NewsMortgage repayments just got dearer. The big four banks were quick to lift their lending rates in line with the RBA’s 25 basis point rise in the official cash rate, to 4% on March the 2nd. The RBA’s decision follows stronger economic data, which has been further boosted by a significant improvement in new homes sales for January. The Housing Industry Association’s New Home Sales Report shows a 9.5% rise in monthly homes sales compared to December. Sales of free-standing homes rose 10.1% while unit sales rose by 4.1%. Victoria drove the rise in new home sales with a 17.1% rebound. But as demand increases, supply in units continues to be a concern.The latest Australian Bureau of Statistics data shows that new unit building approvals fell 7% in January. However the number of approvals for private sector houses rose 0.3%.
Suburb in FocusLet’s now turn to our suburb in focus section, and this week we’re continuing our holiday home series, looking at properties under $200k located less than 250km from Melbourne in Victoria.First up we look at Ararat located approximately 205 km west of Melbourne.The town’s population was 8,215 in the last census. Ararat is a vibrant rural city, set between mountain ranges and surrounded by fertile grazing land. The town has been described as the gateway to the Grampians Wine Region where you can enjoy some of the regions finest local wines. There are many cultural and historic attractions including the nationally recognized Ararat Regional Art Gallery, or discover Ararat’s gold heritage at the Gum San Chinese Heritage Centre. Ararat is also a good base from which to explore the regions many natural attractions like Mt Cole, Ararat Hills Regional Park, Grampians National Park and the Pyrenees Ranges.Looking at the figures and the median house price in Ararat is $159,500. There were 173 homes sold in the area in the 12 months to December. Currently there are around 164 properties listed for sale, starting from around $105,000.And now let’s take a look at the town of Moe located 135 km east of Melbourne. The town’s population in the 2006 census was 8,745. Moe is a city in the Latrobe Valley and Gippsland region of Victoria and is home to the annual Moe Cup horse races and Moe Jazz Festival. Lake Narracan is popular for water skiing, jet skiing and fishing. And golfers can play at the Moe Golf Club. Nearby Mount Baw Baw has a small ski resort and Mount St. Gwinear is a popular destination for cross country skiing. Turning to the figures, the median house price in Moe is $135,000. There were 191 homes sold in the 12 months to December 2009. Currently there are 174 properties listed for sale starting from $90,000.
Tax TipAnd now to the Tax Tip of the week from Depreciator. Tax Depreciation Schedule specialists. Today we’ll look at claiming the travel to and from your investment property to do work on it - or to supervise work being done by others. Most people assume they can claim the cost of this travel. Sadly, they can’t.
The ATO see the cost of getting to the property as being separate from the cost of doing work to the property. There is a logic to this. But you may be able to claim the cost of making an annual trip to inspect your rental property. Talk to your accountant about this.
The issue of repairs vs improvements and how to claim the costs of both is an area where many people get caught out. We will look at a few issues related to this over the coming weeks. And of course this is general information only and you should always speak to your accountant or tax professional before making any investment decision.