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Sep 4, 2020
Increase Rental Income & Deductions
(Source: BMT Quantity Surveyors) Australia’s renovations industry appears to be profiting from weaker economic conditions and tighter lending standards, with alterations and additions to residential buildings hitting a historic high recently. Australian Bureau of Statistics December Building Activity data showed a 6.6 percent increase in alterations and additions in 2018, with renovation spending reaching $2.27 billion in the December quarter. This indicates homeowners and investors seeking to improve capital values and increase rental income have been renovating their properties, rather than purchasing anew. It’s expected this boom will continue, as Master Builders Australia has forecast homeowners and investors will spend $8.8 billion annually on renovations over the next five years. Renovations can significantly increase rental income. According to the first CoreLogic Quarterly Rental Review for 2019, gross rental yields are currently around 4 percent. However, in some scenarios, renovators can achieve a 13 percent return on their renovation investment. Renovation case study to increase rental income Let’s look at a case study where an investor completed a $60,000 renovation. Here is the investor’s scenario before and after completing the renovation. Original purchase price (before renovation) = $410,000 Rental income per annum prior to renovation = $18,720 Total renovation spend (completed in 2018) = $60,000 Property value on completion = $565,000 Rental income per annum after renovation = $26,520 In 2018 kitchen, bathroom and other cosmetic renovations were made. Newly installed plant and equipment assets included an oven, cooktop, dishwasher, rangehood, carpet, blinds, lights and a split-system air conditioner. The investor also installed fixed and structural items such as kitchen cabinets, benchtops, a bath, toilet and tiles. A post-renovation valuation found the property was now worth $565,000. A property manager’s rental appraisal also found the owner could earn $510 per week. Below is the investor’s tax scenario before and after the renovation. Prior to the renovation, the investor was experiencing an annual cash loss of $1,207. However, after renovations their weekly rental income increased by $150, achieving a 13 percent yield on the renovation cost. They also turned their annual cash loss into a positive cash flow of $4,054, an additional $5,261. Renovation tips and traps While this example shows the great results possible, it’s important to be aware of some tips and traps before committing to a renovation project. Scrapping can increase deductions when renovating As part of any renovation, old assets will be discarded and new assets will be installed. When removing structures or assets from an investment property, existing assets may have a residual depreciable value. A process known as scrapping should be applied to ensure undeducted entitlements are claimed. Asset selection when renovating affects depreciation deductions Choosing which assets to install can also make a difference from what can be claimed once a renovation has been completed. Items that serve similar purposes, such as flooring, depreciate at different rates. Carpet installation with a $2,000 cost will result in $500 in depreciation deductions in the first full year compared with floating floorboards and tiles of the same cost, which result in $267 and $50 in deductions respectively. Avoid over capitalising when renovating Investors should stick to a budget when selecting items as it’s easy to over capitalise. This is particularly relevant in today’s property market, where according to CoreLogic dwelling values fell by 7.4 percent from their peak in October 2017 to the end of March 2019. As many capital cities have experienced price declines, investors need to be wary of recouping the dollars spent during a renovation, particularly if they are planning the work to help sell their property at a higher value or raise the cost of rent to increase rental income. Sticking to a budget is crucial. Seek advice prior to starting work, particularly if living in the property while renovating A specialist Quantity Surveyor can provide advice on potential deductions available including whether depreciation legislation changes passed in November 2017 have any impact on your personal situation. If you’re living in a residential property whilst completing a renovation, work completed can impact future deductions should you rent the property later. Newly installed plant and equipment will be considered previously used if items are added to a residential property while living there. BMT data shows one in four people lived in their property before renting it out in FY 2018/19. There are exceptions. Substantially renovated properties and capital improvements to fixed and structural items aren’t affected. Even if fixed and structural improvements were completed by a previous owner, a new owner can still claim these items in the future. Assumptions and disclaimer The depreciation deductions in this case study have been calculated using the diminishing value method. Assumptions: The renovations were paid for by increasing the existing home loan and the investor falls into an income tax bracket of 37 per cent.
Sep 1, 2020
3 Mistakes Sellers Make (That Costs Them Thousands)
Selling a home is complicated. Getting top dollar is a mixture of price, presentation, and promotion. Some homes sell in less than a week. Others might sit on the market for months and months. It totally depends on the pricing strategy, how well the property presents and the marketing plan. It's easy for sellers to be subjective about the place they have called home for such a long time. So here’s a quick list we made of the 3 biggest mistakes that can make the job of selling your home more difficult. Dropping The Price A Little (Instead Of Updating The Interior) This is a really common mistake. Thinking that instead of upgrading the outdated bathroom or kitchen, you can just drop the price a bit….and let the buyer use the extra money to upgrade it themselves. Now, I can see how this logic makes sense to them, but the truth is that it is exponentially harder to sell a home that doesn’t “show” well. Most agents know how to manipulate the photography to highlight a home’s strengths, and downplay its weaknesses, but you can’t hide an entire room! If the kitchen is outdated (old cabinets, old countertops, old appliances, etc), no amount of creative photography or “staging” can make up for that! Rather than dropping the price $10,000, it makes much more sense to just FIX THE KITCHEN. Homes with updated kitchens sell much, much, much faster than homes without updated kitchens. The same is true of bathrooms. Here’s the bottom line: if you want your home to sell in a reasonable amount of time (30 to 60 days), don’t be lazy when it comes to updating the kitchen or bathroom! It’s easy to just drop the price a little bit and save yourself the hassle, but it almost guarantees your home will take a long time to sell. Failing To Stage The Interior The old cliché is true: a little paint goes a long way! Even simple upgrades like fresh paint (neutral colours are best), new carpets, tile flooring, etc make a BIG DIFFERENCE. The average home can feel like a completely new house for about $5,000 or less of cosmetic upgrades. And while I’m on the topic of maximizing the interior, make sure to properly “stage” it. If you can, hire a professionally certified home stager. They will maximize the price you get for your home by making sure everything is strategically arranged. In almost every case, the small fee you pay the home stager is far less than the extra money you get by selling your home for more money than you would have otherwise received. If you cannot afford a home stager, make sure the home is always in pristine condition before showings. Get all the carpets professionally cleaned, dust everything, remove as much of your “personal” stuff as possible (family photos, etc). If you have to store it in the garage, then do so neatly in boxes. Taking Amateur Photos Or Video In the age of the Internet, there is simply no excuse for not having professional photography and video. Recent statistics show that over 90% of homebuyers begin their house-hunting search online. Honestly, I don’t believe that statistic! I’m guessing it’s 100%. I don’t know ANYONE who didn’t start their home search online. When the first impression of your home is almost certainly going to be online, don’t you think it’s a good idea to invest a little bit of money to make sure you make a good first impression? The difference between amateur photos and professional photos? Usually a couple of hundred bucks. It costs about the same amount of money to film a video tour of a home, yet most agents don’t invest the time or money to do this! Personally, I always invest in top-notch marketing for my listings. It helps the homes sell faster, AND for top dollar. It’s not an expense. It’s an investment. If you’re considering selling your home, make sure that your agent is willing to invest resources into promoting the listing with photography and video. If you’re thinking about listing your home for sale, speak to your local expert at RealWay who will take a look at your home and advise you so that you get a great price with a minimum of fuss. Good luck!
Aug 24, 2020
10 Reasons People Move Home
1 minute read Moving home can be a stressful, time consuming and costly process. This begs the question: "Why do so many people choose to move?" We explain the top 10 reasons why people decide relocating is the best option. 1. Need more space First time home buyers positioning themselves on the property ladder often outgrow their starter home. This means they might need to upsize to a larger house with plans to start a family. 2. Upgrade Deciding whether to improve your property or move to a new home entirely can be difficult. Becoming restless at home is a common problem, with many people getting itchy feet to upgrade to a bigger, more desirable home. 3. New job A new job can mean relocating to a different area if the commuting distance is simply too long. Maybe travelling from your current home to your new job is completely unfeasible. 4. Empty nest When the kids are all grown up and have moved out of the family home, many choose to downsize. Usually, they choose a smaller place as they no longer need all the extra space or the upkeep. 5. Relationships Choosing to move in with a partner is typically a significant stage in any relationship and is one of the main reasons people relocate. This often means that one partner needs to sell their house if both owned homes prior to the decision. On the other hand, break-ups can also result in moving home, as one person’s income may not be able to support the price of the home or one individual may need to buy the other out. 6. Visit family more often Living closer to the family can be very important and can be one of the key reasons people choose to move. As the family unit extends to several generations, parents want to be nearer their children. Grandparents want to see more of their children and grandchildren so they move closer. 7. Catchment area for schools More and more people are shifting to catchment areas where their children will be a higher priority for admission to their school of choice. Parents who are keen to send their child to a particular school may not fall within the specific catchment area in their current home, meaning many decide to relocate. 8. Change of scenery or lifestyle Those feeling unsettled in their current home or searching for a fresh start are most likely to uproot and move to a different location. Whether you want to move from the bright lights of the city to the peaceful countryside or vice versa, many decide that a change of scenery is the ideal option for them. 9. Cost of running a house A change of income or need to save money means many choose to relocate to an area where the running costs of a house are much lower. From the price of the house itself to rent or bills, the expense of owning and running a house can cause many to move to a different area. 10. Changes in the surrounding area Since originally moving into your current home, the neighbourhood might have significantly changed. This might be due to economic, social or physical reasons. You may choose to relocate to an area where you feel much happier and more comfortable in your surroundings.
Jul 31, 2020
What Buyers Should Remember During an Open Home
Would you spend just 20 minutes inspecting a property that is going to be your home for many years? Some buyers do – and they live to regret it. Don’t remember the things you should have looked for after you have left. You should have a building inspection done during the contract stage of your purchase, but you don’t want to spend money on it until you have the basics. 1. Check for water stains, mould, peeling paint and corrosion. You need to know if there has been any water penetration or leaks in the house. There might be a leaky roof, poorly sealed windows or doors, plumbing and drainage problems, or even signs of flooding in the past. The main giveaway signs are a mouldy smell, flaky plaster, and watermarked walls or ceilings. It sounds obvious, but make sure you look closely near the ceiling and around showers, baths and toilets and even look in the cupboard under the kitchen sink. 2. Is the building structurally sound? Big cracks are what you are looking for – but you should expect some hairline cracks. Look especially around where extensions join, above and below windows and doors which are weak points where you’ll see cracking first if there is any movement. If the house is on stumps, then check that the floor is level. You’re looking for issues now that you can ask the homeowner or real estate agent about and then ask your building inspector to investigate later. 3. How much storage space is there? Storage space is a valuable but often overlooked asset. Where will you keep your vacuum cleaner, towels, spare linen, lawnmower and boxes of junk? Do the bedrooms all have built-in wardrobes? If not, is there room for cupboards or shelves to be built in? Especially in newly built houses, storage space can be scarce. 4. Which way does the house face? A block's positioning and the sunshine it receives are crucial to how much light and warm the home will be in winter and how cool it will stay in summer. Everywhere in Australia, the ideal aspect tends to be north or north-east. There are advantages to having the main living spaces, such as the lounge, dining room, kitchen and backyard, where most people spend 90 percent of their waking time at home, facing north. To savvy buyers, a north-eastern aspect can be worth a premium of 10% on the price. 5. Are the rooms big enough for your needs? We’ve heard of new build home developers putting smaller furniture in rooms to make them seem bigger. Be warned! Assuming you won’t be buying all new furniture as soon as you move in, will your existing furniture fit? Is the layout right for you? Some buyers plan just where each piece of furniture will go on a floor plan before they make an offer. 6. Is home staging influencing your logic? Cleverly placed mirrors, strategic lighting, delicious smells, cosy fires, and fresh licks of paint are all tricks sellers use to make their homes more appealing. It’s nice to feel you can move straight in without having to do a thing but try to remain objective. And if their furnishing makes the space, take photos and ask what they are leaving behind. You might be surprised what the seller will be prepared to leave. 7. How well maintained are the windows? The state of the external window frames is a great indicator of the state of the house – if people have invested in and looked after those, they are likely to have taken great care of the rest. If you can easily push your finger into a wooden window frame, they are usually rotten. Aluminium windows can often stop sliding freely: sometimes they can be refurbished with new rollers, catches and locks, but sometimes they need to be replaced. 8. Termites? Ask whether the area is prone to termites or other borers and double-check what you are told with the local council. Check for termite damage wherever any wood touches the ground, such as alongside walls, pergolas and decking. When was the last treatment done? 9. Are there enough power points and what condition are they in? Dodgy wiring can be dangerous and rewiring your new home can be an expensive business. Also, check out the consumer unit to make sure that there are safety switches – often an indication of the state of the wiring but an electrician will confirm if it needs replacing. Having enough power points is apparently a big selling point in our increasingly gadget driven world so worth taking note on the way round. Does the property have solar panels for power – they could save you money on your electricity bills. 10. Is the plumbing up to scratch? Run the taps to check the water pressure. Check that the pipes are not steel, as they corrode and will need to be replaced at some point. How old is the hot water service (you could check the date on the side of the tank)? Is there solar hot water? Will the gutters and downpipes discharge the water from heavy storms? Ask a plumber to check out the plumbing and drainage if you are concerned. 11. If you are looking at a unit is it properly sound-proofed? Neighbourly noise from TV, music showering, toilet flushing or scraping furniture on the floor above can be annoying. Make sure that you can listen out without background sound whilst you are at the inspection or open house to check that poor sound insulation won’t drive you crazy once you move in. 12. What’s the internet and mobile phone reception like? Ensuring high-speed Internet access before your purchase can be a tricky proposition. Make sure that you’ll be able to binge-watch the latest shows and ask to see for yourself that download speeds will support TV streaming. Likewise, check for a decent signal on your mobile phone whilst you look around the home. 13. What’s the area like? Are the other homes in the street neat and tidy? Is there suburb improving; are there lots of builders renovating in the area, is there new or planned infrastructure - roads, rail, shopping centre? Can you walk to shops to buy milk, or do you have to drive? What’s the Walk Score Ranking of the home? Is it easy to get to public transport? Are there noisy roads or train tracks nearby? Is the property underneath a flight path? Does a nearby school make it impossible to get out of your drive at school run time? And most importantly, does it feel like you could make it your home? If you do like a property, arrange another inspection for a different time of day, and scout out the local area a bit more. If you can, take somebody with you who might be able to notice things you don’t.
Jun 23, 2020
Moving with Children
By the time you are a parent you will almost certainly have lived in several homes. However, children might have only ever known one home and moving from it can be a significant upheaval. This can be compounded if you are leaving for a new life elsewhere, particularly if that is interstate. Here are some ways to make the move easier for your children to process and deal with. Before you move Involve your children from the start. Parents often assume that the less time children have to worry about moving the better, but this just isn’t so. Kids are perceptive and will pick up on what’s going on so don’t leave them out of the loop. They need time to get used to the idea of moving and you're the best person to help them understand. Whenever possible, take your children with you when you inspect properties. Ask them for their opinions and views and where possible try to include these in the final decision. Whilst they are not going to make the final decision, it is important that they feel part of the process. You might feel it’s appropriate to discuss the reasons behind your choice when you’ve made it. If you can’t take them with you, take photos of the home, the garden, and the local area. Then you can show your children and talk about the move. You could ask them to help you research the new area on the internet. Talk about what they have found. This is a good way to gauge how they are feeling if they are excited or apprehensive about moving. If you are moving to a new area, find out about local facilities for children, schools and the benefits of living there. It is important to be positive about the move. Kids will pick up on your emotions and feelings towards moving. Make sure that your children feel involved. Sit down and work out a moving checklist. Plan the design and furniture layout of their bedrooms so that they feel part of the move. Leaving your old home Encourage your children to tell their friends that they are moving. Help them collect email addresses and phone numbers so that they can keep in touch with friends once they have moved. Your children will probably feel a mixture of emotions leaving their old home. It’s good to let them know that you feel the same way too. Show them that you understand how they feel: excited to be going somewhere new, but sad to be leaving your old home and friends behind. A few weeks before you leave, think about the special places that you go to. If you have a favourite park or cafe you could make a special trip one last time before you leave. Moving day Get younger children to make moving labels and stick them on the boxes with their toys and clothes in. They could draw on some of the boxes with crayons so that they can recognise their boxes in the new home. If your children are very young, you might want to ask a friend to look after them to keep them out of the way of the removal men. You can bring them back to say goodbye to the house when it is all packed up. Pack one box with the essentials that you will need when you get to your new home. Pack it last so it is first off the truck. Include things like a kettle, towels, bedding, favourite toys, toiletries, toilet paper and some food. Find out where the nearest supermarket, takeaway or restaurant is to your new home and check the opening hours. Then you’ll know where to go to get your family’s favourite food when you arrive. Once your property has been emptied take a final walk through with your children. Compare how it feels now with how it felt with all your furniture and belongings. This can help your children understand that what makes a home is the family and all your personal belongings, books, pictures, toys and furniture. Moving in When you arrive at your new home it is tempting to try and unpack everything all at once. Take care of your children’s new rooms first so that they can have familiar things around them. Then unpack the rooms you use most like the kitchen and family living room. Although there will be disruption when you move, try and re-establish family routines like bedtimes and mealtimes as soon as possible. Young children benefit from routines and it will help them to settle in. It also sends a clear message that you are still the same family and the same rules still apply, you are just in a new home. If possible, allow your children some input into the setting up of their bedrooms: this is their space in your new home. Children can have problems sleeping in new rooms so take some time to talk to them about how this room is different from their old room. Perhaps there were things that they didn’t like about their old room like a creaky floorboard, help them see the good things about their new room. After the Move Once you’ve moved into your new place it will take a few weeks to settle in and get used to things. It’s important to keep talking to your family and stay positive. If you all get involved with the community (meet the neighbours, get involved at school) both you as parents and your children will settle in quicker.
May 15, 2020
How to Buy and Sell a Home at the Same Time
OK, your life situation has evolved and you have to sell your home. And you have to buy a new home. You might remember the time you first bought your place and might be worried about putting yourself through the stressful experience yet again. But wait! We're here to lend a helping hand. If you've decided that you are going to buy and sell a house around the same time, then we have some tips from experts in the industry, and some tips and tricks that would help you make the journey easier for you. So, buckle up, and read on! Where to Start? Buying or Selling? Doing either one of the jobs of buying or selling a property can be exhausting, and you may be scared to be handling both at the same time. How do you go about it? Do you buy a home first? Or do you close the deal on selling your home first? Well, let us start with a list of pros and cons of doing each of these. Then you’ll get an idea of what you are up for. Buying Before Selling The Advantages: Buying a house before selling it gives you the advantage of having a clear head while looking around. That’s because you’re not rushed into buying one, and you can therefore make a better choice. You’ll be free to look around at your ease, without the stress of having to move. The best part is, you could time the buying and selling of property, so that you buy when the market suits for buying, whilst you sell when it is good for selling. In some ways, buying a new home before selling your current one is better when it comes to reducing stress. On the other hand, when you close the deal on your new home, you would have to sell your house fast because… The Disadvantages: If you buy before selling, there is the problem that if you buy a home that you get a great deal on, and you wait for the current place to sell, you will be paying two mortgages at the same time. This problem will not occur if your mortgage is paid off, but if it is not, you would certainly struggle with paying two mortgages at the same time. In addition to this, you would get a harder time qualifying for a new mortgage since you will have a higher debt to income ratio. How does this work? “To buy before you sell, your income will have to support both mortgage payments at the same time. If you're struggling just to have enough income to qualify for the new loan without figuring in your old mortgage, you probably won't be able to qualify with both unless you can find a lender that will allow a higher debt to income ratio.” Selling Before Buying The Advantages: When you sell your property first, you have the advantage of knowing how much money you’ve got to work with. So, you can budget your expenses from there, and make a calculated choice in buying a new home. This way, even if you make the mistake of overestimating the value of your home, you can deal with it as you haven’t committed your money on a new house. Another benefit of selling first is that you get the mortgage more easily, since you’re not tied down to paying the mortgage for the old home. However, you will also be left without a home for the time that you have not bought a new house. Which brings us to… The Disadvantages: When you sell before you buy a property, you take a risk of being homeless for a while. You can’t expect to sell and the deal to settle when you predict it to. The process of selling a home could take longer than you think. Consequently, what do you do in the meantime? You could rent! For some people, renting could be a worse option as first they would have to shift all their belongings into the rented home. Then they’d have to shift all over again when they find their new home. Since moving houses is a stressful job, the thought of moving twice in the same year would put a lot of people off. Also, selling first means that, you have to make the choice of buying a home quicker. This is because your hard-earned money would be going towards paying the rent every month. Maybe the choice you make would be a spur-of-the moment one: triggered by the anxiety to buy quickly. So, you may not get a better deal than if you’d bought first after all. Which is Better for Me? Buying First or Selling First? Now that we have considered some pros and cons of each, here’s the real question. Which option is better for you? Understand that both these options can have their own issues. You need to be prepared for each of them, whichever you choose. Who Should Buy First? If you’ve already paid off your mortgage of the home you’ll sell, or can afford to pay off two mortgages, then buying before selling might be the better option for you. It gives you the freedom to choose a house at your leisure. There’s no deadline hanging over you, and you can have a look at many houses before you find your dream home. For people who’ve already chosen a new home, and now have to sell, they may need to close the deal on the new home before anyone else grabs it. They would also need to multitask, setting up their house on sale. In order to make it easier for them, they can simply use a real estate agent to help them out in this trouble. The agent will advise how to sell your house quickly, and you can focus on getting the deal closed on the new house. Your agent can even help with the purchase if you go to them before you start looking. Who Should Sell First? People who would rather NOT pay two mortgages at once should consider selling their home first before buying a new one. Of course, this means that they’d have to spend money on renting whilst they look around to buy, but it could be worth the hassle. You’d get the mortgage for your new home more easily, as you wouldn’t have the extra mortgage to pay every month. You should keep in mind that you would have to rent. So it’s prudent that you find a rental for your family or yourself while your sale is going through. Do remember, though. that rental markets can be tight at times so you shouldn’t hang around. It might take four weeks to find and rent a place. Things to Keep in Mind Buy first or sell first, you need to keep some things in mind so that you don’t fall into trouble later. Be Ready with a Contingency Plan If you choose to buy a home before you sell, you need to have a plan for the financials to take care of the mortgage. Make sure you have a plan ready for when things don’t go as planned. Talk to a mortgage broker and do your sums. Ask them about your financing options such as temporarily changing to an Interest Only Mortgage or what the cost of a Bridging Loan might be. This is a whole other area outside the scope of this article, and you should discuss it with a trained professional broker. Do Your Research Properly You should research on the state of the market in your area. A lot of things depend on whether the market is currently favouring the buyers or the sellers. Once you are aware of the situation, you can make a better plan to optimise your role as a buyer and a seller. An experienced real estate agent can really give you their insights into the state of the market. Strategies for a Buyer’s Market When the market favours the buyer, you should definitely consider selling first, and buying later. This is because you should get the harder part over and done with, which, in this case, would be selling. In a buyer’s market, selling would be difficult, so, if you buy a house first (which you will get fairly quickly), then you’d be left with two mortgages to pay. And since it is the buyer’s market, you would face some problems and delays in selling. That means you’d be stuck paying for two mortgages for a long time. Here are some helpful tips, for you to think about. 1. Check out the Competition Do some research and check out prices around your neighbourhood and, especially, for property like yours. The price you’d like for your house should be justified by asking, “What else could a buyer get for their money?” 2. First Impression is the Last Impression The street appeal of your house matters. A lot. You need to ensure that the buyer is attracted to your property and you get them inside to inspect. Consider a makeover and create a great first impression to buyers. 3. Price Realistically Putting a realistic price is the most important part while selling in a buyer’s market. You can discuss this with an agent to make sure the price is attractive to buyers. Strategies for a Seller’s Market When the market favours the seller, you should buy a home first, and sell later. Again, the reason is the same as before. You need to get the hard part over with as soon as possible. Since you know that the market will favour you when you sell your house, it is best that you buy a house quickly, and then sell the house. This way, you will be safe. After you sell your house for a good price, you won’t have to worry about buying a house in a seller’s market, as you would have already done that. However, you still need to get your ducks in a row and be ready to sell your place as soon as you have found a new one. Prepare your place for sale, get the street appeal right, remember the buyer’s first impressions. Get the agent in to give you an appraisal so you have a proper idea of what you can spend and so you can get market-ready. If you are wondering how to buy in a seller’s market, then here are some strategies to help you out. 1. Be Prepared In a seller’s market, there are more people after the same property, so you must be ready to act quickly and to have the money at hand. You’ll need to convince the seller of the house that you choose that you are the individual that has the finance to be able to pay them. You should let the mortgage broker contact the real estate agent to confirm that the mortgage has been pre-approved. This will further improve your credibility in the eyes of the seller. Remember, there are many buyers in the market, so you need everything in your favour that will make you stand out from the crowd. 2. Research Online Before Inspecting In order to make the choice simple and easier, you should browse houses online and make a shortlist. Make a specific list, and make sure that the list only includes the properties that you would be interested in buying. Then inspect the properties with the intention of buying. Don’t confuse yourself by looking at places that don’t meet your needs. 3. Keep in Contact with Your Agent Your agent is your friend in need. You need to keep in contact with them so that they can provide you with information about any and every new house that is on the market, which meets your specifications of a dream house. Line Up Your Settlement Dates In order to manage both selling and buying, you need to coordinate the settlement dates closer to each other. If you are buying first, you should try to negotiate a longer settlement so that you have more time to sell and settle that contract. This might be tricky as the seller is in the position of strength. When you negotiate the sale of your old house you can ask for a settlement date that lines up with that of the place you are buying. If you are selling first, try for a longer contract period on your old property and then negotiate a shorter settlement on the home that you are buying. Talk to Your Agent Keep in constant contact with your agent. Your trusty agent knows about the state of the market. They’ve experienced it before and can guide you through the difficulties of buying and selling at the same time. We have mentioned many things that you should keep in mind, such as the state of the market, whether you have paid off the mortgage of your home or not, and other things. Your agent would know this and keep all these considerations in mind, and many more that you might not have thought of. They’ll help you make the best choice with what you have, for both selling, as well as buying a house. As you are buying and selling around the same time, you have double the pressure. To ease that, you would need the help of a professional who knows their way around the market. One who can point you in the right direction, so that you don’t wander off where things will be costly for you and waste your time and energy.
Apr 29, 2020
What's Happening to the Real Estate Market?
Are you confused about what is happening in the property market, perhaps even scared? It’s a pretty normal reaction to have. After all, our world has been turned upside-down with restrictions imposed to flatten the curve and protect the vulnerable from Covid-19. In the past six weeks, we’ve seen the ASX plummet (and recover somewhat), witnessed empty shelves at the supermarkets from panic buying, and have read little other than bad news stories. We’re missing lots of things like having a coffee at our local cafes, dinners with friends and family, and even trips away to the coast. There’s no wonder that we are wary of what impact it will have on real estate. The number of properties selling across Australia is considerably less right now – it’s about 30% less than this time last year. However, sellers are still getting strong prices due to the lack of property available for sale. This is not a time when buyers can name their price and make lowball offers. In fact, with fewer houses to choose from some buyers might find they miss out if they don’t take a level and reasonable approach. When will it be ok to sell my house? If you are a vendor who needs to sell, you don’t need to be afraid. You should give your property the very best chance by showing it in its best light. You are still very likely to get a good price now and with the latest technology that RealWay offers, it is possible to manage inspections and negotiations and hold auctions virtually so the risk of Covid-19 infection during the sale is significantly minimised. Most recently, we have added new technology such as 360˚ virtual walk-through tours as well as a private inspection booking tool. What should I be doing now? Like many others you might have used the extra time on your hands to make a few home improvements. That might have been cleaning, decluttering, gardening, or painting. This is an excellent time to show your newly refreshed home to the online world, whilst buyers have more time to look. As isolation restrictions lift - even if it is gradual - market activity will increase. If you have been thinking of selling, now is the right time to prepare for sale. RealWay can help. Your local experts at RealWay can provide you with a Property Price Report. We offer virtual consultations to help you make the most of your house without us needing to step inside. Our Property Price Report will provide you with a house evaluation and price range, a suburb guide and current market trends. We will advise you on what you should do now and in the coming weeks to improve your home so that it is ready for sale. Individually we may not be able to control all that is happening around us, but we can control our decisions around property. Knowledge is power. Contact your local RealWay agent today. [siteloft_form id=11 add-background="true"]
Apr 18, 2020
How Much is a View Worth?
Reposted from Matusik Property Insights April 16, 2019 2 minute read One of the things we do at www.projectadvice.com.au is to review a new project’s asking prices and often suggest that they should be changed. There is some science behind what we do and often there isn’t enough ‘light and shade’ between individual prices, resulting in some product selling quickly and other stock remaining unsold. Getting the price right, across the board, is often hard and an independent set of eyes (or in our case, two sets of peepers) is well worth the effort. One of the things that is often misjudged, when it comes to pricing, is factoring in how much a view is worth. To that end, we have undertaken a study in 2018 to help provide us with some guidelines and we found that certain types of view added a different value to a property. Our work identified the different views available and then we looked at how much they can increase a dwelling’s value. Our investigation was also based on an identical new dwelling built in the same area (but with differing views) with a base price of $500,000. The five major view types: 1. Ground level, unobstructed view (3% to 5%). This type of view means that you are located at the same level as many of the other properties around you, but you have the advantage of having a view that allows you to see a large, non-residential space, like open space. Such a view increases a property's sale price by between 3% and 5% and the new sale price could be as high as $525,000. 2. Rooftop, partially obstructed view (6% to 8%). A view from above would suggest that you can almost see over all of the other properties around you but there may be a few buildings that partially obstruct your view. Generally, the higher you are, the more value a view can bring to your home, so a rooftop’s partially obstructed view can bring in an additional 6% to 8%, lifting the potential sales price to $540,000. 3. Unobstructed view from a medium elevation (9% to 12%). This category is primarily reserved for homes that reside on the top of a small hill. This particular view can see areas all around a home without any obstructions but aren’t high enough to see far beyond the house’s small community. Having an open area will always command more money than if you can only see a few houses down, so this type of view has the potential to add between 9% and 12% to the value of your home, so the new sale price might be $560,000. 4. Unobstructed view from high elevation (15% to 25%) Doing much better than the previous view, being able to see a wide vista from the comfort of your own home can add significant value to it. Our estimates here have a wide range because much depends on what you see. Still, the value of the real estate can increase substantially, with the new sale price as high as $625,000. 5. Unobstructed water view (30% to 80%). The biggest attraction of a view continues to be a large body of water, with the higher premiums being given to saltwater. Also, at the upper end of the premium range the water view needs to be unobstructed and the more rooms it can be seen from, the better. Depending on the body of water, the residence can increase in value up to 80%. This would mean that our $500,000 base house has a potential price tag of $900,000. In summary, pricing a view is certainly not an exact science but as more and more properties are constructed in an area, the chances of finding a great view are becoming increasingly difficult. Hence, properties with a view command a range of premiums now and these bonuses are likely to rise further in the future.