Australia has long been a preferred holiday and investment destination. The climate, the good quality of life and many other economical advantages it offers to property investors from all over the world. Australia has on offer a wide array of lifestyle properties that include country homes, waterfront real estate, farms and weekenders, holiday apartments, acreage and investment properties.

It is claimed that the prices of residential properties in the largest Australian cities are likely to rise by up to 19 percent in the next 3 years. According to the latest analysis revealed by economic forecasters BIS Shrapnel, the real estate market conditions in major Australian cities such as Melbourne and Sydney are showing signs of sustained recovery.  Earlier, the Real Estate Institute of SA had said that the South Australian real estate market has been marching onwards in its strength and stability after completing the year 2008 on a positive ground.  The update report indicates that the median prices in all areas of the market including auctions, private treaty sales, and rent and yields have grown steadily. In 2009, the interest rate cuts and the substantial increase of the first home owner grant contributed to the increase in the market activity.  Prices have also stabilized encouraging new buyers of real estate.

Australia’s federal government has recently increased the First Home Buyers Grant to $14,000 for all first home buyers and to $21,000 for people buying a new home as their first home.  This move by the federal government is believed to encourage the first home buyers and to stimulate growth in the housing sector.

Realestate.com.au is Australia's most popular real estate website. This site has useful information to guide you in matters related to Australian real estate. Using this site you can buy, rent or share your house, know about new properties coming up, shops, commercial property, vacant land and holiday rental accommodation. You can get help in finding a home loan or a real estate agent.  It offers search option from your mobile phone. You can also get home renovation information on the relevant section. The site has many step by step videos and several tips, ideas, guides and DIY articles for the benefit of consumers interested in Australian real estate. There are useful links that can help you in preparing to sell your property and on choosing an agent.  You can advertise your property for sale on the site as well.  You can get advice on right time to sell and on how to know how much your property is worth along with the latest auction results.

The Real Estate Institute of Australia (REIA) is the national professional association of the real estate industry in Australia. This non-political organization provides researched and well informed advice to the Australian government, the opposition, public and the media on the issues related to the real estate market. It enjoys the status of being the most credible source of information and considered opinion on residential and commercial property markets in Australia. REIA represents Australia in the International Consortium of Real Estate Associations (ICREA) as one of its founding members.

Real estate commission has gone up in the last few years. It is necessary to understand as to what real estate commission means.

Who is a real estate agent and what is real estate commission?

The person who is authorized or licensed by the state to do the business of dealing in real estate is referred to as real estate agent. There is a commission which is paid by the parties to the agent for carrying out the buying and selling process and this is called as real estate commission. The commissions are directly linked to the property prices. Higher the property prices, higher are their commission. For example, in case your property got sold for $100,000 and the real estate fees are roughly around 2% to 3% of the sale price, then the commission works out to $2000 or $3000. In some states in Australia like Queensland, the commission is based at a maximum of 5% of the first $18,000 of the sale price and for the balance sale price, it is at 2.5%. The commission generally varies from state to state and also depending on the real estate agent. Moreover, it is very important to select the right real estate agent who should be reliable and have a good credibility. The real estate agent should be a licensed agent and who would deal in buying and selling of properties.

While paying your real estate commission, you need to understand that commissions are negotiable and can be discussed or bargained with the agents. Many times, agents employ brokers for listing their client’s properties and hence commissions are split amongst them. In case the agent does the listing himself, then the commission would totally go to him only. This is referred to as ‘dual agency’ and is applicable only in some countries and states. There are some agents who offer a discount in case you buy and sell homes through them. Apart from real estate agents, there are online realtors who do the business of buying and selling properties.

Formalities relating to real estate process

There are many steps involved in the sale of real estate process. The real estate agent will inspect the property and will discuss your selling/buying requirement. Price terms are discussed upon and the agent discusses with the client the best methods of sale as well as marketing strategy. The mode of selling process is decided. Marketing as well as advertising process are agreed upon and terms of agreement are duly discussed. As regards selling, photographs of the property are taken and in some cases even signage boards are displayed. Today internet is a goldmine of information. The internet provides information on all the real estate prices as well as property trends. In case the agent is promoting online, the property is listed on many internet sites and promoted through various methods in order to get good number of potential buyers. Taking in to consideration all factors like transaction fees, stamp duty as well as paying real estate commission, buying and selling of properties involves so much of finance than anything else and at times could be quite stressful also.

Recession is sweeping over all countries across the globe and is causing a cascading effect on other markets.  Crumbling stock markets and failing banking industry have lead to a huge economic crisis. In this scenario the real estate sector is the worst affected as there are no takers for the homes as all funding channels have dried up. Mounting foreclosures and job losses are adding to the grim situation all over the world.  According to RBA Governor Glenn Stevens world financial markets have remained turbulent both locally and globally over the past month.  Australia’s Reserve Bank has lowered the interest rates by more than 75 basis points for the third time in the last three months.  This is said to be the most aggressive policy decisions since the last time recession hit in the early 90s.

As an aftermath of the mortgage meltdown and sliding home prices, the US real estate market is caught up in a recession nationwide says the latest analysis by the Housing Predictor. It has predicted estimates that more than 250 local housing markets are in the grip of recession. The other markets are in a position to escape the recessional state because of their stronger lending practices and standards in these communities. The sub prime crisis is blamed as the reason behind the collapse of the financial markets. 5 million adjustable rate mortgages will face adjustments over a little more than the next two years.

In an attempt to infuse confidence in the people’s mind the Federal Reserve has announced cut in the interest rates and are keen to announce further cuts.  This is aimed at limiting the disastrous effect of the real estate recession as this crisis is the most unprecedented in the US history that could make the economy to suffer the worst national economic turmoil than in the years of the great depression during the 1930s. The real estate market crisis is the result of the unethical and greedy mortgage lenders, brokers and builders.  Mortgage companies continuously developed several newer and creative mortgages flouting the lending guidelines.  When the real estate markets were booming, the first time home buyers took advantage of the situation to get their mortgages. The Federal government’s failure to impose restrictions on the sub prime mortgages is also stated as one of the reasons for this real estate recession. Due to this the home prices have fallen by 40 to 50 percent of their peak prices in some areas.  It gained momentum in the early 1990s.

The Asia Pacific real estate market also is witnessing major impact of the global economic meltdown.  This is characterized by office space leasing declining and vacancy rates shooting up according to global realty consultant Jones Lang LaSalle.  The financial crisis in Asia Pacific has begun to affect the occupancy market for the major financial office centres. The leasing activity has been on the decline for several quarters in cities including Tokyo, Sydney, Singapore and Hong Kong, says the latest report of JLL. The report further says that the economic impact on real estate fundamentals are hitting gradually in Europe than in the Middle East and North Africa or Asia Pacific.

The economic update released by ANZ economics and market research has stated that in June 2008 the housing finance commitments have reduced to a larger extent. The research confirms that the dwelling commitments have slumped by nearly 4% in the month of June and a total standing is at around 25% in the current year. In the month of June alone, dwelling investments fell to around 0.9%. It should also be noted that the vendor owned properties were down around one percent and the loans taken by investors have lessened around 0.3%. However, home financing for first time property buyers has gradually increased to nearly 17 ½%. Various factors like fuel prices, interest rates, rents and rises in grocery items have triggered the weakness in housing finance consignments, as family units were unable to cope with the economic trend. Ultimately the crisis has destabilized the housing sector leading to the downfall of real estate industry. Vendors and purchasers remain suspicious about the development, which has lead to plummeting demand for funds.

The demand for dwelling commitments has plunged by forty three percent for new homes and to twenty five percent for traditional houses. The approval rates have also dipped subsequently. It can be termed as the market protecting itself from a major downfall in rates as very few houses are put up for sale when prices are weak. The RBA has maintained a restraining strategy, as the economic conditions are very tense with high inflation menacing its way through. It is also predicted that the interest rates could take a downward move and remain stable till June 2009. Further cuts are anticipated if the inflation threat is completely dissolved. The month of July 2008 had experienced a smooth financial commitment with mortgage rates increasing. It is also expected that the slash in interest rates will stop the slimming down in the housing sector in the future months. As soon as the condition gets better the activity in the housing industry would definitely elevate.

In the month of June 2008 the owner used dwelling finance commitments dipped in all the major states in Australia. In New South Wales and Western Australia dwelling finance commitments decreased around 4 ½% in the negative. In Queensland it was around five percent down, in Victoria nearly four percent down. Whereas, in South Australia and the Australian Capital Territory it was around 3 ½ % behind. Tasmania stands at 5.8% and Northern Territory it is down by 3 ½%. The global scenario and the interest rates will take its toll on the Australian housing finance commitments in the future months. The negative trend in the demand for property can further lower interest rates. The reason for the crisis is stated that, the investors are unwilling to take high security home loans. The demand for housing loans has drastically reduced since July last year. It is also stated that with the weakening in the real estate sector the interest rates are more to fall.

This article deals with the struggle facing Regional Australians who are suffering a lot more than their city counterparts in repayment of mortgage loans. It is found that the people living in the regional and rural parts of Australia are struggling a lot to meet the mortgage repayment than the people in the city according to the Mortgage & Finance Association of Australia (MFAA).

The survey by the MFAA says that it is a vital relationship between where the people want to reside and how they try to repay the mortgage loan. This survey has brought to light that the people in the rural and regional areas suffer a lot in repayment of loans when compared to the people in the cities. A total of 29.3 per cent of respondents living in the city find it difficult to repay the loan amount and 39.8 per cent of respondents living in the regional and rural areas are struggling to repay the amount.

Some city dwellers say that they are struggling a lot in the repayment of the mortgage loans and that they are probably paying a higher percentage of their take home salary on repayment of mortgage loans.
On the whole 31 per cent of the people in Australia are finding it difficult to repay the loans and 0.5 per cent of them are paying it with a delay of three months. While the rest find it easy to repay. One of the surveys of the MFAA says that persons whose financial status was low had been doubled in one year from 18.3 to around 35.2 per cent and those whose position was much worse had multiplied to 12.6 per cent. In simple words nearly two-thirds of the borrowers in Australia are easily making their repayments without any constraints. They have learned to meet the ends and costs. These people are adjusting and trying to make ends meet. They reduce their costs in all aspects such us spending less for eating out by taking lunch to work or buying food from bulk or lower cost outlets, thus reducing their costs at home. This is of course valid adjustments as a reaction to the increased rate of interest and enabling them to manage and repay the loan amounts. Mostly the persons in the city are managing to repay the amount and hence their burden to struggle for repayment is much less than the persons residing in the regional and rural parts of Australia.

Thus this article clearly brings out the reason for the struggle of persons in repaying their mortgage loans especially those residing in the rural and regional areas. One main reason for the struggle is due to the increased rate of interest just in 3 months this year. Another reason is that most of the people in the regional and rural areas don't plan their self as to how to repay when they get loan. Some don't adjust, others never plan. They only sit back and murmur that the loan has just ate all their take home salary. Though the interest rate may be the reason for struggle to repay the mortgage loan, it is better these persons especially those in the rural and regional areas have to plan and decide and think once to twice as to how they are going to repay and then go for loans.