September 2011 Newsletter

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Hello,

While our economy and stock market continue to waver, the Australian commitment to home ownership remains steady. A new report - see first article - shows that young Australians are as keen as ever to own their own home, even if it means sacrificing lifestyle comforts to get their foot in the door of the housing market.

First home owners are also making a comeback to the market, as we reveal in article 3 "Anyone looking to buy a property?" The article uncovers some interesting statistics and tells readers how they too can join the ranks of first home buyers.

Article 4 looks at how the introduction of the National Consumer Credit Protection Act has promoted the role of mortgage brokers as trusted advisers. Here you will find an answer to the commonly asked question "why not just use a bank for your mortgage?"

Enjoy this newsletter and please feel free to pass it on to family and friends.

Glen Barrett

23 Caravel Ct
Cleveland QLD 4163

Tel:	1800 253 486
Mob:	0400 737 767
Fax:	07 3319 0931

Young Australians want their own home

Building Wealth for Retirement

Anyone looking to buy their first property?

Bank or Broker?

Young Australians want their own home

The dream of home ownership is alive and well, according to a new report that reveals Generation Y are willing to give up luxuries to own their first home.

Over 90 per cent of Generation Y (those born between 1979 and 1990) has indicated that owning a home is a higher priority than buying the latest gadgets or fashion accessories.

Building Wealth for Retirement

Investing in property can help build wealth for retirement in a way that superannuation, savings or the stock market cannot.

The number one advantage of investing in residential property is its potential for long-term capital growth. Well-located property has consistently doubled in value every seven to ten years, and historically has provided rental yields of around 5% per annum.

Anyone looking to buy their first property?

First home buyers are putting aside their nerves and making a comeback to the property market. After lying low for 12 months, the number of new home loan commitments by first home buyers is on the rise, according to the Australian Bureau of Statistics.

Interest rate stability, an increase in rents and a lull in house values has given buyers the confidence they need to enter the market. While first home buyers face a tougher economic environment than last year, a growing number have decided not to let this stand in their way.

Bank or Broker?

Clients sometimes ask us why they shouldn't just go direct to a bank. Our answer is that mortgage brokers can do a lot more than process a transaction - we provide advice, financial guidance and valuable assistance with negotiating your way through the mortgage process.

We also take the time to listen to your needs and understand your future financial goals. The recent introduction of the National Consumer Credit Protection Act has strengthened the broker's role as an advisor.

About Us

Barrett Lending Solutions is a boutique mortgage broking business, specialising in finding solutions to assist client's needs in relation to their lending requirements. We provide assistance in setting up strategies, borrowing structures, and finding loan options - be it for residential, investment or commercial lending needs.

Why not let us do it for you?

Our points of difference:

Accredited with over 50 lenders.
Our service is totally FREE. We are remunerated by the chosen lender, whoever that ends up being.
Over 5 years industry experience
Individual attention to each loan scenario
After loan settlement-ongoing care and support.

Barrett Lending Solutions Core Values:

Integrity
Transparency
Accountability

Need an accountant?

Gregory Thomas Accountants offer:

Income tax returns
Financial reporting
Business setup
Small business advisory & support services
Cash flow statements & management accounting

Contact Gregory Thomas Accountants by calling 07 3821 5929.

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Investment structures

Most taxpayers will purchase their properties in their personal names without any thought of the implications. This is generally done to make use of the negative gearing opportunity. However there are many more issues which need to be considered, including asset protection, family relations, and long term tax planning. In any event a little tax planning at the outset may easily achieve your goal of immediate tax relief through negative gearing as well as the long term goal of asset protection and tax structuring. You should be asking your advisor about this at the very beginning of your investment journey.

When buying an investment property there are certain issues one needs to consider in the decision making process. We have provided the 10 fundamentals that are widely held to be vitally important:

1. Structure your investment to protect your asset;
2. Know the activity you are getting involved in;
3. Consider your partners carefully;
4. Consider how much money is involved and the risk;
5. Examine your financial projections carefully, use "what if" scenarios to project different outcomes;
6. Consider your financing and future capital needs;
7. Know your neighbours;
8. Determine in advance your distribution plan, if applicable;
9. Determine what each partner wants out of the investment;
10. Determine the duration of the investment and structure the investment accordingly.

If you would like more information on structuring your investment, please do not hesitate to contact Jewell Moore Chartered Accountants.

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Information from Sovereign Capital Management's Individually Managed Account

As of this writing, global markets are again in turmoil and for many investors this will be a cause of concern.

Are you:

Concerned about the volatility and uncertainty of the share market?
Concerned about rising interest rates and the economy?
Interested in enhancing your Self-Managed Super Fund?
Interested in paying off your loan/s sooner?
Interested in generating cash flow to purchase additional investment properties?
Interested in wealth creation strategies not dependent on rising stock and property prices?
Interested in reducing your risk AND increasing your return?

Sovereign Capital Management Pty Ltd (SCM) is an investment management firm that can help you with this and more. Our investment strategy has been thoroughly tested over 6 � years and produces stable, consistent returns of up to 27% per annum with high liquidity and very low volatility, with the safety of knowing your cash and assets remain in your own account at a major Australian bank.

SCM's market neutral strategy removes market risk, so we are 'not investing in the share market'. Instead, we make profits through intelligent stock selection due to our most preferred shares outperforming our least preferred shares and we profit from both rising and falling prices, achieving good returns without experiencing the roller-coaster performance that is often associated with investments 'in the share market'. Some of the many benefits of our Individually Managed Account (IMA) service are:

1. Higher Returns - consistent and stable returns (after fees and transaction costs) of up to 27% per annum, dependent on the leveraging option chosen by the investor.
2. Lower Risk - our strategy is capable of generating a higher long-term return than the share market with less than a third of the risk.
3. Proven Strategy - our quantitative equity market neutral investment strategy has been thoroughly tested over 6 � years, covering up, down and sideways market conditions.
4. Liquidity - no lock-up period and high liquidity, as we only invest in the top 200 shares in Australia - and investor funds are available at short notice.
5. Higher Risk- Adjusted Returns - higher returns with lower risk than can be achieved by investing in real estate or the share market.
6. Portfolio Enhancement - adding a SCM IMA to a portfolio of other assets such as real estate, shares and/or bonds will provide a substantial diversification benefit, in many cases increasing portfolio return and reducing portfolio risk, at the same time.
7. Control & Transparency - having an IMA means all cash and assets remain in the name of the investor and do not get pooled. We also provide you with details of every transaction.
8. Safety - investment funds remain in the investor's name at a major Australian bank where they are also guaranteed by the Australian government.
9. Cash Flow - the nature of our strategy makes it ideal for providing an income for retirement purposes, additional investment income, accelerated loan repayment or reducing the overall cash flow burden of an otherwise negatively geared portfolio.
10. No interest rate stress - the expected return of our strategy rises in line with interest rates.

As we only deal with wholesale clients, the minimum investment is $500,000 - but this can come from one or more sources, such as: the equity in your real estate, cash, managed funds, or shares.

Lastly, our strategy is allowable for Self Managed Super Funds (SMSF) and complies with SMSF rules.

For a no-obligation copy of our detailed Investor Summary, or to arrange a free consultation, please contact our Business Development Manager, Mr Glenn Rushton at: glenn@sovereignmarkets.com or phone (07) 3272 6000, or 0413 948 888.

AFSL 341926
ABN 46 116 555 732

Disclaimer: This newsletter is intended to provide general news and information only. Readers should rely on their own enquiries before making any decisions regarding their own interests. Please do not rely on any part of this newsletter as a substitute for specific legal or financial advice. All material is copyright 2011.