22 Sep Faster depreciation payments + Affordability and jobs get a tick + An island resort on cryptocurrency
Highlights from this week:
- How to get depreciation quicker
- Has Perth bottomed out?
- Economists bullish about affordability
- Use a Lot Owners Deed to settle disputes
- Cryptocurrency and holidays – how does that work
Crpytocurrency and holidays – how does that work? – Tim and Anthony
Kevin: Recently I conducted an interview on the show and spoke to an American agent, or as they call there, a broker who is now specialising in doing all of her transactions, real estate transactions, using cryptocurrency. I was interested to see that Great Keppel Island is about to undergo a multi-billion dollar redevelopment which is funded by cryptocurrency tokenization. Never heard of tokenization but we will find out about it and in fact, it is the first island in the world to be crypto tokenized.
Kevin: We’ve got two sides to this conversation. Anthony Aiossa is representing Tower Holdings, who are the owners of all of the leases for Great Keppel Island and also Tim Sommers will join me. Tim representing the consortium who is working with Tower. Tim, firstly congratulations on this initiative and I’ll get to Anthony in just a moment and talk about the how, sorry about the why, but let’s talk about the how. Tim, how does this work?
Tim Sommers: We’re a Blockchain technology organisation that have been looking for projects outside of utility tokens and a utility token is something that hasn’t got a lot of value attached to it. We were looking for a significant Australian based asset that we could tokenize. What I mean by that is once you tokenize it it means that the holder of that token has an asset back to it that can be liquid. You can sell that asset or sell that token.
Kevin: Yeah, and I guess that’s one of the benefits of cryptocurrency is that transaction can happen very quickly, can’t it?
Tim Sommers: That’s correct and Blockchain is the enabler to allow us to raise funds in order to work with Tower and to crypto the island.
Kevin: Yeah, a lot of people don’t realise that Blockchain is the technology or the security behind cryptocurrency, is that the correct way to describe it?
Tim Sommers: It is, but there’s two factors to what we’re trying to achieve with the island in terms of Blockchain. What we’re allowing people to invest in the project using Blockchain as the enabling technology and they can do that by using their own US dollars or Australian dollars as well as using Bitcoin and Ethereum and other cryptocurrency. That’s one factor. We’re then going to allow people to have utility token to actually spend the cryptocurrency on the island.
Kevin: Yeah, so Anthony Aiossa as I said at start is the CEO for Tower Holdings, the owners of the leases for Great Keppel. This is quite a bold move Anthony, why are you doing it?
Anthony Aiossa: I guess the simple answer to that Kevin as to why we’re doing it is because it’s the most compelling proposal that’s been put forward to us. We’ve been involved in the project for just a little bit more than 13 years now. It took us quite some time to get the development approvals. We secured those in 2013 and unfortunately at that time we were living in the post GFC world in which the raising of project finance for large speculative projects, if you like, such as the one on Great Keppel was extremely difficult. We spent a number of years trying to secure funding and we got very close a number of times.
Anthony Aiossa: We’ve recently undertook an international marketing campaign and this particular consortium came to us with this proposal and it’s a proposal in which we were very confident that they’re going to be able to raise the necessary funding to get the project off the ground. To answer your question, the why is because it was a compelling proposal and it’s a proposal in which they suggested an alternative form of financing, which could very well suit the island.
Kevin: It’s a very big redevelopment proposal. It’s 750 luxury villas, 300 luxury apartments, about what, just over 200 marina berths, but the 18 hole Greg Norman designed golf course, is that going to remain?
Anthony Aiossa: Yes, yeah the project as it was approved back in 2013 will remain in that format.
Kevin: That’s good. Does Greg Norman get there himself?
Anthony Aiossa: He’s been on the island, yes, yes. We’ve had him on the island, looked around it.
Kevin: Tim, what’s been the take up on this from consumers who, I mean, cryptocurrency is still scary for a lot of people.
Tim Sommers: Well I think it’s becoming less scary and more mainstream. You guys in the media I think are helping that. We launched this publicity campaign I think on Friday night, maybe Saturday morning, and we put up a fairly vanilla page, a website to allow people to register their interest. I mean, in the first three days we had somewhere in the region of about 50 million dollars worth of interest, which was 50 percent worth of cryptocurrency and 50 percent in fair currency, so it’s been a significant uptake.
Kevin: Yeah, that’s actually quite impressive, 50 percent tokenization, is that the way to say it or is it just cryptocurrency?
Tim Sommers: No, no, in terms of the people’s interest in terms of investment it’s 50 percent has been in Bitcoin and Ethereum and cryptocurrency and the rest has been in fair currency.
Kevin: As I said at the introduction, it’s a fairly, not so much common thing but one of the things that I’ve noticed out of the states is that it’s a very quick, it can really quicken up the transaction. Over there, I mean, they’ve had delays of anything up to three months but with cryptocurrency it can happen in a matter of days.
Tim Sommers: It’s a great point, so once we’ve tokenized the island and people have the value to their assets, they can instantly liquidise their holdings through exchanges around the world, so you bought a piece of real estate, but therefore not only can you spend that part of your token, but you can also liquidate and put it into fair currency again.
Kevin: How do we get a bit more information about this Tim? Is there a website?
Tim Sommers: There is, but I did mention it’s a very vanilla based website at the moment. There will be a lot more information coming soon, but it’s GKItoken.com.
Kevin: Okay, we’ll make sure that’s in the transcript. GKItoken.com, that’s the website. Tim Sommers, thank you so much for your time. Anthony Aiossa, all the best. Congratulations on the guts behind this development. I take my hat off to you. Well done gentlemen.
Tim Sommers: Thank you Kevin.
Anthony Aiossa: Thank you.
Has Perth bottomed out? – Damian Collins
Kevin: Great news. The average vacancy rate in Perth’s rental market has fallen to its lowest level in over three years, according to recent data released by the Real Estate Institute there. Damian Collins from Momentum Wealth is our man on the spot in WA and he joins me. Hi Damian.
Damian Collins: Hi Kevin.
Kevin: Damian, what is vacancy rate, and what’s that telling you about the Perth market right now?
Damian Collins: Well, Kevin it’s come from over seven and a half percent down to four and a half percent recently. So we’ve seen the number of vacant properties drop from the peak of 12,000 to just over 7,500. So it is definitely starting to turn.
Damian Collins: We’re not seeing rental rises across the board. On some selected properties we are, but certainly the trend is heading in the right direction. And I’d expect, yeah it’s certainly a decreasing trend, and I expect that to continue.
Kevin: Yeah, that’s a good indication of what the market doing. Is it too early to say that the market there generally apart from rentals has actually turned?
Damian Collins: It is, it is. We’ve definitely hit the bottom as a general market, but it is still in segments. So where some segments, the premium end of the market’s already in recovery. The middle tier’s probably at the bottom and in some of the new suburban areas, there’s a lot of excess supply. They’re still struggling along the bottom and perhaps have a little bit to go. So generally across the board you’d say the bottom, but it’s a bit segmented in the market.
Kevin: Damian, what do you think, what impact will this have on developers and construction generally?
Damian Collins: Well, the home building market has still, I think, got 12, 18 months to go. That’s where we’ve seen the biggest overs generally in the outskirts, in the new home and land packages.
Damian Collins: But apartments, look we are seeing owner occupiers certainly come into the apartment market. That’s the stuff that’s selling. The developers across the board are all finding that the three bedroom property is more at the premium end of selling. But investors are still quite thin on the ground.
Damian Collins: So look overall, I think that the new home building market’s 12, 18 months away before they’ll see much. But developers are starting to feel a bit more confident, but there hasn’t, it’s been owner occupiers. Investors still haven’t come back into the market yet.
Kevin: Of course employment’s also another key indicator for us. What’s happening with jobs there in WA?
Damian Collins: Well, that’s been one of the stories that is certainly been for 2018, and it’s just started to feed through into property, that the mining sector is certainly in recovery. There’s been a lot of lithium mines getting, and lithium processing, processing places getting developed. Iron ore’s got some big expansion plans at [inaudible 00:02:30] and for Rio. Four and a half billion or thereabouts to BHP.
Damian Collins: So that’s been, people in the mining sector say it’s not boom times, but certainly there’s skill shortages, and they can’t get people. So the trouble is we’ve got to get them in and ease employment and certainly the number of jobs available is the best it’s been in four years.
Kevin: Yeah, of course with rental, the rental market tightening up a bit, that puts pressure on property availability that’s going to flow through to increased demand. When are you expecting an uptick in prices, or is that already happening?
Damian Collins: Kevin, it’s the owner occupier market is the premium and it’s definitely already happened. They’re offering between five and eight percent already. So certainly anything above your million that’s, and that was confidence driven where people could afford it. The rates, the interest rates are low and it was just about confidence that people were worried about having a job at the mining, you know, the middle management and upper management level now feel very comfortable. So that’s moved.
Damian Collins: The mid tier, we just haven’t seen a lot of investors back yet. There, certainly in our office, I know we’re getting people from Sydney. They’re about 30, 35 percent of our business. Local investors are still a bit thin on the ground and I think they need to see the vacancy rate go down a bit more, and rent rises start to happen.
Damian Collins: So I still think in 2018, it’s the end to the middle of 2019, it’s going to be, in the general market overall, slow growth. But I think yeah, second half of 2019 and 2020. All the fundamentals are there to say that’s when Perth should do pretty reasonably well.
Kevin: Well, just on the point of investors there, what’s investor stock like in Perth at present?
Damian Collins: Yeah, there is investors, there is an over supply of finished apartments, so the investors are running around getting a few bargains in some spots. The stuff that’s in high demand we’re finding with our buyers agents out in the market, is anything that development potential. Even though the market overall you’d say it’s balanced and it’s not super strong, we find that the good quality properties near transport stations, and near infrastructure. We’re often finding we’re sometimes competing against two or three offers.
Damian Collins: So the smart investors are looking at something that they can redevelop a bit further down the track. So that sort of stock is in fairly high demand. But your finished development stuff is still a bit, a bit soft in there. So I reckon that’ll get soaked up over the next six to 12 months.
Kevin: Yeah. Where would you say the best opportunities for investors exist right now in Perth?
Damian Collins: Well, Kevin, I’d certainly be saying, as an investor, you know Perth’s starting to recover in population growth, depending on whose forecast you read. We’re going to be two million now, we’re going to be somewhere between three and a half to five million over the next 30, 40 years. It’s, you follow the trend of what’s happened in Sydney and Melbourne. It’s near transport. As the city gets bigger, you want to be near the train station. Then the infrastructure, the amenity, the shopping centres, the lifestyle, the cafés.
Damian Collins: So certainly anything in Perth, you know, close to the beach within 15, 20K at Scarborough I like. There’s going to be a bit of a development going on, but I think that’s the future Bondi of Perth.
Damian Collins: And certainly to come back a bit inland on the southern side, it’d be like South Lake, Bibra Lake along the free land and train lines. But in the Northern Corridor, your Warwick, your Craigie. They’re the ones that you can still get a decent property for under $500,000 in Craigie and those sorts of areas, and Bibra Lake. It’s just something you wouldn’t see in Sydney and Melbourne.
Damian Collins: So just focus on being near amenity and transport, that’s what’s going to give you the growth incentive prices as the city grows in population.
Kevin: Yeah, well it’s certainly been a tough time in Perth.
Kevin: So thank you for that update, Damian. And it’s really good news that that market may just be turning around at long last.
Kevin: Good on you Damian. Thanks for your time.
Damian Collins: My pleasure, Kevin.
Use a Lot Owners Deed to settle disputes – Jacob Duane
Kevin: Sometimes when we go into any endeavour, it’s not so much a matter of how much we know. It’s a matter of what we don’t know, and this highlights some of the common mistakes that property investors make. So, we’re going to talk about that with Jacob Duane, who is the Director of Bennett and Philp Lawyers, and leads the firm’s property and real estate team. Jacob, thanks for your time.
Jacob Duane: Thanks for having me, Kevin.
Kevin: I asked you to put together the top three mistakes that you see investors make. We might just work through those. I wasn’t at all surprised to see that the first one was going in with others. You’re talking here about family and friends?
Jacob Duane: I am, and I’ve got this one down from personal experience, Kevin.
Kevin: Oh, really? Okay.
Jacob Duane: Years and years ago, I was involved in an investment property transaction. Family, in-laws, friends, it was a decent bit of property. But honestly, different stages of life, different investment appetite, and changing family circumstances all imploded. So I see this regularly, and my advice is always to avoid it at all costs.
Kevin: Avoid it, but if you need to do it, always go in with the end in mind. In other words, have your exit strategy before you even … And I have those important conversations as well, Jacob.
Jacob Duane: One of the things that a lot of these co-interested investors don’t consider is a Lot Owners deed, which actually outlines the exit opportunities for them at all stages of the ownership.
Kevin: In putting that together, that would raise a lot of interesting questions that need to be confronted as well, wouldn’t it?
Jacob Duane: It does and it’s interesting because what they say is, “Oh, look. That won’t happen. We don’t need to consider that.” And so they’re happy families when they go into the transaction, but generally they’re not happy at the end.
Kevin: Such a shame, isn’t it? But that can be avoided by having this thing documented. I guess we’ve gotta realise that this thing is like a business, and with any business transaction, you need to have it really, clearly set out as to what the procedures are.
Jacob Duane: That’s right, that’s right. I had a matter recently, Kevin, where a brother and sister, and a sister-in-law purchased a property. It was all fantastic in the beginning. By the end of it, the sister was excluded from the property and was living in a room downstairs, away from the kitchen, away from the balcony, away from all the exciting parts of the property.
Kevin: It’s amazing, isn’t it? When something goes wrong, it just drives an enormous wedge and even those very strong family ties can’t help it at all. But it is a matter of clarifying it, and I said at the outset, that sometimes there are reasons why you’d want to go in with others, and that is to get your foot into the ladder. But if everyone understands that is the case, and then everyone sort of says, “Well if I want to sell this is going to be the scenario.” As long as everyone understands it, Jacob.
Jacob Duane: That’s exactly right, Kevin. And look, it’s not a difficult document to draught, a co-owner’s deed. Couple of hours of my time, and an hour with you running through the scenarios that might be relevant to you and we get it sorted.
Kevin: Yeah. And the reason I like doing it with a solicitor, a third party, is that you can offer or ask those very uncomfortable questions that need to be confronted.
Jacob Duane: Yes, and then you’d appreciate this, Kevin. Noel Whittaker wrote a piece two weeks ago on the Courier Mail, and said, “Your best business partner is always the bank, as they only want you to pay interest.”
Kevin: That’s so true. That’s what I like about Noel, he cuts straight through, doesn’t he? Number two you said it was due diligence. This is such a broad subject on its own. But just quickly cover off for me, what are some of the areas in due diligence we need to be aware of?
Jacob Duane: Well, one thing that people need to remember is that the consultants generally haven’t seen the property. So I don’t know whether that pergola looks like it’s approved. So I don’t know whether it’s appropriate until you obtain a full town planning certificate. I don’t know whether we need to get a building approval search done. People say, “Well look, just order the relevant searches.” And I say, “Look, to me all the searches are relevant, because they’re all going to turn up something.” It’s a commercial call for you as to what ones you want to take, and what risks you’re prepared to take.
Kevin: Getting a building and pest inspection done, they’re very basic things. But it’s amazing how many people don’t do it.
Jacob Duane: Kevin, I’ve seen extensions built over underground easements. And people have lost part of living rooms, in relation to council coming along and saying, “Look, I need access to that sewer easement. You have to remove that part of the building.”
Kevin: Exactly. Spruikers was number three and this is one that we’ve covered quite often in the show, but it amazes me how many people continually fall for this.
Jacob Duane: Yeah, Spruikers have a role Kevin, but I think what investors have to do is ask a lot of questions. You don’t necessarily have to use those associates recommended by the spruiker. You may use some, you may use the real estate agent, you may use the accountant. But what you need to do is go in with your eyes wide open, having asked a range of questions. Advisors have the obligation to provide recommendations to their clients that’s in the client’s best interest. You’ve always got a question whether there’s a conflict between your advisor and whether your best interest is being considered.
Kevin: Yeah. When we talk about Spruikers, I normally think of spruikers as people who are trying to sell you something, but it’s a product that I’ve got. So therefore they’re getting a double commission. They might be getting something from you, but certainly getting something from the developer as well.
Jacob Duane: Yes. Well, one thing that we never do Kevin, is that we never get kick backs to you.
Kevin: Well that’s good for us. Yeah. I think that’s the question you need to ask these people when they’re offering you a service is, “Are you getting a kickback on this?” It’s okay sometimes to get a kickback, but as long as it’s disclosed and you know.
Jacob Duane: If it’s disclosed it’s right. As long as everything’s up front Kevin, it’s fine. But as a matter of policy, I think it would be better for advisors not to do it.
Jacob Duane: Fee for service or for advice I think is more important.
Kevin: We touched on three very important issues here and they all need further discussion, so we’ll probably do that at a later time. But Jacob, thank you so much for your time.
Jacob Duane: Great. Thanks for having me. Kevin.
How to get depreciation quicker – Brad Beer
Kevin: Property investors often don’t know that there are two different methods of calculating the depreciation deductions for the plant and equipment items that are inside their investment property. Yet, investors can only select one. So, which one? Brad Beer from BMT Tax Depreciation joins us. Brad, welcome to the show.
Kevin: What are the two different methods?
Brad Beer: Yeah, thanks, Kevin, great to be here.
Brad Beer: Two different methods of calculating the claims on plant equipment. One’s called the prime cost method. The other, the diminishing value method. Tax office comes up with fancy names here.
Brad Beer: Prime cost is basically a straight line method, or, we take the value of the item, we take it over the effective life and we make that claim. It’s the same amount each year for the effective life of the item. A very simple way to say that is, let’s say, carpet worth $10,000 has a 10-year life. You get $1,000 per year for the 10 years of owning that carpet as a deduction.
Brad Beer: Diminishing value, slightly different. What it is is a claim based on its diminishing value each year. Now, under the current legislation, it’s been a little different in the past, it’s twice the rate. So, it’s 20 percent instead of 10 percent. So, on your $10,000 carpet, you’ll get $200 (correction from audio – $2,000) in the first year, which is 20 percent of the $10,000 carpet, and in the second year, you’ll get 20 percent of the value that’s left, which is 20 percent of $8,000, and so on each year diminishes based on what’s actually left each year. So you get more out of that diminishing value in the early years, but obviously, it’s a diminishing value, or diminishing claim, each year over the period of ownership.
Kevin: Is that why, do you think, it’s the preferred option for investors, that they’re getting more money up front?
Brad Beer: Diminishing value gets more money in the early years, absolutely. So, you would generally choose that because, you know, as investors we’re looking for money now instead of tomorrow. Money’s worth more today than it is in three years’ time. And, look, the only time you’d go the other way is if, you know, that in two or three years that you’re going to have some increase in income and you’re going to be in a different tax bracket, so these deductions might be used in a different way. So you’d be able to look at what your expected income in the future is.
Brad Beer: When we do a report, we give you both the prime cost/diminishing value total claims, and we calculate and work out exactly what it’s going to be each year to help you with your financial advisors to make a decision on what’s actually best for you.
Brad Beer: But, yes, usually the diminishing value gets more in the early years, and that’s when we like our money, today, not tomorrow.
Kevin: Absolutely. Yeah. Immediate write-off and low-value pooling. Can you explain what those methods are?
Brad Beer: The immediate write-off is, you know, items with a value of less than $300 when you buy them, and they’re not part of a set, get an instant claim in the first year that you buy them, or when you buy the property. So, you know, there’s not a lot of things worth less than $300, but rather than claiming them over 10 years, 12 years, they’re in instant deduction straight away. So the more of those we can find, obviously, the better.
Brad Beer: The low-value pooling, not quite as simple, but, in simple terms as best we can, if an item is worth less than $1,000, rather than claiming it at its normal, effective life rate, like that carpet over 10 years, you actually get to increase the claim percentage up to 18 and 3/4 percent in the first year without a pro rata adjustment, and then 37 and 1/2 percent in the following years after that first year.
Brad Beer: Now, 37 and 1/2 percent is much higher than 10 percent, 20 percent, obviously, so, making sure things are done properly within a low-cost pool or low-value pool, which, you know, they either are worth less than $1,000 when you buy them, or drop to a value of less than $1,000, means that you get more deductions in these early years of owning this property, so anything that does fall into those categories, obviously, we drop them into those low-value pools to maximise those deductions for investors on the way through.
Brad Beer: Not overly difficult, but it is something that really needs to be applied properly, and just helps you to get more deductions out of those properties in the early years of ownership when you need it.
Kevin: What kind of investors would prefer the prime cost method?
Brad Beer: Often, large property trusts might choose prime costs, because they actually want to spread the deductions out over the time and make them the same, rather than trying to get more now and less later. And the other one would be someone who knows, as I probably alluded to before, knows that their tax bracket might be higher in a couple of years time, and the more deductions in later years will be of much more value to them, because they’ll get to claim more of the money back as they make those deductions.
Kevin: Which experts do you think investors should consult when they’re trying to make that decision, between the prime cost and the diminishing value method?
Brad Beer: A Quantity Surveyors, and we do this in our reports, obviously, should be able to split up the two methods, and even under the two methods, you can actually make a few more choices, so, we actually set them up with a prime cost schedule, and a diminishing value schedule with a low-value pooling schedule sort of attached to that.
Brad Beer: But, sometimes you may want something in between, and it can be very easily done by us, and seeing what the numbers look like. But, the accountant, and yourself, obviously, you can have a discussion about your future income potential, or your future income expectations to help make sure that any deductions we help you to find are best used in your situation for going into the future.
Kevin: Brad, great talking to you, as always, thank you very much. Brad Beer, from BMT Tax Depreciation. Thanks for your time, Brad.
Brad Beer: Thanks, Kevin, always a pleasure. Thank you.
Economists bullish about affordability – Graham Cooke
Kevin: Recent out of cycle increases by some of the banks has caused a bit of a panic amongst some property buyers, and there’s a prediction now that values in Sydney and Melbourne in particular, are going to drop by as much as 6%. Some saying that this going to last for about 20 months to even two years. Joining me from finder.com.au is Graham Cooke. Graham, thank you very much for your time.
Graham Cooke: G’day Kevin. How you doin?
Kevin: Yeah good mate. I’ve got to say that the recent increases from the banks have not been all that substantial.
Graham Cooke: No, no they haven’t been, and they’ve been a bit slow to be honest. So that’s quite interesting. I don’t know whether they’re going to kind of follow suit. We have seen some smaller lenders follow suit, such as Suncorp, but I do expect them to fall into line, maybe even by the end of the week. But it’s going to be interesting now because the falling house prices will provide some cushioning to the increasing rate rises for first home buyers who have a deposit saved.
Kevin: If the banks do actually put rates up or the RBA puts rates up in particular, that’s almost a reflection that the economy is improving.
Graham Cooke: Yeah, yeah but I don’t think that’s going to happen for quite a while. We’ve been conducting a survey of leading economists in Australia for several years now, every month, and we ask them when they expect the next rate movement is going to be. Now for the whole of the last two years they’ve been saying rate movement happening every month is not going to happen. But the prediction of when it will actually move, has been moving forward, and forward, and further forward. Now we’re not seeing any predictions of a movement this year. In fact most of the economists are predicting the earliest movement we’re going to see is towards the second quarter of next year.
Graham Cooke: But across the board the expectation is that will be a movement in the positive direction. So 88% of the economists are thinking there will be an up, but not for a while. If you’re a first time buyer and if you have a deposit saved, now is a good time to be in that position. But you know it’s a question of when the market’s going to bottom out. I mean I’ve seen some research from Capital Economics in the paper, over the last couple of says, saying they expect a fall by 12% over the next four years.
Kevin: It’s so difficult when you know we hear about price drops like that, in such a general sense, because each market is totally different. You know we might see Sydney come off a little bit maybe compared to Brisbane, Brisbane doesn’t fall off as much, and Perth seems to be improving. Graham, in the survey you asked economists their impression of the market, how they felt consumer confidence was, what did they say?
Graham Cooke: We asked them this time, how long they expect the market to be in a downturn in the two most heavily hit markets in the country, which are Sydney and Melbourne. I found the results quite surprising. The average came back at 20 months, and it’s about the same for Sydney and Melbourne. So we’re looking at probably a two year downturn across the two capital cities, is what the economists are saying. But who knows what’s going to play out next year. Inflation is still low, wage growth is still low, so because of that they’re not thinking that the RBA is going to drop cash rates any time soon. So we’re probably looking at a kind of stagnant period ahead of us right now.
Kevin: Was there any comment from any of the people you spoke to about the jobs situation? That’s always a big trigger for what’s happening with the economy and with property prices too.
Graham Cooke: Yeah. There’s been a fair bit of commentary on the fact that inflation is low, in terms of jobs growth. We do do a sentiment tracker as well, as part of the survey. So we ask the economists, what their kind of feeling is negative or positive on the economic sentiment, in various different areas of the economy, and wage growth is one of the things that’s in there. It’s kind of mixed to be honest. So one third of the economists came back feeling positively about wage growth, and the other 57% were kind of in between, so they’re neutral. We also asked about unemployment specifically, and this one came back quite positive. So 57% of economists are feeling positive about employment in the Australian economy.
Graham Cooke: Looking at these metrics over time is quite interesting, the positive sentiment on unemployment has remained relatively steady since March to September this year, kind of hovering between 50% and kind of 65%. Everything else has been relatively steady. But the one metric that they’ve changed their views on, massively, since March this year was housing affordability, that’s gone from only 4% of economists feeling positive about it in March this year, 50% of economists feeling positive about it now. So that is the one aspect of the kind of economic situation that’s changing rapidly.
Kevin: Graham, always good talking to you mate. Graham Cooke from finder.com.au. Thanks for your time Graham.
Graham Cooke: Thank you very much Kevin, cheers.