property investment finance hints, tips and strategies

Master Class:

Insights to Financing your property portfolio

With Paul Kalajzich from Anne Street Partners

We help investors build and manage

their property portfolios

In partnership with…

Real Estate Investar’s tools

Master class webinars• Designed to share knowledge.

• Desire to provide extra value to our clients.

• Great for both new and experienced investors.

• Plenty of opportunity for Q&A.

• We will run these regularly throughout the year, and sometimes involve our partners to provide additional insight.

Todays 9 topics1. Why there is so much changing in

the current investor lending market

2. Low interest rates are fixed rates feasible

3. Should refinancing be a consideration

4. What is borrowable equity and the main factors that determine borrowable equity

Todays 9 topics5. Choosing a Bank or Lender

6. How much to borrow

7. SMSF lending - Limited recourse borrowing arrangements (LRBA).

8. Locations - Regional areas

9. Professional unbiased advice

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Audience poll

Which property investment category are you in?

Anne Street Partners Home Loans Pty Ltd. ABN 11 135 905 681 Australian Credit Licence 391660 10

Material contained in this presentation is an overview only and it should not be considered as a comprehensive statement on any matter nor relied upon as such.

This presentation contains general information only and does not take into account your personal objectives, financial situation or needs and you should consider whether the information is appropriate to you before acting on it. Both superannuation and tax laws are complex and subject to change. Before acting on any information you should consider seeking advice from a financial adviser and your accountant before making any financial decision in relation to any matters discussed in this presentation.


Introducing Paul Kalajzich

Meet your presenter

• Paul has over thirteen years of hands-on experience in the residential mortgage market, particularly within mortgage broking.

• Paul holds a Diploma of Financial Services (F/MB) and at the end of this year is due to complete his MBA(Finance).

• He is also a member of the Mortgage and Finance Association of Australia (MFAA ).

• Paul has held senior mortgage broking related positions with Aussie Home Loans, NAB, St George Bank and is currently based in Perth with Anne Street Partners.


Anne Street Partners

• Established 1997

• Privately owned – non bank aligned

• Broad range of financial solutions

• Nationwide footprint

• Experienced mortgage finance professionals with over $1.3 billion on the current home loan book.

One of Australia’s leading wealth management organisations


Why is there so much changing in the current investor lending market?

* “Strong growth in lending to property investors — portfolio growth materially above a threshold of 10 per cent will be an important risk indicator for APRA supervisors in considering the need for further action”

As a result banks have now cut discounts for housing investor borrowers, and informed brokers of further changes to its credit policies, serviceability, including maximum loan-to-valuation ratios (LVR) for investment products.

* APRA Press release – 09 Dec 2014


Why is there so much changing in the current investor lending market?


Making sense of the changes

Source: NABBroker August 2015


Audience poll

Are you aware of the home loan interest rate you are currently on?


Did you know?

• Investor lending growth accelerated from 11.7% in 2013-14 to 18.6% in 2014-15

• Lenders had a combined $516.9 billion of interest-only mortgages at the end of 2014-15, which represented growth of 20.0%, compared to growth of 13.6% in the previous financial year

Source “APRA figures support lending crackdown” http://www.mortgagebusiness.com.au/ 26 Aug 2015

http://www.mortgagebusiness.com.au/

http://www.mortgagebusiness.com.au/


Audience poll

When did you last have a professional review all of your home loans?


Low interest rates are fixed rates feasible?

• The affect of an interest rate change will be determined by whether the loan is entered into at a fixed or variable rate.

• Here are the advantages of fixing your loan:

– Makes budgeting easier

– Rate rises don't matter

• The disadvantages– Rate drops will annoy you

– Can you make extra repayments?

– Break fees


Low interest rates - are fixed rates feasible?

• Break fee = loan amount x remaining fixed term x change in cost of funds

• Fully functioning fixed rates

• How to decide


Low interest rates

• Variable rates

• Discounting

• Comparison

• Rate is a non definable

• Term vs property turnover– What is your investment strategy

– Split variable / fixed


Should refinancing be a consideration?

• Structure– Loan type– Structure– Equity



• “Cross collateralised” security– Family home and new

investment property used as security for both loans

• Stand Alone

• Stand Alone or Cross Collateralisation



• Structure– All Monies Mortgage

– Offset

– Repayment type

• Flexibility

• It’s not about rate… or is it?


Borrowable equity and the main factors that determine borrowable equity

• Property valuation– Types of valuation utilised– Not an exact science

• Revaluing all properties

• Improving valuation potential


Choosing a Bank or Lender

• Lender types

• APRA impacts

• Appetite and risk

• Exposure

• Policies

• Access


Choosing a Bank or Lender

• Advantages of being with one lender

• Disadvantages of being with one lender


How much to borrow?

• Income types

• Rental treatment

• Gearing

• Buffers

• Existing debt


Audience poll

What would make you considering refinancing?


SMSF lending - Limited recourse borrowing arrangements (LRBA).

• Superannuation Industry Supervision (SIS) Act amended in September 2007 (section 67A)


LRBA Structure


Benefits of SMSF strategy

• Ability to invest in direct property

• No financial impact on lifestyle

• Increase exposure to growth assets

• Control over investment choice

• Potential tax benefits


Audience poll

Have you ever considered using a SMSF as strategy for property acquisition for retirement?


Locations - Regional areas

• Newly developing regions

• Banks apply differing consideration outside of metropolitan areas

• Mining areas


Professional unbiased advice

• Legal

• Financial Adviser

• Finance manger


Introducing Anne Street Partners Finance Managers


The Anne Street Partners Finance Team

Karim El BaghdadiSenior Manager, FinanceMelbourne

David LeeSenior Manager, FinanceBrisbane

Mustafa HaddadManager, FinanceSydney

Paul KalajzichSenior Manager, FinancePerth

Cliff O’ConnellSenior Manager, FinanceAdelaide

Greg SawyerSenior Mobile Lending SpecialistSydney

Wade HenrySenior Manager, FinancePerth

Mark CollieManager, FinanceMelbourne

Aida LiangSenior Manager, FinanceSydney


Finance Q&A

Paul KalajzichSenior Manager, Finance

David LeeSenior Manager, Finance


Get your 45 min complimentary lending phone consultation today

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submit your details and one of our specialists will call you.

Finance Q&APaul KalajzichSenior Manager, Finance

David LeeSenior Manager, Finance

http://www.tiny.cc/ASPFINANCE