Trending Financial News 16 October

Which Sydney suburb has the highest rental
yield?

The average rental
yield in the greater Sydney area is 2.8 per cent for houses and 3.7 per cent
for units according to SQM Research.

Some suburbs in
Sydney are outperforming the average yield. For freestanding houses, the Lower
North Shore area has the highest average rental yield at 3.5 per cent.
South-western Sydney and Western Sydney have an average rental yield of 3.3 per
cent per year.

For units, the Sydney
CBD has the highest average rental yield of any Sydney suburb with 4.4 per
cent. The Hills District, South- western Sydney and Western Sydney have average
rental yields on units of 4.1 per cent.

Neobank Up Bank turns one with 135K customers

Australia’s first neobank brand Up Bank is one year
old today. Up is a joint venture between South Melbourne-based Ferocia and
Bendigo and Adelaide Bank.

Up Bank has 135,000 customers, 250,000 accounts and
$100 million in current deposits one year after launch, said Dominic Pym from
Ferocia.

Up added 100,000 customers over the last eight
months following the inclusion of payments functionality in the Up Bank app in
April.

The average age of Up Bank customers is 27.

Up is developing an international remittance
function in the Up app with TransferWise.

Big banks are more trusted than little banks

Australians “are not very trusting” of their banks
or big companies in other industries according to new research surveying more
than 2,000 people by Deloitte.

42 per cent of people “trust major banks to keep
their money safe”, with regional banks, mutual banks, and superannuation funds
generally less trusted.

“Digital banks … were trusted by only 10 per cent
of people, and distrusted by 29 per cent,” said Deloitte.

“Technology companies have the lowest trust score,
trusted by only nine per cent of people.

Is switching banks too hard?

New research from Deloitte shows that 20 per cent
of Australians have switched at least one loan or banking product from one bank
to another lender or financial institution in the last three years.

Switching is not difficult for most products said
the Deloitte report, “It’s not as difficult as people perceive. Once someone
has switched, they realise it is not as difficult as they might have thought.”

RAMS cuts home loan rates from today

RAMS has cut variable and fixed home loan rates, effective
from today, 16 October 2019. RAMS’s variable home loan (Owner Occupier
Principal and Interest) rate has been reduced by 0.15 percentage points to 4.86
per cent p.a. (comparison rate 4.92 per cent pa).

RAMS’s investor variable rate (P&I) home loan has also
been cut by 0.15 per cent p.a.
to 5.37 per cent p.a. (comparison rate 5.44 per cent).

RAMS has
cut fixed rates as well with the two and three-year fixed rates now set at 3.39
per cent pa (comparison rate also 3.39 per cent pa).

Rental yields in
Sydney declining

Rental yields in Sydney have
been declining for 10 years according to the latest Herron Todd White
(HTW) residential investment report using SQM Research.

Average rental yields
for houses in Sydney fell from 3.7 per cent in August 2009 to 2.8 per cent in
August 2019. Average rental yields for units fell from 4.9 per cent to 3.7 per
cent over the same ten-year period.

“As prices began to fall over the
past two years, rental yields did not climb as expected,” said the HTW report.

“Increasing rental vacancies put downward
pressure on asking rents.”

Credit card spending is declining

Spending on credit and charge cards increased by
1.1 per cent in August, the lowest monthly growth rate in 30 years, according
to MWE Consulting.

“We need to go back to 1989 to see a lower annual
rate of growth,” said MWE’s Mike Ebstein.

“Account balances also fell by 1.7 per cent, a new
low.”

In the 12 months to the end of August 2019 the
number of credit and charge cards on issue fell by 3.3 per cent to 15.69
million in Australia. In 2017 there were more than 16. لعبة بلاك جاك مجانية 7 million cards on issue.

Are credit cards still popular?

The advent of ‘buy now pay later’ providers has
contributed to the fall in credit card spending in Australia but debit cards
are the real reason Aussies are turning away from credit.

Debit cards accounted for 44.7 per cent of all
card-based payments in 2016 and are now expected to overtake credit and charge
cards with more than fifty per cent of annual spend before the end of 2019.”

“The shift from credit cards to debit has lost no
momentum over the last twelve years.

Citi Australia, with a new range of retail and card
deals was one of the few local card issuers to grow credit card balances in
August 2019.