Uncategorized

From the Horse’s Mouth

The Top 15 Brisbane Suburbs Primed for Growth in 2021

By Brett Warren

Considering an investment into the Brisbane property market but don’t know where to start?

Well…after Sydney and Melbourne, Brisbane is arguably Australia’s third-biggest property market.

And so far this year it’s been one of Australia’s top performing property markets

The latest Corelogic stats show that Brisbane house values grew 6.2% over the last quarter and 14.8% over the last year.

Brisbane will exhibit high double digit capital growth over the full 2021 year as some of the underperforming months of last year fall off the rolling averages.

Brisbane apartment values did not grow as much, + 2.3% over the last 12 months

But there is still plenty of growth and opportunity left in the Brisbane housing market.

The Sunshine State is shining and strong demand for detached houses and outstanding demand for lifestyle areas means as an investor, if you  buy the right investment property in the right location, you could be primed to supercharge growth.

South Bank Brisbane

Westpac Bank recently updated its property forecasts, with Brisbane prices tipped to surge 20 percent between 2022 and 2023, meaning Brisbane is likely to be one of the best performing property markets over the next few years.

There is no such thing as a hotspot

But first things first.

I don’t believe in hotspots or investing in an area just because it is expected to be the “Next Best Thing”.

“Hot-spots” tend to become next year’s “not-spots” and I’m a long-term investor, meaning I take educated risks based on evidence and fundamentals, I don’t gamble.

Instead, I like to approach this list of top Brisbane suburbs for 2021 in a way where I get the opportunity to highlight those strong and stable suburbs that have both shown consistent historical growth and also have the right demographics to suggest future long-term growth.

Mind the neighbourhood

Neighbourhood is now more important than ever

Let’s not forget that the ability to work, live and play all within 20 minutes’ reach is the new gold standard desirable lifestyle.

And this ‘ultimate goal’ is now more important than ever thanks to our new “Covid Normal” world.

If social distancing and the Covid-19 environment has taught us anything, it has taught us the importance of the neighbourhood we live in.

If you can leave your home and be within walking distance of, or a short trip to, a great shopping strip, your favourite coffee shop, amenities, the beach, a great park, the recently implemented coronavirus restrictions might seem a little more palatable than if you had none of that on your doorstep.

But the reality is, this concept is nothing new.

In fact, the rise of the 20-minute neighbourhood started long before Covid19.

You will find these are often in the gentrifying aspirational lifestyle suburbs of our capital cities and people will pay a premium to either own a property in these locations or rental property in these locations.

Many inner suburbs of Australia’s capital cities and parts of their middle suburbs already meet a 20-minute neighbourhood test.

However very few of the outer suburbs would do so.

Follow the demographics

According to leading demographer Bernard Salt, the coming of the coronavirus has changed the Australian workforce and not just by prompting adaptation to new technology like Zoom calls and triggering a work-from-home movement, but also by rigidly dividing the nation according to skill sets.

The Australian Bureau of Statistics classifies every job according to one of five skill levels with Skill Level 1 being the most skilled.

Demographics

It is well recognised that the rich – such as people with a Skill Level I job – are getting richer, and at the other end of the spectrum, Skill Level 5 jobs requiring little or no previous work experience (like general sales assistant, kitchen hand) are experiencing no wages growth.

A Skill Level 1 job requires a bachelor’s degree or higher, or the equivalent of at least five years’ training.

People with these types of jobs will earn more income and be able to afford to pay more for their properties.

The pandemic cricket demand for skills in finance (accounting), risk management (solicitors), computer programming and many other skill levels one jobs.

However, the story for the balance of the workforce has been quite different.

So understanding where the skill level one worker lives in Brisbane is critical and be seen in the following graphic provided by Bernard Salt in The Australian.

Brisbane Skill Level 1 Jobs

Top 15 Brisbane suburbs for 2021

Whether you are looking for a higher-end purchase or a beginning investor, I think these are the Brisbane suburbs that are set to take advantage of the changing face of the city.

In addition, while growth is on the mind of every investor, importantly these locations could also be considered recession-resistant.

Why?

Remember we talked about the importance of neighbourhood above?

Each of these noteworthy suburbs are close to major employment hubs, they have bulletproof school catchments and immediate access to public transport and local infrastructure.

Here, they’re listed in order of the highest to lowest median property price, revealing data from Domain Group and Real Estate.com.au.

1. New Farm / Teneriffe

Teneriffe, Inner Brisbane

Total population: 12,534 & 5,341

Average age: 20-39

Median property price: $1,827,500 & $2,000,000

When they said property is as safe as houses, they were probably thinking about New Farm and Teneriffe.

This incredible inner-city suburb has all the ingredients for a bulletproof investment.

It has premium lifestyle precincts, high walkability, low commute times and great school catchments, all a stone’s throw from our biggest employment hub, the rapidly expanding CBD.

2. Ascot

Ascot

Total population: 5,787

Average age: 40-59

Median property price: $1,597,000

Ascot is right in the middle of Brisbane’s two largest (and rapidly expanding) employment hubs: the CBD and the airport precinct.

While apartments have taken a back seat due to nearby oversupply issues, houses continue to go from strength to strength.

Another suburb with an iconic café strip, strong school catchment and an easy train or ferry ride into the CBD.

3. Highgate Hill

Highgate Hill

Total population: 6,195

Average age: 20-39

Median property price: $1,272,500

With a quiet neighbourhood just a stone throw from West End, South Bank and closest to the City, Highgate Hill is probably one of the best suburbs in Brisbane.

It’s peaceful with good dining options and combined with recent and upcoming infrastructure developments such as new roads, transit, schools, hospitals and other major infrastructure projects, the area creates great opportunities for business and investors alike.

While the whole suburb is primed for growth, the streets which fall within the catchment area for Brisbane’s best school, and those with sweeping city views are in especially high demand.

4. Wilston

Wilston

Total population: 3,949

Average age: 40-59

Median property price: $1,162,500

Wilston already has a real community spirit with a very strong school catchment and café strip that locals flock too.

This suburb has really gentrified over the last few years with old workers cottages, replaced with bigger, modern contemporary homes.

Pros include a railway stop and a new Northern Busway, it is primed to take advantage of the Brisbane Airport expansion.

5. Ashgrove

Ashgrove

Total population: 13,046

Average age: 40-59

Median property price: $1,105,000

With a cosy neighbourhood feel, while only being four kilometres north-west of the city, Ashgrove is a convenient suburb for established professionals and families who want a little room to move without having to move too far away from the city centre.

6. Taringa

Taringa

Total population: 8,381

Average age: 20-39

Median property price: $1,000,000

Taringa is a great suburb – lovely and green, close to the city, good transport with a train station and buses plus you get all the benefits of living near a university (sporting fields, cinemas, cafes and restaurants).

The suburb is multi-generational but perfectly suits families, young working professionals and university students due to the nearby iconic schools, public transport options and entertainment precincts.

7. Tarragindi

Total population: 10,793

Average age: 40-59

Median property price: $863,000

Tarragindi is a small suburb of just 8 streets and a strong family feel and excellent infrastructure.

The short commute to CBD via Pacific Motorway or access via bus at the Holland Park Busway is a huge bonus for those rightfully keeping ‘neighbourhood’ at the forefront of their minds.

8. Holland Park

Holland Park

Total population: 8,097

Average age: 20-39

Median property price: $826,000

Holland Park is widely talked about as a suburb that has the benefit of great easy access to Brisbane City while still being surrounded by amazing parklands, excellent schools, charming cafe’s, bars and restaurants.

9. Cannon Hill

Cannon Hill

Total population: 5,539

Average age: 20-39

Median property price: $812,000

Cannon Hill is considered one of the best suburbs in Brisbane for its real estate and lifestyle potential, with the property market having moved exponentially in recent years.

The area has good schools, a train line, and the gentrification of shopping centres and older homes.

10. Wavell Heights

Total population: 9,691

Average age: 40-59

Median property price: $762,000

Another high demand market thanks to its close proximity to many amenities and transport.

The suburb is within a few minutes of Chermside Shopping Centre and only 10 minutes travel time from the airport and CBD.

11. Mansfield

Total population: 8,695

Average age: 40-59

Median property price: $727,500

Thanks to great infrastructure and high demand for school catchment areas, Mansfield is one of the most sought after pockets in the south-eastern suburbs of Brisbane.

Local commercial and retail development and expansion in Mt Gravatt also primes the suburb for more growth in future.

12. Stafford

Stafford

Total population: 9,552

Average age: 20-39

Median property price: $670,000

Stafford is surprisingly close to everything from choices of shops, schools, hospitals, to the city and transport making the suburb extremely easy to live in and get around.

Combined with it being a notoriously high-demand market with consistent property price growth, it’s no wonder the suburb is at the top of so many investors’ lists.

13. Stafford Heights

Stafford Heights

Total population: 6,821

Average age: 20-39

Median property price: $652,125

Just over the hill from big brother Stafford, this suburb has started to hit it off with families and investors alike.

With a number of retirees moving on and government housing hitting the open market, professional couples and families started to take over and put some money into the area, spending up big on their homes and transforming the neighbourhood to a more desirable one.

14. Chermside West

Chermside West

Total population: 6,449

Average age: 40-59

Median property price: $637,500

Chermside West offers the best of both worlds: it’s close to retail and business hubs, but it also offers a quiet retreat from its busier neighbouring suburbs.

Add to that two major Hospitals and a strong school catchment, you start to understand that it has strong investment credentials.

15. Keperra

Keperra

Total population: 6,791

Average age: 20-39

Median property price: $570,000

Arguably the most value of any Brisbane suburb, with a strong community feel and still very low key.

This suburb has awakened since a number of train stations have been planned for  the area, better connecting it to greater Brisbane.

Limited stock of property and quick property sales has also imposed a demand which will only continue to push up prices for properties.

Changes in Brisbane property prices over the past two years

During the height of Covid-19, Brisbane’s housing market defied the odds, shone through, and even came out relatively unscathed.

By the end of 2020, Greater Brisbane’s property price median hit a new record high of $616,387, which is $28,000 above the previous record set in early 2020.

House prices have risen modestly over each quarter of the 2020 calendar year, rising a further 0.8% over the December quarter to end the year 5.6% higher than the last.

Dr Nicola Powell, Senior Research Analyst at Domain explained:

“First-home buyers became active utilising incentives and low mortgage rates became the norm.

Upsizing buyers were enticed by cheaper credit and altered their wish-lists to think more about property characteristics such as space and lifestyle, rather than commute time and distance to the CBD.

The rising interest from interstate buyers and the movement of residents from regional Queensland into Greater Brisbane will continue to support demand. Outer suburban and lifestyle areas will be the main beneficiaries.”

By December 2020, 85% of Brisbane’s suburbs recorded annual growth.

Double-digit percentage price rises were even noted across 17% of suburbs.

In Brisbane’s north, 88% of suburbs increased in price, 86% in Brisbane’s west, and 85% in Bayside South.

In Bayside North and Brisbane East growth was seen in around 80% of the suburbs in the area.

Brisbane’s suburb of Thorneside recorded the strongest growth across all the suburbs with a 28.5% increase in house prices over the two-year period.

Virginia, Highgate Hill, Carina Heights, and Yeronga also saw house prices surge more than 20%.

Despite most Brisbane suburbs enjoying property price growth, 15% of suburbs recorded a fall in median house prices by December 2020.

The steepest price falls were seen in Ormiston (8%) and Burpengary East (8.4%).

Uncategorized

DISTRESSED PROPERTY SALES

Recently, the Governor of Australia’s Reserve Bank forecast that the unemployment rate will skyrocket to double digits by June.

This, of course, is bad news in itself.

But when you consider that the bank’s own calculations suggest that for every 1 percentage point lift in unemployment, the mortgage arrears rate increases by 0.8 percentage points, it’s clear that a lot of borrowers could soon be at risk of default.

Millions of people could soon struggle to balance living expenses and mortgage repayments…

Like all situations in life where one door closes, another opens. In the coming months we predict that buyers will have the opportunity to potentially secure these distressed properties at up to 10% to 40% below market value – while also helping the families who’ve fallen on hard times.

In order to assist our sellers we will be trying to save them as much money as possible, especially when it comes to marketing costs. This means that money will not be spent to advertise on all of the usual websites. These properties will be listed exclusively as OFF MARKET listings only.

If you would like to sell your property “off market” without any marketing costs, please contact Tracie Harrington.

You can register your interest in by emailing us.

Real Estate · Uncategorized

WHAT NOT TO DO WHEN BUYING YOUR HOUSE

OK, so your home finance has been pre-approved and you have found your ideal home. DO NOT assume that this is the finish of all of your hard work. You have definitely finished most of it (pat yourself on the back) however you still have to make sure that you avoid doing certain things in order to make the house purchase as smooth as possible.

AVOID CHANGING JOBS

We are all tempted by a higher paying job in a better environment, however if you have a contract on a home now is not the time to change your job. I could really delay home ownership (especially if the contract falls through and if you do not find a property during the pre-approval time limit). Banks want stability!

DO NOT MOVE HOME TOO FREQUENTLY

As I have mentioned above stability is what the banks are looking for so ensure that you are not moving around too much.

ENSURE THAT YOU HAVE A MONEY TRAIL

Do you really have savings in the bank? Have you saved those funds or are they a loan from a family member? Make sure that you really do have those funds and that they have a money trail. You want to prove that it is not a loan and that you saved the money yourself.

DO NOT APPLY FOR A NEW CREDIT CARD

Applying for a new credit card can look poorly on your credit rating, as the banks usually add your credit limit as a debt (even if you have not spent one cent on the card). The more enquiries on your credit the worse your score is.

DO NOT BUY A NEW CAR

So you have pre-approval and you know that you can borrow money (your credit rating is obviously good enough now), this is an exciting time for you. It is definitely not the time to start shopping for a car – unless you want to live in your car instead of your home….

DO NOT OWE MORE THAN HALF OF YOUR CREDIT CARD LIMIT

Ask your broker for advice – but most banks will look negatively on a credit debt that is in excess of 50% of the limit.

DO NOT GET BEHIND ON THE PAYMENTS

Ensure that you are on top of all of your bills, your rent, credit card/s, phone, electricity etc. This is super important!

DO NOT EVEN LOOK AT NEW FURNITURE

We have all done it, arranged where you are going to put the furniture before you have settled on the property. (As an agent we know that a prospective purchaser or tenant will be moving forward with a property if they are imagining where they will put their furniture.) Avoid it at all costs!

DO NOT SPEND YOUR SAVINGS

You will need them, either for solicitors fees, stamp duty, payment of a credit card etc.

Daniel Dos Santos from AMD Finance has assisted me to make this list for you, if you have any questions please contact him direct. – Tracie Harrington

Real Estate · Uncategorized

#metoo real estate agents….

In recent weeks we have all read the stories about Harvey Weinstein, since then we have heard from people in the movie, music and entertainment industries who have told stories of their own personal experiences.

It made me think about #metoo and how it resonated with me, not because I have been harassed as an employee etc but as a real estate agent I have experienced harassment and inappropriate advances from people who I have interacted with during my career. These experiences have made me a very cautious woman.

I have to admit that I have had a few scary experiences myself however as an agent in London, I was made very aware of the “Mr Kipper” story. Wikipedia reports that  Suzy Lamplugh was an estate agent reported missing on 28th July 1986 after going to an appointment with someone calling himself “Mr Kipper”, to show him a house in Fulham. Her office diary recorded the essential details of the appointment: “12.45 Mr. Kipper – 37 Shorrolds Road O/S”, with the “O/S” annotation meaning outside the property. Witnesses reported seeing Lamplugh arguing with a man in Shorrolds Road and then getting into a car.

Her white Ford Fiest (registration: B396 GAN) was found that night outside a property for sale in Stevenage Road, Fulham, about a mile and a half away. The ignition key was missing and Lamplugh’s purse was found in a door storage pocket.

Police suggested that a black, left hand drive BMW vehicle might have been involved, because of an eyewitness account of a car at the same location as Lamplugh’s in Stevenage Road. It was thought for some time after her disappearance that “Kipper” was her pronunciation of the Dutch name “Kuiper” but despite police investigations, nobody of this name was found to be connected to Lamplugh.

As a young agent in London I found this story to be truly shocking and a warning to all real estate agents in the industry. This story in particular made me very wary of who Iw as dealing with.

During my career, at one time or another, I have armed staff with personal alarms, come up with coded phone messages, developed safety strategies & precautions in order to protect my staff whilst they have been out meeting strangers in empty properties.

To be honest when you think about it, it goes against everything that you have been taught doesn’t it? Meet a stranger you say? No thanks…. Meet a stranger in an empty property you say? No way! You just would not do it and I am sure you would not encourage your children to do it, however we as agents do it every single day. When I write this down, it seems ridiculous!

There have been similar cases to Suzy Lamplugh’s i.e. in June 2006, there was a similar case involving a 48-year-old female estate agent in Wiltshire, UK who met a client called Mr. Herring. She was attacked with a sharp object, causing cuts to her arm, and was pushed to the ground, but managed to free herself. The assailant ran away. Police have said there is no connection between this case and the disappearance of Lamplugh.

In January 1992, Michael Sams kidnapped Stephanie Slater. She was an estate agent working in Birmingham, UK. Slater’s employers paid a ransom and she was released. He was later found guilty of her kidnap, and of murdering 18-year-old Leeds prostitute Julie Dart. Sentenced to life imprisonment, was still imprisoned as of 2015.

There have been numerous times where I have felt intimidated in a property. Let’s get this out in the open now, I talk a big talk,  I am feisty and I do not back down. However, I am also less than 158cm (5ft 2in in the old money) so I have managed to be lucky enough to manoeuvre myself out of worrying situations.

In order to avoid confrontation and bad situations, I always do the following:

  1. Make sure my appointment is in my calendar
  2. Make sure that the appointment has a link to an email invitation (I email the other party to confirm the appointment, location etc)
  3. Make sure I enter the name and the mobile phone number of the person I am meeting.

If I am visiting a property to do a periodic inspection I will always do the following:

  1. Knock on the door loudly
  2. Announce that “Hello Tracie from Harrintgons’ is here”, several times over and over
  3. Inspect the property quickly to check if anyone else is in the home (always leaving the front door open in case I need a quick exit)
  4. Once I am sure that no-one else is in the home, I lock the front door behind me, I do my inspection and then I leave.

If I am visiting a property to do a private inspection, I will always do the following:

  1. Open up the rear door and other doors in the property in preparation,
  2. Stand out at the front of the property and meet the person there,
  3. I will assess them and see how I feel about them and what my gut says, and
  4. If I feel safe enough then I will take them through the house,
  5. I will always try to put myself between the nearest exit and the person I am meeting.

If I am hosting an open home and I expect a few people to come through, I will always  have another staff member at the front of the property obtaining ID details of people wanting to enter the property – however many people feel that it is unjust to provide ID before you enter a property.

If there is one thing that I want prospective tenants and buyers to know is that we do this for the safety of our staff and the property more than for marketing.

Eventually I am sure that the process of viewing a property will become safer for real estate agents but until that day we will have to continue to adopt our strategies to the particular environment and situation that we are in.

-Tracie

 

Uncategorized

Accommodating the visitors of the 2018 Commonwealth Games

As you are probably already aware the Gold Coast in Queensland is due to host the 2018 Commonwealth Games in April 2018 and with that will come visitors!

From what I can see the Gold Coast and Brisbane are set to have their own win by renting out their spare bedrooms and homes during this time.

If you have not already taken advantage of this influx of visitors I highly recommend that you investigate it further. It could be advantageous for you and your family to take a few weeks holiday and let you property out for the short term to these visitors. Alternatively if you have a spare bedroom why not consider renting it out for the short term?

We can see that the number of local listings on Airbnb grew by 35 per cent in the past 6 months and Airbnb are expecting more to sign up the closer it gets to the games.

We already know that many of the hotel rooms have already sold out more than 12 months ahead of the Games. Wotif is reporting 95 per cent occupancy over the 11-day even next April. Not to mention to budget caravan and camping spots, they are nearly already taken up as well.

If you are based in Brisbane or the Gold Coast (or anywhere in between) and you are considering leaving the GC during the Commonwealth Games in 2018 then please contact me.

-Tracie

 

 

Real Estate · Uncategorized

PREFERRED CONTRACTORS LISTINGS

Throughout my years as a Property Manager I have been asked many times for recommendations of local Brisbane based contractors who I use regularly within my real estate agency.

So here is my little black book of contractors.

Plumbing

Tubeline Plumbing – Brisbane & Redlands

All About Plumbing – Brisbane & South East Brisbane

Impact Plumbing Solutions – Northside of Brisbane

Electrical

Point to Point Electrical

Cleaning

Cleaning Queen – Michelle – 0412 122 955 (regular, bond and AirBNB cleans)

Carpet Cleaning

Stately Carpet Care

Handy Man

Touch of Class – 0409062425

Pest Control

Black & White Pest Control

Gardening

Cooch’s Mowing Service – South East Brisbane – 0439061292.

Tropical Landscaping – 0412 122 955

 

We have a 54’’ Zero turn for larger blocks and small acreages plus a 21’’ for normal sized blocks.

 

We also do whipper snipping/brush cutting, hedging, pole saw and small chainsaw jobs.

 

Call Dawn to book a job on 0439061292.

Please let me know if you need any other specific contractors. I am here to help!

-Tracie

 

 

Uncategorized

5 Reasons your Rental Property is still Vacant

You know what it is like, you buy your investment, you choose your property manager and now all you have to do is wait for the tenant applications to roll in. However they are not. It has been over 10 days and nothing….

vacancy

A long vacancy period will kill your profitability on your investment. However it will be worse if you approve a tenant who you know is probably not the best and you have to take a chance. Your Landlord insurer will want to have a look at your application also so if your due diligence is not up to par they may not pay up if the tenants defaults.  I cannot emphasis enough how much I do not want you to approve the wrong tenant so that your property is occupied – that is not the aim, the aim is to have it profitable.

Let’s look at the top 5 reasons your rental property is still vacant.

High Expectations

Is the rental amount comparable to other properties in the area?

You and I both know that not all properties are created equal. Just because your best friend has a 4 bedroom property in the same suburb that is renting out for $650 pw does not mean that your 4 bedroom rental is valued at the exact same rate.

If your property is not worth the asking price tenants will not apply. If you property has fewer amenities than others in the marketplace then you will need to consider lowering your asking price to find an appropriate tenant.

Instead of offering 1 weeks’ rent free – consider this “insider tip”. Let’s say that you have a property at $650 pw you want to offer 1 weeks free rent, but a property manager cannot advertise that on the various websites because they only have the ability to enter the rental price on the various rental websites. So tenants have to look for the more expensive price and then ready the header where most agents will write REDUCED PRICE, 1 WEEK RENT FREE etc, so why not calculate how much a discount is over 12 months and then advertise the property at that price instead i.e.

$650pw

$650 x 52 = $33,800 per annum

$33800 – $650 = $33,150 per annum

$33,150/52 = $637.50 per week

Advertise it for that price or round it up or down but that way the property manager can entice more people to look at your property as the cheaper the property the more enquiries you will receive. You do not receive any less – you just market it differently.

Are you looking for the Hen’s teeth?

As you know many landlords can choose their own criteria (as long as they adhere to Legislation) for their ideal tenant.

Most of the time when screening tenants, landlords will make a decision based on rental history, income, general background and references. Some landlords believe that they can only rent to the top tier tenants – this usually happens after a Landlord has had a bad experience.

If you set your criteria or income too high, you might not be able to find a tenant. When I check applications I always work out what the affordability rate of the tenant is i.e. the rent not costing the tenants anything more than 30% of their total income. Anything more than 30% and it tends to be difficult for the tenant to meet all of their financial requirements.

In the past we have accepted a tenant with a fair to good rental history, especially if they have excellent references and verifiable income instead of waiting for that perfect tenants (which never exists).

I hate the property manager

Have you ever walked into an office to ask about a rental only to be given the cold shoulder and basically treated like scum by the Receptionist or the Property Manager? Would you like to work with a Property Manager like that for the next 12 months? It can be an instant turn off  for tenants. However, it works the same way with Property Managers too. I have met demanding & rude tenants at inspections and I have thought to myself that there is no way that my client (or myself) will be able to maintain a relationship with them over the next 12 months. Sorry but if you are rude to the Property Manager at the first inspection, I can guarantee that you will not get the property.

If you are finding that your investment is constantly vacant, then I think that it is time that you (and your friends) did some “secret shopping”. Ask a friend to call the agency to organise an appointment to see your property. Does the Property Manager return the call? Do they turn up on time? Do they have keys? Are they professional and polite? How does the Property Manager treat your friend. I have known one to sit in his car smoking until someone turned up to view the property, then he would open up the door and the prospective tenants basically showed themselves through whilst he was on his phone outside.

Check out their online reviews, we all have tenants who hate us because of bond issues or owners who did not get the result that they wanted however look at the majority of the comments. What do they tell you?

A Property Manager may have one face for their clients and another for their tenants. I know one Property Manager who when faced with a tough email she just deletes it – she is the owner of the agency! I could not believe it when I saw her do that! Imagine what the rest of her staff are doing if they feel that this behaviour is sanctioned! Honestly I was flabbergasted.

Remember that your Property Manager is a direct reflection of you. If they give a negative first impression then there is a great chance that applicants will pass your property.

Poor marketing

Putting a for rent sign out the front and and advertisement in the newspaper will no longer rent out your property.

You need to invest in marketing:

  • Professional photos (including aerials now that we have drone photography)
  • For rent sign out the front
  • Placed on rental list
  • Emailed out to relocation agents
  • Emailed out to prospective tenants weekly
  • Placed on various websites (the main one in Brisbane is realestate.com.au)
  • Promoted to stay on top of the other listings. Due to logarithms we find that our landlords have to pay extra for a “promoted” listing instead of a “standard” listing in order to ensure that the property is kept at the top of the listings. You do not want it to fall to the bottom – no-one will see it. (Most tenants only look on the first 3 pages of a property website)
  • Open home promoted each week

I have recently seen brand new apartments being advertised for rent, at 1/2 of the regular rental price for the first 2 months. This is an especially good alternative if the builder has provided a renal guarantee with the sale of the property.

Pets

You already know my feelings on pets. However for those of you who have not read my earlier blog I will summarise – by allowing pets at a rental property, you will have many more opportunities to find a tenant.

In my opinion more than 70% of tenants have a furbaby. The majority of tenants with furbabies (approx 60%) say that they really struggle to find pet friendly homes. If you allow pets at your property, your listing will be the first pet-owners respond to.

You must also note that when the demand is not there, the price will increase and the tenants tend to stay at homes longer. Do you know what that means? Less vacancy rate which means increased profitability.

I hope you have found this to be helpful – if you want to talk further please feel free to email me tracie@harringtonsrealty.com.au

-Tracie

Real Estate · Uncategorized

Where do I start?

So you have finally made the decision to purchase an investment property. Congratulations! This will be an exciting (and sometimes stressful time for you), however it is important that you prepare yourself in order to get yourself in the best position possible before submitting your mortgage application.

mortgage approved

You do not want an application to be turned down because you have not prepared yourself. An unapproved loan application can be detrimental to your credit rating as it leaves a footprint on your credit history – the more applications (be they successful or not) can negatively affect your credit rating.

Unfortunately lenders use many different criteria in order to assess if you can borrow from them i.e. your salary, weekly running costs, outstanding debt level, number of dependants and credit history. I wish that there was a tick and flick list that could be used by all lenders but I suppose it is their differences that keep them competitive.

I think that it is important to understand how how a lender will assess your eligibility to borrow funds.  There are certain factors that can make it easier or virtually unworkable for you to obtain finance.

Daniel Dos Santos from AMD Finance advises “that there are several things that you should do in order to prepare yourself”:

Credit reference

Your lender is going to do a credit check on you. They’ll be looking at any credit applications made by you and will be checking if you’ve defaulted on payments or have an infringement referenced either in your name or your company’s name (if you are self employed).

Make sure that you have a ‘clean slate’ by checking your credit report. There is no use applying for a loan only for it to be turned down because you forgot to pay an old store card etc.

You can order your personal credit file online by googling “credit history report”

  • Enter your personal information,
  • pay by fo the report and your credit file will be forwarded to you usually in an email as a PDF file.

If something appears on your report that you are unaware of fix it ASAP.

You should bring this report to your appointment with your broker/lender.

Know your limits

The amount you can borrow for your investment property will depend on many factors such as your deposit or other equity you hold, what you are buying, the expected rental income, whether you will be negatively or positively gearing the property, property management costs and if you have allowed for a period of vacancy.

This is where your broker can help you to work out how much you can borrow and what type of loan will suit your budget and lifestyle.

Organise your Deposit

Most lenders require a minimum 10% deposit (and evidence of you saving this), however if you are borrowing 80% or more of the purchase price you will normally be required to pay mortgage insurance (which means an additional fee).

The way you structure your investment loan will depend on your personal circumstances and should be discussed with your accountant or financial adviser prior to meeting with your lender/broker.

Deposit bonds

A deposit bond is a guarantee to the vendor, by an insurance company, that they will receive their 10% deposit, even if the purchaser defaults on the contract of sale. You, the
purchaser, are able to provide this guarantee to the vendor by paying a small premium to the insurance company. All purchase funds are paid at settlement. In the ordinary course of events, settlement takes place, the purchase price is paid in full and the
deposit bond simply lapses.

We are buying it together…

couple buying investment

The most common way to buy a property with two or more people who aren’t a married or defacto couple is through a tenants-in-common arrangement. This allows the property ownership to be split any way, not necessarily into equal shares. Three people can buy a third each, or it can be divided in other proportions. This means your share of the property can be left to the person of your choice when you die.

In contrast, a property owned under a joint tenant arrangement (usually by couples) is
where the property is held in equal shares. If one owner dies, their interest passes to the
other owner. Shared property ownership only works if strict ground rules and a tight contract are in place. Everything needs to be in writing. Your legal representative should be consulted.

The two most important points you need to cover are what happens if one owner wants to sell their share and what happens next.

Stamp duty

The amount of stamp duty payable varies from state to state and whether you are a first home buyer or an investor. Your conveyancer/legal representative will advise you of the amount payable or you can check your state’s website.

State/Territory Website
ACT http://www.revenue.act.gov.au
NSW http://www.osr.nsw.gov.au
NT http://www.revenue.nt.gov.au
QLD http://www.osr.qld.gov.au
SA http://www.revenuesa.sa.gov.au
TAS http://www.treasury.tas.gov.au
VIC http://www.sro.vic.gov.au
WA http://www.dtf.wa.gov.au

Make sure you are aware of stamp duty costs, you may have to factor this into your loan amount.

Loan application fee

There is a standard upfront loan establishment fee. The fee covers the preparation of loan application documentation, legal fees for standard mortgage preparation and one
standard valuation.

Applying for a loan

If you’re approaching a lender for the first time you’ll need to be ‘identified’.

When you apply for a loan you have to show identification up to the value of 100 points. A driver’s licence earns 40 points, a credit card can earn 25 points and a birth certificate 70 points. Only original documents qualify.

It’s not unusual for a loan application form to take up to 10 pages. Your lender will want
to ascertain your existing assets, capacity to repay, financial risk, collateral (is the property you are buying adequate security for the amount borrowed?). You will also be asked if you have dependent children, how long you have lived at your current address, what you owe, your personal insurances and your credit card details.

It is advisable to have your two most recent pay slips, group certificates for the past two years and documentation from your employer detailing income and length of employment.

Self employed applicants should provide their past two years’ ATO assessment notices
or their past two years’ financial statements and accountant’s details. Some institutions
may even ask for a profit and loss statement certified by a registered accountant.

Also needed are savings details, bank statements including transaction, saving
or passbook accounts, investment papers including managed funds or term deposits,
what you owe and own, details of personal loans, credit cards or charge cards and
tax liability if self-employed.

Details of life insurance policies and superannuation as well as approximate value of other assets such as furniture and jewellery should also be included.

Remember to include your expected rental return in your loan application. This will affect your borrowing capacity and loan serviceability and may allow you to purchase a more expensive property. Your real estate agent will be able to provide this information.

I know that there is a lot to consider and to obtain from various third parties however it is much better to be prepared so that your broker/lender can get a picture of your credit history and ability to borrow funds now than after you have made an incomplete application.

Loan approval

approved

It is best to have your loan pre-approved before you make any offers. Knowing that your finance is pre-approved will allow you to concentrate on a price range and give your full attention to the purchase. Remember that a vendor may also accept a lower than advertised price knowing that your finance is organised. They may want a quick and hassle free sale.

Once your loan is formally approved, the lender will arrange mortgage documents to be signed. Be sure to read the mortgage contract carefully and understand the contents.

Property management

Professional property management frees you from dealing with tenant issues and gives you more time to concentrate on your portfolio. Your property manager is also up-to-date with changes to the Residential Tenancies Act and is better suited to negotiate with your tenant on your behalf should the need arise. They are also in a position to obtain credit checks on potential tenants and have access to tradespeople. If you prefer to stay one step removed and not deal personally with your tenants, then a professional property manager is definitely recommended.

So once you have your loan pre-approved, the next step is finding your new property. My biggest tip here is to find a real estate agent that you get along with. They usually know of properties that are coming onto the market before they hit the internet etc. I have sold many properties without having to advertise them. In a lot of cases tenants will buy the property they are renting – all you have to do is ask the question.

Once you have found your ideal property, you will need some assistance from other professionals.

Legal eagles

You will need to appoint a legal representative to ensure that the contract is in your best interest and does not contain any unsatisfactory terms. Make sure you know your legal representative’s qualifications and exactly what service they are offering as well as their costs. I have found that their fees vary considerably from office to office.

Your legal advisor is there to:

• Give advice on the property contract
• Facilitate council, strata and company title searches
• Order pest and building inspections
• Arrange for the exchange of contracts
• Negotiate with the vendor’s solicitor on your behalf
• Arrange for the settlement process, and
• Deal with any difficulties that arise during the settlement period.

It is a good idea to ‘shop around’ for someone experienced.

Building & pest inspectors

Building and pest inspections are a must! Your conveyancer will enlist the services of an authorised pest and building inspector. Your purchase contract can be subject to a satisfactory inspection or your inspection can be scheduled during your cooling off period.

The inspector will provide a written report pointing out any faults in the property, whether they can be repaired and how much these repairs are likely to cost.

If buying at auction you will need to ensure that all inspections are completed prior
to the day of the auction. In the case of a strata title property, your contract for sale will provide the name of the strata manager so that you can arrange for an inspection of the books and records of the owners’ corporation.

Your legal representative should also advise you of any future developments
which could affect your home by checking the local council records.

Insurance broker

broekn leg

There are some insurance policies that you should look into:

MORTGAGE PROTECTION AND LENDER’S MORTGAGE
Mortgage protection and lender’s mortgage insurance (LMI) are for two different situations.

Mortgage protection is insurance that supports you in case you become involuntarily unemployed or are unable to work due to illness or disability. It makes sense to ensure that you can continue to meet your commitment in the case of unforeseen events.

However lender’s mortgage insurance is usually required where your deposit is less
than 20% of the purchase price of your property and protects the lender in the event
that you default on your repayments.

LIFE
Life insurance provides a lump sum payment to your beneficiaries in the event of your death. If you are the main income earner in the family, this insurance will help your family manage their future (for example paying out mortgages, schooling and other family expenses) without your ongoing earning capacity.

LANDLORD
Landlord insurance is a policy to cover an investment property owner from financial
losses. Common features of a landlord insurance policy include malicious or intentional damage to the property by the tenant or their guests, theft by the tenant or their guests, loss of rent if the tenant defaults on their payments, liability including a claim against you by the tenant, and legal expenses incurred in taking action against a tenant.

TPD – TOTAL AND PERMANENT DISABILITY
You can choose to cover yourself for either total or permanent disability or death options, providing you can no longer work or in the event that you die due to illness or accident. When combined with life insurance, this can provide security for you and
your family.

BUILDING
Building insurance should provide you with adequate cover in the event you need to repair or replace your investment property (ie home, garage, shed). Flooding and fire can leave you with a property that is not fit to live in, you need to cover yourself.

INCOME PROTECTION
Income protection insurance pays you a predetermined percentage of your monthly
income should you be unable to work due to illness or injury.

Land tax

Land tax is an annual tax levied on owners of land. In general, your principal place of
residence (your home) or land used for primary production (a farm) is exempt from land tax.

Investment property, on the other hand, may be subject to land tax and the rate of tax varies from state to state. Your broker/lender can help with the rates applicable in your circumstances.

Your broker/lender can provide you with information on stamp duty in the state of your purchase, comparisons of various loan application fees and have access to insurance recommendations.

Good luck! Let me know if you have found this to be useful and informative.

-Tracie

Disclaimer: The advice contained in this document has been prepared without consideration of your objectives, financial situation, personal circumstances or individual needs. Whilst care has been taken to ensure the accuracy of the information contained herein, it neither represents nor is intended to be legal or taxation advice. Please consider the appropriateness of this information before acting on any advice from this booklet. Harringtons Realty & AMD Finance aims to understand your circumstances and requirements to provide you with a loan and other products that are best suited to your needs.
Real Estate · Uncategorized

TOP TIPS FOR LANDLORDS AT TAX TIME

It’s that time of the year again.

Tax time is looming but many Australian property investors may be underprepared, according to leading landlord insurance specialist Terri Scheer Insurance.

“Landlords often come under scrutiny from the ATO when lodging tax returns, so it is important they complete their claims accurately,” said Carolyn Parrella, Executive Manager of Terri Scheer Insurance.

“Landlords should consult their accountants to confirm what can and cannot be claimed as a tax deductible expense. This ensures all claims are legitimate and the tax return amount is maximised.

“Seeking advice from a tax specialist can help make this time of the year much easier for landlords.”

Ms Parrella, also a property investor, has offered the following top tips for tax time:

– Negative gearing
“The net loss generated by negative gearing can be offset against other income, to reduce the tax payable,” Ms Parrella said.

“Landlords may be unaware that interest can only be claimed when the property is availablefor rent. For example, if a property is lived in for half a year and leased as a holiday rental for the other half, you cannot claim the interest for the full 12 months.”

-Insurance
“Property investors can usually claim their landlord insurance premium as a tax deduction butthis is often overlooked,” Ms Parrella said.

“Ahead of tax time, it’s also worthwhile checking your insurance policy to ensure you have theappropriate coverage. Some landlord insurance policies provide cover for professional feesincurred as a result of an ATO tax audit relating to investment properties. A standard homeand contents insurance policy won’t cover landlords for the specific risks associated withproperty investing.

-Expenses
“Landlords can potentially miss out on thousands of dollars of tax benefits by under claiming,”Ms Parrella said.

“Apartment or unit owners may be able to claim body corporate fees on strata or community title properties. Landlords who rent a fully-furnished property, such as a holiday home, may be eligible to claim some of their rental income as a tax deduction.
“Maintenance costs, such as changing light globes or fixing a hot water service if it breaks, may also be tax deductible. Running costs such as council rates, land taxes, water and sewerage charges might also be legitimate and claimable expenses.
“Landlords should check with their accountant to determine what they can and cannot claim.”

– Offsetting costs
“You may be able to claim travel to your investment property as a tax deduction, however you shouldn’t exploit this by incorporating it as part of a holiday or another trip,” Ms Parrella said.

“Similarly, if you’re a self-managed landlord, you may be able to claim some of the costs of your home office. You won’t be able to claim all the costs, such as purchasing the computer and the monthly internet bills, however a fair and reasonable part of this may be deductible.

“An experienced and qualified accountant can provide further advice.”

– Property manager
“Not only are property managers an invaluable asset to landlords, their cost can be a deductible expense for landlords,” Ms Parrella said.

“Appointing a property manager might create a potential tax benefit while assisting with organisation and saving time for landlords.

“A good property manager will take care of the administrative responsibilities involved in an investment property. They should also be able to help reduce the burden at tax time by compiling and completing the relevant paperwork for ATO reporting.”

For further information, visit http://www.terrischeer.com.au or call 1800 804 016.

Sport · Uncategorized

Touch Football Mum

Harringtons Harriers-01.jpg

Those of you who know me personally,  you know that I am an avid fan of touch football. Each weekend you will find me out on the fields, screaming, jumping and barracking for the various teams I am involved in.

When my son – we will call him J was young, I was willing him to be older so that I could sign him up to a team sport. I wanted to see him get out and run on the fields, as much for his good as for mine. I desperately wanted to make new friends, meet new people and stop feeling as isolated as I did being a Mum of a small child and a business owner.

I remember when my son was about 5 and they had a mini Soccer team on Saturday mornings. There I was on the sidelines all dressed up (in my office gear with high heels on, sinking into the grass) cheering him on. Then I watched in amazement as he became grumpy because “the other boys were taking the ball off him”. The other parents on the side lines laughed and I have to admit I had to stifle a few giggles as I cuddled him and told him it would be OK.

When the Coach changed his position and made him Goalie, I thought OK here we go! Instead he stormed off the field because the boys kicked the ball in the goal! My little Goalie was lying down on the sidelines (leaving us vulnerable) and he was bawling. Telling me how unfair it was. Oh the joys of parenting and early Winter morning starts!

As you have probably figured out Soccer was not our thing. We waited a few years and eventually we became involved in our school touch football team then our local touch football team. Now for over 4 years we have been playing in various teams and age groups. It has been lovely to see them progress from “little minions” as I call them where they just  chase the ball all over the field in a “swarm formation” to now, where I can see skill and strategy developing.

We are involved in our lovely local club team where we have a very caring coach right up to the local Representative team where try out were necessary and we thankfully made the cut.

These days we are involved in 3 teams varying from Under 12 – Under 14. This keeps us very busy as well as being the Manager for the Representative Team and the Coach of our own team Harrington Harriers. Our Rep Team means that we have Carnivals to attend each month and we train twice a week – it is a lot of organising to make sure that they get to training and then to the Carnivals which are usually at least an hour away.

Along the way I have met some wonderful people, they are very caring and would bend over backwards for you – that is what I have discovered, there seems to be a loyalty with this club. I remember when I was trying to find Mal Meninga (the Australian Coach and legendary goal kicking centre) a home in Brisbane and my son was over the moon. J told all of his friends at school that Mum had met Mal Meninga, what a proud little boy I had that week.

Apart from the people you meet, I love the fact that kids can roam free on the fields, they learn to be independent and to not hover around their parents. I also love the fact that this gives me a bit of me time where I can chat with other parents and a catch up in the Clubhouse (and a cheeky well-earned Friday night drink) after the games have finished. All of our kids are out kicking balls, running around and exhausting themselves even more whilst we are inside chatting away with each other!

Our Carnivals are a huge amount of fun, we all pack the car, we pick up other team mates and friends and we have a bit of a road trip before we get to the fields. We set up a meeting area usually and then is a case of making sure the kids are wearing sun screen, hats & shirts. We go to their various fields and we scream and cheer them on, making complete fools out of ourselves. We have picnics for lunch on the sidelines when we have a break from playing, we watch the older kids play – wow they can fly! We watch our younger kids absorbed in the game, they all excitedly chatter and mimic the older kids moves on the sidelines. It is wonderful to see the comraderie of the team, it is absolutely terrific!

I wanted to say congratulations to every parent, grand parent, foster parent, uncle, aunty, brother and sister etc. who dedicates their time to ensure that their families are involved in sport – whichever sport it may be. There are so many benefits not only health.

I have seen J grow in confidence, his resilience has improved, his perception of right and wrong is now a bit more grey rather than black and white,  because let’s face it we never agree with the referee 100% of the time do we? J is learning about our community, that kids and parents are different that they have different abilities and behaviours.

I believe that parents need a greater amount of dedication to a child’s team than the child does (and usually the parents do!).

-Tracie