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Generating Investment Income

Disclaimer

This presentation was prepared by SuperIQ Pty Ltd (ABN 27 147 105 164) (“SIQ”). Material contained in this presentation is a summary only and is based on information believed to be reliable and received from sources within the market. The information is believed to be accurate at the time of compilation and is provided by SIQ in good faith. However, the statements including assumptions and conclusions are not intended to be a comprehensive statement of relevant practice or law that is often complex and can change. It is not the intention of SIQ that this presentation be used as the primary source of readers’ information but as an adjunct to their own resources and training. To the extent permitted by law, no liability is accepted for any loss or damage as a result of any reliance on this information. SuperIQ does not guarantee the performance of any fund or the return of an investor's capital. No representation is given, warranty made or responsibility taken as to the accuracy, timeliness or completeness of any information or recommendation contained in this publication and SIQ will not be liable to the reader in contract or tort (including for negligence) or otherwise for any loss or damage arising as a result of the reader relying on any such information or recommendation (except in so far as any statutory liability cannot be excluded). Individual circumstances, in particular relating to self managed superannuation funds, may vary greatly. This presentation has been prepared for general information purposes only and not having regard to any particular person’s investment objectives, financial situation or needs. Accordingly, no recommendation (express or implied) or other information should be acted upon without obtaining specific advice from an authorised representative.

Introduction

3 Month $10,000 Term Deposit Rates

Source: RBA

Agenda

Fixed Income Outlook – Elizabeth Moran FIIG

Equities Outlook – Tim Bowers, Evans & Partners

Break

Property Outlook – Paul Castran, Castran & Gilbert

FIIG. CREATING ACCESS TO INVESTMENTS YOU CAN TRUST © 2014 FIIG Securities Limited | www.fiig.com.au FIIG Securities Limited | ABN 68 085 661 632 | AFS Licence No. 224659

Make your cash work harder

Elizabeth Moran - Director Education and Research

November 2014

FIIG. CREATING ACCESS TO INVESTMENTS YOU CAN TRUST © 2014 FIIG Securities Limited | www.fiig.com.au

FIIG Securities Limited (‘FIIG’) provides general financial product advice only. As a result, this document, and any informat ion or advice, has been provided by

FIIG without taking account of your objectives, financial situation and needs. Because of this, you should, before acting on any advice from FIIG, consider the

appropriateness of the advice, having regard to your objectives, financial situation and needs. If this document, or any advice, relates to the acquisition, or

possible acquisition, of a particular financial product, you should obtain a product disclosure statement relating to the product and consider the statement before

making any decision about whether to acquire the product. Neither FIIG, nor any of its directors, authorised representatives, employees, or agents, makes any

representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising

in any way (including negligence) for errors in, or omissions from, this document or advice. FIIG, its staff and related parties earn fees and revenue from dealing

in the securities as principal or otherwise and may have an interest in any securities mentioned in this document. Any reference to credit ratings of companies,

entities or financial products must only be relied upon by a ‘wholesale client’ as that term is defined in section 761G of the Corporations Act 2001 (Cth). FIIG

strongly recommends that you seek independent accounting, financial, taxation, and legal advice, tailored to your specific objectives, financial situation or needs,

prior to making any investment decision. FIIG does not make a market in the securities or products that may be referred to in this document. A copy of FIIG’s

current Financial Services Guide is available at www.fiig.com.au/fsg.

An investment in notes or corporate bonds should not be compared to a bank deposit. Notes and corporate bonds have a greater risk of loss of some or all of

an investor’s capital when compared to bank deposits. Past performance of any product described on any communication from FIIG is not a reliable indication of

future performance. Forecasts contained in this document are predictive in character and based on assumptions such as a 2.5% p.a. assumed rate of inflation,

foreign exchange rates or forward interest rate curves generally available at the time and no reliance should be placed on the accuracy of any forecast

information. The actual results may differ substantially from the forecasts and are subject to change without further notice. FIIG is not licensed to provide foreign

exchange hedging or deal in foreign exchange contracts services. The information in this document is strictly confidential. If you are not the intended recipient of

the information contained in this document, you may not disclose or use the information in any way. No liability is accepted for any unauthorised use of the

information contained in this document. FIIG is the owner of the copyright material in this document unless otherwise specified.

FIIG Securities Limited | ABN 68 085 661 632 | AFS Licence No. 224569

http://www.fiig.com.au/fsg

FIIG. CREATING ACCESS TO INVESTMENTS YOU CAN TRUST © 2014 FIIG Securities Limited | www.fiig.com.au PAGE 7

Term deposit rates – the past

2%

3%

4%

5%

6%

7%

8%

9% FIIG All TD Maturities Index versus cash rate

AllMats TDIndex CashRateSource: FIIG Securities


2.40%

2.50%

2.60%

2.70%

2.80%

2.90%

3.00%

3.10%

3.20%

3.30%

Australian BBSW/SWAP Yield Curve

Forward 90 day bank bill yield Current Cash rateSource: FIIG Securities

PAGE 8

Cash rate versus BBSW – future rate expectations

0.47%


OECD Pension Fund Statistics - 2012

PAGE 9


• Earn more than cash for a small

increase in risk

• Lock in higher returns for longer

• Three types of bonds provide protection

no matter what happens to the

economy

• Capture increases in rate expectations

without having to shop around for term

deposit rates by investing in floating

rate bonds

Bonds will improve your returns over deposits

PAGE 10

Interest payments are quarterly for Floating rate and Inflation linked

bonds and half yearly for Fixed rate bonds providing greater scope for

compounding


What is a bond?

PAGE 11

Bonds

Guaranteed by

company unless they

go into wind up

Shares

Shares bought in

company

Owner

Expectation of growth

in share price and

dividends

No guarantee of

dividend payment or

return of capital

vs

Interest repayments

and principal at

maturity

Banker

Loan/IOU


Qantas bonds versus shares

• Qantas bonds

• Believe Qantas will survive

• $3bn in cash on balance sheet

• Circa $600m in undrawn bank facilities

• Many assets that it can sell

• Issued USD bonds

• Fixed rate 2020 paying around 6.1%

available to retail

• Fixed rate 2021 and 2022 paying circa

6.5% available to sophisticated only

• Qantas shares

• Full year $646m underlying loss ($2.8bn

statutory) - no growth

• Dividend has not been paid for three

years

• Share price high of $1.70 and low 95

cents in last year

PAGE 12

Bonds provide known income

and return of capital at maturity;

shares do not have that certainty


• Vast majority of bonds are “investment grade”

• Added protection of regulatory oversight of banks (APRA) and insurers

What gives analysts (and investors) confidence?

PAGE 13

Tip: FIIG has a dedicated fixed income research team. They are sector

specialists and follow companies in their sector daily. Any change in view is

reported to the Middle Markets Team who will then email or call you.

• Capital structure buffer of

shares which take on

first loss position in a

wind-up

• As long as the company

continues to operate,

you will be paid $100

face value at maturity

• Companies will protect

bondholders at the

expense of shareholders


• Australia’s largest fixed income specialist - Over 15 years’ experience

• Over 5000 clients - SMSFs, Advisors, Middle Markets and Not for Profits, Super funds and

Corporations

• Offices in Sydney, Melbourne, Brisbane and Perth - $11 billion funds under investment

About FIIG

PAGE 14


1. Register to receive The WIRE

• Our weekly e-newsletter produced by the

FIIG Research Team dedicated to fixed

income

2. Learn more by:

• Requesting your free copy of “Corporate

Bonds Made Simple”

• Attending a seminar or webinar

• Visit our website www.fiig.com.au

3. Start investing!

Next steps

PAGE 15

Visit www.fiig.com.au

Equity Markets

November 2014

16

• Evans & Partners established in November 2007.

• Australian owned independent investment house

• We are 100% staff owned – delivering a strong client focus.

• Our service is delivered via the design and monitoring of individually tailored

investment strategies.

• We have a team of ~100 staff across Melbourne and Sydney

• Experienced professional staff; investment advisers average ~18 years /

research analysts ~20 years.

• We prefer a direct approach to investing for income maximization /

predictability, strategic flexibility, transparency, fee efficiency & tax efficiency.

17

Evans & Partners

18

Investing in Equities for Income

$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

$140,000

$160,000

$180,000

$200,000

$220,000

$240,000

$260,000

Investing For Income - Cash vs Dividends (pre-franking benefit) (Annual income from a $1.0mn investment in December 1996)

BHP CCL RIO WES CSL CBA ANZ WOW ORI WBC CASH

Source: IRESS

1998 1997 1999 2000 200 2002 2003 2004 2005 2006

10 stock equity portfolio. $100,000 in

each stock as at 31 December 1996.

2007 2008 2009 2010 2011 2012 2013

1. Considerations Prior to Investing

2. A quick look back

3. Where we are now

4. Outlook – Where to from here

5. Investing in Equities for Income

19

Agenda

1. Return Objectives

2. Risk Profile

3. Time Horizon

4. Liquidity

5. Flexibility

6. Simplicity

7. Appropriate Entity / Structure – Trust, Super Fund, Company

8. A strategic asset allocation framework - Diversification.

9. Tax

10.Seek Professional Advice

20

Considerations Prior to Investing.

21

Unprecedented Monetary Stimulus

1. Unprecedented Monetary Stimulus from central banks –

Result of GFC 1. To drive growth / inflation

2. Most powerful driver investment performance in markets

2. Consequence: low global interest rates 1. Forced Investors up the risk curve

2. Equities (domestic & international)

3. Low growth environment 1. Focus on strong balance sheet / capital management

2. Cost out strategy

22

A quick look back

23

Earnings expectations and forward PE’s:

ASX200 & MSCI World Index

ndex

23

50

60

70

80

90

100

110

120

130

Jan 07 Jul 07 Jan 08 Jul 08 Jan 09 Jul 09 Jan 10 Jul 10 Jan 11 Jul 11 Jan 12 Jul 12 Jan 13 Jul 13 Jan 14 Jul 14

Rolling 12mth Forward EPS ExpectationsWeekly to 24 October

MSCI World ASX200

Jan 07=100

Source: IBES, Datastream, Evans & Partners

8

9

10

11

12

13

14

15

16

17

Jan 07 Jan 08 Jan 09 Jan 10 Jan 11 Jan 12 Jan 13 Jan 14

Australian and MSCI World Index Forward PE RatiosWeekly to 24 October

MSCI World Index - 12mth fwd PE Ratio S&P/ASX 200 - 12mth fwd PE Ratio

12 mthfwd PER

Source: Datastream

24

ASX Industrials PE Multiple

ndex

24

25

Global Fixed Interest: Expensive (despite equity outperformance)

Timing & pace of a tightening in US Monetary Policy a key marker

0

2

4

6

8

10

12

14

16

18

71

18

76

18

81

18

86

18

91

18

96

19

01

19

06

19

11

19

16

19

21

19

26

19

31

19

36

19

41

19

46

19

51

19

56

19

61

19

66

19

71

19

76

19

81

19

86

19

91

19

96

20

01

20

06

20

11

US Long Government Bond Yield %(10 year T-Note post 1953) %%

Source: Robert Schiller, Yale University

60

70

80

90

100

110

120

130

140

150

160

170

180

190

200

Jan-95 Jan-97 Jan-99 Jan-01 Jan-03 Jan-05 Jan-07 Jan-09 Jan-11 Jan-13

Relative Performance: Global Equities vs Global Bonds (Monthly Data USD Terms)

Index

Equities Outperform

Source : MSCI, JPMorgan

1. Slow global growth environment to continue 1. But stronger in North America

2. Low interest environment for longer 1. QE in Japan & Europe

3. Central banks likely to continue to support asset price inflation 1. To support the financial system

2. The Mistake of 1937

26

Outlook

Australian equities to provide high single digit total returns

1. Focus on quality companies in strong industries

2. Strong balance sheets and capital management focused companies.

3. Growth as opposed to cyclical industries

1. Health (HSO)

2. Regulated Monopolies (SYD/TCL)

3. International earnings (BXB)

4. Market Position (WES)

27

Australian Equities Outlook

Preference for international equities , especially U.S. equities

1. Corporate quality & strategic opportunity is far superior offshore

2. Flight of capital into the US

3. Lower input prices – Wages and energy

4. Long residential cyclical recovery in the U.S.

28

International Equities

29

Global Equities:

The case for international equity diversification

• Australia comprises only 1% of world GDP and a little over 3% of global equities by capitalisation.

• The Financials and Materials sectors comprise over 60% of our index; compared to 1% for the IT sector.

• The top ten Australian stocks by market capitalisation comprise over half our index.

1. The hunt for yield continues 1. Cash returns are not material

2. Bond yields impacted by QE

3. Investors looking to equities generate returns – capital & income

4. Inflation adjusted returns are critical – Equities are a good inflation hedge.

2. Appropriate asset allocation allows for diversified income sources – fixed income

equities

3. Fully franked dividend yields 1. Benefit for zero tax payers

2. Low tax rate payers – SMSF’s

4. Key considerations 1. Sustainable and growing dividends

2. The quality of the industry

3. The quality of the company

4. Market position / competitive advantage

5. Absolute and relative valuation

30


31


$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

$140,000

$160,000

$180,000

$200,000

$220,000

$240,000

$260,000

Investing For Income - Cash vs Dividends (pre-franking benefit) (Annual income from a $1.0mn investment in December 1996)

BHP CCL RIO WES CSL CBA ANZ WOW ORI WBC CASH

Source: IRESS

1998 1997 1999 2000 200 2002 2003 2004 2005 2006

10 stock equity portfolio. $100,000 in

each stock as at 31 December 1996.

2007 2008 2009 2010 2011 2012 2013

1. Asset Allocation – Critical risk management strategy

2. Ensure you understand what you want to achieve prior to investing – 10 key points

3. Sustainable and growing cash flows over the long term are critical to investment

returns

32

Key Takeaways

33

Current Representative Balanced Asset Allocation Tactical Tilt: Unchanged since April 2014 when we reduced to “Neutral” (Growth v Defensive Assets)

Evans & Partners: Asset Allocation Strategy

Tactical

Tilt

CASH 8.0% 16% 8%

FIXED INTEREST 38% 30% -8%

Government Debt 75% 29% 15% 5% -24%

Corporate Debt 25% 10% 85% 26% 16%

EQUITIES - Australia 34% 24% -10%

Industrials 79% 27% 81% 19% -7%

Resources 21% 7% 19% 5% -3%

REITs 0% 0% 0% 0% 0%

EQUITIES - Global 20% 30% 10%

Currency Hedged 50% 10% 10% 3% -7%

Currency Unhedged 50% 10% 90% 27% 17%

100% 100%

Note: This is a generic portfolio. Please consult your Adviser for a benchmark appropriate to your individual circumstances.

Source: Evans & Partners

Strategic

Allocation

Tactical

Allocation

• GENERAL RESEARCH DISCLAIMER, WARNING & DISCLOSURES

• This document is provided by Evans and Partners ABN 85 125 338 785, holder of AFSL 318075.

• The information is general advice only and does not take into consideration an investor’s objectives, financial situation or needs. Before acting on the advice, investors should consider the appropriateness of the advice, having regard to the investor’s objectives, financial situation and needs. If the advice relates to a financial product that is the subject of a Product Disclosure Statement (e.g. unlisted managed funds) investors should obtain the PDS and consider it before making any decision about whether to acquire the product.

• The material contained in this document is for information purposes only and does not constitute an offer, solicitation or recommendation with respect to the purchase or sale of securities. It should not be regarded by recipients as a substitute for the exercise of their own judgment. Investors should be aware that past performance is not an infallible indicator of future performance and future returns are not guaranteed.

• Any opinions and/or recommendations expressed in this material are subject to change without notice and Evans and Partners is not under any obligation to update or keep current the information contained herein. References made to third parties are based on information believed to be reliable but are not guaranteed as being accurate.

• This document is provided to the recipient only and is not to be distributed to third parties without the prior consent of Evans and Partners.

• EVANS AND PARTNERS DISCLOSURE OF INTERESTS

• Evans and Partners and its respective officers and associates may have an interest in the securities or derivatives of any entities referred to in this material. Evans and Partners does, and seeks to do, business with companies that are the subject of its research reports.

• EVANS AND PARTNERS CORPORATE RELATIONSHIP DISCLOSURE

• Company

• Nature of Relationship

• Company Nature of Relationship

• ANI Evans and Partners arranged, managed or co-managed a public offering of the company or its affiliates in the past 12 months.

• ASH Evans and Partners arranged, managed or co-managed a public offering of the company or its affiliates in the past 12 months.

• AUI The Issuer has appointed Evans and Partners as Broker to an on-market buy-back. Accordingly, Evans and Partners is unable to give Sellers advice in respect to a sale of this security.

• BEN Evans and Partners has arranged, managed or co-managed an offering of securities of the company or its affiliates in the past 12 months.

• DUI The Issuer has appointed Evans and Partners as Broker to an on-market buy-back. Accordingly, Evans and Partners is unable to give Sellers advice in respect to a sale of this security. Evans and Partners has been appointed as Placement Agent in respect of the company’s renounceable rights issue and will receive fees for acting in this capacity.

• HSO Evans and Partners has arranged, managed or co-managed an offering of securities of the company or its affiliates in the past 12 months.

• IDR Evans and Partners has arranged, managed or co-managed an offering of securities of the company or its affiliates in the past 12 months.

• IMF, IMFHA Evans and Partners has arranged, managed or co-managed an offering of securities of the company or its affiliates in the past 12 months.

• MBLPA Evans and Partners has arranged, managed or co-managed an offering of securities of the company or its affiliates in the past 12 months.

• MQG A director of Evans and Partners Pty Ltd is a director of Macquarie Group Limited.

• NAB Evans and Partners has arranged, managed or co-managed an offering of securities of the company or its affiliates in the past 12 months.

• PGH Evans and Partners has arranged, managed or co-managed an offering of securities of the company or its affiliates in the past 12 months.

• PNC Evans and Partners has arranged, managed or co-managed an offering of securities of the company or its affiliates in the past 12 months.

• REG Evans and Partners has arranged, managed or co-managed an offering of securities of the company or its affiliates in the past 12 months.

• SAR Evans and Partners has arranged, managed or co-managed an offering of securities of the company or its affiliates in the past 12 months.

• SPO Evans and Partners has arranged, managed or co-managed an offering of securities of the company or its affiliates in the past 12 months.

• SWM A director of Evans and Partners Pty Ltd is a director of Seven West Media Limited

• DISCLAIMER

• Except for any liability which cannot be excluded, Evans and Partners, its directors, employees and agents accept no liability or responsibility whatsoever for any loss or damage of any kind, direct or indirect, arising out of the use of all or any part of this material. All information is correct at the time of publication; additional information may be available upon request.

34

Important Disclosures

RESIDENTIAL

PROPERTY AS A

SUITABLE ASSET

PRESENTED BY

PAUL CASTRAN, CEO OF CASTRAN GILBERT (AUST) PTY LTD

“THE BIGGEST RISK IS

NOT TAKING ANY RISK.”

MARK ZUCKERBERG

36

WHY INVEST IN REAL ESTATE?

• There is no reason why residential real estate should

not be part of your superannuation portfolio.

• It is fundamental – we all need water, food and

shelter.

• It is a long term asset and the returns are

compelling.

• Look BEYOND the headlines – good news stories

don’t sell newspapers.

• Do your own research and look at cold hard facts.

37

WHY INVEST IN REAL ESTATE?

• Tangible

• Low Volatility

• Taxation Benefits

• Dual Investment Return

• Off-The-Plan Advantages

38

HISTORICAL DATA

$0

$100

$200

$300

$400

$500

$600

$700

1966 1969 1972 1975 1978 1981 1984 1987 1990 1993 1996 1999 2002 2005 2008 2011 2014

Thousands

Th

ou

sa

nd

s

Median House Price

Source: REIV

1982: Major

Recession

1987: Stock Market

Crash

1990: Pyramid Disaster

1990: Asian Financial

Crisis

2000: Millennium Bug

2001: Tech Bust & 9/11

2008: GFC

39

FACTORS THAT DRIVE THE MARKET

• Wages

• Interest Rates

• Australian Dollar

• Employment

• Population & Migration

• Auction Results

• Construction Costs & Land Value

• Overseas Demand

40

WAGES

• Wages growth is a driver of values

• In the twelve months to May 2014, Trend series Full-Time

Adult Average Weekly Ordinary Time Earnings increased by

2.4% to $1,453.90 (ABS).

• The Full-Time Adult Average Weekly Total Earnings in May

2014 were $1,516.90, a rise of 2.3% from the same time last

year (ABS).

Higher Wages More Super

41

WAGES

Source: ABS

$1,360

$1,380

$1,400

$1,420

$1,440

$1,460

$1,480

$1,500

$1,520

$1,540

May-12 Aug-12 Nov-12 Feb-13 May-13 Aug-13 Nov-13 Feb-14 May-14

Average Weekly Earnings Trend

42

WAGES

0

20

40

60

80

100

120

140

1997 2000 2003 2006 2009 2012

Index Wage Price Index Annual Growth

Source: ABS

43

WAGES

TOTAL ASSETS IN SUPERANNUATION:

$1,853.5 billion (approx.) (Source: APRA Statistics – June Quarter 2014)

TOTAL ASSETS IN SELF-MANAGED SUPER FUNDS:

$550 billion (approx.) (Source: APRA Statistics – March 2014)

44

INTEREST RATES & AUD

• Record low interest rates – 2.5% for the 16th consecutive

month

0

2

4

6

8

10

12

14

16

Aug-90 Aug-93 Aug-96 Aug-99 Aug-02 Aug-05 Aug-08 Aug-11 Aug-14

% RBA Cash Rate

Source: RBA

45


Source: Yahoo!7

46


Source: global-rates.com

0

0.5

1

1.5

2

2.5

3

USA Europe Australia Britain Japan

Interest Rates (%)

Interest Rates (%)

47

EMPLOYMENT

• Number of jobs in Australia rose by 24,100 to 11.59 million

in the past month on a seasonally adjusted basis. (ABS)

Source: ABS

0

2

4

6

8

10

12

1992 1995 1998 2001 2004 2007 2010 2013

% Unemployment Rate

48

POPULATION

• Australia’s population is set to double to 46 million by 2075.

(ABS)

• Driven by strong growth in Victoria and New South Wales

49

0

10

20

30

40

50

60

70

80

2012 2017 2022 2027 2032 2037 2042 2047 2052 2057 2062 2067 2072 2077 2082 2087 2092 2097

Mill

ion

s

Australian Population Growth Forecast

Higher End Current Trends Lower End

POPULATION

Source: ABS

50

MIGRATION

• Net Overseas Migration (NOM) is forecasted to continue to

increase until 2016.

Source: Department of Immigration and Border Protection

240,000

242,000

244,000

246,000

248,000

250,000

252,000

254,000

256,000

Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15

NOM Forecast

51

POPULATION

Source: ABS

0

1

2

3

4

5

6

7

8

9

10

2012 2015 2018 2021 2024 2027 2030 2033 2036 2039 2042 2045 2048 2051 2054 2057 2060

Mill

ion

s

Capital City Population Growth

ACT Adelaide Brisbane Darwin Hobart Melbourne Perth Sydney

52

MIGRATION

• Interstate migration into Victoria at a record high

• National leader for interstate migration with a net 2,468 more residents moving to the state from other parts of Australia.

(Property Observer, 27th October 2014)

53

AUCTION RESULTS

• Strong auction results demonstrate strong buyer sentiment

and healthy demand.

Source: REIV

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1981 1984 1987 1990 1993 1996 1999 2002 2005 2008 2011 2014

% REIV Auction Clearance Rate

54

AUCTION RESULTS

Source: The Domain Group

55

Super Saturday 25th October 2014

More Than 1500 Properties Went

Under the Hammer

Most Auctions Held on a Single Day

Since The City’s First Public Auction in

1837

75% Clearance Rate

CONSTRUCTION COSTS & LAND VALUE

Source: ABS

56

0

50000

100000

150000

200000

250000

1987-88 1997-98 2007-08

VIC

AUSTRALIA

• The average cost of building a house in Australia almost quadrupled in the twenty years to June 2008, rising from $65,000 in 1987-88 to $236,000 in 2007-08.

CONSTRUCTION COSTS & LAND VALUE

Source: HIA

57

NON-RESIDENT APPETITE FOR

MELBOURNE REAL ESTATE

58

TOP 3 DESTINATIONS FOR CHINESE

BUYERS

Australia

Melbourne

Sydney

Gold Coast

United States

Canada

Sixty-three million Chinese have sufficient wealth to

purchase international property, including 2.8 million

high-net-worth individuals.

Over 60% of these high-net-worth Chinese are already

engaged in overseas investment, immigration

or education.

Australia, United States & Canada are the most popular

destinations for Chinese buyers. Melbourne properties

receive more enquiry from Chinese buyers than

properties in any other Australian city.

Source: Juwai.com

NON-RESIDENT APPETITE FOR

MELBOURNE REAL ESTATE

59

Overseas demand for Australian properties to rise:

• In February 2014, Canada axed a 28-year-old visa scheme

designed to attract wealthy foreigners to the country.

• The United States has halted the popular EB-5 immigration

visa program until October 2015.

• More Chinese expected to apply for Australia’s Significant

Investment Visa and buy Australian property.

• Falling Australian dollar makes Australia cheaper to invest

in.

FACTORS THAT WILL DRIVE YOUR ASSET

WAGES GROWTH,

MORE SUPER

LOW INTEREST RATES

CONSTRUCTION COSTS & LAND

VALUE

EMPLOYMENT GROWING

POPULATION HOUSING DEMAND

OVERSEAS DEMAND

60

CASE STUDY

17 VALE STREET, ST KILDA

1 BEDROOM UNIT

(SOLD BY CASTRAN GILBERT)

Purchased in

1994

$69,000

Sold in 2014 $280,000

Held For 20 years

Capital Growth $211,000

Percentage

Growth

406%

Growth Per

Annum

20.3% p.a.

Plus Rental Income

61

108 GREVILLE STREET,

PRAHRAN

2 BEDROOM UNIT

Purchased in

1995

$187,000

Sold in 2014 $650,000

Held For 19 years

Capital Growth $463,000

Percentage

Growth

348%

Growth Per

Annum

18.3% p.a.

Plus Rental Income

CASE STUDY

62

CASE STUDIES

305/ 1C Michael Street,

Brunswick

1 BEDROOM UNIT IN A NEW BUILDING

Purchase Price $345,000

Date of Purchase 2/11/2012

Settled 7/5/2013

Current Value (RP Data)

Med - High

$377,113 -

$418,375

Income Received

$18,247

(Rental - $380

pw)

Management Fees $1,405.02

Water Rates $640.00

Council Rates $1,070.00

Owners Corporation $1,292.00

Total Outgoings $4,407.02

Financial Year 2013-14

Cash Outgoings

Cash Profit (Gross) $13,839.98

Depreciation Schedule

Allowance

(provided by landlord)

$8,854.00

Taxable Profit (Net) $4,985.98

63

CASE STUDIES

305/ 1C Michael Street,

Brunswick

1 BEDROOM UNIT IN A NEW BUILDING

Off-The-Plan Purchase $1,820.00

Established $15,770.00

SAVINGS $13,950.00

STAMP DUTY

64

“THE LONGER YOU

WAIT, THE MORE

YOU PAY.”

65

Paul Castran (CEO) 0418 313 038

[email protected]

Documents

Generating Investment Income - SuperIQ...• Requesting your free copy of “Corporate Bonds Made Simple” • Attending a seminar or webinar • Visit our website 3. Start investing!