Mortgage Exit Fees officially banned

Mortgage Exit Fees, which sometimes are as high as AU$7,000 will be banned from July 1.

The regulation, which did not need the approval of Parliament, is intended to make it easier for home borrowers to shop around for better deals, even if they already have a loan.

The Government believes Mortgage Exit Fees have been "one of the biggest roadblocks stopping Australians getting a better deal for their families".

Treasurer Wayne swan produced the regulation, which became law on March 23rd, 2011 as part of a package to boost competition among lenders, particularly the major banks.

Mr Swan believes it will allow borrowers to "walk down the road if their bank isn't doing the right thing by them".

Andy [Armando] Cristofori
- Education & Marketing Strategist

Andy holds formal qualifications in Finance [Managed Funds & Securities], Real Estate [Full Lic], Education, Safety & Security, Timeshare, Marketing & Advertising, Travel & Tourism and Architecture. Andy brings a plethora of valuable knowledge and skills to the NRAS Education Team.

Andy brings real life hands-on experience in all aspects of marketing and has held senior marketing and general management positions in Property Marketing where he was responsible for designing and co-coordinating the global division of one company and later the recruiting & training of a national sales-force for others. Andy has also been the Licensee Director for a number of commercial and residential real estate agencies in Queensland and in NSW.

He has been responsible for the launch of a number of dealer incentive and consumer loyalty programs as well as for several product launches and corporate restructurings both in Australia and interxnationally.

In the late 80’s and early 90’s he held senior marketing and general management positions in the Investment & Finance Industry with companies such as Investment Products [discount broker], IPAC Securities [Financial Planners],Fidelity Securities [Managed Funds Mgr],and Morgan Grenfell [Privately owned bank].

Andy has also held senior marketing and general management positions with Flight Centre, the Tourism Authority of Thailand, Thailand Board of Investments [responsible for the ASEAN and the Mekong Basin countries] and in the mid to late 80’s with Thomas Cook [then the oldest and largest travel & tourism operation in the world].

In his spare time Andy trained and mentored others in leisure and services marketing including at various private colleges, TAFEs and universities in Sydney, Bangkok and on the Gold Coast.

Andy is passionate about assisting people to become financially independent.

http://www.nraseducation.com/

National Rental Affordability Scheme (NRAS)

The National Rental Affordability Scheme (NRAS) is a long term commitment by the Australian Government to invest in affordable rental housing. 

The Scheme seeks to address the shortage of affordable rental housing by offering financial incentives to the business sector and community organisations to build and rent dwellings to low and moderate income households at 20 per cent below-market rates for 10 years. NRAS aims to:

• Increase the supply of new affordable rental housing;
• Reduce rental costs for low and moderate income households; and
• Encourage large scale investment and innovative delivery of affordable housing.

The Australian Government has committed $1 billion to the Scheme over four years to stimulate construction of up to 50,000 high quality homes and apartments, providing affordable private rental properties for Australians and their families.

With an NRAS property your eligible tenants will be qualified and referenced.

NRAS tenants and landlords are regulated under State and Territory tenancy laws. The same rules regarding evictions, maintenance obligations and responsibilities of tenants apply to NRAS tenants as they do to other tenants in the private market.

NRAS tenants tend to be key workers, such as childcare workers, teachers, nurses, police officers, fire fighters, trades people and paramedics.

Approximately 1.5 million households are currently eligible to rent NRAS properties.

Investors can pick any tenants for NRAS properties, as long as these tenants do not exceed a certain income and asset threshold and in Queensland are Australian and Queensland residents.

Upper levels for eligible NRAS tenants are generous and allow for tenant salary increases of 25 per cent above the entry income limit.

With an NRAS property you will have a secure income stream that significantly increases your return on investment.

The Government is committed to ensuring that the full value of the NRAS Incentive is passed to all investors. If you have any questions, speak with your accountant

The Australian Government has no legal or equitable claim over an NRAS property.

Australian housing is becoming increasingly unaffordable, according to experts. House prices continue to surge, and interest rates maintain an upwards spiral.

As Australia’s population continues to grow, and the gap widens between availability and demand for dwellings, many people are now resigned to renting. For investors in property, this means continued strong demand and increasing rental returns.

With an NRAS property your Property Managers and NRAS Compliancy Management* are accredited and highly regulated.

As with any private investment property, there are a range of property and tenant management services that need to be performed for all NRAS properties.

NRAS investors must appoint a tenancy and/or property manager to provide services including selection of tenants and periodic assessment of their ongoing eligibility to rent an NRAS property, as well as property maintenance.

Standard State and Territory residential tenancy laws apply to NRAS properties just as they do for any private residential investment. This includes laws applying to registration and licensing requirements for tenant managers.

*NRAS Compliancy Management is undertaken by an approved applicant to ensure your apartment complies with NRAS standards and you receive your incentives for the 10 year life of the scheme.

With an NRAS property professional Property Managers, with extensive databases, provide you with added security against vacancies.

Given the attractiveness of the NRAS scheme to renters, vacancy rates are expected to be less than 1%.

With an NRAS property you continue to be eligible for all other tax deductions normally associated with property investment.

These include: Conveyance fees and legal costs, advertising, stamp duty, travel costs, cleaning, depreciation, insurance costs, interest on your loan, land tax, council rates and water rates, pest control, repairs, body corporate and property management fees.

Please talk to your NRAS Educator for more information.

The return on your investment in NRAS property outperforms other market residential property.

The official Government NRAS website says this about the potential for your involvement:

NRAS investors can expect to benefit from the annual NRAS Incentive, rental yields and capital gain.

NRAS is intended to be a commercial, profitable investment for participants, while also assisting Australia to increase the supply of affordable housing.

With returns on direct residential property proving higher than returns on office or industrial property over the last 10 years, residential property has proven a profitable investment.

While house prices have fallen substantially globally, the Australian housing sector has shown resilience, primarily due to strong fundamentals – low vacancy rates, high population growth, insufficient housing stock, high employment and sound lending practices.

Demand for residential property is high with the National Housing Supply Council’s State of Supply Report 2010 estimating a current housing supply deficit of 178,400 homes across Australia.

Partly due to the shortfall in supply, the residential rental market represents a good long-term investment. Independent financial modelling of the NRAS Incentive shows that it can provide market rates of return at levels that are strongly competitive with other asset classes.

The Australian Government commissioned a free financial modelling tool, available to interested investors. You can view the Financial Modelling Tool by visiting the FaHCSIA website.

Compared with a conventional residential investment property, in certain markets the NRAS Incentive can provide better cash return to investors than the receipt of full market rent.

In addition, investors are able to apply property expenses and non-cash deductions and allowances against a lower assessable rental income, increasing the negative gearing benefit.

NRAS can counterbalance the risk and volatility of equity markets and assist in providing a balanced portfolio. It offers great flexibility, with investors encouraged to develop portfolios with diverse dwelling types across different locations.

With more than 1.5 million households eligible to rent NRAS properties, the vacancy risk is negligible.

With an NRAS property your market will remains fully liquid.

While you can remain in the scheme for 10 years, you may:

• On-sell your property/properties and leave them in the scheme for the next investor; or

• Exit the scheme with suitable notice to the managers.

The only penalty for removing properties from the scheme is the loss of the unpaid incentive for that NRAS year and no future incentives.

With an NRAS property you will enjoy strong market capital gain potential.

Australia’s National Housing Supply Council predicts a huge gap between the Australia’s housing supply and availability over the next 20 years.

Queensland already needs 46,000 more dwellings than it currently has.*

According to the National Housing Supply Council, demand for dwellings in Australia over the next five years will be 182,700 homes per annum.*

Returns on investments are also forecast by all sources to be strong.*

* Source: Resolution Research.

With an NRAS property you will receive a minimum of $116,000* worth of incentives over 10 years.

The annual income-tax free incentive is currently $9,140 per dwelling, and is indexed each year to the rental component increases of the CPI. It comprises:

• ·         An Australian Government contribution of $6,855 per dwelling per year as a refundable tax offset or payment; and

• ·         A State Government contribution of $2,285 per dwelling per year in direct or in-kind financial support.

• ·         These will usually be paid in June/July.

• ·         In 2008 the Australia wide rental component indexation was 8.4%. In 2009 it was 5.4%.

$116,000 is based on receiving the incentive for 10 years, which is currently $9,140 p.a. indexed for an estimated rental component of CPI of 4.5%.

With an NRAS property you will receive $9,140 in tax free incentives indexed annually at the rental component of CPI every year for 10 years.

NRAS Education Associates will organise your application for the NRAS incentives. Investors must agree to rent the approved dwelling at app 20% below prevailing market rates to eligible tenants.

Your approved dwelling attracts the NRAS incentive for 10 years so long as you continue to comply with conditions such as tenant eligibility and rent discounts.

NRAS properties offers a quality real estate investment.

Each eligible NRAS property must be new.

Each eligible NRAS property must be built up to a standard, not down to a ‘price’ with the Australian government applying rigorous selection criteria as to location, design and amenities.

How to:

There are some basic rules to follow when looking to benefit from an NRAS purchase. You can learn more in our full workshop, but we have provided a quick overview below to assist potential investors to get started.

• Gain information- Do the basic research.
  
  
• Gain specific information relevant to your personal situation -Meet with an authorised representative that can give a correct financial strategy for the purchase .
  
  
• Your Authorised Representative will complete with you an NRAS Acceptance Form, the information gained will be used to determine your comfortable borrowing capacity and also determine your eligibility for the NRAS scheme. At present specialised finance is required to purchase an NRAS property, most banks and brokers will not know how to set this finance. We can guide you to the correct specialised finance required to suit your personal investment needs.
  
  
• Your Authorized Representative can help you determine if your current contacts are able to do this or refer a qualified NRAS mortgage planner to you to get an approval that will suit your personal strategy.
  
  

With these important steps in place you now have the knowledge to select the most appropriate NRAS property

• We can guide you through the purchase process and recommend suitable legal advice that can advise you on the NRAS agreement.
  
  
• You will have an initial conditional period with your NRAS asset purchase during which time all necessary backup paperwork may be completed!
  
  
• NRAS Education will assist you to ensure that the process of securing an NRAS property is hassle free.

The NRAS Incentive

The NRAS Incentive is a substantial annual tax-free incentive available to any investors who agree to rent approved dwellings up to 25% below current market rates, and is payable on a per-dwelling basis.

At present the incentive amounts to nearly $175 per week, or $9,140 per year, totalling over $100,000 within a 10 year period with a likely rise of at least 5% due in May 2011.

Each approved dwelling attracts the NRAS Incentive for 10 years, provided that investors continue to comply with conditions around tenant eligibility and rent levels. The Australian Government has no legal or equitable claim over the property, so NRAS investors can therefore expect to benefit from the annual NRAS Incentive, rental yields and capital gain.

Go to www.NRASeducation.com to learn more about the NRAS Incentive.

NRAS Workshops

NRAS Education offer a fortnightly workshop where the National Rental Affordability Scheme is explained and all your questions can be answered in either a group environment or at your home by one of our Financial Strategists.
These educational workshops cover topics such as :

• What is NRAS
• Why is the Government offering this opportunity
• Financial benefits to Investors
• NRAS and the potential tax savings
• Positive Cash Flow Positioning
• How Specialised Property Partners can make this an easy process

To arrange an in home visit simply click the ‘book now’ button on the left of this page.
Our workshops are open and accessible to any qualified investor and you can sign up easily by simply completing a short qualification questionnaire below. After completion you will also be provided with a financial analysis document providing you with information on your investment potential.

Our next workshops will be held at:
 
Monday, 21st March, 201 .......... 16:45pm for 7:00pm start 
The Ashgrove Golf Club ..... 863 Waterworks Rd,The Gap, Qld
Go to www.NRASeducation.com to register

Opportunities for NRAS Investment

The Australian rental market represents a good long-term investment for investors with the opportunity for significant capital gains as our housing sector has shown a high level of resilience during the recent financial crisis.  Contributing to the national strength in the property sector are our strong fundamentals, low vacancy rates, high population growth, insufficient housing stock, high levels of employment and prudent lending practices.


We encourage investors to develop portfolios utilizing the scheme as NRAS offers great flexibility with diverse dwelling types and varying locations. With more than 1.5 million households eligible to rent as NRAS properties, the vacancy risk in any specified location is negligible.

To learn more about the NRAS and how it can apply to you as an investor, NRAS offer education workshops, consultations to your home, and information packs to fully explain how the National Rental Affordability Scheme process works and define an easy path for investing.

Additional documents regarding the NRAS are provided below, or if you would like to book an in home appointment simply click here.

Our workshops are open and accessible to any qualified investor and you can sign up easily by simply clicking the Workshop button above and completing a short qualification questionnaire. After completion you will also be provided with a financial analysis document providing you with information on your investment potential.

Workshops

Monday, 21st March, 201 .......... 16:45pm for 7:00pm start 

The Ashgrove Golf Club ..... 863 Waterworks Rd,The Gap, Qld
Go to www.NRASeducation.com to register

The NRAS Incentive

The NRAS Incentive is a substantial annual tax-free incentive available to any investors who agree to rent approved dwellings up to 25% below current market rates, and is payable on a per-dwelling basis.
Each approved dwelling attracts the NRAS Incentive for 10 years, provided that investors continue to comply with conditions around tenant eligibility and rent levels. The Australian Government has no legal or equitable claim over the property, so NRAS investors can therefore expect to benefit from the annual NRAS Incentive, rental yields and capital gain.
With the introduction of the scheme the government has increased the possibility of higher than commercial returns for purchasers of NRAS approved property. The scheme will help in providing Quality housing at affordable rents up 25% below the market rate. NRAS is not designed as a social housing scheme, its aim is to help long term renters in their local areas that have the financial character required to maintain their rental obligations, the introduction of the NRAS scheme should result in far less people being displaced and give security to key workers in our service industries.
There is clear evidence that homes being constructed in Australia are not currently matching the demand, and are increasing in average construction size when compared to other economic powers around the world.
Owning an NRAS approved property provides the same taxation benefits as a standard residential property with the addition of far better cash flow opportunities, and the aid of incentives paid by State and federal governments. There is also the prospect of obtaining an asset class that will have an continually increasing demand.
www.NRASeducation.com