The first-home owners grant will be restricted to people buying homes worth up to $750,000 from next year amid fears the market is overheating.

Fierce competition that started late last year in the lower end has now expanded into the mid to upper sectors. A surge of Australian investors is also gaining momentum.Buyers of all budgets are increasingly concerned that missing out will mean a wait until autumn, when prices and interest rates could be greater.

On October 1, the first-home owners boost was reduced from $14,000 to $10,500 for existing homes and from $21,000 to $14,000 for new homes. The grant will be lowered to $7000 for both new and established homes from January 1.

Change to First Home owner grant

Each state and territory government would be allowed to cap the ''enormously successful'' grant, federal Housing Minister Tanya Plibersek confirmed yesterday.

The real estate crush has already contributed to a 1 per cent rise in the headline rate of inflation for the September quarter, the highest rate for a year. It makes a Melbourne Cup Day interest rate rise of 25 or even 50 basis points almost assured, as the Reserve Bank moves to tackle inflation before it gets out of control.

 

In NSW, Western Australia and the Northern Territory, only homes less than $750,000 will receive the $7000 grant. In Victoria, the cap will be set at $600,000 while Queenslanders will be able to pay up to $1 million and still receive the bonus.

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At 11 km from the Perth city CBD  and Bigger sqm than the usual units getting listed at these prices these new releases on the market are good catches being spacious and also a decent small good backyard in some of them. Grab them while they last !!

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&&&&&&&Great First Home
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&&&&&&&Brand New To Market!
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Houses / Units  between 200 K and 300 k for investment .

MAYLANDS

$199,000-$219,000

FANTASTIC FIRST HOME OR INVESTMENT...

1 bedroom home for sale in Maylands

You will just love this Immaculate, light and bright ,one bedroom top floor end apartment with balcony, under cover carbay, all furniture included and nestled in a full security group. This property was rented at $240pw so this definitely suits investors and first home buyers. Be Quick for this one.

http://www.realestate.com.au/cgi-bin/rsearch?fslm=1&a=o&id=105985513&t=res&s=wa&snf=rbs

------------------------------------------------------------------------------------------

17/19 Raymond Street, Yokine

$240,000

Second Chance - Sale Fallen Through Home Open Saturday 11.00-11.45am

1 bedroom home for sale in Yokine

Features:

· A/C

You’ll know “the one” as soon as you see it, so don’t delay and risk this one passing you by!
Situated on the top floor of a well maintained complex this renovated 1 bedroom apartment boasts loads of natural light, open plan living, built in robes, air conditioning, timber flooring and the perfect outlook over the city skyline.
Set in a fantastic location first home buyers and investors should make this a priority viewing.

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12/50 Cambridge Street, Leederville

From $240,000

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1 bedroom home for sale in Leederville

What a fantastic starter or investment. Recently moderized throughout, this 1st floor 1 bedroom apartment is for the market. Located walking distance to Leederville and Subiaco and a short commute by bus or train to the city. The building is well managed with security parking and pool at rear. With strong rental returns available, sought after location and nothing to spend on the apartment since its all done, a quick inspection would be a great idea.
Council Rates: $874.75/yr
Water Rates: $574.70/yr
Strata Rates: $365/Qtr

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36/19 Joseph Street, Maylands

From $239,000

BANK ON THIS!

2 bedroom home for sale in Maylands

Looking for a good little earner?
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http://www.realestate.com.au/cgi-bin/rsearch?fslm=1&a=o&id=106066847&t=res&s=wa&snf=rbs

Hot investor picks for WA

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The $64 million question is how quickly will rates rise from
here? At the start of the last rate hike cycle in 2002, the
Reserve Bank made two quick-fire rate hikes before retiring
to the sidelines.

How much pain will a 25 basis point hike cause for

borrowers?

Actually, not a lot. The Commonwealth Bank
estimates that more than 90% of its home loan customers are
ahead in their loan repayments. That is, when interest rates
were cut, most customers elected to maintain existing
repayments. The main burden of the rate hike will hit those
who have purchased or built homes relatively recently. And
the higher loan repayments will certainly be factored in by
budding home buyers in coming months.

But at that time the low point for rates was
4.25% – much closer to the ‘normal’ or neutral zone around
5%. In the past the Reserve Bank has lifted rates a few times
before resting to gauge the impact. Another rate hike on
Melbourne Cup day is a safe bet and over the next year cash
rates will likely lift to around 4.5%.

It had to happen sooner or later, but a clearly confident
Reserve Bank believes that now is the time to be removing
‘emergency’ rate settings. The emergency is over, and now a
more appropriate level of interest rates needs to be put in
place.

Ref: craig james (comsec )

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Businesses and home owners will be doing it hard as the Interest rate rises  and  we will have more rate hikes to come as we go further.

If your home loan is currently with one of the major four banks commonwealth bank , westpac bank , NAB bank , ANZ bank and you are paying a standard variable rate of 5.74 percent  p.a, you could pocket the savings by switching to Bank west  ( Now  Commonwealth Bank  owned)  with a variable interest rate of 4.87 percent p.a.

Rates will vary depending upon the amount of money you want to borrow,however, remember to factor in costs associated with refinancing, such as exit fees from your existing lender and establishment fees from the new bank.

With interest rates tipped to increase  more families may find the need to use hardship provisions.

Some economists are forecasting a rate rise by the Reserve Bank of 0.25 percentage points in both November and December , which  the first one has already come true with the latest hike announced yesterday.

A 0.25 percent increase on the average mortgage of approximately $350,000 would add about $50 a month to repayments.

Home owners should be prepared for multiple rises early next year. "Interest rates dropped  , so we expect rates to rise above current levels over the next 12 to 18 months."

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