Counting for Life

About Counting for Life

 As many of you know we are proud to be sponsoring Counting for Life which aims to develop the numeracy skills of children in Years 3 to 5. This program is specifically targeted at children who are experiencing difficulties in numeracy. Here is a bit of feedback from one of the young and budding participants Angelica.


Angelica’s progress

Angelica is eight-years old and in year three at Old Guildford Public School. Angelica has completed five 45 minute sessions in the Counting for Life Program so far. When Angelica was assessed her main struggles were processing speed and she often found herself second-guessing answers to questions which meant she was unconfident and would withdraw from some of the activities and games. The sessions have been focused on addition and subtraction with Angelica’s strengths in addition lying in written practice. She can complete all of the skills in written practice, however when it comes to completing activities without writing it down she seems to struggle.

Over the five weeks Angelica has really improved in her willingness to have a go and make mistakes, something that she previously did not do – often opting to not say anything at all despite appearing to be working it out in her head. She is answering questions a lot faster and getting through more of the material than was possible in the earlier sessions. Her enjoyment of the program is increasing at every session as she gains more confidence and her self concept has changed regarding her ability to solve maths problems. Angelica is really enjoying the worded problems and board games and is coming to each session excited!

Upcoming sessions will focus on finishing off addition and applying it practically as well as moving on to subtraction and combining the two areas to increase familiarity and confidence.

Georgia our volunteer says that “I am able to observe changes on a week-to-week basis – she is engaging more, is more self-confident and above all becoming better in her maths tasks.”


Build on Bookkeeping are also proud Sponsors of Counting For Life – heres a few words on why  

Whether it’s Lego pieces or company revenue, we know how important it is to understand numbers and be able to count accurately. It’s a life skill that can mean the difference between achieving an outcome, and not. We chose to support the Counting for Life program so that more children who are experiencing difficulties in numeracy will get the 1-on-1 intensive support and education that they really need.

Are property prices set to drop in the next three years?

Things could be looking up for homebuyers, with a new report forecasting a drop in property prices over the next three years. But could this also signal the end of the Australian property market golden era?

According to BIS Shrapnel’s Residential Property Prospects 2016–2019 report, median house and unit prices in our capital cities will be lower by 2019. This is due to a perfect storm of slower population growth, falling immigration levels and an oversupply of new homes. The Australian Prudential Regulatory Authority’s recent work to tighten lending standards has slowed investor activity, also contributing to the downward trend. Investors have previously been a huge driver of market demand, particularly in Sydney and Melbourne.

How each capital might be affected
In Darwin and Adelaide, median house prices are forecast to drop by two per cent by June 2019. That’s around nine to ten per cent in real terms, given the general rise in the cost of living and wages over that period. Darwin will continue to be affected by oversupply, falling resource sector investment and weak population growth, while Adelaide faces the closure of its Holden factory in 2017.

Surging house prices in Melbourne and Sydney could also slow considerably, with BIS Shrapnel predicting a fall of one per cent in these capital cities.

Perth is expected to be hit hard, as it continues to feel the fallout from the mining boom. Prices in the west coast capital could drop around eight to nine per cent in real terms for houses, with potentially even bigger falls for units.

The strongest performers, according to the report, will be Brisbane, Canberra, and Hobart.

Are apartments at more risk?
Apartments, which are being built at record rates in most capital cities, could be affected more than houses.

According to BIS Shrapnel, 220,000 new dwellings began construction in 2015–16, with a record 49% expected to be multi-unit dwellings. A large number of apartment complexes will be finished in 2017–18, potentially leading to an oversupply, lower rents and a drop in value.

The median unit price over the next three years is expected to drop by eight per cent in Melbourne, five per cent in Sydney and six per cent in Brisbane.

After several years of high property prices and a tough market for new homebuyers, the tide could now be turning – it just might take a few years.

Bargaining power: How to negotiate your purchase price

No one wants to feel like they’ve been taken for a ride, so when you’ve found the right property, how do you get it for the right price? Here are some things to consider when it comes to purchasing negotiations.

Do your homework
Property prices are influenced both by demand and how much other potential buyers are willing to pay. Before you make an offer, research similar properties that have sold recently in the same area. Also consider organising a pre-purchase building report, as any issues with the building may give you leverage to negotiate a lower price.

Investigate the seller’s motivations
It pays to investigate the seller’s circumstances. The more you know, the more negotiating power you will have. Ask questions such as:

  • “Why is the current owner selling?”
  • “Have there been any offers?”
  • “How long has the property been on the market?”

Keep your cool
Play your cards close to your chest and don’t reveal your position. This includes keeping the maximum amount you’re willing and able to spend confidential. Otherwise, the agent may try to push you closer to your maximum, even if your current offer is a fair one.

If you’re serious about the property, it might be worth making an offer slightly above estimated market value, as long as it is still within your means. But don’t risk significantly overpaying just because you’ve become attached. New properties are being listed all the time, so something else will always come along – and it might even be better.

Most importantly, try to keep your emotions separate from your negotiations. Don’t let competitiveness or fear of losing the property push you past your limit.

Third and final call: What happens if nobody bids at an auction?

Selling isn’t a certainty at auction. In New South Wales and Victoria, for example, around a quarter of all auctioned properties are passed in (1). What does it mean for the vendor and prospective buyers when no one makes a bid?

After the auction
An auction campaign puts a property into the public eye, but not all interested parties will attend the auction or make a bid. This might be because they aren’t in a position to adhere to an auction’s binding sale conditions, or they need more time to consider the purchase. Other parties may see a chance to skip to the negotiating stage if no one is bidding. In the wake of a failed auction, the agent will likely contact everyone who showed interest in the property during the sales campaign, in the hopes that one of them will make an offer.

Vendors: Research and regroup
If your property didn’t sell because your price was unrealistic, you might need to lower your expectations. Find out how many days similar homes in the same area are typically on the market. Houses left on the market for too long tend to attract lower sale prices, so if your campaign has stalled, it might be wise to take a break. You may want to consider launching a fresh campaign at another time with different photos, a new write-up and perhaps a new agent.

Buyers: Get ready to bargain
For prospective buyers, an unsuccessful auction can be an opportunity to nab the property at a lower price. Following a failed auction, the highest bidder earns the first option to negotiate with the seller. If their offer is rejected, the property will be open to all parties. There’s a good chance the vendor will be more motivated to sell if their property is still on the market more than two or three weeks after auction.

A failed auction may seem disastrous, but many properties that don’t sell under the hammer sell privately within a few weeks. So whether you’re a buyer or the vendor, be prepared to talk numbers.

Source: 1.

Using the equity in your home for a family pledge

If you are already repaying your own home or another investment property, you may be able to use the equity you have built up to assist your children with their entry into the property market as a family pledge.

This scenario will assist if your children do not have sufficient savings for a deposit. Let’s use an example to explain this process.

Your ability to assist

Lenders generally only loan up to 80% of the property value unless lender’s mortgage insurance (LMI) is paid. To keep things simple we will assume that the bank will only loan 80% of the value of your existing property. From our example on the right, there is $250,000 sitting in your home loan that could be used as a family pledge to assist your child with the purchase of a property.

Your child’s purchase

Let’s assume that your child does not have sufficient savings to purchase a property but has the servicing capacity to purchase a property worth $500,000. As they do not have any savings they will need to finance 100% of the property value plus upfront purchase costs. These upfront costs vary from state to state so we will assume an amount of 5% of the total purchase price (or $25,000). This means there will be a need to borrow $525,000.

Security for this loan will need to be provided as:

  • $400,000 against the property to be purchased (being 80% of the property value), and
  • id=”mce_marker”25,000 against your existing property.

End result

As a consequence of the above transactions the following will result:

Obviously, the amount of savings the child may have will reduce the need for a family pledge – or the amount of the pledge.


If your property was used as security for a family pledge, your child would owe the lender $525,000. As a parent you would continue to only owe the original id=”mce_marker”50,000. However in the event that your child defaulted on their loan and was unable to repay the lender then the lender may call upon you (as security provider) to repay the loan. If there are additional costs and default interest the ultimate amount that is payable as a parent may exceed id=”mce_marker”25.000.

Family…to help or not to help?

Do you have children trying to get into the property market? Are your children wondering if it will ever be possible to buy a property in today’s market?

Outgoing Reserve Bank governor Glenn Stevens stated that the only way for young people to get onto the property ladder in Australia’s most heated market – Sydney – is with the help of their parents.

He’s not alone. A survey we conducted earlier this year found that nearly 30% of parents were worried whether their children would ever be able to buy a home.

Most concerning, in the same survey, 66% of respondents claimed that their biggest financial worry was whether they would have enough money in retirement.

There is a common belief that baby boomers are reaping the rewards of a lifetime of substantial capital growth in the property market. However, they are also the first generation in history to face a ‘third age’ – expected to have approximately 20+ years of healthy life after retirement that requires funding.

What do we do when our children need assistance to get into the property market when as parents we are not in a financial position to help them?

How CAN parents help?

For those parents who are financially able and prepared to help their children enter the property market this financial support may be in the form of:

  • letting the kids live at home longer, in many instances rent free, so they can save a deposit,
  • gifting at least part of the deposit to their children,
  • providing a supplementary loan in addition to the bank loan, typically interest free, or
  • acting as a guarantor (although the drawbacks need to be considered here).

Kids living at home longer

In 2016, more than one third of 18-34 year olds still live with their parents. If the purpose is to allow the adult children to save a deposit then parents need to make sure it happens. Failure to save will place pressure on both parents and children with neither benefiting.

Gifted deposits

Be aware that a ‘gift’ is not repayable. If you are in a position to do this, it’s a great boost for your children. Most banks will require parents to declare there is no need for these funds to be repaid.

Parents on a pension also need to ensure that there are no adverse consequences of gifting.

Supplemental loan

Parents who have available funds today but with future needs may want to consider a supplemental loan to their children at low or no interest. This way you are able to help them NOW but the money will be repaid for your future use.

For any such family arrangement it is always recommended the loan amount and the terms of the arrangement be formalised in a legally binding document.

As an alternative to a loan, parents may choose to buy a home WITH their children. This will give the children a foot on the property ladder while providing the parents with an investment property. In this scenario it is common practice for the parties to be ‘tenants in common’ rather than ‘joint tenants’ and their share of the property be allocated according to serviceability.

Acting as guarantor

Some lenders have a loan product known as a family pledge. Parents or other family members are able to use equity in their own property as additional security. This product is aimed at home buyers and investors who have the ability to repay the loan but lack sufficient funds to meet the deposit and other upfront costs.

Regardless of the preferred option, it is imperative that all family finance scenarios be carefully considered in terms of both current AND future needs of both parties.


If you think you are not or will not be in a position to help your children then we need to talk. We will be able to help assess your ability to start investing now so that you may be in a financial position later to help your children. Securing your financial future first is a step in the right direction.