Saving For Your First Home (Guest Post)

Owning your own home is part of the Australian dream. Entering the property market can come with many ups and downs, but regardless of where and when you're buying, the best thing you can do is to put yourself in a good position financially. 

How much can you borrow?

Whether you are a single or a couple, the amount you can borrow will depend largely on your income and your existing financial commitments. With a greater income you have the potential to make bigger loan repayments, but if you already have large loans or credit card debts, these will be taken into account when assessing your borrowing power. Before approaching a bank or mortgage broker, review your finances and establish what you could realistically afford to pay each month. 

Be aware that earning power does not guarantee your eligibility for a home loan. Lenders will look at your credit history, the size of your deposit, your age and financial stability when assessing your loan application. 

To have a better understanding on what to expect before applying, it is advised to use a free loan calculator.

What size deposit do you need?

In the past, a deposit of 20% was required for purchasing a home. Meaning that someone wishing to buy a $500,000 property would need a deposit of $100,000. Lenders no longer look for a deposit of this size, usually requiring as little as 5% ($25,000 for a $500,000 purchase), but there are a few things to consider before rushing in to a 95% mortgage. 

Having a larger deposit means having a smaller mortgage. The more you can save for a deposit, the less you will have to borrow, meaning less to pay back to the bank. 

With a deposit of 20% or more you will avoid paying Lender's Mortgage Insurance, a step lenders take to protect themselves in the event you cannot meet your repayments. 

Having a larger deposit will also help with your eligibility for a loan. Banks can see that you have the ability to save and therefore make repayments.

First home owners grant

You might have heard about the first home owners grant, a form of government assistance introduced in 2000 to help Australians purchase their first home. The nature and amount varies from state to state, and can also change from year to year, so if you are budgeting with the grant in mind, be sure to obtain up to date information on what is available in your state. 

The scheme delivers a one-off grant to home buyers purchasing their first home, who meet all of the eligibility criteria. The grant amount is often dependent on whether you are purchasing a new or existing property, buying land, whether you are buying in metropolitan or regional areas.  

Bear in mind that the grant may not be paid directly to you, but instead paid as a credit against transfer duties. 

Other expenses

You home deposit and size of your mortgage will be front and centre in your mind when planning to buy a house, don’t forget the other expenses that need to be paid as part of the process.

The exact kinds of costs will vary depending on your situation, but some extras include stamp duty, real estate commissions and conveyancing and legal fees, building and pest inspection fees, loan establishment fees, mortgage insurance and building insurance.

BREXIT - The Aftermath AND Potential Regrets By The Britons

The historical outcome of BREXIT referendum yesterday (24th June 2016) shocked the world and created bloodbath across the global stock market as well as political unrest (start with the resignation of the UK PM, David Cameron, to be effected in Oct 2016).  

Personally, I am not that into politic and trying to refrain myself from writing post with political theme, but this historical event just creep me up too much and hence this post. 

Let's start with the aftermath of BREXIT 

1.  According to TODAY's report, over US$2 trillion (SGD $2.7 trillions) value of stocks worldwide was being wiped off! Knee jerk reaction? I think it might be more than knee jerk... ;-)

2.  The value of Pound is falling like a heavy metal falling knife...fast and furious style... The weakest since 1985 (30 years) @ US$1.3229

3. Oil price plunged 6.8% to US$46.70 a barrel.

4. And I am pretty sure many more to come from next week onward...embrace yourselves...

And the Regrets?

1. One of the pro-BREXIT's biggest propaganda (350 million pounds pledge to fund the NHS) is a "mistake", as per Nigel Farager himself in a National TV. Are those voted for him regretting now? A little bit, maybe? Check out the article and TV interview here.

2. Some of the voters who voted for BREXIT have shown their regrets openly in the news (always remember, every single vote counts and play a part, don't under-estimate it and vote properly next time, OK?) :

3. Oh, I also find this sarcastic article from The New Yorker very hilarious and apt to share it here too : BRITISH LOSE RIGHT TO CLAIM THAT AMERICANS ARE DUMBER

So what's next for non-Briton like us? 

Life goes on! Markets will continue to tumble for the next couple of weeks/months (my prediction) but we just need to embrace it. On the other side of the coin, I know a couple of my financial blogger friends/opportunists are eagerly waiting to release their Kraken (war-chest) when opportunity strike. So, it's not all bad... 

The BREXIT will officially kick-in only in 2018 and its impact to the Britons as well as the world in general will be forever!

Cheers!

Hiring Office Plants vs. Buying Office Plants (Guest Post)

Plants are a fantastic addition to the décor of any office. They look great, have amazing air filtering properties, and most importantly, they are proven to improveemployees’ productivity and reduce absenteeism. The only drawback associated with adding indoor plants to an office is that they require regular upkeep.

From selection of the right indoor plants to keeping up with their water and sunlight requirements, there are several considerations of adding plants to your office. Considering this, some businesses may prefer renting office plants to save the energy and time spent on their upkeep while others may consider buying office plants to be a more cost-effective option.

To help you make the right choice, we are comparing the pros and cons of hiring and buying office plants. Consider the benefits and drawbacks of both and choose the option that suits your needs.

Hiring Office Plants — A No-Hassle Way to Make Your Office Greener

Adding plants to a workplace offers numerous benefits; however, these benefits can only be achieved if the plants look healthy, fresh, and presentable. Neglected, poorly maintained plants with dry leaves not only make your office look untidy, they also have a negative impact on the productivity of your employees. As a result, many businesses prefer hiring office plants from providers who look after the plants and replace them with fresh, healthy plants when needed.

In addition to hassle-free maintenance, there are several other benefits of hiring office plants, such as:

• No Up-Front Costs — Unlike buying, hiring office plants incurs no up-front costs, making it a cost-effective option for businesses with a limited budget. All you need to do is to pay the costs for the plant hire period which may range from as low as $1 to $20.
• More Options, Greater Flexibility — Hiring office plants allow you the flexibility to change the planters to compliment your office’s new décor. In addition to this, if you’re moving your business to a place that’s smaller in size, you can always return the plants or replace large troughs with smaller desk top plants.   
• Free Expert Advice — Selection of the right indoor plants is a difficult decision anyone who is not an indoor plant expert. There are only a handful of plant species that can grow and survive in dimly-lit, closed environment of an office. Therefore, working with a provider that offers plant hiring service provides you an added advantage in the form of free advice from an indoor plant expert. 

Buying Office Plants — An Option Unsuitable to Many Businesses

While buying is the preferred option in case of commodities that have long durability, such as homes, cars, and equipment, it is not suitable when it comes to indoor office plants. Since indoorplants live for 6 to 12 months, they are required to be replaced quite frequently, making buying a less practical option. In addition to this, businesses with limited décor budget cannot spend a large sum of money on buying plants; therefore, they are better off hiring office plants from indoor plant hire companies.

My First IPO Stock - Frasers Logistics & Industrial Trust (FLT)

Slightly more than 2 years ago, I locked in my first stock with Super Group (S10). Last Friday, I've gotten my first IPO stock or REITS, Frasers Logistics & Industrial Trust (FLT). Even though it's only "minionly" 1 lot but I am pretty happy and excited about my maiden IPO stock and I will keep it for its sentimental value. 

If you want to find out more of the FLT's balloting result, you can check out Investment Moat's coverage here. 

FLT will start trading from tomorrow (21st June 2016) onward. I am not sure how it will go but I am pretty sure will keep it for as long as possible.  

What is your first IPO stock (if any) and are you still keeping it? 

Cheers!

Euro 2016 Caused The Double Digits Drop In SGX Trading Volumes In The Past 2 Days?

At the time of my writing, the Euro 2016 match between Russia and Slovakia is on-going and Slovakia is leading by 2-0 at the moment. Being a soccer fan myself, this set me thinking on whether the kick-off of world's most beautiful sport has much impact to our local SGX trading volumes as well as values? If yes, how great is the impact? 

So, decided to do a simple compilation of the brief stats (source of date : SGX website) and following is my initial findings :

SGX Trading Volume and Values For The Past 2 Days

In both trading volumes and values, there are double digits drops! Of course, I am not saying that all the drops are caused by Euro 2016 but I do believed that it does play a key part to it. 

In case you are not aware, Euro 2016 (at France) is a one-month event starting from 10th June 2016 to 10th July 2016 and almost everyday there are games at 9 PM, 12 AM and 3 AM Singapore time. As the saying goes, sleepy man is an angry man (even more so if your favorite team loss) and investing might not be the top priority of the sleepy/angry man! lol 

Are you a soccer fan and following the Euro 2016? If yes, do you see any change in your pattern of your investing/trading? 

Cheers!

Singtel - My First DCA (Dollar Cost Averaging) Counter

I have been contemplating to put aside  a fixed quantum of amount every month to form part of my DCA (Dollar Cost Averaging) Investment portfolio. Finally, I've made the move and selected one of the blue chip, Singtel (Z74) as my first DCA counter. 

Managed to get 300 shares @ $3.90 yesterday and my plan to investment 300 shares per month on on-going basis. 

In order to have full control and flexibility of my DCA transactions, I've chosen to purchase the shares directly from the market (via POEMS, they are still having their promotional 10 bucks commission [till end of the year] for transaction less than 1,000 shares) instead of through the DCA plan with Maybank, OCBC or POEM (Shares Builder Plan). 

Some of you might be curious as to why I didn't choose the ETF for DCA instead?

There are a couple of reason actually :

1. All a long, I am eyeing to own at least one local telco stock. So, I thought to kick-off my DCA with a telco stock. Among the 3 telcos (Singtel, Starhub and M1), Singtel is the largest [in fact, largest in the Southeast Asia] and has the better valuation in terms of their P/B ratio and profit margin):

Singtel's P/B ratio : 2.52

Starhub's P/B ratio : 22.27

M1's P/B ratio : 5.43

Singtel's Profit Margin : 22.82%

Starhub's Profit Margin : 16.19%

M1's P/E Profit Margin : 15.65%

[The above stats are from Yahoo Finance]

2. The dividend yield for EFT is not as "juicy" as  Singtel's, even though it is less than 1% difference ;-)  

3. In the recent news, Singtel is to list its broadband unit, Netlink Trust by Apr 2018 and hence there is a potential up side for the shareholders (from the disposal) in the short-medium term.   

The intention is to accumulate slowly...but surely... 

Cheers!

3 Valuable Things I Gained From My Investing Journey (Money Is Not One Of It)

Time flies, it has been almost 2 years and 3 months since I first started this blog, as well as my investing journey. After more than 730 posts and 1,500 comments, I am still going strong with my blog as well as my investment. 

As I mentioned before, prior to this journey, Accounting or Finance is my Achilles Heel and I never thought of seeing myself get my hand "dirty" with the "game" of shares investment (you see, prior to this, I always view share investment as a form of gambling and luck is the most critical factor. Of course, I've changed my mind now even though am still believed that luck do still play a part in it). 

So, what have I gained or learnt throughout all these years, besides money? Note : the reason why I excluded money from it is because as at to date, my minion portfolio is still experiencing with double-digits paper loss ;-) 

Here we go, the 3 most valuable things that I've gained so far :

1. FINANCIAL KNOWLEDGE:

If I really have to put a measurement on my financial literacy progress from a scale of 1 to 10 (10 being the best), I think I've moved a notch or two from say level 3 to 5. There are much more to be learnt but being an avid reader, I can always reading and learning along the way. 

2. NEW FRIENDSHIP:

I count this as the most valuable and surprising gain as it is never part of my plan when I started off this journey. Managed to get to know up-close and personal with  a bunch of cool and friendly liked-minded peer financial bloggers is godsend. You know who you are, let's keep this friendship 长长久久 !

3. MY BLOGGING STYLE:

From a noob to non-so-noob in the financial world, I've expanded my writing scope from mostly movies to personal finance stuff (especially those posts involving numbers), it has tremendous impact (positively, I hope... maybe) to my style of writing or blogging. 

What about you? What are your top 3 non-monetary gains from your investment journey?

Cheers! 

Frasers Logistics and Industrial Trust (FLT) IPO - All You Need To Know Now

If you are into IPO and have not already gotten the good news, your new potential baby is coming real soon : Frasers Logistics and Industrial Trust (FLT) is expected to launch the biggest IPO since 2013 from next Friday (10 June 2016). 

While I am still waiting for the prospectus to be released, following are the key pointers that I've gathered from the media for this upcoming FLT IPO :

1. It will be managed by FCL (Frasers Centrepoint Limited)
2. It will be backed by 51 Australian properties in Melbourne, Sydney, Brisbane, Adelaide and Perth (the portfolio has an occupancy rate of 98.3% and WALE (Weighted Average Lease Expiry) of 6.9 years.

3. It is seeking around $900 millions from the IPO

4. It is expected to be priced at 85 to 89 cents per unit.

5. The forecast Dividend Yield is 6.9% to 7.1% this year (2016) and 7.3% to 7.5% next year (2017).

6. Some of the cornerstone investors are : Morgan Stanley Investment Management, Lion Global Investors and JF Asset Management.

7. The IPO will be listed in Mainboard and is expected to open on 10 June 2016 (Fri), with listing targeted for 20 June 2016 (Mon).

 

Personally I am into REITS and have keen interest in this IPO. What about you?

Cheers!