5 Reasons Why You Should Open a First Home Saver Account before 30 June

I have recently looked more into the First Home Saver accounts more carefully and thought I should share with you the tips that I've figured out about this strange financial life hack that most first home buyers have completely overlooked. One thing to realise is that not all banks offer the First Home Saver Account. For example, Bankwest does not offer the FHSA.

Here are five reasons why you should open a First Home Saver account.

1. Free money The first rule of the First Home Saver Account is that you must deposit $1,000 per year but the government will kick in an extra 17% into your account each deposit for a maximum of $850 total (ie where you deposit $5,000).

2. Good Interest Rates Of the banks that do offer the FHSA, the interest rate offered varies. The highest at the time of this post was Members Equity FHSA which offers 6.4% whereas ANZ and Commonwealth Bank offers only 5%.

3. You only need two years and two days Contrary to what you may have heard, you do not need to leave the money in for four years. Your account just needs to be open for FOUR FINANCIAL YEARS. So you can deposit $1000 on the 29th June 2010 and withdraw the money to buy a home on the 1 July 2012 and it will be considered four financial years.

4. Tax on interest is only 15% Interest is considered income so normally you can be paying up to 45% tax on your interest income so 15% tax on your interest is a good move.

5. Disciplined approach to saving The rules behind the FHSA are designed to also help people get into the habit of saving. This may be the best reason why you should open one of these accounts especially if you are still studying and are not likely to buy a house soon. Even if you do not buy a property in the end, you can use the FHSA balance at the end of the "four" years to deposit into your superannuation.

If you have any questions, you should call the First Home Saver account 1300 788 069.

Freezing Cold Perth Photos from this Morning

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Currently the temperature is only 0.5C but this morning it dropped to -0.6C at around 7:30am with Jandakot picking up a low of -2.5C! Go have a walk around but for those not brave enough, here are some photos I took which you are welcome to use

Better run this through a bit of water 

Smoking sewers, are we in NYC?

Murdoch Park

Top 20 Suburbs Houses Unsold for 60+ Days

The Barefoot Investor has recently published a newsletter which showed the top 20 suburbs in Australia in number of houses sitting around unsold for 60 days or more. Here is the list thanks to SQM research:

Postcode	Count of Properties on Market over 60 Days	Location
4184	1197	KARRAGARRA ISLAND, QLD
4655	1163	HERVEY BAY, QLD
2539	717	BAWLEY POINT, NSW (near Nowra)
2536	653	BATEMANS BAY, NSW
6210	607	MANDURAH, WA
2540	597	BEECROFT PENINSULA, NSW
2450	570	COFFS HARBOUR, NSW
2428	464	FORSTER, NSW
2340	430	TAMWORTH, NSW
4670	412	BUNDABERG, QLD
2430	399	TAREE, NSW
6280	399	BUSSELTON, WA
4217	397	GOLD COAST, QLD
2580	395	BANNABY, NSW
2460	393	GRAFTON, NSW
2800	378	BOREE, NSW
2870	375	PARKES, NSW
4212	356	SANCTUARY COVE, QLD
2577	351	AVOCA, NSW
5607	344	VENUS BAY, SA

Buying, Selling or Renting in Perth

There has been a lull in the news world regarding house prices of late. This is a very short post which goes out to those that pass through this blog, all be it very briefly at times. Leave a comment and tell us whether you are buying, selling, renting or are you in the business of all three? Let's get a little interactive and everyone wins :)

RBA leaves rates at 4.5%

The RBA stopped increasing interest rates today as they announced that the cash rate will remain at 4.5%. Their statement explaining the decision can be found below. 

At its meeting today, the Board decided to leave the cash rate unchanged at 4.5 per cent.

Since the Board last met, concerns about sovereign creditworthiness in several European countries have been a focus of financial markets. Investors have generally displayed a good deal more caution. As a result, equity prices have fallen and long-term government bond rates have declined outside of the countries most affected by the sovereign concerns. The Australian dollar fell sharply as part of this adjustment. Commodity prices have also softened, though those important for Australia remain at very high levels.

European policymakers have responded by assembling a large package to provide financing for the relevant countries for a period of time, stabilise bond markets and provide liquidity. They have also committed to action to bring budget deficits down and stabilise debt over time.

The effects of these various factors on the world economy will need to remain under review. At this stage, global growth is still expected to be at about trend pace in 2010. Conditions in Europe overall have been relatively weak, and the foreshadowed budgetary tightening will probably mean that this will continue, but growth is becoming more established in North America. In Asia, growth has continued to be quite strong and may need to moderate in the year ahead.

In Australia, with the high level of the terms of trade expected to add to incomes and demand, output growth over the year ahead is likely to be about trend, even though the effects of earlier expansionary policy measures will be diminishing. Inflation appears likely to be in the upper half of the target zone over the next year.

Consistent with that outlook, and as a result of actions at previous meetings, interest rates to borrowers are around their average levels of the past decade, which is a significant adjustment from the very expansionary settings reached a year ago. Taking all the available information into account, the Board views this setting of monetary policy as appropriate for the near term.