Money
Young Aussies selling their first homes as mortgage stress bites
A surge in quick home resales has been attributed to the growing mortgage stress faced by homeowners, according to analysts and real estate agents.
Brisbane real estate agent, Jett Jones, has noticed a significant increase in properties returning to the market within a short period after being sold.
The data from CoreLogic, exclusively prepared for ABC News, indicates that the proportion of homes resold within two years of their previous sale is at a nine-year high. In April, 8.3 percent of properties sold were owned for less than two years, indicating a steep increase since mid-2021.
FILE PHOTO: An ibis perches next to the Reserve Bank of Australia headquarters in central Sydney, Australia February 6, 2018. REUTERS/Daniel Munoz//File Photo/File Photo
Quick turnover
Analysts point out that the current scenario is different from previous instances of quick property turnover, which were typically observed during property booms when investors sought fast profits. This time, a substantial number of properties resold within a short duration are being sold at a loss. This suggests a rise in forced sales, as homeowners who purchased during the low-interest rate pandemic period struggle to cope with surging mortgage repayments.
Younger buyers, including first-time buyers who may have overextended their budgets, and investors looking to retire or reduce costs, are among those impacted. Hobart and Brisbane are the leading cities where properties are resold within two and three years, highlighting the severity of the issue.
Financial counsellors have reported a 30 percent increase in calls for help related to mortgage stress, with the number one reason for seeking assistance being the inability to afford mortgage repayments. The situation has become more critical for those with pandemic-era, cheap, fixed-rate mortgages expiring.
Experts urge homeowners facing financial trouble to seek advice early, engaging with their banks and relevant services to explore their options and remain in control of the sale process. While some are still making profits on property sales, a significant number of pressured sellers may be on the rise as interest rates and inflation continue to impact mortgage affordability.
Money
Australia revises superannuation tax plans for fairness
Australia revamps retirement tax with new thresholds and increased support for low-income earners amid political pressure
Australia revamps retirement tax with new thresholds and increased support for low-income earners amid political pressure
– Treasurer Jim Chalmers announced a 40% tax on retirement balances over $10 million, aiding low-income earners.
– The reform improves the Low Income Superannuation Tax Offset, helping 1.3 million Australians with higher annual payments.
The announcement comes after months of political and industry pressure and represents a major shift from the original policy.
It addresses prior criticisms related to indexation and taxation of unrealised capital gains.
Under the revised policy, balances between $3 million and $10 million will face a 30 percent concessional tax rate.
Both thresholds will now be indexed to inflation to prevent bracket creep affecting middle-income Australians.
The government has also removed taxes on unrealised capital gains, with changes applying solely to realised earnings from 2026.
“This has been a contentious policy,” Chalmers stated, indicating that it affects less than 0.5 percent of Australians, with about 80,000 anticipated to have over $3 million in superannuation next year.
Key Benefits
The reform package significantly improves the Low Income Superannuation Tax Offset (LISTO).
Annual payments will rise from $500 to $810, with an increased eligibility threshold from $37,000 to $45,000 by 2027.
This adjustment will assist approximately 1.3 million Australians, mainly benefiting women.
Eligible workers could gain around $15,000 in retirement, increasing LISTO eligibility to 3.1 million Australians.
The changes could generate about $1.6 billion in net revenue by 2028-29, a decrease from the original $2.5 billion projection due to enhanced LISTO benefits and extended implementation.
Money
Bitcoin declines to $104,782 amid trade tensions
Bitcoin drops to $104,782 as Trump intensifies US-China trade tensions, impacting global markets
Bitcoin drops to $104,782 as Trump intensifies US-China trade tensions, impacting global markets
– Bitcoin dropped to $104,782 due to heightened US-China trade tensions.
– The S&P 500 Index fell over 2% amid escalating market uncertainty.
The decision follows China’s recent restrictions on rare earth mineral exports, which are crucial for various technologies and manufacturing sectors.
The trade dispute affected global markets, resulting in a more than 2% decline in the benchmark S&P 500 Index.
Bitcoin experienced an 8.4% drop at $104,782 by 17:20 ET, while Ethereum, the second-largest cryptocurrency, fell by 5.8% to $3,637 at 17:21 ET.
Money
Gold plunges as investors react to Middle East ceasefire
Gold prices fall over 2% to below $4,000, as investors shift from safe-haven assets after Gaza ceasefire news.
Gold prices fall over 2% to below $4,000, as investors shift from safe-haven assets after Gaza ceasefire news.
Gold prices have fallen sharply, dropping over two per cent to below $4,000 per ounce, as investors took profits following the announcement of a Gaza ceasefire agreement. The deal between Israel and Hamas triggered a shift away from safe-haven assets, with silver and platinum also sliding.
The U.S. dollar strengthened as markets responded to the news, making precious metals more expensive for foreign buyers. Analysts say the pullback is likely temporary, with long-term demand for gold and silver expected to remain strong amid global instability and rising debt levels.
Market experts warn that volatility will continue as geopolitical tensions persist, even as short-term optimism grows around the Middle East peace process.
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