According to realestate.com.au, based on the number of properties listed for sale in a particular suburb combined with the number of visits on the website to homes in that suburb, Sutherland and the northern beaches are where most people in Sydney want to live, with home buyers seeking a mix of lifestyle and infrastructure.

The latest Sydney’s real estate hot spots, Jannali, Heathcote, Bangor and Engadine, all in the far south of the city, drew the most hits on realestate.com.au during the biggest selling season of the year.

They filled the list of the city’s top 10 most popular suburbs in terms of both listings and visits to properties, along with northern beaches areas Narraweena, North Balgowlah and Allambie Heights. The only suburb close to the city which made the most popular list was Lilyfield.

The most clicked-on suburbs in the south were in the affordable belt of the Sutherland Shire, where the beaches and transport to the city are close by. The northern suburbs were not as affordable but were still close to beaches and in leafy, attractive areas.

The results showed home buyers preferred established suburbs, close to infrastructure and lifestyle options rather than new housing developments on the fringes of the metropolitan area, said Real Estate Institute of NSW director Christian Payne.

“Our current planning laws are not giving people the options they want,” Mr Payne said. “There is not enough medium density development in established areas. You can still buy a big house on a brand new block of land far from the city but this shows most people want to be closer to waterways and established hubs.

“It’s not about the McMansion any more and having the most bedrooms and bathrooms. People know if they can live closer to work in a smaller, more practical home they’ll have lower rates, petrol and transport costs and more likely will be closer to friends and family.”

What is negative equity?  Negative equity occurs when the value of your property is less than the outstanding balance on your home loan. Ben Phillips, principal research fellow at the National Centre for Social and Economic Modelling, helped prepare an analysis which pointed to 60,000 households nationwide with negative equity.

While the percentage of home owners with so-called negative equity remains tiny – about one in fifty of the 3 million households with mortgages – the number may well swell in 2012 if home prices extend their declines as some analysts expect.

National city home prices retreated 4 per cent in the year to October 2011 after peaking at the end of 2010, according to RP Data figures.

The final weekend auctions for 2011 indicated the interest rate cuts hadn’t reversed that slide, with Sydney’s clearance rate and median price, for instance, both ending the season at lows for 2011.

Mainstream commentators, such as Westpac economists, predict home prices to be flat or lower in 2012, with worries about the European crisis and a greater reluctance by households to take on debt even as borrowing costs contract nullifying the impact of the RBA cuts.

In Queensland, 19,700 households are estimated to be in negative equity, or 3.2 per cent of the state’s mortgage holders.

While in Western Australia, the total amounts to about 4.5 per cent, or 16,000. New South Wales had the smallest share of mortgages under water, at 1 per cent, or 9000, slightly better than Victoria’s rate which was 1.2 per cent or 9100, although the latter’s household debt levels are drawn from 2010 data.

In South Australia 2.1 per cent of households, or 5000, were in negative equity. Tasmania had 1.5 per cent of households, or 1100, according to the analysis.

FIRST home buyers jumped on the state government stamp duty sweetener for property priced up to $600,000 when it was first offered in 2004.

But based on Sydney’s median price, the return on their investment might not have been as much as they expected.

The longest property boom on record – a decade of growth – was at an end, with median house prices peaking in March of 2004 at $568,700. Prices dropped after that and did not recover for five years.

Latest figures from Australian Property Monitors put today’s median house price at $637,102. That amounts to a growth rate of a paltry 12 per cent over the almost eight years, or 1.5 per cent annualized. Median apartment prices have jumped 20 per cent, or 2.5 per cent a year.

Some may suggest the median data is not a reliable indicator because first home buyers target entry-level property. But Andrew Wilson, a senior economist at APM, has done the numbers on the lowest-quartile properties and comes up with similar growth levels – 12 per cent or 13 per cent.

So is it really bad for that kind of growth rate? Well, if you are still holding the property or if you were a first home buyer when you bought the property in 2004, you are still making profit if you sell it today although the ROI on your cash investment (including Initial Cash Outlay and Holding Cost) might not look great – say perhaps only  30% or so. (SYED4MHHTYAS)

The Australia’s big four banks finally decided to pass on the Reserve Bank’s 0.25 point cut.

ANZ move first, announcing yesterday on 08/12/2012 it would cut its standard variable home loan rate from 7.55 per cent to 7.30. Fellow Melbourne-based giant NAB followed quickly, dropping its standard rate to 7.22 per cent.

Commonwealth fell into line late in the afternoon, and Westpac, which had the highest home rate before the controversy, yielded about 7.30pm 08/12/2012.

And ANZ, although it acted first to cut this time, has flagged a bid to escape the political pressure to pass on Reserve Bank moves in future. It says it will now review its rates on the second Friday of every month, regardless of whether the Reserve has moved.

The shift means that for ANZ’s 700,000 customers, their interest rates could rise or fall even when the central bank has left official rates unchanged.

ANZ’s Australian operations chief, Philip Chronican, implied that ANZ might not pass on any future cash rate moves as there were far more significant influences on bank costs than the Reserve cash rate.

Although the government repeats its demands they pass on the interest rate cuts, none of the big four banks – ANZ Bank, Commonwealth Bank, National Australia Bank or Westpac – has revealed the results of their reviews of their interest rates almost two days after the RBA’s rate reduction on 06/12/2011.

Australia’s big four commercial banks stand to reap an extra $5.6 million in pre-tax profit for each day they hold off passing on this week’s interest rate cut to borrowers, according to one industry estimate. This is supported by rate tracking agency Mozo’s own calculations.

To date, Bank of Queensland and MEBank have passed along the full 25 basis point cut to their customers, as have a slew of credit unions.

6 December 2011, the RBA cut the cash rate by 25 basis points to 4.25 per cent. If passed along in full by the banks, this cut will save the average mortgage holder – with a $300,000, 25-year mortgage – about $47 a month.

It seems that the central bank has now shifted its stance to focus on bolstering domestic demand as the outlook particularly Europe turns gloomier amid the region’s sovereign debt crisis.

Some economists expect that the RBA will cut cash rate again in early 2012 as the global economic outlook dims.

Interest rate futures – one gauge of how investors view what’s coming on the rates front – are tipping the RBA’s cash rate will drop to 3 per cent by June. That view implies rate cuts at each of the RBA’s first five rate meetings in 2012 – assuming each move is 25 basis points.

Are hundreds of Australian investors going to lose millions of dollars in the American property market? It might be!

Prices for American properties are so low and the Australia dollar is so high that an investment in “the home of the brave and the land of the free” seems like a really good idea.

You’ll be told by those Aussie spruikers that you can buy a house in USA for as little as $50,000 and rent it out for about $200 a week. That’s a 20% return. Does this sound wonderful?

Unfortunately, buying real estate in America is a very bad idea.

Ask yourself an obvious question. If these American properties are such a good deal, how come the locals aren’t buying them?

Right now, interest rates on home loans in America are very low (around 4% for 30 year fixed-rate mortgages). That means an American family can borrow $50,000 and pay just $2,000 in interest each year! Why, then, would that same family pay rent of $200 per week when they can buy the property for a far lower payment? Something just doesn’t seem right, does it?

You have to ask yourself: What price are the locals paying for similar properties? If the locals are not buying the properties, then you shouldn’t touch them either.

In some areas there is no rent because the properties are abandoned. Even if you are lucky and do rent your property out, “You need an armoured Humvee and a bullet-proof vest to collect the rent.”

If you really want to check out the American real estate market, do it properly. Buy a ticket to the United States and check out the market for yourself. Under no circumstances should you buy property on the advice of an Australian company alone. Do the real research by yourself.

Again, $50,000 sounds like a cheap price for a property. However, there are Australians who have bought houses in the United States for $50,000 and cannot re-sell those houses for $25,000.

So, be warned Aussie investors. Don’t be ripped off by buying American real estate.

How can you pay off your home mortgage or home loan faster?

There are many things you can do. Here are some tips from everyday Australians who are repaying their mortgage like you.

1. Make fortnightly repayment instead of monthly. You have to take advantage of the fact there’s 12 months in the year, but 26 fortnights, meaning you make one fortnight’s repayment more per year than you would if you were paying monthly. How much you can save? It depends on many factors. You can download the free Mortgage Home Loan Amortization Calculator from Investment Property Calculator to see how much fortnightly repayment can save you.

2. Shop around for better interest rates. 0.2% saving in interest rate will save you $14,500 over 30 years for a loan amount of $300,000. You can download the free Home Loan Repayment Calculator from Investment Property Calculator to see the impact of a lower interest rate. However, refinance your mortgage is not going to help if you do it wrongly. You can You can download the free Home Loan Refinance Calculator from Investment Property Calculator to see the impact of a lower interest rate.

3. Use a 100% offset account. When you have savings, put them into your offset account so that you can pay less interest. It is much better than putting them into a savings account because you have to pay tax. You can download the free Mortgage Offset Calculator from Investment Property Calculator to see the impact of using a 100% offset account.

4. Use a credit card as much as possible so money stays in the offest account longer.

5. Budgeting, prioritizing and buying within your means.

Summary

• Australia capital city home prices fell by four per cent in the year to October 2011.
• Flat to lower house prices for the next six months or possibly the next 12 months.

Australia capital city home prices fell by four per cent in the year to October 2011, after a 0.5 per cent decline in the month. The median dwelling price in capital cities now stands at $448,500.

According to the latest RP Data, Brisbane led the national decline, with average home prices falling 7.5 per cent in the ten months to October 2011. Home values in Melbourne, Adelaide and Perth all declined 5.8 per cent, 4.4 per cent and 3.8 per cent over the same period, while Sydney remained relatively steady, with prices dropping by 1.4 per cent.

At the same time, regional home prices fell by 3.4 per cent.

All capital city home prices fell for the month of October 2011, except Sydney, which was unchanged, and Canberra and Hobart, which added 1.6 per cent and 3.1 per cent, respectively.

The national prices falls are being skewed by a retreat at the more expensive end of the market, according to Century 21, a national real estate group.

In Sydney, the market below $1.2 million was still very active. For Melbourne, the tumbling prices in 2011 followed several years of rapid gains, with values up by more than 25 per cent over the 18 months to June 2010 alone.

The outlook for housing may be improving, though, with new home sales up 5.5 per cent in October, according to Housing Industry Association figures out today. The increase marks a rebound from the 3.5 per cent slide in September 2011.

A decision by the Reserve Bank of Australia (RBA), which meets next week, to cut interest rates could provide much needed support for the market although I don’t think this is going to happen.

Even with lower interest rates, analysts predict prices will continue to slide in the months ahead, with Melbourne likely to see steeper falls than Sydney. It is possible that we will see flat to lower house prices for the next six months or possibly the next 12 months.

Some analysts are positive on the national outlook as they thought that Australia was to some extent immune from what was happening in Europe as Australia’s future is more closely linked to the growth of emerging world economies that need our resources. Even the growth rate of those emerging world economies slows down moderately, it would still allow growth in our economy in years to come.

According to Mortgage News Daily, the Federal Housing Finance Agency’s seasonally adjusted purchase only price index (HPI) shows that U.S. house prices rose slightly in the third quarter of 2011.

The HPI is calculated from data on home sales obtained from Freddie Mac and Fannie Mae acquired purchase money mortgages where previous mortgages were also held by one of the government sponsored enterprise (GSE).  In addition to its usual analysis of home price data, the report looks at the effects of supplementary information added to the analysis last quarter and at the impact of the increase in the prices of and demand for certain commodities in recent years.

Home prices rose 0.2 percent on a seasonally adjusted basis from prices in the second quarter.  On an unadjusted basis prices were up 0.7 percent.  Prices in the third quarter were 3.7 percent lower than in the third quarter of 2011.

The index which tracks monthly prices showed an increase of 0.9 percent on a seasonally adjusted basis from August to September and 0.7 percent on an unadjusted basis.