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.

“It’s sometimes hard to work out when interviewing a new Glenelg Landlord, why they may feel vaguely dissatisfied with their incumbent property management service” said Ms Bonet Principal – Raine & Horne Glenelg.

“When you sart talking to them you know straight away it’s not working for them, but you can’t put your finger on why?”

“Our experience with our Glenelg Property Management business is that most property investors want to communicate with one person for their day-to-day needs” said Ms Bonet. ”They don’t want different jobs to be managed by different personnel (task management); they want their whole portfolio to be looked after (whether they own one property or several) by one person who is responsible for all tasks relating to their properties – arrears, re-letting, repairs and so on”.

When it comes to hiring a property manager, here is a checklist you can run through to reassure yourself that your agent is doing the best thing by your investment. Here’s a checklist thatall Property Investors should ask themself;

1. Does your property manager talk to you on the phone or does he/she send emails or text messages? Most landlords are baby boomers and prefer to discuss things directly when there is a problem so if you feel your property manager is hiding behind emails or text messages when you need to talk, let them know.  
    
2. Do they respond to your requests quickly? Property managers who take longer than half a day to respond to phone calls and emails are letting you down.
    
3. Most landlords prefer minimal vacancy; it’s obvious that even a week’s vacancy is money that will never be recouped.  If your property is vacant, don’t let your property manager ‘give it another week to see how we go’. If it isn’t rented in 10 days, it’s time to drop the rent by 10%.
    
4. Are you getting the best referenced tenants? Keeping the rent at 95% of market value minimises arrears, vacancies and maintenance – and therefore increases net return although the rent is slightly below market. Landlords who go for the highest rent lose money in vacancies and repairs – so check that your agent isn’t setting the rent too high.
    
5. Does your property manager keep you informed about further ‘good’ investments? This could be via an email with links to their website and properties for sale.

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.

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

105,000 fellow Australians are cold and in danger tonight and you and I can help them, easily, immediately and effectively.

As a result of issues such as domestic violence, mental illness, family breakdowns, unemployment, drug and alcohol problems thousands of people are sleeping rough tonight and every night in Australia. 

To help St Vinnie’s provide support and solutions to break personal cycles of poverty on 16^th June, Kevin Magee - CEO of Raine & Horne South Australia is  representing the Raine & Horne SA Team at St Vinnie’s annual fundraising event the ‘CEO Sleep out.’ 

Homelessness is not a choice and over 54,000 homeless people are turned away from supported accommodation and help services in Australia annually due to a lack of capacity. 

If you can spare a tax deductible dollar or two over the next few weeks to help please visit http://bit.ly/iMYfvX

Any donations, volunteers to join in or promotion of this event to raise awareness will be greatly appreciated.

Together we can all make a difference.

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

When a tenant moves into a property, both the tenant and the managing agent/landlord are required to complete a condition report.

“This report is an extremely important document as it is a record of the condition of the premises at the start of the tenancy” said Ms Bonet, Principal of Raine & Horne Glenelg.

Ms Bonet said “When completing a condition report it is not a quick process of ticking and flicking that everything is clean, working and undamaged.  Extreme caution and time needs to be taken to describe all of the fixtures and fittings.”

This includes:

• The colour of the carpets and walls,
• A full description of the window coverings and light fittings,
• Detailed information on appliances, including the make and model,
• A list of any inclusions, etc.

“If you fail to adequately describe the inclusions, fixtures and fittings it can cause unnecessary disputes at the end of the tenancy or lead to a possible financial loss for the property owner” said Ms Bonet.

“For example, if you just tick window coverings as being good and undamaged and fail to describe them, the tenant can leave any form of window coverings when they vacate.” “Or if the tenant decides to paint a bedroom hot pink and the condition report just has walls ticked as good, you will be unable to enforce that the walls be returned to the original neutral colour, as the tenant decide to be difficult and disputes it” said Ms Bonet.

The more detailed the condition report, the easier it will be to over-come pending disputes at the end You can be confident that our property management team are very thorough when completing condition reports to protect your investment.

As well as describing the fixtures and fittings, it is equally important that the property is presented in a clean and safe condition from the outset. 

Upon vacating, the tenant is required to leave the premises in the same condition (allowing for fair wear and tear) as it was at the commencement of the tenancy. If the property was not clean, the lawns were not mowed, there were weeds in the garden and marks on the walls, then the tenant can leave the property in the same condition – or often they leave it worse with no recourse for a claim.

Ms Bonet said “Once again, you can be confident that our office is constantly working towards protecting your investment, which includes our team taking a little extra time and effort to be thorough with our documentation when a tenant moves into the property.”

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

“You can claim a deduction for certain expenses you incur for the period your property is rented or is available for rent”  Monika Bonet, Principal of Raine & Horne Glenelg said.

Ms Bonet further noted “However, you cannot claim expenses of a capital nature or private nature – although you may be able to claim decline in value deductions or capital works deductions for certain capital expenditure or include certain capital costs in the cost base of the property for capital gains tax (CGT) purposes.”

Types of rental expenses

Ms Bonet stated that there are three categories of rental expenses – those for which you:

• cannot claim deductions
• can claim an immediate deduction in the income year you incur the expense
• can claim deductions over a number of income years.

For a detailed understanding of all rental property expenses Ms Bonet  recommend that you visit the following web link of the ATO and download a copy of their 2008

http://www.ato.gov.au/content/00131327.htm

This guide explains how to treat rental income and expenses, including how to treat more than 230 residential rental property items.

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

Most investors agree that successful ownership of residential rental property is all about maximising long term net income.

“Novice investors and property managers often simplify what is a complex interplay of forces and focus on the amount of rent being achieved right now,” Monika Bonet, Principal of Raine & Horne Glenelg said. “Because tenant harmony is a crucial part of the income equation, most experts agree that setting rent at 95% of market value usually achieves a higher income long-term than holding out for a 100% or more. Tenants paying top dollar are more likely to be finicky about the standard of the property, and make more demands for repairs and improvements. Furthermore they tend to start looking around to see what else is available for the money and move on if they find better value.”

Ms. Bonet said that the more often a property is vacant, especially if the advertised rent is high, the more chance there is of vacancy and loss of income.

“Even a few weeks vacancy per year can significantly reduce the investor’s return, thereby requiring an even higher rent to make up for it and setting a negative pattern in motion,” Ms. Bonet said.

According to Ms. Bonet a related factor that is often poorly handled by novice investors is the market rent review.

“Property investment managers carry out market rent reviews on a regular basis and the rents are raised according to supply and demand,” Ms. Bonet said. “Novice investors often think the best approach to raising the rent is to make frequent small increases, but these are seen by tenants as penny pinching and lead to disharmony, increased demands for repairs and higher vacancy over the long-term. Experts say that in most cases rent increases should occur when market indicators show that a 5% increase is warranted.”

Ms. Bonet said that experienced property managers report that the most stable income and long term optimum return is gained by investors who follow the advice of the experts they have selected to manage their investments.

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

Many home buyers no doubt wish they had a dollar (or a property!) for every time a real estate agent has told them…”This one won’t last long”.

“Inexperienced agents use this cliché to create urgency regardless of whether it is appropriate or not,” Ms. Bonet of Raine & Horne Glenelg said. “The result is that professional agents wishing to give their best advice to purchasers in circumstances where the comment is in fact justified hold back or risk disbelief.”

Ms. Bonet said that purchasers need to do their own research to determine whether they are buying in a sellers’ or a buyers’ market.

“If there are more buyers than sellers then there not enough properties to go round – a bit like musical chairs,” Ms. Bonet said. “In this situation buyers who spend too much time deciding whether to make an offer end up losing the property to another more aware buyer. Certain types of properties are more sought after than others no matter what the state of the market. Popular property categories vary from location to location. But a property that is keenly priced will almost always sells faster than one that is grossly overpriced.”

According to Ms. Bonet agents are knowledgeable about property values over a broad geographic area, price band and property category.

“Buyers on the other hand may start their search looking more broadly but by the time they are ready to buy they are specialists in a more narrow category and price range. They will also be well aware of the type of market they are shopping in.

“In fact buyers who are ready to make a decision should be able to answer the question of whether a particular property will or won’t last as well as the agent they are talking to,” Ms. Bonet concluded.

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