Sif. CGT exemptions has been abolished for China. Plus they have their own property bubble.
Won't make such a huge difference. Chinese pay CGT of 20% on full capital gain. Since Australia and China have a taxation treaty, the Australian tax will be deducted from the Chinese tax bill. So they are only out by the amount in excess of 20% of the capital gain they pay to the Australian Government. Maybe 10-15%. Enough to sting, but maybe not enough to make them change their decision.
And if they have the intention of becoming residents, then the point is moot.
I don't know the current rules for claiming unemployment, but if you get a payout I don't think that you get the dole immediately - can anyone add to that?
It is means tested on liquid assets, so you have to draw down on savings until $3000 or $5000 (I forget which and it's been a while since I looked) per adult in the household.
This is the 'shadow unemployment' of the middle class that the Financial Review has run quite a few stories on recently.
Of course, once you get down to 6000 (or 10,000) bucks in savings, you are not going to be able to pay your mortgage off for much longer, so it is good to have a little buffer. Most of the financial services sector job cuts came with a redundancy payout as well, so that probably adds a few months to your buffer.
Most of those job losses were 3-6 months ago, so if that sector doesn't pick up we will see those people start to appear on the dole queue and their property on the market.
#winning
Thanks, I knew there was an asset test of some sort. Really if you did get a good payout and had a mortgage, you may be better off paying that off the mortgage and then applying.
Your point is valid though, anyone with a large mortgage is very vunerable to any loss of income.
Any expressed market opinion is my own and is not to be taken as financial advice
It turns out that the RBA has indeed (at least superficially) "misread" the economy, as so many commentators are keen to claim. Awkwardly, however, it seems to have materially underestimated the strength of our labour market, which its research suggests is the single most powerful predictor of future inflation.
Despite both the RBA and the Treasury forecasting that Australia’s jobless rate would rise to 5.5%, and using this as a key justification for lower rates (alongside a temporary decline in the prices of internationally traded goods and services), it appears, as I had previously argued here, that the peak in the unemployment rate is behind us.
According to the official statistician, Australia’s seasonally adjusted unemployment rate fell to 4.9% in April from a downwardly revised 5.1% in March. But let’s avoid the temptation of looking at a single month of data. As the chart below clearly shows, the three month “moving average” jobless rate has been falling steadily since September 2011, ironically just before the RBA started slashing rates. It is now nearly a full percentage point below its 5.8% peak during the GFC.
The monotonic decline in the unemployment rate since the second half of 2011 tells us a few things. First, the economy is not about to head into a protracted recession. Nor is the economy likely expanding at a rate that is significantly below trend (or capacity). In fact, the jobless rate implies that the labour market is near-fully employed. This in turn tells us that the economy is not in dire need of further interest rate relief.
Having said that, the volatile and prone-to-revision GDP data could very well confuse the issue. As the RBA has noted, the National Accounts are difficult to interpret when the country is undergoing a very lumpy and capital intensive private investment boom.
The second thing the unemployment rate tells us is that the high circa 3.5% per annum domestic (or “non-tradable”) inflation consistently recorded by the ABS is likely to be a permanent presence. In contrast, the “tradables” deflation induced by the striking appreciation in Australia’s exchange rate is, as I have explained before, a temporary event. Indeed, with the Aussie dollar now down about 8% from its 2011 highs, the deflation in internationally traded products that helped pull down Australia’s core inflation rate will likely have the opposite effect going forward.
You are unlikely to hear or read many of these arguments from other commentators. Most analysts are forecasting an increase in unemployment combined with a lower cash rate. Anyone with a commercial interest in the Australian equities and/or housing markets, including, importantly, almost all retail bankers, has been clamouring for rate cuts ever since the RBA appropriately tightened policy in November 2010. The Gillard government, its lobbyists and public proxies, are pinning their fragile political prospects on below-average lending rates. And the hysterical complaints of the trade-exposed industries almost always overwhelm the silent savers and retirees.
It is interesting to contemplate what the RBA might have done at its May board meeting had it had the benefit of this information and the Commonwealth budget. At face value, the super-sized 50 basis point cut would have been off the table. And a single 25-basis-point reduction might have been a less than certain proposition.
Anybody who believes these ABS figures has rocks in their head. Just look at some of the recent headlines from the MSM and tell me where the hell any new jobs are coming from? Most of these listed in the job loss thread on the forum here ( http://australianpropertyforum.com/topic/8826518 ) so can't say you didn't hear of them!
Bottle maker sheds 70 jobs January 20, 2012 Thousands of bank jobs face axe: UBS January 16, 2012 ANZ to slash hundreds of jobs January 13, 2012 Jobs cut as strong dollar burns NSW smelters January 11, 2012 Jobs go as Fletcher Jones tailors for buyer December 15, 2011 Westpac to shed jobs as cost cutting bites November 9, 2011 MF Global’s Aussie arm to close, 83 jobs lost November 21, 2011 Toyota cuts 350 Altona jobs January 23, 2012 BlueScope confirms 1000 jobs cut August 22, 2011 Ford to shed 240 local jobs, cut production as demand slumps April 14, 2011 Mortein-maker culls 190 manufacturing jobs February 1, 2012 Telstra to shed 200 jobs in latest cuts January 31, 2012 BHP gears down nickel mine, jobs lost February 1, 2012 Strong dollar claims jobs at Holden February 2, 2012 Westpac set to announce job cuts February 2, 2012 Macquarie flags more job cuts February 7, 2012 Hundreds of smelter jobs at risk February 8, 2012 Suncorp to axe more workers: union February 8, 2012 Qantas axes 500 jobs as profit slumps February 16, 2012 60 jobs go as largest tomato grower crushed February 21, 2012 OneSteel to cut 430 jobs as shares soar February 21, 2012 Anzac biscuit maker crumbles, placing 170 jobs at risk March 1, 2012 Westpac axes more jobs to bolster profit March 6, 2012 Almost 600 people to lose jobs at WOW March 7, 2012 IAG to axe 600 jobs over three years March 9, 2012 Rising rents force job cuts at discount stores March 9, 2012 Jobs to go in OneSteel plant closure March 15, 2012 Electricity merger will cost 780 jobs March 19, 2012 Optus poised to cut hundreds of jobs March 20, 2012 Gearbox maker stands down 250 workers March 27, 2012 Metcash cuts 478 jobs April 3, 2012 BHP Billiton to close Norwich Park mine April 11, 2012 130 jobs to go in federal law office April 12, 2012 Optus cuts 750 jobs May 2, 2012 Workers locked out, 600 jobs gone as 1st Fleet shut down May 3, 2012 St George IT jobs on the line April 26, 2012 More jobs on line as Macquarie cuts costs April 27, 2012 Public service bracing for job cuts May 04, 2012 At least 500 Vic TAFE jobs to go Wed May 2 2012 Wine industry faces job cuts, ongoing grape glut May 03, 2012 Budget to slash 40 jobs from Department of Prime Minister and Cabinet to save $9m May 03, 2012 Qld public sector fears massive job cuts Tue May 1 2012 CBA cuts jobs in Melbourne May 7, 2012 Murray Goulburn sheds 301 jobs after revamp May 10, 2012
Thanks, I knew there was an asset test of some sort. Really if you did get a good payout and had a mortgage, you may be better off paying that off the mortgage and then applying.
I think the average redundancy payout is 3-6 months pay, depending on a lot of factors. You get long service leave, plus a sweetener for keeping your mouth shut. It's unlikely that many will be able to pay down their entire mortgage from their payout, but if they could, you are right, they should. It would still be a struggle, but at least your biggest cost would be eliminated.
On the other hand, there is almost no mortgage that can be paid off with dole payments, so if you run out of cash and need to live on gov bennies, then the house has to go.
Quote:
Your point is valid though, anyone with a large mortgage is very vunerable to any loss of income.
Even in dual income households, the loss of one income can cause severe repayment stress. On the other hand, I personally know some couples that if they lost the smallest income, it would actually be a net gain
It is cast in demographic stone that the participation rate is and will continue to fall.
I expect Lefty will be proclaiming in 2050 that the unemployment rate would be 30% if nobody had retired from the workforce.
The unemployment rate is based only on those who are in work or seeking work. People without the means to support themselves do not suddenly cease seeking work. There's no dole if you cease to seek work.
The unemployment rate is the seekers/workforce. Face facts. It is not rising. Hypothesising that the unemployment rate would have risen if people had not retired is hypothetical nonsense.
What matters in terms of overall citizens well being is the unemployment rate - not the number of jobs. The ideal is an unemployment rate of 0%, even if no one has a job and everything is done by robots.
Strindberg, I will say that when it comes to gauging the actual state of the broad labour market, it is perfectly plausable that you are correct and that the director of an institution dedicated to the purpose of researching the Australian labour market has it wrong - but you'll have to forgive me if I suspect that it's the other way around.
No, the labour market is not presently "crashing" - but it is far from growing robustly, it's not doing well enough to be realistically considered "ok" either and to pretend otherwise is unhelpful.
It is cast in demographic stone that the participation rate is and will continue to fall.
I expect Lefty will be proclaiming in 2050 that the unemployment rate would be 30% if nobody had retired from the workforce.
The unemployment rate is based only on those who are in work or seeking work. People without the means to support themselves do not suddenly cease seeking work. There's no dole if you cease to seek work.
The unemployment rate is the seekers/workforce. Face facts. It is not rising. Hypothesising that the unemployment rate would have risen if people had not retired is hypothetical nonsense.
What matters in terms of overall citizens well being is the unemployment rate - not the number of jobs. The ideal is an unemployment rate of 0%, even if no one has a job and everything is done by robots.
Strindberg, I will say that when it comes to gauging the actual state of the broad labour market, it is perfectly plausable that you are correct and that the director of an institution dedicated to the purpose of researching the Australian labour market has it wrong - but you'll have to forgive me if I suspect that it's the other way around.
No, the labour market is not presently "crashing" - but it is far from growing robustly, it's not doing well enough to be realistically considered "ok" either and to pretend otherwise is unhelpful.
Lefty - when compared to historical data, an unemployment rate of around 5% is really very good, and it isn't possible to have unemployment racing down from this level. If we had high unemployment, then in a growing market we would see a stronger rate of growth, but really we are close to the maximum.
I don't think that everyone accepts this figure without some reservations, but even it if tracks back to last months level next month, it's still very good.
Any expressed market opinion is my own and is not to be taken as financial advice
Depends where you start your historical data though from Peter. For a long period, we managed to average around 2.5%. Additionally, there has been a long trend of increasing casualisation and part-time work, with the ABS measuring under-employment at around 12.5% at last count. Job growth is fluctuating around the zero line and the participation rate is falling, pulling down the headline unemployment rate as the pool of working age people in the labour force shrinks.
Personally, I feel that to aspire to no better than this is a rather weak aspiration. I guess I could try adopting a rosier outlook and ignoring the obvious problems.
Additionally, the near-zero jobs growth rate in conjunction with slowing growth, signs of disinflation, falling job ads and a host of other weak indicators is telling us that all is not well in the economy. Yet we are told that the mining boom - the biggest in history - is turbocharging the economy, threatening an inflationary breakout. How is it that we have near-zero jobs growth, disinflation and a sick housing market with flat to falling prices in such an allegedly turbocharged environment?
I can really only agree that it's not presently crashing Peter - I wouldn't be calling it "very good".
Depends where you start your historical data though from Peter. For a long period, we managed to average around 2.5%. Additionally, there has been a long trend of increasing casualisation and part-time work, with the ABS measuring under-employment at around 12.5% at last count. Job growth is fluctuating around the zero line and the participation rate is falling, pulling down the headline unemployment rate as the pool of working age people in the labour force shrinks.
Personally, I feel that to aspire to no better than this is a rather weak aspiration. I guess I could try adopting a rosier outlook and ignoring the obvious problems.
Additionally, the near-zero jobs growth rate in conjunction with slowing growth, signs of disinflation, falling job ads and a host of other weak indicators is telling us that all is not well in the economy. Yet we are told that the mining boom - the biggest in history - is turbocharging the economy, threatening an inflationary breakout. How is it that we have near-zero jobs growth, disinflation and a sick housing market with flat to falling prices in such an allegedly turbocharged environment?
I can really only agree that it's not presently crashing Peter - I wouldn't be calling it "very good".
2.5% - when was that lefty?
When I studied for my bronze medal in swimming I distinctly remember the opinion that anything better than 7% was not too bad.
Any expressed market opinion is my own and is not to be taken as financial advice
Australian Property Forum is an economics and finance forum dedicated to discussion of Australian and global real estate markets and macroeconomics, including house prices, housing affordability, and the likelihood of a property crash. Is there an Australian housing bubble? Will house prices crash, boom or stagnate? Is the Australian property market a pyramid scheme or Ponzi scheme? Can house prices really rise forever? These are the questions we address on Australian Property Forum, the premier real estate site for property bears, bulls, investors, and speculators. Members may also discuss matters related to finance, modern monetary theory (MMT), debt deflation, cryptocurrencies like Bitcoin Ethereum and Ripple, property investing, landlords, tenants, debt consolidation, reverse home equity loans, the housing shortage, negative gearing, capital gains tax, land tax and macro prudential regulation.
Forum Rules:
The main forum may be used to discuss property, politics, economics and finance, precious metals, crypto currency, debt management, generational divides, climate change, sustainability, alternative energy, environmental topics, human rights or social justice issues, and other topics on a case by case basis. Topics unsuitable for the main forum may be discussed in the lounge. You agree you won't use this forum to post material that is illegal, private, defamatory, pornographic, excessively abusive or profane, threatening, or invasive of another forum member's privacy. Don't post NSFW content. Racist or ethnic slurs and homophobic comments aren't tolerated. Accusing forum members of serious crimes is not permitted. Accusations, attacks, abuse or threats, litigious or otherwise, directed against the forum or forum administrators aren't tolerated and will result in immediate suspension of your account for a number of days depending on the severity of the attack. No spamming or advertising in the main forum. Spamming includes repeating the same message over and over again within a short period of time. Don't post ALL CAPS thread titles. The Advertising and Promotion Subforum may be used to promote your Australian property related business or service. Active members of the forum who contribute regularly to main forum discussions may also include a link to their product or service in their signature block. Members are limited to one actively posting account each. A secondary account may be used solely for the purpose of maintaining a blog as long as that account no longer posts in threads. Any member who believes another member has violated these rules may report the offending post using the report button.
Australian Property Forum complies with ASIC Regulatory Guide 162 regarding Internet Discussion Sites. Australian Property Forum is not a provider of financial advice. Australian Property Forum does not in any way endorse the views and opinions of its members, nor does it vouch for for the accuracy or authenticity of their posts. It is not permitted for any Australian Property Forum member to post in the role of a licensed financial advisor or to post as the representative of a financial advisor. It is not permitted for Australian Property Forum members to ask for or offer specific buy, sell or hold recommendations on particular stocks, as a response to a request of this nature may be considered the provision of financial advice.
Views expressed on this forum are not representative of the forum owners. The forum owners are not liable or responsible for comments posted. Information posted does not constitute financial or legal advice. The forum owners accept no liability for information posted, nor for consequences of actions taken on the basis of that information. By visiting or using this forum, members and guests agree to be bound by the Zetaboards Terms of Use.
This site may contain copyright material (i.e. attributed snippets from online news reports), the use of which has not always been specifically authorized by the copyright owner. Such content is posted to advance understanding of environmental, political, human rights, economic, democratic, scientific, and social justice issues. This constitutes 'fair use' of such copyright material as provided for in section 107 of US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed for research and educational purposes only. If you wish to use this material for purposes that go beyond 'fair use', you must obtain permission from the copyright owner. Such material is credited to the true owner or licensee. We will remove from the forum any such material upon the request of the owners of the copyright of said material, as we claim no credit for such material.
Privacy Policy: Australian Property Forum uses third party advertising companies to serve ads when you visit our site. These third party advertising companies may collect and use information about your visits to Australian Property Forum as well as other web sites in order to provide advertisements about goods and services of interest to you. If you would like more information about this practice and to know your choices about not having this information used by these companies, click here: Google Advertising Privacy FAQ
Australian Property Forum is hosted by Zetaboards. Please refer also to the Zetaboards Privacy Policy