THE ADVISER’S NOTEBOOK

OCTOBER 2021

Recently, we’ve seen indicators of Australia’s resumption to normality. On the 11th of October, NSW emerged out of lockdown and many of the restrictions were lifted. Not only that; we look to be on the road to freedom, with the Government announcing Australia’s international borders could reopen within weeks!

I know that many parents will be pleased to see their children return to school, and the prospect of international travel begs the question: where will people travel to first once restrictions ease? If you’re lining up your international travel itinerary, don’t forget to check your travel insurance to ensure that you will be covered for COVID-19 related claims.

On another note, for many of us, owning a home represents the fulfillment of the great Australian dream. But there are two things that prospective homeowners should take note of. First, the banking regulator APRA has recently announced tougher serviceability tests for home loans, which will make it harder for some borrowers to get a mortgage. Second, recent data reveals that the Australian housing market has increased by 20.3% in the year to September. This is the highest rate of annual appreciation since June 1989.

In the previous editions, we have included articles about the saving habits of Australians during the pandemic. The trend continues as recent data shows that saving habits throughout the pandemic have reached an all-time high. However, will these savings habits resume as restrictions ease? Will we continue to save our money as we are doing now, or will we give in to the temptation to splurge when we can?

From a market perspective, the combination of improving global growth and earnings, vaccines ultimately allowing a more sustained reopening, and lower interest rates mean market performance is looking quite positive.

We are ending this month’s issue with a big win for planet Earth after the devastating Australian fires at the end of 2019 and early 2020. Nature is amazing! Check out the story below.

We hope you have an enjoyable October.

We’re on the run to the end of the year, and Christmas is not too far away!

Stay safe and well.

Gavin Glozier, AdvFP
CEO & Principal Financial Adviser
P 1300 763 498 • M 0408 155 140
Level 33, 264 George St NSW, Australia
Life the life you want to live.

HOME LOANS: TIGHTER RULES A BOON OR BANE?

The banking regulator announced that starting November, banks will have to test whether new borrowers can still afford their mortgage repayments if home loan interest rates rose to 3% more than their current rate. More restrictions may follow. Click the button below to read more.

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MARKETS: GENERAL RELIEF BUT WHY DO WORRIES REMAIN?

An update about coronavirus; some key economic activity trackers; some major economic events here and abroad and their implications; the outlook for investment markets; what to watch out for in the coming weeks; and why worry remains despite relief.

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TRAVEL: IS YOUR INSURANCE READY FOR YOUR HOLIDAY?

Recent data revealed that 69% of Australians plan to travel on a local or international holiday once international borders fully reopen. As exciting as that may sound, prospective travelers are warned that before jetting off, they should check their insurance policy for COVID-19 coverage.

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HOUSING: VALUATION RISES BUT WHAT ABOUT AFFORDABILITY?

The value of Australian residential real estate reached 8 trillion in April. In September, it breached the 9 trillion mark. Housing values are now 28.2% higher than the estimated value of superannuation, the ASX, and commercial real estate combined. How does this affect housing affordability?

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MONEY: CAN YOU HOLD ON TO YOUR SAVING HABITS?

More Australians are focused on their savings now than before the pandemic. But with the impending opening of the economy, many may give in to the temptation of spending. With the indicators of convenience economy now apparent, sustaining good money habits may be challenging. It all boils down to you.

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THE PLANET: CO2 FROM AU MEGA FIRES OFFSET?

When 715 million metric tons of carbon dioxide was coughed up into the atmosphere from the massive 2019-20 wildfires in Australia, scientists feared global warming had just been given a steroid shot. But scientists can breathe - for now - as the Earth did a balancing act in a scene that features the phytoplankton and photosynthesis.

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