000 and above to other land tax payable, however this is only applicable to interstate investment. The ATO are now unfortunately disallowing deductions for travel expenses relating to inspections, maintenance or collecting rent for a residential rental property. Foreign tax residents are now subject to increased capital gains tax withholding rate of 12.5% from 10%, with a reduced Capital Gains Tax holding threshold of $750,000 which has been brought don from $2,000,000.

A more positive change from the recent legislation is that first home buyers entering the housing market will see a rise in the Queensland First Home Owners’ Grant temporary increase from $15,000 to $20,000 for contracts on newly constructed homes purchased between July 1, 2017 and December 31, 2017. Specific voluntary contributions from superannuation after 1st July 2017 are now accessible for first home buyers also, the voluntary contributions will be accessible by individuals from July 1, 2018. Limits apply to the amount that individuals can contribute under this measure to $15,000 per year and $30,000 in total.

If you have any further questions or are looking for further readings please refer to http://qeas.com.au or http://www.budget.gov.au .

Harmony for Sunshine Coast Property Development.

With a growing population estimated to reach over 500,000 by 2036, the first steps to a major development project in Palm View have begun.

Peter Crosby Way officially opens on Monday, it is the northern access into the 378ha project to the south of Sippy Downs. Over the next 15 to 20 years Harmony will deliver more than 4800 homes for 12,000 future residents, all enhanced by 100 hectares of open space.

Harmony is also proposed to offer a town centre covering 15,250 Square-Metres of floor area.

Peter Crosby a local Sunshine Coast Farmer has been a land-owner since 1964 and has strong roots in the area.
Crosby Hill Road at Buderim is named after the family.

Mr Crosby has been operating a cattle farm on the land, and a cane farm in previous decades.

AVID Property Group general manager Said in a recent interview with the Daily “The road’s name pays homage to the site’s Crosby family history and will service 12,000 future Harmony residents, as well as those in neighbouring communities.”

Work has already commenced on display homes in the Harmony Display World, with 43 homes from 25 varied national and local building partners expected to open in the second half of this year.

Sunshine Coast Looking Prosperous In The Nations Property Market.

As the ethos between the nation’s capital cities continuing to change day by day, Sydney is expanding at an exponential rate with its second and Third CBD growing out to the west. Brisbane is beginning to take on the cultures and lifestyles of both Sydney and Melbourne. Adelaide has been suggested to be in desperate need of some major economic drivers and Perth continues to move forwards with its outward expansion.

Some of the nation’s smaller cities have been seeing a remarkable increase in population with the Gold Cost currently sitting at 638,000 and the Sunshine Coast boasting 327,000 residents as of 2016. In a recent article written by The Australian they will continue to grow for another generation. Combined with Newcastle’s population at 439,000 and Canberra’s 429,000, these four cities contain 1.8 million people which is approximately 8 percent of the Australian population.

It could be suggested these record highs are because of the existing links to Queensland’s Capital city Brisbane, with the link between the two Queensland ‘Coasts’ becoming stronger and stronger people are drawn toward the famed ‘Coast’ Lifestyle. It’s quite impressive when you consider that both Coasts exist, as Australians were found to be looking for a more relaxed style of living as a prime retirement destination.

Bringing this back to the current housing situation, we have seen growth consecutively for 5-years in a row. The recorded rate of growth has accelerated over the first quarter of this year, with the combined capital city index being found to be increasing at its fastest annual pace since May 2010. This continual increase in property value has resulted in the price of residential property reaching $7.0 trillion nationally.

With the Sunshine Coast reflecting this same trend and the population continues to grow, the Coast property market is an exciting prospect for potential investors and home owners. The figures show the Sunshine Coast region’s median house price for the quarter lifted 4.8% to $545,000 from the previous quarter and the median for the year rose 6.2% to $552,129. The unit market showing a good level of growth for the last 12 months at 4.4% to $391,262 according to a recent report by CoreLogic.

At present I can imagine that Mooloolaba is being driven by the very limited supply of quality beachside homes and Birtinya & Wurtulla experiencing a lot of new development in part to the Kawana Health Hub which has raised the median sale price for houses by quite a margin.

Investor interest reaches all time high on the Sunshine Coast.

I absolutely love this place, and by the stats and the feedback in the area, so do tourists as well.

For me first hand knowledge and feedback is king, and in a recent interview with the Daily, Mantra Group Regional General Manager Winston Hall said the Group, which operates seven properties on the Sunshine Coast, has also seen a strong uplift in visitor arrivals into the region.”Our Peppers, Mantra and BreakFree resorts on the Sunshine Coast are experiencing unprecedented demand, with most properties nearing no, capacity on weekends and during peak periods, achieving a combined average occupancy of 81% throughout the reporting year,” said Mr Hall.

“Not only are our occupancy rates at record levels, visitors are also staying longer with an increase in our guests’ average length of stay year on year.

“Our two properties in the holiday hotspot of Noosa continue to go from strength to strength and we’re also seeing strong uplift in corporate business, particularly at Mantra Mooloolaba Beach.”

The great thing about this is the benefit to investors in the area, with rate of occupancy trough holiday letting on the rise. It means that the income provided from investment units will show an equal rise for this financial quarter, and not to mention the $2.06 billion to the local economy.

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