NewsFor many families with home mortgages the Easter weekend wasn’t a long enough break away from reality. The first Tuesday in April saw the Reserve Bank of Australia lift the official cash rate by 25 basis points to 4.25 per cent - making it the fifth rate hike in the past six RBA Board meetings. The April rate increase means that if you have a $300,000 home mortgage, the monthly repayment will go up by nearly $50. Weighing into the rate rise debate - The Housing Industry Association says the April increase will only reduce the chances of a sustained recovery in the building of new homes.
While, national project marketing group MLG has countered forecasts of slowing growth in the housing sector and says it expects prices to rise further as sales are supported by international property investors as changes to Foreign Investment Review Board criteria start to have an impact.And just briefly - Two real estate companies have reported record sales in March. National company Ray White reported its strongest month since the financial crisis unfolded and Sydney based McGrath’s also said it had is strongest month ever.
Suburb in FocusIn our suburb in focus section, we are running a series looking at suburbs with the lowest days on market for each state and territory. This week both suburbs are located in the city of Darwin in the Northern Territory. First up we look at the house market in the suburb of Tiwi located around 14.5 kilometres from the heart of Darwin.Tiwi is a northern suburb bordered on one side by a coastal strip that separates Casuarina Beach and Lee Point Beach. Tiwi’s population in the last census was 2,515. The suburb has been substantially redeveloped since Cyclone Tracy in December 1974, with new estates. The Royal Darwin Hospital is located in Tiwi, and a short flight or cruise takes you to the Tiwi islands where you can enjoy dense rainforest, sandy beaches and rock pools.For the 12 months to 2009 Tiwi recorded a median house price of $452,500. There were 34 homes sold in the area, with the median price rising 8% for the year. The median advertised weekly rent is $445 with a gross rental yield of 5.1%. Houses on average spent around 71 days on the market, one of the lowest in the state.And now let’s take a look at the unit market in the suburb of Millner around 10 kilometres north of Darwin’s CBD. The suburb’s population in the 2006 census was 2,366. Millner is considered one of the major growth areas of the northern suburbs. It has the second largest shopping complex, Homemaker Village and houses Darwin’s only velodrome. Millner is next to the Darwin International Airport. Turning to the figures, the median unit price in Millner is $331,500 with 44 units sold in the 12 months to December 2009. The median 12 months growth rate for unit’s in Millner is 22.8%. The advertised weekly rent is $340 taking the gross rental yield to 5.3%. A unit in the suburb of Millner spent an average 63 days on the market.
Tax TipAnd now to the Tax Tip of the week from Depreciator. Tax Depreciation Schedule specialists. Today we are having a look at special levies that can be raised by a body corporate for expenses relating to strata titled unit buildings.A special levy is different to regular body corporate fees that are used for upkeep and maintenance. A special levy is usually for a specific project to be undertaken. This may include installing a new lift, or perhaps renovating the entrance of the unit block. So how do you treat these two different types of expenses when doing your tax? Well, the quarterly strata fees that go toward upkeep, you can claim.However, you are required to account for special levies, depending on what they are paying for. If it is simply for a major repair to the building, you will be able to claim the cost as a deduction, as you would for a normal repair. If the special levy is for capital expenditure, you will need to depreciate this capital cost over 40 years.Your accountant or tax professional will be able to assist you in claiming a special levy deduction appropriately.
