Welcome to our Sydney Wealth Management team's 2019 Winter Wealth Management Update, covering all the latest news from the previous quarter.
Sydney residential property – the worst is probably over
The Sydney housing market that boomed from 2013 began to falter in mid-2017 when a combination of policies transpired to cool activity. In 2018, the headwinds continued with banks beginning to significantly tighten lending criteria to all borrowers in response to the damaging Banking Royal Commission revelations and the opposition Labor Party proposals to limit negative gearing and halve capital gains tax concessions created more negative sentiment for the housing market. This combination of events, coupled with a surge in supply following years of new apartment construction, proved to be a perfect storm for residential property. Yet after two years of falls, there are finally some encouraging signs that the worst may soon be over. See more.
What you need to know about changes to your borrowing power
Interest rates are at record lows, but your bank still won’t approve your loan. Why? Because banks don’t assess loans on actual rates, they use ‘buffered’ rates to test your borrowing capacity. Rates are currently at the lowest levels ever seen in the Australian market with the average first home buyer generally taking out a 30-year loan. History tells us that over that period of time interest rates will likely go up. So it is with due care that lenders work to ensure that customers can reasonably absorb these rate increases, and still comfortably live their lives. See more.
New superannuation rules from 1 July 2019
From 1 July 2019 a number of changes to superannuation will take effect, including the removal of work test in the first year of retirement for individuals 65-74, the commencement of carry forward concessional contributions, the cancellation of insurance within inactive super accounts, the closure of inactive super accounts, cap on fees for low balance accounts, and switching funds without exit fees. See more.
Proposed superannuation changes
Following the surprise Federal election victory, the Morrison Government is now likely to seek approval of its proposed superannuation changes. See more.