Banks now less desperate for deposits

ONLY two of the top online savings accounts have passed on the Reserve Bank's November interest-rate rise in full, suggesting the deposit war between the banks is losing intensity.

Bankers have argued that the high cost of raising deposits left them with no choice but to push through lending rates above official moves by the Reserve Bank.

But some of the most aggressive online banks, including Commonwealth Bank-backed Bankwest, Citibank and National Australia Bank's UBank, have held on to most of the November 25-basis-point official rate rise, according to figures supplied by rate-comparison service Mozo.

  

From today, Virgin Money, which previously had the second-highest interest rate offer in the market, will cut its promotional rate by 24 basis points to 6.51 per cent. In addition to holding on to the RBA rate rise, this equates to an effective rate cut of 49 basis points across its savings accounts.


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VENDORS BRIDGE EXPECTATION GAP

There are many reasons why vendors’ expectations are higher than the market indicators suggest. A few vendors have unrealistic expectations of what the market will bring, some have held out too long for a non-existent top dollar and have lost the momentum of marketing, others simply misunderstand that the market responds to supply and demand and as such, prices are not theirs to dictate.

Most vendors who receive offers lower than the price they have originally set their hearts on find the experience a confronting one. While some readily understand the relationship between timing and price in achieving the best sale outcome for their property, others find it really difficult to accept any variation in the price they have decided on and find it hard to understand that the longer the property takes to sell, the less chance they have of achieving a higher price.

It may help vendors to bridge the expectation gap if they realise that purchasers too have a price they think the property is worth; just as some vendors have to lower their expectations, purchasers too often have to lower theirs – or raise the price they’re prepared to pay. The good news is that most vendors end up getting a price they are ultimately happy with – which is not the same necessarily as getting what they first hoped for. They come to accept that the emotional value that they place on their years of living in the property is simply not capable of being passed on to incoming purchasers who are making their comparisons and looking for value for money.

To help with the decision making process when an offer is disappointing, vendors should ask their agent to provide facts and figures from past sales of similar properties. They need to be scrupulously impartial when making their comparisons (They should ask themselves questions such as: ‘Is the fourth bedroom really a bedroom or would it best be described as a sunroom or a study.  If I were the purchaser, what would I call it?’ or ‘Is the driveway steeper than a similar house that sold down the road for the price I want?’)

Source:  http://www.localpropertynews.net/

DO YOU REALLY NEED A BIGGER HOUSE?

The end of one year and the beginning of the next is the time when many people make serious lifestyle decisions such as moving to a bigger house.  Australian Bureau of Statistics figures show the average floor area of  new Australian homes has hit a record high of 214.6 square metres in the 2009 financial year, while the average floor area of  freestanding houses is just above 245 square metres. This is ‘normal’ isn’t it? Doesn’t it happen in every developed country?

In fact, the answer is emphatically ‘No’. New data from the Australian Bureau of Statistics (ABC News Monday November 30 2009) indicates that new homes across Australia are bigger in square metre terms than anywhere else in the world.

Newly built Aussie homes are 7 per cent bigger than those in the US, double the size of those in Europe, and triple the size of those in the UK.

It means that Australian homes are around a third bigger than what they were 20 years ago and 10 per cent bigger than a decade ago.

The director of the Institute for Sustainable Futures at UTS in Sydney, Professor Stuart White, says he is worried by what is happening.

Professor White says too many Australians aspire to larger housing simply because they are concerned about their status relative to the rest of the community.

While it is true that many of us need to trade up to a bigger property as our families expand or our lifestyles change, it is also true that clutter can expand to fill the spaces we provide for it and give us the sense that we are being crowded out of our own homes. 

So if we don’t move to a bigger house, what other solution is there?

In fact, people tend to fill big homes with bedrooms that are never slept in, fireplaces that are never lit and wardrobes and spare rooms full of hoarded clothes that even the Op Shop wouldn't want. But many of us put off the challenge posed by smaller homes as we don’t want to be forced to choose which items to keep, and which to discard.

While we all dread the de-clutter challenge,  we have probably all experienced the frustration of too much ‘stuff’ – the irritation of knowing we have something tucked away in a cupboard or drawer that we just can’t find.  Absurdly, we often go out and buy a replacement object and store it somewhere equally ‘safe’.  Many things we intend to re-use have perished, dried out or are otherwise unusable by the time we need them again. Try going through your medicine kit and see how many out-of-date medications you are holding onto! Feeling free to discard or re-cycle items which in your heart of hearts you know you are unlikely to need again soon enough means that the items you do retain are easy to find and the stress of unmanageable clutter drops away.

In fact, big houses are not always all they are cracked up to be; they are energy guzzlers that impact heavily on the environment and come with huge cleaning and maintenance schedules and heating and cooling costs.  De-cluttering, on the other hand, promotes clear and decisive thinking and reduces stress and anxiety.

If you decide you can’t bear to face the de-clutter on your own, consider employing an expert to help you assess what is worth keeping and what isn’t and how best to organise what you have., www.lessmess.com.au andwww.organisedclutter.com.au are 2 websites offering professional consultants with specialist knowledge in how to create space and reduce clutter.

Regularly removing the clutter from your life will make your life more efficient and less stressful. You never know, maybe it will also keep you from making an expensive and time-consuming move to a bigger home. You can always use the extra money you could borrow to fund an investment property!

source: Local Property News