Co-housing is a way of living that offers many benefits, especially for seniors. If the concept is unfamiliar, you may be conjuring up images of a 1970s hippy commune, but rest assured you won’t have to wear tie dye t-shirts or become a vegan to be accepted! In this article, we explain what co-housing is, where it originated, and provide an example of a co-housing community in action in Tasmania. Remember, if you’re considering downsizing or making living arrangements for your retirement, we’re here to help you find the right finance for your needs.

What is co-housing?

Co-housing is defined as “an intentional community” of private homes built around shared facilities. These common spaces may include a common house with a shared kitchen and dining area where residents can cook and eat together.

There may be community gardens, playgrounds and recreational spaces. Some co-housing developments may even include communal swimming pools and movie rooms for residents to enjoy.

Each household in the community is independent and fully equipped with its own amenities, including private kitchens and baths. However, the idea behind co-housing is for neighbours to be part of a collaborative community.

Co-housing differs from regular retirement villages in that the community is owned and managed by the residents who live there.

The key benefits of a co-housing community are that residents may have the opportunity to collaborate over how it is set up, what amenities it includes and how much it costs.

Where did the idea originate?

The idea of co-housing started in Denmark in the 1960s. From Scandinavia, the concept spread to other parts of Europe, on to North America, and over to New Zealand and Australia.

Co-housing initiatives are now popping up in many parts of Australia, reinvigorating the concept of community. Seniors’ co-housing has been suggested as an alternative to aged care or retirement villages for those wishing to age in place.

What are the benefits?

Enthusiasts believe co-housing offers the following advantages:

  • More meaningful relationships with neighbours.
  • A feeling of belonging, in that you’re part of a community.
  • Reduces loneliness and isolation by connecting you with others.
  • A collaborative culture of sharing and caring.
  • Maintenance tasks are divided among the community.
  • Decisions affecting the community are based on the consensus.
  • You still have privacy, as well as the support of your neighbours as needed.
  • Reduces household bills, as expenses for shared space are divided between residents.
  • Depending on your community, it may be less expensive than other housing options.
  • Reduces your environmental impact thanks to a “greener” approach to living.

An example of a co-housing community in action

Cascade Cohousing in South Hobart is a great example of a thriving co-housing community. Established in 1991, there are currently 22 adults, ranging in age from young families to retirees, and six children living in 15 privately-owned properties (on strata title).

There’s a central common house with a shared kitchen, dining area, lounge, laundry, workshop and TV room. Three nights a week, the residents get together for a meal, and once a month they hold body corporate meetings and working bees for maintenance. There are fun activities on offer like film nights, games evenings and gardening.

You can find examples of other established and emerging co-housing communities on the Cohousing Australia website.

If you’re entering the next phase of life, co-housing may be the way to go. As your mortgage broker, we can help you secure the finance you need to start your exciting new chapter in an existing co-housing community, or even work with you and your chosen ‘community group’ to set one up. Please talk to us at Element Finance about your retirement lifestyle plans and goals today!

We hope you are embracing the arrival of winter and enjoying the cool change. In recent weeks we’ve seen conditions for property buyers improving, with fewer homes reaching the reserve price at auction and values trending downwards in many markets. During the colder months, there are usually fewer buyers doing the rounds, so there could be some red-hot deals for you to snap up. If you’re thinking about purchasing a new home or investment property this winter, please give us at Element Finance a call.

Interest Rate News

As expected, the Reserve Bank of Australia kept the cash rate on hold at 1.5 per cent again this month. There is some speculation that rates could start to rise toward the end of the year, provided the RBAs measures to improve inflation, employment and wages growth start to take effect.

Some local analysts are anticipating that lenders will soon start to raise rates outside of RBA movements, due to the rising costs of borrowing. Interbank lending rates (the rates that apply to Australian banks when lending money to each other) are on the rise in line with global money markets and are likely to affect home loan interest rates across the board at some point this year.

There is some good news, however. The Australian Prudential Regulation Authority (APRA) has lifted the 10% limit on property investment credit growth for eligible banks from July 1. This has resulted in some lenders cutting rates on interest-only loans already, so if you’re in the market for a property investment loan please call Element Finance.

Property Market News

Whilst our property markets had a healthy number of properties up for auction throughout May, clearance rates declined considerably and there was a general softening in home values.

For the week ending Sunday 03 June, (officially the final weekend in the busy autumn selling season), Victoria held the highest number of auctions at 1161, achieving a clearance rate of 62 per cent. NSW was next with 1001 scheduled auctions and a clearance rate of just 52 per cent. QLD held 273 auctions with a clearance rate of just 43 per cent. ACT held 107 auctions and cleared 66 per cent, and SA held 105 auctions and cleared 68 per cent. WA only scheduled 29 auctions and achieved a clearance rate of about 25 per cent, NT 11 auctions with a clearance rate of about 50 per cent and Tasmania only scheduled three auctions with no sales recorded.

According to CoreLogic, home values were softening in our larger property markets during the month ending May 31. Sydney home values fell by 0.22 per cent during the month and were showing a decline of 4.21 per cent since this time last year. Melbourne’s home values fell by 0.50 per cent but were still up by 2.22 per cent from this time last year. Canberra’s home values fell by 0.10 per cent last month but were up by 2.28 per cent YoY.

Home values also fell in Darwin by 0.22 per cent in May and are down by 7.88 per cent from this time last year. They also fell in Perth by 0.14 per cent in May and were down by 1.84 per cent since this time last year. Adelaide and Hobart are the only markets showing increases – Adelaide’s home values were up by 0.50 per cent in May and by 0.62 per cent since this time last year and Hobart is still proving to the outstanding performer, with home values up by 0.81 per cent in May and by 12.71 per cent since this time last year.

Winter is generally a quiet season, so we can expect to see a further slowing in auction numbers, clearance rates and home value rises in the next few weeks. This may provide a chance to pick up a bargain for those willing to brave the cold weather. If you need pre-approval on a loan as a first-home buyer, next home buyer, or property investor, please get in touch with Element Finance today!

When done right, investing in property can help you to build long-term wealth, and who doesn’t like the idea of an additional income stream? (Imagine what you could do with that!) The really great thing about property investing is that just about anyone can understand the principals. If you’re thinking about building wealth for your future this way, here’s a step-by-step guide on how to go about it. We’ve kept it super simple and you’re bound to have questions, so please give us a call to find out how we can help you make it work!

Step 1: Talk to us about your borrowing power

The first step involves a friendly chat with us about the finance set-up. We’ll run through your personal financial circumstances and help you determine your borrowing power – which is the amount a lender may be willing to lend you. Your borrowing power may be very different for an investment property than for a home to live in yourself.

Like all property purchases, you’ll need a deposit. If you already own your home and it has appreciated in value, or you’ve paid down your mortgage somewhat, you may be able to refinance to access equity to fund it. We can explain how this works and the kind of loan that will best suit your situation. We can also organise pre-approval so that you can set a purchasing budget and be confident a lender will come through with the finance when the time comes to start investing.

Step 2: Formulate an investment strategy

Ask yourself what your ultimate objective is – do you want to build a big investment portfolio of 10 properties or more and make a business out of it? Or are you more interested in concentrating on paying off your own home, perhaps using an investment or two on the side to generate some money to do it?

We recommend seeking advice from your financial planner or professional tax advisor when formulating your investment strategy. Maximising tax advantages is a big part of property investing and knowing what they might be in your personal situation is key. Ask us for a referral if you don’t already have a professional on board.

Step 3: Set your budget

There are many costs to factor into your budget when buying an investment property. The financial side of a successful property investment is a balance between costs, income, tax deductions and how they affect your overall cash-flow. The costs to factor in may include the following:

Initial costs

    • Deposit
    • Loan establishment fees
    • Lenders’ mortgage insurance (if you have less than 20% deposit)
    • Stamp duty (calculators are available here)
    • Conveyancing and legal fees
    • Building and pest inspection reports
    • Quantity Surveying fees – to create your Depreciation Schedule for the fixtures in the property, so you can maximise your tax deductions (after purchase).

Ongoing costs

  • Rates/government taxes
  • Insurance
  • Mortgage repayments
  • Body corporate fees
  • Utilities not paid by the tenant
  • Property management fees
  • Repairs and maintenance costs.

Step 4: Do your research 

The key to buying the right investment property is to spend plenty of time researching. Property investors usually focus on two key financial returns – capital growth potential (which is the growth in the property’s value) and rental yield (the income the property will generate from the tenants).

These factors are driven by supply and demand, so try to find a property that will be in high demand by tenants and future potential buyers. Ask us for assistance with the right property market data to inform your property searches.

Once you’re set on a property, be sure to organise building and pest inspections. You’ll want to know that the property is structurally sound and free of unwanted guests before making an offer or going to auction.

Step 5: Finalise your finance

The final step involves us helping you secure an investment loan that suits your financial circumstances and goals. Ask us to get you pre-approval on a loan for the specific property you want to buy before you make an offer or buy it auction, so you can have a realistic ceiling price to work with during the negotiations.

This step is the most important one of all if you’re buying at auction – you will be required to put your deposit down on the spot and it is not refundable if the lender does not agree the property is worth the price you paid and won’t lend the amount you need to complete the purchase. If you are buying under offer, we recommend you include a ‘subject to finance’ clause in the sales contract, to cover this contingency.

If you’re thinking about joining the thousands of Australians building wealth for the future through property investment, don’t wait to give Element Finance a call. Our mortgage brokers are here to give you expert guidance about investment loans and structuring your finance. Talk to us today!

Can you believe it’s already May? If you’ve been thinking about a 2018 property purchase, here’s why now is a great time to go for it. Firstly, the cash rate remains unchanged at a record low level. Secondly, home values and auction clearance rates are falling in many markets around the country, so conditions look like they’re starting to turn in favour of buyers. And last, but not least – there’s plenty of housing stock to choose from in the busy autumn selling season, so why not go for it?

Interest Rate News

This month, the Reserve Bank of Australia decided to leave the cash rate unchanged at 1.5 per cent, and it’s widely believed any change to the cash rate is still some way off. Meanwhile, some banks have dropped interest rates on investor and interest-only mortgages in recent months. If you have an investment property, it’s worth checking in with us to see whether your investment loan is right for you. We may even be able to find you a more competitive rate.

Property Market News Across the combined capital cities, home dwelling values fell by -0.31 per cent over the month ending April 30. Hobart was the outstanding performer, with home values rising 1.16 per cent. Canberra was next with a rise of 0.64 per cent, followed by Darwin at 0.58 per cent and Adelaide at 0.06 per cent. Perth and Brisbane experienced marginal home value reductions of less than .05 per cent, whilst Sydney home values fell 0.36 per cent and Melbourne saw the biggest monthly home value reduction of 0.45 per cent.

Auction activity increased across the combined capital cities in the week ending Sunday April 29, however clearance rates around the nation are showing significant declines. In Victoria, there were 1,419 auctions with a 66 per cent clearance rate. NSW held 975 auctions, but only 58 per cent of stock sold. In South Australia there was a 62 per cent clearance rate on 134 properties, and in Canberra, 92 properties went to auction and 64 per cent sold.

Clearance rates were even lower in other states. In Queensland, 305 properties went to auction and 42 per cent sold, whilst Western Australia saw 44 auctions take place, returning a clearance rate of only 38 per cent, and Tasmania had the lowest clearance rate of around 33 percent, but only eight properties went to auction.

Winter is coming!

It can be a dreary time of year in the property market. So why not take advantage of the busy autumn selling season while it lasts? With auction clearance rates generally softening, you may be able to negotiate a fantastic deal for a new home or investment property. Whether you’re a first-home buyer, next home buyer or investor, Element Finance can provide expert advice about all your finance needs. Please get in touch to arrange pre-approval on a loan for your next property purchase today!

When renovating for profit, the golden rule is minimal expenditure, maximum return. The key is to focus on renovations that will maximise your property’s value, whilst not costing you the earth. Here are 6 smart renovation ideas that will resonate with prospective buyers and help you get great returns when you sell. Remember, if you need assistance with financing your renovations, we can offer you competitive loan choices! We do all the leg-work for you, so you can focus on transforming your property into something extraordinary.

Curb Appeal

First impressions are everything. When it comes to renovating with resale in mind, you want your home to have that ‘wow’ factor as soon as buyers see it. Consider the view from the street – the front façade, fence, garden, windows, roof and driveway. Spruce them up and make them work together to add charm.

Kitchen

Renovating the kitchen is one of the most effective ways to add value to a property. Many buyers like the idea of having the kitchen done for them, so that they can just move in and enjoy it. If you have a larger budget, you might like to opt for a custom-made kitchen that’s made-to-order to suit the home. Alternatively, there are some great modular kitchens available at reasonable prices. New cabinetry, appliances, benchtops, and a striking splashback will do wonders for your home’s sale price.

Bathroom

Renovating bathrooms with modern fixtures and fittings can also drive up the value of a property. If your bathroom is passable but just needs some love, you could simply respray the tiles, fixtures and fittings, rather than redoing the whole lot. Another idea is to redo the tiling yourself, and update only the fixtures that need replacing, whether it’s the bathtub and vanity, or basins and shower screen. If you only have one bathroom, consider adding extra bathrooms to your property, as this can boost a property’s value.

Flooring

Installing new flooring can make a big difference to the appeal of your home, and therefore its value. There are plenty of great budget flooring options out there that look attractive. Vinyl planks and laminate flooring for example, are both popular, durable, budget-friendly products that you can install yourself. When choosing your flooring, remember your target audience. If your market is a family or property investor, wall-to-wall carpets may not be the best option. Remember the golden rule, minimal expenditure, maximum return.

Paint

It’s amazing what a fresh coat of paint can do to transform a property! A 1960’s home with retro mustard wallpaper can look instantly modernised and refreshed with a new lick of paint. Best of all, a paint job can be relatively inexpensive, particularly if you do the painting yourself. If you want to give your property a lift and appeal to the majority of buyers, be sure to go for a neutral colour scheme that won’t date quickly.

Additional bedrooms

If the space allows, adding more bedrooms to your property is another way to increase its value. While you may be up for a sizeable outlay in the tens of thousands, the financial rewards come sale time can also be big (in some cases, several hundreds of thousands). Remember, properties are typically valued based on land size and the number of bedrooms – the first, you can’t change, but the second you can. If you need help with finance for major structural renovations, speak to us about your options.

If you’re looking to renovate to boost your property’s value, remember – careful budgeting and planning is key. We’re here to help with that, as well as to help you work out the right option to finance your renovations. You may be able to refinance your home loan to access equity to complete the project. Alternatively, we can walk you through the other finance options available to you, depending on your financial circumstances and goals. Please get in touch with your Element Finance mortgage broker in Joondalup and Fremantle and we’ll help you get the transformation under way!


1 2 3 4 20
Copyright 2016