First homes fall further out of reach: what you've missed this week
The first home falls further out of reach, and superannuation funds cop heat for providing worthless advice.
Here are five things you might have missed this week.
Property further out of reach of first-time buyers
It now sounds like a broken record, but first home buyers are falling yet further out of the market.
According to the latest statistics from the Australian Bureau of Statistics (ABS), the number of loans approved nationally for first home buyers seasonally adjusted over March fell by 3.1% to 15,623, the second consecutive fall in lending for the group.
"First home buyer activity continues to fall as affordability declines in the face of soaring home prices and government incentive polices conclude or are diminished," says Archistar chief economist Dr Andrew Wilson.
Victoria again recorded the highest number of first home buyer loans over the month with 4623, followed by NSW with 3733, QLD with 3437, WA with 2579 and SA with 1072.
"Although first home buyer activity clearly remains strong with underlying activity still the highest since the record period of 2009, the prospects are that activity will continue to decline as price increases push many out of the market. Increased competition from sharply rising investors will also act to reduce first home buyer numbers."
Shroders rolls out China fund
Shroders has rolled out a new actively managed fund that will invest in China A-Shares, Chinese and Hong Kong listed companies and US-listed ADRs.
The Schroder All China Equity Opportunities Fund it pitched as a fundamental, bottom-up fund that aims to outperform the MSCI China All Shares Index after fees over the medium to long term.
"As the second-largest stock market in the world and the biggest contributor to global economic growth, the size and ambition of China present an attractive opportunity for investors," says Schroders Australia head of distribution Graeme Mather.
Super funds coming up short on advice
Superannuation funds are coming up short on advice, according to UK fintech Smart's The Future of Global Retirement report. It found that while 50% of Australians expect to receive retirement advice from their super fund, only 16% of those who received advice found it of any value.
Meanwhile, 53% of Australians said they would expect to seek retirement advice from a financial adviser but of those over 55 years of age who had, just 29% found that advice to be useful.
Recovery to hinge on climate action
A report from social researcher Dr Rebecca Huntley and commissioned by Aware Super, titled Building back better: the intersection of climate solutions, healthy people, and thriving communities is calling for a commitment to net zero carbon emissions by 2050, which it suggests would kickstart our economic recovery.
"Before COVID-19 our economy was stagnant, our labour force was casualising in the gig economy and inflation was stubbornly stalled below the Reserve Bank's target range," says Aware Super CEO, Deanne Stewart
"At the same time the cost of living for Australians continued to swell, driven by factors such as energy prices and the housing market. We don't want to return to that - we need to reshape the Australian dream."
House price growth "unsustainable"
Astronomical house price growth has been one of the ironies of the COVID-19 pandemic, but almost half of experts say the trend is likely to slow.
While national dwelling values have increased by 6.2% over the past year, according to data from CoreLogic, 47% of experts surveyed by Finder believe the growth is "unsustainable".
"Rock-bottom rates, government stimulus and a fear of missing out have really lit a fire under the belly of the market," says Graham Cooke, head of consumer research at Finder.
"Listing numbers are unable to meet high buyer demand, keeping inventory levels low overall and adding to the sense of urgency among buyers.
"We've seen more borrowed for housing over the last six months than during any similar period in history - and economists have tipped us to borrow more over the next six. However, the view from our panel is that this fast-paced growth will not continue indefinitely."
According to Mala Raghavan of the University of Tasmania, buyers may have gotten ahead of themselves by joining the buying frenzy.
"The recent uptick in buying behaviour largely appears to be due to the fear of missing out, and many buyers are rushing into the market without clear foresight of the impending risks," she says.
"When mortgage rates start rising, many households will risk being unable to service their loans, and could be vulnerable to foreclosures."
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