The RBA finds it hard to justify rate rises.

That's how I read it anyway. Unfortunately, one second it's going up, the next second it may actually drop, then we read articles like this. A bit of a mystery this is...

Finally, finance has been approved!

I won't bore you too much with the details, but organising the finance for this purchase has been a mini nightmare, with one stupid unnecessary delay after another. After a lot of stuffing about, finance was approved today, about a week and a half late.

I pondered on this scenario for a while and I now ask myself are banks THAT BUSY right now that it takes them over 4 weeks to approve a loan to a relatively low risk client? We have NEVER missed a payment, not even close, we have cross-collateralised way below 80% LVR, and the house we're buying a is a solid place which we will be living in. Considering the above, perhaps maybe I should apply to become a bank lender, as I can not see how ANY approval would take any more than 30 minutes. Banks, surely, SURELY, would have a lending criteria tick-and-flick, finance approved or valuations, or not. Come to think of it, a large chunk of the issue was getting to the valuer stage, which is bizarre! I'll role play a lending officer for a moment:

1. Receive loan application

2. Observe on the application that the mortgagee wants to cross collateralise with a list of properties: Order valuations.

3. Continue process of organising paperwork and making an ad-hoc decision based on paper estimates.

4. Receive valuations, approve loan.

5. Go and eat KFC.

So why does this take 4 WEEKS PEOPLE! 4 WEEKS? A load of crap...

Property Investing in 2011

I have been wondering for a while whether investors in 2011 are active. As no doubt you know the market is having a breather and there are A LOT of properties for sale. So, I posed the question on Somersoft and here are the results:

As you can see, 11% of people who have read my post are still buying, and not just one, but multiple properties. In fact, some are buying whole complexes and one investor has bought 14! He is an exception, but 44% of respondents have purchased already up to June. This does mean that 56% are either sitting on their hands, consolidating, offloading, or going bankrupt.

There is much to read into this data. If we do in fact have almost half the investing population still active, this should echo the sentiment of real estate agents, who, as far as I've experienced in my investing regions, are all saying the market is flat, only JUST becoming a little bit busy. So now I'm confused; is the market flat, or is the market busy, and perhaps more importantly, is the market moving ahead?

While I don't tend to analyse this area too much (as I believe property markets move ahead for medium to long term investors, which I believe I am), if the market is flat, now is the time for investors to pick up bargains. Now is the time to see if, even at 7% interest rates, you can find cf+ properties. Now is the time to see if an investor can try to penetrate inner city, or exploit regional/rural areas. It makes sense for cashed-up investors to be active, to put in ridiculous below market offers to see if they can catch a beauty.

Until next time!