TDMVPDPOY
04-03-2009, 05:56 AM
Australia's example for you americans since you be getting FHOG to stimulate the housing industry. Dont get sucked in if you cant afford it.
First-home grant a '$25bn time bomb'
By John McCarthy and Melissa Ketchell
http://www.news.com.au/business/money/story/0,28323,25273566-5013951,00.html
THE First Home Owner's Grant may become a $25 billion time bomb and make it even tougher for people to get their first house.
As the development industry called for an extension of the $14,000 grant to all homebuyers to stimulate a dormant market, Reserve Bank deputy governor Ric Battellino warned the funding could backfire.
Analysts also forecast a potential housing crisis later this year with rising unemployment pushing up to 460,000 households "close to the edge" through mortgage stress.
Mr Battellino said the $21,000 available to first-home buyers could end up being priced into the cost of the home.
"It doesn't take long for the average house price to increase by $20,000 and leave the buyers no better off," he said. Forecasts were for a "substantial rise in unemployment", he added.
Human Resource manager Emma Holmes, 26, moved into her first home, a unit at Seaton, less than two weeks ago and described the grant as a "massive boost".
"It was great because it basically covers stamp duty and fees, the sorts of costs that creep up on you a bit," she said.
"I'd hate to see it not around after June, because too many people will miss out."
Stock market analysts ABN Amro said the first-home owner segment was becoming "inherently risky".
"The confluence of artificially high housing prices, lack of savings record and higher unemployment risk makes the first-home buyer segment a high-risk segment," he said.
Economists Fujitsu Consulting said it expected to see a significant rise in mortgage stress this year.
Apparently everyone jump on the bandwagon to quick last year when the scheme was extended and increased the grant. increase population, shortage of houses, rents increasing, housing prices were out of reach and continue to increase. Then everything hit the shits 12 months later....
30,000 Australian homes repossessed by December
By Lanai Vasek , NEWS.com.au, March 24, 2009 02:30pm
http://www.news.com.au/business/money/story/0,28323,25235255-5013951,00.html
MORE THAN 30,000 homes will be repossessed or foreclosed and almost half a million Australians plunged into severe mortgage stress by the end of the year, according to a new industry report.
One third of the expected repossessions will be first time home buyers who bought in the last 12 months, the monthly Fujitsu Mortgage Stress report predicts.
The March report, revealed exclusively to news.com.au, estimates that 30,741 homes will be repossessed or subject to foreclosure - where a lender takes control of a mortgaged property and holds a forced sale - and 497,168 homeowners will be in “severe mortgage stress” by December.
The forecasts are based on the unemployment rate - which is now 5.2 per cent - hitting 7.5 per cent by the end of the year.
The Federal Government predicts the unemployment rate will rise to 7 per cent by mid-2010, meaning an extra 300,000 jobless.
Westpac senior economist Matthew Hassan expects unemployment to peak at 8 per cent by the end of next year.
“It’s not going to be at a major shock to the market but we will see higher mortgage stress and increased property sales as a result of these job losses,” Mr Hassan said.
“For those that lose a job they have to fall back on savings - it gets difficult to keep up - some will be able to ride it out but for (many) it will be much more difficult.” Are you experiencing mortgage trouble? Email us at [email protected].
Despite the dire prediction, the Fujitsu Mortgage Stress report shows a massive 41 per cent decline in the number of home owners facing potential sale or foreclosures from 164,590 homes in February to 96,532 in March due to Federal Government handouts and lower interest rates.
Sydney-based financial counsellor Dennis Borham said the number of home owners at risk of losing their property had increased this year.
“In the last three years I’ve had only four people (facing repossession), this year so far I’ve already seen 12,” Mr Borham said.
He said home owners should seek financial assistance early if they feared trouble ahead.
Mr Borham’s most recent case involved a father of two who was forced to leave his home after losing his job and failing to meet his repayments.
“He lost his job in October and didn’t apply for Centrelink because he thought he’d find work easily. The wife didn’t work, and four months later they were both still unemployed and left with a car loan, three maxed-out credit cards, and two young kids to feed on top of their mortgage," he said.
“By the time they came to me he’d stopped answering his phone because there were so many people chasing him.”
After numerous letters from the bank, the family put their home on the market last month and are now living in a rental property.
Only thing i can say....sub prime crises again.....stimulate the economy my arse, the only thing its doing is keeping builders/realtors/estate agents in jobs and the trickle effect of the money spend doesnt streamline to other industries but only the building/housing industry.
First-home grant a '$25bn time bomb'
By John McCarthy and Melissa Ketchell
http://www.news.com.au/business/money/story/0,28323,25273566-5013951,00.html
THE First Home Owner's Grant may become a $25 billion time bomb and make it even tougher for people to get their first house.
As the development industry called for an extension of the $14,000 grant to all homebuyers to stimulate a dormant market, Reserve Bank deputy governor Ric Battellino warned the funding could backfire.
Analysts also forecast a potential housing crisis later this year with rising unemployment pushing up to 460,000 households "close to the edge" through mortgage stress.
Mr Battellino said the $21,000 available to first-home buyers could end up being priced into the cost of the home.
"It doesn't take long for the average house price to increase by $20,000 and leave the buyers no better off," he said. Forecasts were for a "substantial rise in unemployment", he added.
Human Resource manager Emma Holmes, 26, moved into her first home, a unit at Seaton, less than two weeks ago and described the grant as a "massive boost".
"It was great because it basically covers stamp duty and fees, the sorts of costs that creep up on you a bit," she said.
"I'd hate to see it not around after June, because too many people will miss out."
Stock market analysts ABN Amro said the first-home owner segment was becoming "inherently risky".
"The confluence of artificially high housing prices, lack of savings record and higher unemployment risk makes the first-home buyer segment a high-risk segment," he said.
Economists Fujitsu Consulting said it expected to see a significant rise in mortgage stress this year.
Apparently everyone jump on the bandwagon to quick last year when the scheme was extended and increased the grant. increase population, shortage of houses, rents increasing, housing prices were out of reach and continue to increase. Then everything hit the shits 12 months later....
30,000 Australian homes repossessed by December
By Lanai Vasek , NEWS.com.au, March 24, 2009 02:30pm
http://www.news.com.au/business/money/story/0,28323,25235255-5013951,00.html
MORE THAN 30,000 homes will be repossessed or foreclosed and almost half a million Australians plunged into severe mortgage stress by the end of the year, according to a new industry report.
One third of the expected repossessions will be first time home buyers who bought in the last 12 months, the monthly Fujitsu Mortgage Stress report predicts.
The March report, revealed exclusively to news.com.au, estimates that 30,741 homes will be repossessed or subject to foreclosure - where a lender takes control of a mortgaged property and holds a forced sale - and 497,168 homeowners will be in “severe mortgage stress” by December.
The forecasts are based on the unemployment rate - which is now 5.2 per cent - hitting 7.5 per cent by the end of the year.
The Federal Government predicts the unemployment rate will rise to 7 per cent by mid-2010, meaning an extra 300,000 jobless.
Westpac senior economist Matthew Hassan expects unemployment to peak at 8 per cent by the end of next year.
“It’s not going to be at a major shock to the market but we will see higher mortgage stress and increased property sales as a result of these job losses,” Mr Hassan said.
“For those that lose a job they have to fall back on savings - it gets difficult to keep up - some will be able to ride it out but for (many) it will be much more difficult.” Are you experiencing mortgage trouble? Email us at [email protected].
Despite the dire prediction, the Fujitsu Mortgage Stress report shows a massive 41 per cent decline in the number of home owners facing potential sale or foreclosures from 164,590 homes in February to 96,532 in March due to Federal Government handouts and lower interest rates.
Sydney-based financial counsellor Dennis Borham said the number of home owners at risk of losing their property had increased this year.
“In the last three years I’ve had only four people (facing repossession), this year so far I’ve already seen 12,” Mr Borham said.
He said home owners should seek financial assistance early if they feared trouble ahead.
Mr Borham’s most recent case involved a father of two who was forced to leave his home after losing his job and failing to meet his repayments.
“He lost his job in October and didn’t apply for Centrelink because he thought he’d find work easily. The wife didn’t work, and four months later they were both still unemployed and left with a car loan, three maxed-out credit cards, and two young kids to feed on top of their mortgage," he said.
“By the time they came to me he’d stopped answering his phone because there were so many people chasing him.”
After numerous letters from the bank, the family put their home on the market last month and are now living in a rental property.
Only thing i can say....sub prime crises again.....stimulate the economy my arse, the only thing its doing is keeping builders/realtors/estate agents in jobs and the trickle effect of the money spend doesnt streamline to other industries but only the building/housing industry.