Trending Financial News 28 October
Pension Loans Scheme rates under review
Treasurer Josh Frydenberg has announced a review of the interest rates charged by Centrelink’s Pension Loans Scheme.
The current interest rate for reverse mortgages under the government’s Pension Loans Scheme (PLS) is 5.25 per cent per annum. The rate has not fallen this year, despite falls in the RBA official cash rate and cuts by banks to their retail home loan rates.
The government was criticised last week by former Labor leader Bill Shorten.
“When the Reserve Bank cut the official cash rate to a record 0.75 per cent on 1 October, this led to bank loan rates at 3 per cent,” said Mr Shorten.
“While the government’s Pension Loans Scheme is still charging older Australians at 5.25 per cent.”
Mr Frydenberg said the current interest rate of 5.25 per cent for the Pension Loans Scheme “Is lower than the rates charged by the private sector.”
Land prices falling fast
Residential land prices have slumped across most of Australia according to the latest HIA-CoreLogic Residential Land Report.
“The rate per square metre of vacant land in Sydney was down 12.6 per cent over the 12 months ending June 2019,” said Tim Lawless from CoreLogic, “And Melbourne land prices were down 7.6 per cent.”
Land prices were also down in Adelaide by 12 per cent and in Brisbane by 4.6 per cent.
Land prices were higher in Perth and Hobart.
Cash ban law enters parliament
The Currency (Restrictions on the Use of Cash) Bill 2019 was passed in the House of Representatives last week and will now go to a Senate committee review. The bill, which bans most cash transactions of $10,000 or more has attracted a lot of criticism.
The Australian Chamber of Commerce and Industry said the government should not be undermining the value of cash. The Certified Practising Accountants of Australia said the penalties (fines of up to $25,200 and jail terms of up to two years) were excessive. The government says the cash ban is aimed at limiting black market activity by criminals.
Josh Frydenberg takes his own advice
The Treasurer Josh Frydenberg is taking his own advice and finding a better home loan deal outside the big four banks. Mr Frydenberg has urged Australians to shop around and compare home loan deals after the big four banks failed to pass on, in full, the RBA’s three rate cuts between June and October.
Mr Frydenberg’s family home is mortgaged to Liberty Financial, a non-bank lender specialising in low-doc loans and loans sold through mortgage brokers.
Banks could soon be ordered to lend to business
Australian banks could be lent money from the federal government to lend to business to stimulate the economy according to documents released under freedom of information to BankingDay.com.
“Funding-for-lending” is the name for the program being planned by Treasury to support growth in the economy by providing funding for business lending activities by banks.
This policy is a form of Quantitative Easing – pushing more money into the economy – that is being discussed by government as the effectiveness of rate cuts declines.
Auction Results for 19 October 2019
The spring selling season is underway with big volumes of property going under the hammer in Sydney and Melbourne in particular. Clearance rates held up despite higher numbers of properties being listed, indicating growing demand.
Sydney Auction Results for Saturday 19 October 2019
There were 641 residential property auctions held in Sydney on Saturday 26 October 2019. 75 per cent produced a sale for a median sale price of $1,212,500 in preliminary results reported by Domain.
Melbourne Auction Results for Saturday 19 October 2019
There were 1400 residential property auctions held in Melbourne on Saturday 26 October 2019. 75 per cent produced a sale for a median sale price of $885,000 in preliminary results reported by Domain.
Adelaide Auction results for Saturday 19 October 2019
There were 83 residential property auctions held in Adelaide on Saturday 26 October 2019. 74 per cent produced a sale for a median sale price of $704,000 in preliminary results reported by Domain.
Brisbane Auction results for Saturday 19 October 2019
There were 95 residential property auctions held in Brisbane on Saturday 26 October 2019. 33 per cent produced a sale for a median sale price of $895,500 in preliminary results reported by Domain.
Canberra Auction Results for Saturday 19 October 2019
There were 39 residential property auctions held in Canberra on Saturday 26 October 2019. 47 per cent produced a sale for a median sale price of $857,000 in preliminary results reported by Domain.