More than a quarter of SME businesses knocked back for finance

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As if small and medium-sized businesses weren’t already facing an uphill battle this year; now it turns out that more than a quarter were knocked back when they applied for finance in recent months. Here’s how we can help.

The latest Sensis Business Index – which surveyed 1,015 businesses in the first week of August – shows 26% of businesses that applied for finance over the past three months were knocked back.

The figure was worse in the bush with 37% of those applying in regional areas declined, compared to 25% in cities.

Additionally, fewer and fewer businesses are applying for finance.

The percentage of businesses that applied for finance dropped to 13%, down from 16% in March and 17% in December 2019.

How we can help

All of the above figures highlight the importance of having a broker like us guiding you through the process.

Here’s what small business lender OnDeck has to say in regards to its recent research on the importance of having a trusted professional to speak to while applying for finance.

“Our survey clearly highlights that SMEs place significant value on the input of a broker in the commercial finance process,” says Robbie Fidler, OnDeck Australia national broker channel manager.

“Brokers can act as a conduit between lenders and SME owners, providing the person-to-person link that is so valued across the SME community.”

Additionally, SME lender Scottish Pacific recently highlighted the important role brokers can play in helping businesses prepare for that September “cliff” you’ve probably heard about.

“When COVID-19 hit and JobKeeper and other initiatives were put in place, September seemed a long way away – it’s only a week away now, and small businesses need to act,” says Scottish Pacific’s General Manager for Victoria, Jane Starkins.

“We are having regular conversations with accountants and brokers who realise their clients need funding in place to pay expenses they have been deferring, including rent, asset finance, PAYG, superannuation and payroll tax.”

Ms Starkins adds that now is an ideal time for business owners to find new funding paths that harness the value of assets already in their business, such as their sales invoices or plant and equipment.

“Business owners are reluctant to extend their borrowings. They are busier than ever trying to navigate the COVID-19 environment, which means accountants and brokers have a crucial role to play in making them aware of other funding solutions,” she says.

Get in touch

If you’re an SME owner in need of finance solutions to get through the months to come, get in touch.

The sooner we can discuss your options with you, the better placed your business can be to avoid the September cliff and thrive beyond.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

Where you’re most likely to score a $50,000 discount on property right now

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Home sellers across the country are lowering their price expectations in droves, new data reveals. But which two capital cities have seen the highest percentage of sellers discount their asking price?

Here’s an exciting stat for all you property bargain hunters out there: the percentage of sellers dropping their asking price during COVID-19 has more than doubled in our capital cities across the country, new Domain data shows.

So which two cities have seen the biggest increase in sellers offering discounts?

Well, the head-and-shoulders leader is Sydney, followed by Melbourne, with Adelaide only just nudging out Brisbane and Perth in a photo finish for third.

But all cities are offering median discounts between $22,000 and $50,000, which we’ll look at below.

A closer look at the stats

Prices dropped on one-in-seven (14.7%) Sydney properties for sale last month, almost a threefold increase from the 5.3% of sellers who offered discounts a year earlier in July 2019.

In Melbourne, the percentage of sellers dropping their asking price during the COVID-19 pandemic increased nearly four-fold from 3.1% in July 2019 to 11.5% in July 2020.

Adelaide recorded the next highest discount figure at 10.1%, up from 3.1% last year, while in Perth the percentage of discounters almost doubled to 10% from 5.3%.

Brisbane followed closely with an increase to 9.7% from 4.4%, Canberra increased to 8.6% from 6.3% and Hobart to 5.4% from 2.8%. Darwin was the only capital to record a slight drop – with 5% of sellers offering a discount this year, compared to 5.5% a year earlier.

So what does that mean for prices?

With most capital cities offering a median discount around 4-5%, the savings you could receive on a median-priced property in each city are: $49,150 in Sydney, $35,254 in Melbourne, $26,810 in Brisbane, $26,210 in Canberra, $24,553 in Perth, $24,351 in Hobart, $23,745 in Darwin, and $22,121 in Adelaide.

But remember, that’s just the median. Better (and worse) discounts are sure to be found.

Here’s a quick table for you to compare the numbers yourself

The percentage of listings with discounts from July 2019 to July 2020:

Sydney: Increased from 5.1% to 14.7%

Melbourne: Increased from 3.1% to 11.5%

Adelaide: Increased from 3.1% to 10.1%

Perth: Increased from 5.3% to 10%

Brisbane: Increased from 4.4% to 9.7%

Canberra: Increased from 6.3% to 8.6%

Hobart: Increased from 2.8% to 5.4%

Darwin: Dropped from 5.5% to 5%

A quick note on the value of the discounts

Now, it’s important to note that the value of the discounts isn’t increasing – just the percentage of properties offering discounts.

Domain senior research analyst Dr Nicola Powell explains: “We’re seeing a broader slowdown in properties, rather than prices tanking, which is good news.

“And I think we’ll continue to see price weakness but the falls to date have been minimal and they’ll stay that way, rather than some of those outrageous predictions we saw at the start of COVID-19 of 30% falls.”

Think you might have found a bargain?

Have you recently stumbled across a discounted property that’s too hard to ignore?

If so, get in touch today and we can help you get your finances in order and apply for a home loan. The lending market can be a little tricky to navigate at present, but rest assured we’re here to help guide you through it.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

Property ranked as 'best investment option right now' by experts: survey

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You’ve heard the saying ‘safe as houses’, right? Well, it seems that old adage may ring true even in the current pandemic, with many of the nation’s top economic experts saying that’s where they’d put their money right now.

A Finder survey asked 28 leading experts and economists to weigh in on future cash rate moves and other issues related to the state of the Australian economy.

When asked: “Where do you think is the best place to invest your money right now?”, the leading response was “property”, with 1 in 3 experts (32%) backing it as their top option.

This was followed by shares (21%), gold (14%), superannuation (11%) and then cash (7%).

But hang on, isn’t the property market meant to be in trouble?

Rest assured it’s not all doom and gloom out there.

According to CoreLogic’s latest data, nationwide median housing values fell just 0.6% in July and fell 1.6% for the quarter, bringing the median dwelling value to $552,912.

However, to put that into context, over the past year national housing values have risen by 7.1%.

Sydney property prices led the way with a 12.1% increase in median value, followed by Melbourne (8.7%), Canberra (7.2%), Hobart (5.9%), Brisbane (3.8%) and Adelaide (2.4%).

Perth (-2.5%) and Darwin (-2.2%) were the only capital cities to record negative growth in housing values over the past 12 months.

Tim Lawless, CoreLogic’s head of research, said housing markets have remained relatively resilient through the COVID-19 period so far.

“The impact from COVID-19 on housing values has been orderly to-date,” says Lawless.

“Record low interest rates, government support and loan repayment holidays for distressed borrowers have helped to insulate the housing market from a more significant downturn.”

However, with fiscal support set to taper from October, and repayment holidays expiring at the end of March next year, Lawless says the medium-term outlook remains skewed to the downside.

“Urgent sales are likely to become more common as we approach these milestones, which will test the market’s resilience,” adds Lawless.

Other interesting property market predictions

Here are a few other interesting stats and predictions we took out of the Finder survey:

– Almost half of experts (42%) believe now is a good time for homeowners to put their property on the market, while a quarter said homeowners should wait two years.

– Two-thirds of surveyed experts (65%) believe Australia will see GDP growth in 2020, despite the Treasurer confirming in June that the nation is now in recession.

– All experts believe no further cash rate cuts will be implemented this year. However, more than two-thirds (72%) of experts forecast an increase in 2021 or 2022.

– More than half of experts surveyed (58%) believe other banks will follow in St George’s footsteps to reduce lenders mortgage insurance (LMI) to $1 for first home buyers with a deposit of just 15%.

Seen a property you like? Get in touch

As mentioned earlier, it’s expected that properties priced for a quick sale will hit the market in the coming months – properties that may prove difficult for some buyers to resist.

So whether you’re looking to add to your property portfolio, looking for a change of scene, or keen to buy your first home and break into the market, get in touch today.

We’re here to help you find a loan that’s just right for you.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

The top ten Australian suburbs to buy in post-COVID-19

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We’re all looking forward to things eventually getting back to normal, or at least the “new normal”. And while it’s not clear exactly what the “new normal” will look like in the property world, there are some promising early signs. 

For instance, you might have seen that interest rates are pressing down towards 2% (and, in a few rare cases, dropping below 2%), and that property prices have dipped a little in some areas.

So what does this mean? Well, it spells good news for prospective buyers who’ve been fortunate enough to escape the financial impacts of COVID-19.

But where to buy?

When looking for an ideal post-COVID-19 purchase location, the first thing to consider is that workplaces are likely to have changed forever.

In the post-pandemic world, it’s likely that those who want to work from home won’t face the same hurdles they did in 2019 and, as such, suburban and coastal suburbs may be more in demand.

This predicted shift in preferences away from inner-city living is clear in analysis supplied to Business Insider Australia by Finder, with half the suburbs on the list within walking distance to the beach.

The analysis also took into account factors including crime rates, property costs, and how family-friendly areas are.

The 10 top post-COVID-19 suburbs

So here are the top 10 suburbs to buy in, according to the analysis.

NSW: Cordeaux Heights, in Wollongong, south of Sydney
NSW: Eleebana, Lake Macquarie, north of Sydney
QLD: Westlake, a western suburb in Brisbane
QLD: Bridgeman Downs, a northern suburb in Brisbane
QLD: Cotswold Hills, in Toowoomba, west of Brisbane
WA: Carine, a northern suburb in Perth
WA: Leeming, a southern suburb in Perth
WA: Gooseberry Hill, an eastern suburb in Perth
SA: Aldgate, just south-east of Adelaide
ACT: Fadden, a southern suburb in Canberra

It’s worth noting that most, if not all, of the above suburbs have an average property price between $720,000 and $800,000.

While Victoria didn’t get a look-in for the top 10, the analysis ranked Thomastown, Lalor, Watsonia North, Greenvale, and Gladstone Park in Melbourne’s north favourably. In the city’s west, Kings Park, Keilor Downs, Albanvale, Keilor Park and Kealba also got favourable rankings.

Where do you want to buy?

You don’t need a list to tell you where you should live.

Everyone has different preferences, purchasing power, circumstances and dreams, all of which will influence your “top suburb” in the post-pandemic world.

So if you’ve been researching a suburb and have an eye on your next dream property, get in touch today. We’d love to help you arrange finance for it.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

How to smooth out your business’s insurance and workers comp premiums

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Getting a bill in the mail is never pleasant, but your annual insurance and workers compensation premiums can be particularly tough lump sums to swallow. There is, however, an affordable financing option that can limit the impact on your business’s cash flow. Let’s take a look.

Most businesses have expensive annual insurance premiums to pay, whether they be for professional indemnity insurance, product liability insurance, public liability insurance, or any other general business insurance policy.

Throw your workers compensation premiums into the mix and these obligations can become quite the annual financial hurdle to overcome.

Fortunately, a financing option exists that can smooth out your cash flow headache and help you become eligible for an early bird discount on your workers compensation premium.

Insurance Premium Funding (IPF)

IPF allows you to split your insurance payments into manageable, affordable, monthly amounts that won’t cripple your cash-flow like an annual lump sum payment can.

Basically, any business that has an insurance premium of more than $5,000 has the ability to use IPF if they need to.

The insurance premiums are normally financed over 8 to 10 months to ensure the premium is fully paid before its renewal, and there is generally no security required with IPF.

Workers comp early bird payment discount due soon

One insurance premium that IPF is commonly used for is workers compensation.

That’s because in some states (including NSW, Victoria and Queensland), employers who pay their annual premium in full are entitled to a 3% to 5% early bird discount.

But here’s the catch: workers comp premiums need to be paid in full before the early bird due date (typically around August/September) in order to receive the discount.

By using IPF to make this payment upfront you can secure the early bird discount, which helps to offset the cost of IPF.

Taking this option will also improve your business’s cash flow, allowing you to redirect capital into income-generating investments.

Find out more

If you’d like to find out more about IPF then get in touch today – especially if you want to be eligible for the workers compensation early bird discount. We’re here to help your business any way we can.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.