Stuart Wemyss 
Now that home loan interest rates have risen by 4% over the past 13 months, is it still worth investing your surplus cash flow, or should all cash flow go towards repaying your home loan? Many of my clients invest some surplus cash flow in the share market each month. This has been very easy …
The ‘great Australian dream’ has always been to own your own home, debt free. It gives you financial security, and over the past three to four decades, homeowners have enjoyed rising prices which has helped them build wealth. But is it always a good idea to own your home, or is renting better? Put differently, …
Most homeowners and investors are long term borrowers. That is, they will have a mortgage for many decades. We must realise that over many decades, there will be periods where interest rates will be higher than the average and vice versa. The average standard variable rate since 1959 is 8.20% p.a. Noting that most …
If you are considering borrowing to invest in a quality property, I would like to remind you of three important considerations. Firstly, it is my thesis that property investors must be more selective about which property/s to invest in. In that past, investors have benefited from a rising tide (driven substantially by rising borrowing capacities), …
Inflation reduced from 7.8% in the December quarter to 7.0% in the March quarter, which was good news, of course. Many economists believe that inflation (CPI) will continue to decline over the coming months. However, history tells us that when inflation has exceeded 8% (like it did in the US last year), it has taken …
Some people plan to give money to beneficiaries (typically children and/or charities i.e., early inheritance) before they pass away, especially if they consider they have more than enough money i.e., surplus wealth. Often, their thesis is that their kids can make good use of the money now, whilst they are younger, rather than waiting another …
Commentators often refer to the price of property relative to household incomes. For example, it is estimated that property in Melbourne and Sydney now costs more than 10 times the median household income. But is this really a meaningful measure because if it is, property cannot continue to grow at a faster rate than incomes …
All investment asset classes move in cycles. Investment returns are almost never linear. As such, investors must expect good and bad periods, which is why patience and discipline are big contributors to an investor’s success. I suspect that commercial property investors’ patience and discipline are about to be tested. This asset class is facing a …
Many people are attracted to borrowing to invest in property because of negative gearing tax benefits. That is, the (income) loss that an investment property generates helps reduce the amount of tax you pay on your salary or business income. However, investing in shares also offers unique tax advantages. I thought it would be …
Borrowing capacity has reduced by around 30% over the past year due to the impact of higher interest rates and the increased 3% interest rate buffer that banks must use to calculate your borrowing capacity. This was eloquently depicted in this chart by CBA in February 2023. I wanted to explore the common strategies that …
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