The real estate properties that are linked to the Cudeco’s blunt boss Wayne McCrae are already earning $100,000 more in rent fees and payments from the copper mining company in just a year. There have been a lot of changes in the property pricing for the past months.
Property stretching from Cudeco’s Gold Coast headquarters to its Mt Isa copper operations is involved.
Company accounts show rent Cudeco paid to entities linked to Mr McCrae, who once boasted the company was as good as a “dog with two d***s”, rose from $224,941 in 2012 to $325,264 in 2013.
He’s been involved in almost $3 million in related party deals since 2005, although accounts show he had also offered interest-free loans to Cudeco and a director-related entity provided free rent.
Cudeco deputy chairman David Taylor maintained all director related-party deals have been handled transparently and at cheaper rates than comparable transactions.
Mr McCrae, 66, is a 40 year veteran of mining, with stints in Africa. He is active despite almost losing both legs in a helicopter crash years ago.
He formed Cudeco in 2003 and shares exploded to almost $10 in 2006 amid hype about its potential deposits. Interest has since waned and shares closed at $1.59 on Friday.
Cudeco since 2006 has rented, from a private company partly owned by Mr McCrae, an office with tinted windows at a Gold Coast industrial strip.
The $50,000 yearly rent was “excellent value”, Mr Taylor said.
That price was also within an acceptable range to a valuer contacted by The Courier-Mail.
But Cudeco refused to specify addresses for other properties rented out from Mr McCrae-linked entities for the remaining $275,000, nor why an increase occurred.
It stated those properties were in Cloncurry, near Mt Isa, and used as employee housing, storage sheds and a company office.
Cudeco’s accounts note buying a Cloncurry property from Mr McCrae’s personal superannuation fund for $1.25 million in 2012.
But another transaction, for an office next to Cudeco’s Gold Coast headquarters, did not have to be disclosed.
A McCrae-run company had sold that office in 2005 for $350,000 to a private family company whose shareholders had included a Cudeco investor. They onsold it to Cudeco for $395,000 in 2012.
Mr Taylor said Cudeco made the purchase to accommodate further growth, and the price was 15 per cent below a valuation.
Cudeco also said the selling family company was not a related party under the Corporations Act.
Cudeco maintained Mr McCrae did not partake in deliberations involving related-party deals or vote on any transactions.
“We consider that all director-related party transactions have been handled in a transparent manner,” Mr Taylor said.
Investors Lead Home Loan Rush
Property investor lending in January has risen by 10.5 per cent, lifting the overall value of home loans to $28.7 billion in the month—an increase of 43 per cent on 2020.
The surge in the latest Australian Bureau of Statistics figures occurred across all states and territories, with the exception of the Northern Territory, to be 44.3 per cent higher year on year, the largest annual growth on record since 2003.
Owner-occupier lending for homes rose 10.9 per cent in January, 52.3 per cent higher than in January 2020, with first home buyers increasing by 9.6 per cent to be at the highest level since May 2009, mirroring the similar uptake following the global financial crisis and the introduction of the first home-owner grant.
Investor lending for housing lifted by 9.4 per cent, capping a 22.7 per cent rise across the last twelve months and revealing a renewed appetite in new loan applications.
The lift marks the the largest rise in new loan commitments for investor housing since September 2016.
The number of first home buyer loan commitments for investment purposes accounted for 4.4 per cent of all first home buyer commitments.
The HomeBuilder program, which offers grants of $25,000 to help construct or renovate a property, is also contributing to an increasingly febrile market.
“Since the HomeBuilder grant was introduced in June 2020, there have been record rises in the value of construction loan commitments,” ABS head of finance Katherine Keenan said.
“Loan applications made late in 2020—prior to the reduction of the HomeBuilder grant on 1 January 2021—contributed to the strong rise in January’s construction loan commitments of 15.7 per cent.”
The value of new loan commitments to owner occupiers rose 10.9 per cent, the largest monthly increase since August 2020.
Owner-occupier first home buyer loan commitments accounted for 36.5 per cent of all owner occupier commitments.
Despite 6.5 million Victorians being put through two lockdowns in the lead up to January, the value of new loan commitments to investors also rose 12.9 per cent in the state across the month.
ANZ economist Adelaide Timbrell said Victoria has continued to play catch-up after its lockdown, with its total new lending moving from 15.2 per cent year on year in December to 29.7 per cent year on year in January.
“Government support is adding to the momentum of housing lending, with stamp duty concessions in Victoria, the first home owner deposit scheme and other first home owner concessions all reducing the initial cost of home purchases.
“Low rates—including an outlook of continued low borrowing costs—are fuelling the housing market more than other parts of the economy,” Timbrell said.
Loans to owner-occupiers for the construction of a new dwelling in the three months to January 2021 compared to the same time last year has tripled in Western Australia, up 221.7 per cent and more than doubled in Queensland to 164.9 per cent.
The Northern Territory recorded a 160.3 per cent boost while Tasmania and Victoria also recorded spikes of around 100 per cent.
HIA economist Angela Lillicrap said investors were now returning but remained more active in the market for established dwellings.
“The value of lending to investors increased by 17.6 per cent in the three months to January 2021 from the previous quarter.
“Low interest rates, rising house prices, higher savings and a demographic shift in demand towards detached housing and regional areas should ensure ongoing demand,” Lillicrap said.
National house prices grew slightly by 0.9 per cent in January to surpassed pre-Covid levels by 1 per cent, and be 0.7 per cent higher than the previous September 2017 peak.
Article Source: theurbandeveloper.com
2020 saw 6,777 interest rate cuts across Australia’s home loan institutions
From 1 January to 31 December there were 6,777 cuts to home loans, with an average cut of -0.30%, according to Canstar’s database.
- 880 cuts to variable rates for owner occupiers, with an average cut of -0.21%
- 2,455 cuts to fixed rates for owner occupiers, with an average cut of -0.33%
- 764 cuts to variable rates for investors, with an average cut of -0.21%
- 2,678 cuts to fixed rates for investors, with an average cut of -0.32%
Over the same period there were 535 home loan rate increases, with an average increase of 0.20%.
On 1st January 2020 the average variable rate for owner occupiers paying principal and interest was 3.73% (80% LVR). Today that rate is 3.32% The lowest variable rate was 2.69% and it is now 1.99% (80% LVR) or 1.77% (60% LVR).
On the 1st January 2020 the average 3-year fixed rate for owner occupiers paying principal and interest was 3.15%. Today the average 3-year fixed rate is 2.30%. The lowest 3-year fixed rate was 2.69% and it is now 1.89%.
Savings interest rates
From 1 January to 31 December Canstar recorded:
- 529 cuts to savings, with an average cut of -0.18%
- 262 cuts to regular savings accounts, with an average cut of -0.19%
- 267 cuts to bonus savings accounts, with an average cut of -0.17%
On 1st January 2020 the average regular savings account rate was 1.12%. Today that rate is 0.43%. The maximum rate was 2.65% and it is now 1.75% (available for 4-months).
On 1st January 2020 the average bonus savings account rate was 1.47%, now just 0.75%. The maximum rate was 2.25% and it is now 1.35%.
Article Source: www.urban.com.au
Home-buyer confidence at an all-time high
More than two-thirds of respondents in a recent survey believe that the conditions are right to purchase a home – a level of confidence not seen since the onset of the pandemic.
Finder’s latest consumer sentiment survey, which involved a nationally representative sample of more than 20,300 respondents, found that 67% of Australians feel that now is a suitable time get on the property ladder, up from 42% last April.
This marked the first time that home-buying optimism has reached this level since the financial comparison site started tracking the metric in May 2019.
Confidence was highest in Adelaide, where 77% of those polled thought now is the right time to buy a home. This was followed by Melbourne’s 70%, Brisbane’s 69%, Perth’s 67%, and Sydney’s 59%. Numbers were not available for Canberra, Darwin, and Hobart.
Those expecting house prices in their areas to “significantly increase” also hit an all-time high of 19%, climbing from just 5% in September last year.
Meanwhile, respondents who anticipate property values to “somewhat increase” rose to 44% from a low of 18% back in April.
Graham Cooke, insights manager at Finder, said that the recent spike home-buyer optimism was a good indication of economic recovery.
“This rebound in buyer confidence is indicative of increased economic activity over the past few months, along with an optimistic outlook for 2021,” he said. “Not only did the Australian government do a better job than most at restricting the spread of COVID-19, but federal and state economic support measures helped prop up the property market.”
Cooke said that property prices in every capital city, expect for Melbourne, have reached a higher level compared to the same time last year, adding that he expected “this trajectory to continue,” especially with 86% of economists in a separate Finders survey predicting a full recovery of national house values this year.
However, Cooke advised prospective buyers to carefully consider the pros and cons “before taking the plunge in the current market.”
“Low interest rates and government assistance packages like the First Home Loan Deposit Scheme put buyers in a strong position. The potential removal of stamp duty in NSW will be another boon for buyers and may spread to other states,” he said. “If you’re thinking about dipping your toe in the market this year, make sure you have a strong credit history, and shop around before signing up for a home loan.”
Article Source: www.brokernews.com.au
- Property Management6 years ago
7 Common GST Mistakes On Property
- Residential4 years ago
Ipswich Proves Frontier In Affordable Housing
- Infrastructure3 years ago
Decision on horizon for key marina section of huge North Harbour development at Burpengary
- Market Place3 years ago
How to make $1 million ‘flipping’ houses
- Developments3 years ago
Brisbane and interstate investors drawn to up-and-coming King Street precinct
- Market Place3 years ago
Moreton Bay makes top 10 list of places to invest in property
- Brisbane2 years ago
Queensland leads the way in market recovery
- Developments4 years ago
Caboolture West could be Australia’s next major regional centre