The Summer market wrap-up

The Summer market has come and gone and it concluded with what the Manly Daily called Super Saturday. Saturday 27th Feb contained 33 Auctions on the Northern Beaches, which was approx double the normal number. A Statistic you may find interesting is that the average days on market for an Auctioned property is 31 compared with a Private Treaty (For Sale) property at 68 days. This can be attributed to several compounding buyer behaviours which when targeted will result in shorter campaign length, less overall marketing costs and less holding costs. If you want to know more just call Steven Purcell on (ph) 8914 3215

Keeping you updated:

Warriewood Sales for February.

Address............................Bed/Bath/Car .......Sale Price

53 Alameda Way............4/2/2.......................$821,000

6/3 Fantail Ave..............3/2/2.......................$635,000

23/30 McPherson St.....3/2/2.......................$575,000

6a Sydney Rd.................3/2/1........................$880,000

14 Warriewood Rd..........4/2/1.......................$889,000



Mona Vale Sales for February

86 Darley St.....................3/2/2.......................$702,500

30/16 Darley St..............1/1/1........................$375,000

40A Elimatta Rd.............5/3/2.......................$1,210,000

4 Foley St.........................4/2/2.......................$755,000

13/6 Foley St...................2/2/2.......................$635,000

10 Halesmith Rd.............4/2/2........................confidential

12/68-70 Park St............3/2/2.......................$967,500

6/46-50 Park St..............2/2/1.......................$680,000

64 Rednal St.....................4/3/2.......................$2,850,000

45 Samuel St.....................4/1/2.......................$1,170,000

5 Southbourne Way.........3/-/-........................$865,000

1/18 Surfview Rd.............2/1/1........................$710,000

6/2-6 Vineyard St............3/2/2.......................$590,000

19/24 Waratah St.............2/1/2.......................$620,000

20/24 Waratah St.............2/2/2.......................$730,000



Just recently I attended a business breakfast, at which Mark Bouris was the keynote speaker. Well known for his Wizard Mortgage business which he sold recently to GE for $400 million and more recently for his TV appearance on Channel 9's "The Apprentice". He spoke of his opinion on the banking industry and their effect on the economy and more importantly the decision making process of the Reserve Bank.

Briefly; As availability of overseas funds is becoming limited, the Four big banks require locally sourced funds to maintain their mortgage business. It is their Home Loan business which makes up a great deal of their profit margin. Accordingly, the banks will raise cash deposit rates to attract cash investors and try and avoid those investors switching to equity based structures. In order to maintain a minimum 3.25% margin on loans they will continue to raise Home Loan rates as they scramble for those cash deposits. Essentially this means that it is the local cost of funds that is driving up Home Loan Interest rates. Interestingly the Reserve Bank no longer needs to raise rates to curb inflation as the banks will do it for them. We saw this theory tested in when the Reserve bank left rates on hold at the last meeting, despite many economists predicting a fourth consecutive hike. Mr Bouris believes that we need more banking entities in the marketplace and he is a great believer in Credit Unions and Building Societies. Their not for profit statis allows them to reduce their margins to assist SME business and their members via competitive Home Loan rates. Unfortunately the great majority of their lendable funds must come from their cash holdings as they are less attractive to the international money fund operators. The effect on our economy, SME's and the mum and dad investors by the four bank monopoly is widespread and quite evident. The costs of Credit for business is being driven up and the cost to continue trading is rising. Banks have raised their margin on loans from 1.65% in 2008 to 3.25% in 2010, by not passing on all of the Reserve Bank cuts and loading the rises in recent years. This is great for the shareholder but not so good for the borrowers. Mr Bouris is a dynamic advocate for the mums and dads aout there and I urge you to read or listen to any of his publicly available comments.

Is your current mortgage the best you could have right now?
If you would like an independant, no obligation, no cost broker to look at your current mortgage and see if there is a better product out there then drop me an email at: stevenpurcell@mcgrath.com.au


Who do you know? - Forward this on.
If you know anybody in the Mona Vale to Warriewood area who would be interested in some of the details I provide here, then pass this blog onto them or send them this link: http://www.stevenpurcell.blogspot.com/



For this weeks McGrath Magazine, hit the link below.

http://emags.newlitho.com.au/?mcgrath/weekly/27february2010



Thanks for reading and making it to the end of this weeks issue, if you need me or any of the information that I can offer, you can call me in my office on (ph) 8914 3215 or email me at stevenpurcell@mcgrath.com.au



Take Care



Steve