Archive for the ‘Buying Real Estate’ Category

Take a sneak peak of this beautiful family home in Glengowrie, see it before it’s open to the public for inspection…

This property is presented by Monika Bonet, Principal of Raine & Horne Glenelg… your Glenelg Real Estate Agents and Glenelg Property Management Experts.

Should I increase the rent?

A contented, long-term tenant is the goal of most property investors, but it can be difficult to measure when it is acceptable to raise the rent, and by how much.

A good guide is to speak to your Glenelg Raine & Horne Poperty Manager about the current average rent for similar properties in the area. If you are considering a rent increase, it should be in line with comparable rents in the suburb or town. This guarantees your tenant they are paying fair market value. Also, any increases you do make should be gradual, rather than a one-off spike which your tenant/s could find hard to swallow.

On the flipside, it is important to keep your own goals in mind, such as capital growth and a steady rental return. The rent you receive will ultimately help you pay off your investment, and the rental return will also be a key factor in determining the future sale price of your property, if and when you decide to sell.

What are the risks of buying an investment property off the plan?

Buying an investment property ‘off the plan’ involves agreeing to purchase a home before it is constructed, often with only a blueprint or computer generated images for reference. But without the finished product to inspect, this approach to real estate investing can carry some risks.

Firstly, study the contract closely and seek legal advice. Your solicitor can advise you on issues such as withdrawing from the contract, or the possibility of changing items such as appliances or kitchen and bathroom finishes.

Also, consider closely the development’s location. Market research from the likes of the Australian Bureau of Statistics (abs.gov.au) and real estate research providers such as RpData (rpdata.com.au) into a suburb’s population growth, infrastructure investment and job prospects will provide a good indicator of your capital growth potential.

Finally, check the reputation of the builder or developer – the internet is the best place to start this search.

Do I need a building inspection, and if so, when?

If you’re serious about buying a home, a building inspection will give you an expert opinion (usually from a qualified builder or surveyor) on the condition of the property you’re interested in. Specifically, the report should provide information about the property’s condition and any significant building defects or problems. In addition, many people choose to have a pest inspection to identify any termite activity or other creepy crawlies that may exist in the property.

If you are unsure of when to conduct a property inspection, be aware that if the house is going to auction, you must complete your building inspection prior to sale. This means you will have no recourse if you find faults in the home after you have won the auction.  

For a private treaty sale, you may have your offer successfully accepted before conducting an inspection. However, the purchase will be contingent on the delivery of a satisfactory inspection report.

For further advice on organising a building and pest inspection, speak to Monika Bonet – Principal of Raine & Horne Glenelg today or visit rhglenelg.com.au.

What is the ripple effect and how will it affect my home purchase?

Many house-hunters can be guilty of focussing on the location of their home purchase to the detriment of all else. But it is also important to consider the ‘ripple effect’ when selecting the location of your home.

The ripple effect refers to the situation where buyers might be priced out of a street or suburb, which leads them to look nearby at more affordable precincts. In turn this starts to push up real estate prices in the adjacent suburb or street, and this is the ripple effect.

The ripple effect is probably more common in suburbs that are on the rise and/or on the edge of more popular areas. Other factors that can create the ripple effect include proximity to public transport, schools, shopping centres, childcare, parks and beaches, which are all factors popular with home buyers and help underpin property values. On the flipside it is also important to be aware of any future development plans for your target areas, as these could impact your selected property’s value, and your quality of life.

This blog post is brought to you by Raine & Horne Glenelg, your Glenelg Real Estate Agents and Glenelg Property Management Experts.

When media reports start talking about static or falling home prices, many homebuyers think that it’s a good idea to watch the market and wait for it to reach the bottom. They feel that if they postpone their purchase long enough, they are likely to see prices fall further and snap up a ‘real bargain’. 

While bargains do exist, of course, for people who are in the right place at the right time, there are often more people who miss out by using this strategy than gain.  Most homebuyers buy their family home and live in it for, on average, seven to ten years.  And when we’re looking at averages, the property market continues, in the big picture, to rise. Based on historical property cycles, property may undergo periods of static growth and periods of galloping growth, but on average, well-located, well-selected residential property doubles in value every ten years or so. Certainly, if we could always pick the lowest time to buy and the highest time to sell we would do very well indeed, but the only buyers who need worry about the immediate state of the market are the real estate speculators who wish to buy then sell again straight away, or those who are too highly geared or who have entered into unrealistic amounts of debt. For everyone else, the chances of strong long-term capital gain are virtually assured, provided they buy well-selected property in well-selected locations.

It’s famously difficult to pick the ‘bottom’ of the market. Often buyers who wait find themselves having little to choose from as listings get scarce – and a sudden flurry of competition for the few desirable properties actually on the market for sale often causes them to sell for higher prices than expected, even in a market described as a difficult one for sellers.  Buyers end up paying more than they bargained for if they  keep on watching and waiting;  because the ‘flurries’ they waited out were signalling an upturn in the market or the end of the halcyon days for buyers.
 
Purchasers who wait too long for a ‘bargain’ or the ‘lowest point of the market’ often only realise that the lowest point has already been reached once they can look back on it with the 20/20 vision of hindsight.

This blog post is brought to you by Raine & Horne Glenelg, your Glenelg Ragement Expertseal Estate Agents and Glenelg Property Management Experts.

Raine & Horne South Australia CEO, Kevin Magee answers the top real estate questions every month including “HOW’S THE MARKET?” in South Australia and “WHAT DOES THAT MEAN FOR ME?” in the process identifying real estate opportunities, clarifying trends and providing property market tips for Raine & Horne members, Buyers, Sellers, Investors (Landlords) & Tenants.

For ongoing & concise property updates, media scoops and tips follow Kevin on Twitter @rhSA_CEO or contact Raine & Horne Glenelg, your Glenelg Real Estate Agents and Glenelg Property Management Experts.

Many Glenelg homeowners are holding off from putting their property on the market as the media continue to report a market downtown and uncertain financial times. But the ‘best time to sell’ is often not what it seems. 

Some people sell to retire and buy something smaller. This blog post does not refer to them. But the majority of sellers at any given time are trading up to a bigger property to house their growing family or reflect their increasing wealth. These home owners will pay more for their next home, than they will get for the one they are selling ….and actually do better when the market is on the decline. The fact that they are spending more money second time round gives them an opportunity to make money on the transaction.

If the reason they think it’s ‘not a good time to sell’ is because they ‘will not get a good enough price’ for their home, then the logical next step is to realise that if the market prevents them from getting the price they want, it will also affect the sellers of the property they are trading up to…and the bottomline net gain remains with the person who is trading up. If you get $603,000 for your home in a cheaper suburb (which has been valued at $670,000), you may feel you are ‘losing’ $67,000 or around 10% of the value of your asset.

But if you (say) buy a more expensive home in a more expensive suburb such as Glenelg, which is (say) valued at $850,000 in the same market. Then the owners of that home will also ‘lose’ 10%, as you also will not be paying more than the current declining market value.

In paying 10% less for the Glenelg Property you will pay $765,000, ‘saving’ $85,000 – thereby ‘making’ $18,000 on the transaction. In other words you ‘saved’  more on the next transaction, than you ‘lost’ on the sale of your current home, so you are ahead by $18,000.

In fact, there are other advantages to trading up in a buyers’ market.

Because prices are stable and properties often take longer to sell, once vendors have sold their original property there is no rush to buy. They can take their time choosing and negotiating their next purchase without having to watch the gap between the price they got for their original property and the price they have to pay for their next one increasing at an alarming rate.

This blog post is brought to you by Raine & Horne Glenelg, your Glenelg Real Estate Agents and Glenelg Property Management Experts.

Raine & Horne South Australia CEO, Kevin Magee answers the top real estate questions every month including “HOW’S THE MARKET?” in South Australia and “WHAT DOES THAT MEAN FOR ME?” in the process identifying real estate opportunities, clarifying trends and providing property market tips for Raine & Horne members, Buyers, Sellers, Investors (Landlords) & Tenants.

For ongoing & concise property updates, media scoops and tips follow Kevin on Twitter @rhSA_CEO or contact Raine & Horne Glenelg, your Glenelg Real Estate Agents and Glenelg Property Management Experts.

Moving into a new a home or out of an old one is commonly ranked in amongst the top 10 most stressful things that many people experience. Connecting or disconnecting electricity, gas, telephone, internet and cable television services and organising removalists are just a few of the challenges that moving house brings.

This short video gives details of an excellent FREE real estate service that removes the time consuming work and stressful issues associated with these and other moving challenges and gets you into (or out of) your property sooner and with complete piece of mind.

This is another in a series of short videos from Raine & Horne South Australia’s Team that give useful and practical real estate tips to help people get the best result possible from their real estate experience.

For more tips, hints, market updates and media scoops follow @rhSA_CEO on Twitter or call Raine & Horne Glenelg, your Glenelg Real Estate Agents and Glenelg Property Management Experts.

Houses have changed a lot since the 1940′s. So has the way we live in them. The emphasis is on space and flexibility with kitchen / living areas flowing onto rear gardens or terraces.

“Houses have turned back to front,” Monika Bonet, Principal of Raine & Horne Glenelg said.

“The focus is no longer on a formal “front parlour” or how the house looks from the street. Increasing density of living has made people more aware of the need for privacy.

 The result?

 Living and entertaining areas are now concentrated in the back areas of the house. Guests are even allowed into food preparation areas that would have been taboo in previous eras.”

According to Ms. Bonet, one of the reasons for the turnaround is that there are more women in the work force than ever before.

“Working women don’t want to come home to solitary confinement behind the kitchen sink,” Ms. Bonet said. “Family members share the cooking and guests and chefs make merry while the cooking is in progress.”

 Ms. Bonet said the kitchen has coped by becoming more of a showplace. Technology has made cooking easier and devices such as the extractor fan keep odours from permeating open plan living spaces.

“House size is the most striking change in the last half century,” Ms. Bonet said. “Families are smaller, yet houses are twice as big as 1940′s houses – they’ve gone from one hundred to one hundred and eighty square metres. Kids nowadays wouldn’t dream of sharing a bedroom. There’s more internal space per head of population, yet we expect to move on to something better every seven years or so.”

According to Ms. Bonet today’s home owners are more mobile, both geographically and socially. While most of our parents lived all their life in one place, we view houses as stepping stones to better investment and lifestyle benefits.

“The motor car, highways, immigration, technology, feminism and the pill have all had an impact on housing structures,” Ms. Bonet said. “Houses reflect both technological and lifestyle changes. Modern owners have less sense of home as the family seat, belonging to the family for a lifetime or even for generations. The modern home is an asset which, adroitly managed, can move us up the social ladder.”

This blog post was brought to you by Raine & Horne Glenelg, your Glenelg Real Estate Agents and Glenelg Property Management Experts.

Many vendors say they find it hard to decide which agent to use to sell their home.

“Choosing an agent is not very different from choosing a doctor or any other service provider,” Monika Bonet, Principal of Raine & Horne Glenelg said. “If you were new to the area and were looking for an accountant or a plumber, you would ask local residents to make recommendations based on their experience.

 The best source of first hand information about local agents is someone who has recently bought or sold a house in your local area.”

According to Ms. Bonet if you don’t know anyone who has recently bought or sold, long term locals such as accountant, conveyancers, mortgage brokers and so on are always a ready source of information about who has the community’s confidence.

“The obvious question on every prospective vendor’s lips is whether the agent in question sold the house for the best price in a reasonable time,” Ms. Bonet said. “But research shows that an issue seldom raised at the start of marketing becomes the main cause for concern when things go wrong… and that is; lack of feedback.”

 Ms. Bonet said that one of the key questions vendors should ask their sources is whether their agent stayed in constant communication and provided regular feedback at every stage of the marketing process. “Knowing what is going on every step of the way reduces vendor stress and contributes to the successful sale of the property,” Ms. Bonet said. “It can help the property sell faster and for a higher price.”

Ms. Bonet said that if your checks reveal that an agent has a first class reputation in terms of service, feedback and results there is no need to look any further.

“Above all, vendors should take their time when selecting an agent and not let themselves be put on the spot by pressure selling techniques designed to get them to sign “now”,” Ms. Bonet said. “After all, for 97% of Glenelg home owners the family home represents their single greatest asset and as such their most significant financial transaction.”

“Everyone has heard the three most important criteria for choosing a house to buy,” Ms. Bonet said. “Location!, Location! And Location!

Choosing an agent can be summed up in a similar way – “Reputation!, Reputation! and Reputation!”

 This blog post is brought to you by Raine & Horne Glenelg, your Glenelg Real Estate Agents and Glenelg Property Management Experts.

Many buyers, especially those new to the buying process, feel a certain reluctance to bid on a property that is up for sale by Public Auction. Those that don’t overcome their nervousness probably miss out on some desirable properties and some good buys -- and in many areas the majority of property is sold this way, which means buyers end up with little choice about taking the plunge and making a bid. But there are ways for buyers to feel more confident when they enter the auction room.

To start with, it’s important to get some experience by going to a few auctions and watching what happens. Stand in different positions and determine where you can best be seen by the auctioneer and at the same time you can see other bidders.  Work out who you might be bidding against if you were actually buying, and observe their body language. Couples especially express a lot of emotion in their stance, exchanged looks and other body language. It is possible to ascertain when people are reaching their limit by the increase in their anxiety levels. By the same token, when you go to an auction that you intend to bid on, be careful not to give your own feelings away.   

Naturally those who have researched property values thoroughly are likely to feel the most confident when bidding time comes. Set upper price limits before you go in; having a range makes it easier, with your ideal price at the bottom and your limit at the top. You can even practice bidding by putting in opening bids or low bids on properties that you know will go much higher. (Don’t end up being left holding the baby though if there aren’t many bidders in the room!)

If you’re really keen on a property (especially if you are an existing tenant or could in some other way be known to the agent or vendor as someone with a special interest and likely to pay top dollar) take the heat off by getting someone to bid for you. You can use a friend or engage the services of an appropriately qualified and professional agent (not someone working for the agent who is selling the property of course!) with whom you have a good rapport.

While auction is often accepted as the way for vendors to achieve the highest price, buyers can often make good buys when there are forced sales, especially in a buyers’ market when there are fewer buyers than properties for sale. Buyers who spend the time familiarising themselves with the auction process are better able to read the mood on the day and know when to bid and when to leave well alone.

This blog post is brought to you by Raine & Horne Glenelg, your Glenelg Real Estate Agents and Glenelg Property Management Experts.