Century 21

ABS releases Housing Finance data for March 2012

Tue, 29 May 2012 00:30:49 GMT

The Australian Bureau of Statistics recently released its Housing Finance data for March 2012, which showed that the total value of dwelling commitments for the month of March, excluding alterations and additions, fell 0.2 per cent (trend) compared with February 2012. The seasonally adjusted series fell 0.5 per cent in March 2012.

According to the ABS, the total value of owner occupied housing commitments (trend) fell 0.5 per cent in March, following a fall of 0.4 per cent in February 2012. Falls were seen in commitments for the purchase of established dwellings (down 0.6 per cent) and commitments for the purchase of new dwellings (down 1.7 per cent), while commitments for the construction of dwellings rose (up 0.5 per cent). March 2012 saw the seasonally adjusted series for the total value of owner occupied housing commitments fall 0.3 per cent.

The total value of investment housing commitments (trend) also rose in March – by 0.4 per cent. The seasonally adjusted series fell 1.0 per cent over the month.

In terms of the number of owner occupied housing commitments (trend) seen between March 2012 and February 2012, on a state by state basis falls were seen in New South Wales (down 2.2 per cent), Tasmania (down 1.7 per cent), South Australia (down 0.1 per cent), and the Australian Capital Territory (down 0.2 per cent). Meanwhile, rises were seen in Western Australia (up 1.8 per cent), Queensland (up 1.1 per cent), Victoria (up 0.4 per cent) and the Northern Territory (up 2.6 per cent).

The seasonally adjusted number of owner occupied housing commitments saw increases in Western Australia (up 3.5 per cent), Queensland (up 2.0 per cent), the Northern Territory (up 23.0 per cent) and New South Wales (up 0.1 per cent), while falls were seen in Victoria (down 0.6 per cent), Tasmania (down 4.5 per cent), the Australian Capital Territory (down 2.6 per cent) and South Australia (down 0.4 per cent).

For more information about this data, as well as advice regarding your property purchase plans, please feel free to stop by your local CENTURY 21 real estate office to speak to an experienced and informed professional.

Maximise the capital growth and yields of your investments

Tue, 29 May 2012 00:29:50 GMT

For some investors it can prove difficult to think with your head and not your heart when considering a property purchase, particularly if you become emotionally attached to a particular dwelling. However, there are a number of factors that must be considered with a clear, unaffected mind if your investment is to be a financially successful one. Chris Gray is a well known property expert and has nearly 20 years’ experience in property investing and education. His top ten tips to maximise capital growth and yield were recently featured in the April 2012 issue of CENTURY 21 Wentworth’s Property Investor, and I also share them with you now.

1. Do your research
Look at as many properties as possible to get an idea about prices in your area, what adds value, which types appreciate faster, how to get a good deal (getting properties at much lower than market value), and what are the pitfalls of a too-good-to-be-true deal.

2. Get the property valued before you buy
Even if you've done sufficient research buyers can still pay overinflated prices for properties. I always pay for an independent valuation every time I buy.

3. Get the property valued before you renovate
One of the biggest misconceptions investors have is that the more capital they spent on a property, the more profit they will make. This isn't always the case. A valuer can tell you what your property is worth now, what it will be worth after planned renovations, and whether your new $30,000 kitchen will actually add $30,000 to your property's value.

4. Get a good property manager
This is the best way to maximise your rental income and to ensure that it rises with the market. Most self-managed properties are under-rented as owners are often hesitant of upsetting tenants. The property manager will also be able to keep on top of maintenance and other issues to do with the property.

5. Location, location, location
Look for areas with potential for high growth and yields. Important things to look for are proximity to public transport, leisure activities (parks, beaches and lakes), work and schools. Pay for some independent research which will tell you what the highest-rated suburbs are - it's worth it!

6. Buy "better" properties
Physical factors to look for when researching properties are good-sized bedrooms, off-street parking, good positioning and a uniqueness that sets the property apart from others in the street. These will ensure the property grows in value and desirability.

7. Buy blue chip
Cheap properties are often cheap because they are not in great demand and there's plenty to choose from. It's often worth paying market value for a better property in a top suburb than it is to get a discount for something that no one else really wants.

8. Buy at, or below, market value
There are ways to acquire good properties below market price. In a flatter market, for instance, clearance rates are around 50 per cent, making properties harder to sell. Here, buyers have greater bargaining power. Unrenovated properties in good areas can fetch lower prices and provide good yields post-renovation. Another way is to buy in an emergency sale situation such as when vendors need to sell to finance a recent buy or relocation and are hard-pressed to do so.

9. Get a good mortgage broker
As an investor a good broker should be one of the most important professionals on your team. If I can borrow 80 per cent of a property's value rather than 70 per cent, it means my limited deposits go 50 per cent further as I only need to put 20 per cent down rather than 30 per cent. It's not always about getting the cheapest rate, and the more legwork the broker does for me the more time I can spend finding a better property.

10. Stick to your strategy
Work out what works for you. Once you find the strategy, stick to it, while also remaining aware of other opportunities and taking on good advice. A good strategy doesn't have to be complicated - it's often the simple things that work best.

To speak to an experienced property professional in your area about your property investment plans, please feel free to stop by your local CENTURY 21 office.

Do you have adequate insurance for your investment property?

Tue, 22 May 2012 04:19:32 GMT

As an investor, it is important to understand your options when it comes to protecting your investment and its contents. To this end, I’d like to share with you the following piece provided by EBM Insurance Brokers, which appeared in the April 2012 issue of CENTURY 21 Wentworth’s Property Investor.

Underinsurance under the microscope

If your home was damaged or your possessions stolen, would the amount they are insured for completely cover your loss?

If you hesitated in answering, chances are you’re caught in the underinsurance trap – a situation facing thousands of individuals and businesses who have neglected to keep their insurance policies up-to-date.

Underinsurance is becoming increasingly prevalent in Australia and around the world. It describes a situation where the amount an individual or business is covered for is less than the true replacement cost of their home, business or contents.

All too often it is in moments of tragedy – be it a house fire or burglary – when people make the discovery they are underinsured. By this time of course, it is far too late.

For many, underinsurance is a consequence of making simple “guesstimations” of the value of their home and contents – and guessing wrong. Failing to take into account the appreciation of assets is a prime example of how households can under-appreciate their possessions.

Even issues like currency fluctuations can play a part – if the Australian dollar falls the replacement cost of imported goods becomes much dearer.

Underinsurance can also affect the value of your most valuable possession – your home.

Construction costs have increased considerably in most states over the past five years so the replacement cost of the family home can be significantly more than when it was first built.

For example, in recent years the cost of building new homes has increased by five per cent in Queensland over a single year, and by 16 per cent in Western Australia. Similar increases have been reported throughout the rest of Australia.

EBM Insurance Brokers General Manager Sharon Fox-Slater said that these increases in construction costs, many of which are passed on to the consumer, can create a significant gap between sums insured and rebuilding costs.

“For home owners, establishing an insurance policy is something they can budget for and can give them a clear idea of what insurable events are covered and what are not,” said Ms Fox-Slater.

“But should a home owner not adequately insure their property and something happens, that’s a risk that they cannot escape. This applies even more so to landlords when insuring their rental properties. Many investors place greater importance on insuring their own home yet less on insuring their rental property.

“The impact of underinsuring (or not insuring) a rental property can be devastating when there continues to be a mortgage to pay, yet no rental income and lack of funds to rebuild,” concluded Ms Fox-Slater.

For more information about EMB’s range of landlord insurance products please visit www.rentcover.com.au or call 1800 661 662.

For this and other valuable stories regarding your investment, we invite you to read the April edition of CENTURY 21 Wentworth’s Property Investor.

Save energy at home this winter

Tue, 22 May 2012 04:06:46 GMT

As winter approaches and with it often some very cold days and nights, it can certainly be tempting to rely on appliances such as heaters to stay warm. Unfortunately, such increased use will likely also result in larger costs over the period.

Having said this, CENTURY 21 Australia believes that both property owners and tenants can successfully mitigate potential increases to energy costs at home this winter through the implementation of simple energy saving measures.

“Many Australians are already seeing their cost of energy go up as a result of rising regulated energy prices. Add to this the increased consumption that is often seen in colder months, and many people might find themselves facing unexpected financial burdens this season,” said Chairman of Century 21 Australasia, Charles Tarbey.

“Having said this, there are many simple ways for households to reduce their energy use, often involving an adjustment in mindset and behaviours.”

One such modification could be in the way that Australians use the standby settings on various gadgets around the home.

According to a study released in December 2011 by the Australian, State and Territory, and New Zealand Governments, entitled ‘Third Survey of Residential Power Consumption of Australian Homes – 2010’, “while newer individual products on average are using less standby power, many individual products continue to use more power in low power modes than is required to perform the desired function.”

As such, CENTURY 21 encourages home owners and renters alike to try to avoid the use of standby power options on appliances and home entertainment and office equipment, including televisions, game consoles and computers, as a means of lessening energy consumption this winter.

“With cold weather fast approaching, the results of this study are particularly relevant as many households may experience a peak in their energy usage with increased reliance on heaters, clothes dryers, electric blankets and the like,” continued Charles Tarbey.

“By simply making a conscious effort to turn off appliances and gadgets as opposed to leaving them on standby, as well as other measures such as switching off unnecessary lights, there may be an opportunity to achieve significant savings on your energy bills,” concluded Charles Tarbey.

For further information about energy savings in the home, or for other general queries about residential real estate in your area, please drop by your local CENTURY 21 Real Estate office to speak with an experienced property professional.

Soft home value results over April

Mon, 14 May 2012 04:33:55 GMT

According to the recently released RP Data-Rismark May 2012 Home Value Index, capital city dwelling values were down -0.8 per cent in the month of April following the stability witnessed over the first quarter of 2012, leaving national home values down -0.7 per cent year to date.

Property values across the combined capital cities of Australia showed renewed softness in the latter half of April with dwelling values falling by -0.8 per cent after a stable first quarter. Over the three months ending April 30 the RP Data-Rismark Index has seen values rise by 0.3 per cent. On a year to date basis, dwelling values are now down -0.7 per cent.

Values were down across five of the eight capital cities over the month of April, with Hobart (-2.9 per cent), Melbourne (-1.7 per cent) and Brisbane (-1.3 per cent) recording the largest falls.

According to RP Data’s research director, Tim Lawless, the housing market gains seen throughout February and March, which delivered a flat first quarter result, have now been mostly offset by the -0.8 per cent fall over the month of April.

Tim Lawless went on to say that segmenting the housing market performance by price point shows that the premium housing market remains the weakest across broad price brackets.

However while April saw values reduce across most capital cities, rents continued to show modest improvements. According to Tim Lawless, at the combined capital city level, the weekly rent on a detached house is up by 4.1 per cent over the year to April and unit rents are up by 3.7 per cent.

For more detailed information about dwelling values and rents in your suburbs of interest, please feel free to contact your local CENTURY 21 real estate office to speak to a property professional for expert, clear advice.

Have you considered a property manager for your investment?

Mon, 14 May 2012 04:32:02 GMT

With reductions to interest rates, subdued value growth and an array of attractive residential real estate purchase opportunities available, current conditions are certainly looking favourable for property investors. What many investors may not understand however is that the investment process doesn’t necessarily stop once a purchase is made – a property must be effectively tenanted and maintained for your return to be maximised.

For many busy investors, the most cost effective and time efficient way to manage a property is to use a professional property manager. An expert manager will be able to manage all aspects of your investment – from ensuring it is occupied by high quality tenants to property maintenance and making sure that you and your property abide by legal requirements.

Securing good tenants is important for investors. A property manager will have the ability to find appropriate tenants and then determine whether or not they are suitable through proven screening systems and personal experience. It is important to get tenanting right - high tenant turnover and vacant days tend to be expensive and can reduce your return on investment.

Setting a market appropriate rental price is also a very important aspect of maximising your investment returns. Property managers have the experience and market data necessary to manage the increase process – without driving tenants away.

Another element for investors to consider is that investment properties require tenant inspections and the management of ongoing property maintenance issues as they arise. Not only can these activities be time-consuming if you decide to take them on yourself, they can also be expensive. Property managers have networks of contacts with which relationships have been established over time, the same as you will have in your own profession. These contractors will often charge the manager less for repairs needed than if you as an owner were to select them out of the phone book.

The process of renting out a property comes with a vast array of evolving legal requirements, covering subjects ranging from when rent is considered overdue to the use of double sided deadbolts on doors and smoke alarms. These laws can be quite complex and are often followed by inconvenient (and potentially expensive) consequences if not followed properly. As property managers deal with rental properties every day, they are well-versed with the legal requirements and can assure you remain abreast of your obligations.

As can be seen, renting out and managing a property can be a fairly complex process, particularly if it is not your field of expertise. As such, many investors often find that the value of using an experienced professional property manager can outweigh the costs of doing so.

For any further information regarding property management services or for attractive investment properties available for sale in your area, please don’t hesitate to contact your local CENTURY 21 office.

Claiming depreciation deductions on your own home

Tue, 08 May 2012 03:01:06 GMT

In difficult economic times, many property owners with spare rooms in their homes may be able to generate additional income by renting these unneeded rooms out to tenants (where appropriate), including family members and friends.

For those readers to whom this option might be of interest, I thought I would share the following piece provided by BMT Tax Depreciation. It is an excerpt of an article which appeared in the April 2012 issue of CENTURY 21’s Property Investor.

In the current economic climate, more and more home owners are renting out rooms within their properties to generate extra cash. This strategy can be quite lucrative, especially when considering the extra tax deductions that become available. Even when family members pay rent, by declaring the rental income in a tax return, a portion of the expenses and depreciation may be claimed as a deduction. BMT Tax Depreciation is dedicated to helping home owners maximise their property depreciation deductions and improving their cash return.

The Australian Taxation Office (ATO) has a preferred method of calculating the proportion of expenses that can be claimed as a deduction under the Taxation Ruling Number IT 2167. This ruling sets out the ATO’s general approach of apportionment based upon floor areas. The ruling states that it is appropriate to add the floor area where the tenant has sole occupancy of up to 50 per cent to the general living area the tenant shares equally with the owner/occupier. It is necessary to only include general living areas the tenant has access to.

A portion of relevant property deductions can be claimed by the owner including property depreciation, which is a deduction available for the wear and tear on the fixtures, fittings and structure of a building. A portion of other expenses such as insurance, rates and the interest payments made on the mortgage of a property may also be claimed.

(Please visit the original article in Property Investor for an example of an owner-occupied house with two bedrooms generating income for the owner, showing the tax deductions available and the resulting improvements to the owner’s cash flow.)

When renting a room out in an owner-occupied property, it is important to obtain a property depreciation report from a specialist Quantity Surveyor such as BMT Tax Depreciation. This will ensure the tax deductions are maximised. It is also important to discuss the options available with an accountant. When a home is changed into a partial investment property, some Capital Gains Tax (CGT) may be triggered if the property is later sold. However, there are scenarios which may reduce or create a total CGT exemption depending on the property’s first use, how long the property was lived in, how long it is income producing and if the owner purchases another home.

For more information on BMT Tax Depreciation’s Australia-wide services, please contact 1300 728 726.

Lower interest rates may spur property market

Tue, 08 May 2012 02:58:28 GMT

At its monthly meeting last week, the Reserve Bank of Australia elected to reduce the official cash rate by fifty basis points to 3.75 per cent. This decision was welcomed by CENTURY 21 and we expect that it will help to encourage growth in the national property market.

Charles Tarbey, Chairman of CENTURY 21 Australasia, said of the decision, “Should the banks pass on the rate cut, this decision should be an excellent shot in the arm for a relatively quiet property market and the economy at large.”

“I believe the decision is the right one when considering the state of the Australian economy and could potentially be the first of a number of cuts.”

The Reserve Bank’s decision came after the release of lower than expected inflation figures, ongoing economic turbulence in Europe and disappointing research from the Housing Industry Association showing that new home sales fell to their lowest levels in over a decade in March 2012.

In his statement following the meeting, RBA Governor Glenn Stevens commented that the decision was “based on information received over the past few months that suggests that economic conditions have been somewhat weaker than expected, while inflation has moderated.”

Mr Stevens noted that national output growth was somewhat below trend over the past year and had been affected in part by temporary factors, but also by the persistently high exchange rate. He also referenced that interest rates for borrowers have been close to their medium-term averages over recent months, “albeit tending to increase as lenders passed on the higher costs of funding their books.”

“With a relatively gloomy global economic outlook in the short term, now more than ever the RBA needs to encourage investment and consumer confidence to spur economic activity,” concluded Charles Tarbey.

The RBA will no doubt be watching closely to see the response of the major banks to its move. Since the decision was made, NAB, Commonwealth Bank and Westpac have announced that they will each lower their standard variable interest rates by 32 basis points, 40 basis points and 37 basis points respectively, with a decision from ANZ due to be announced this Friday.

For more information about the residential property market in your areas of interest, please feel free to stop by your local CENTURY 21 Real Estate office for expert, clear advice. Additionally, if you would like to speak to a mortgage professional about the impact of this rate cut on your mortgage, or to find out more about suitable loan packages for your circumstances, please contact CENTURY 21 Home Loans.

Maintain a garden even if you’re living in an apartment

Fri, 27 Apr 2012 05:59:26 GMT

When comparing the pros and cons of apartment living, a drawback that usually tends to arise is that apartments generally don’t allow for occupants to have a garden. While many won’t see this as an issue at all, others might be making the transition from a property with an outside area and could mourn the loss of their gardening time.

Living in an apartment, however, doesn’t have to mean the end of outside space or your gardening hobby. There are a variety of housing features that buyers and renters can look for when searching for a property to reside in to ensure that they are able to continue to enjoy their pastime. And for those already living in an apartment, there are numerous ways to incorporate some plant life into your decor.

Many residential complexes will have ground floor apartments – some of which have an outdoor backyard or courtyard area. Despite being compact in size, keen gardeners may be able to establish gardening beds in these spaces, or at the very least install a variety of different pots and containers in which to grow and maintain plants, flowers, herbs and vegetables.

Those people that find themselves living in apartments situated on higher levels of a building could have access to balcony space. While again compact, a balcony may offer an outside area in which to cultivate a number of potted plants.

And in apartments where neither a balcony nor courtyard is present, residents can still maximise the space beneath windows – maintaining potted plants in the sunlight that these openings can provide.

All apartments will be different in terms of the directions they face and the levels of light present. As such, the plants that apartment residents are likely to have the most success with will change from home to home. In order to select the best plants possible for your situation, the best solution is usually to visit your local nursery and have them recommend options according to your living space.

For those keen gardeners out there, apartment living doesn’t necessarily have to mean giving up your hobby, rather it might involve a few tweaks in the way in which you carry it out. In any case, there are numerous plants, flowers, herbs, vegetables and the like that can be grown in an apartment setting – allowing residents to maintain their pastime.

Fire safety at home a must this winter

Tue, 24 Apr 2012 05:43:29 GMT

Fires that occur in the home can be truly tragic events. In many cases much of the heartbreak lies in the fact that the episode potentially could have been avoided altogether. As the weather gets colder and the risk of household fires escalates, I encourage all home owners and tenants to be aware of the dangers of fires in the home and to take preventative steps to protect family members, property and possessions.

Charles Tarbey, Chairman and Owner of CENTURY 21 Australia, recently commented on the risk of fires in winter. “As the temperature drops, people tend to increase their use of heaters, clothes dryers and the like at home, all of which can pose a serious fire threat if not managed in a careful manner.

“There are some terrible examples of preventable residential fires occurring because, for example, a heater has been left unattended or hasn’t been maintained properly. These incidents can tragically result in loss of life and major property damage, all of which could have been avoided if various safety measures had been practiced.”

In order to prevent a serious fire occurring, all home owners and tenants should ensure that heating equipment and clothes dryers are cleaned and maintained prior to and throughout the winter months and monitored when in use.

In addition, it is essential that smoke alarms are installed and in working order throughout a home so as to alert a property’s occupants should a fire occur.

“Working fire alarms and proper fire protection equipment such as extinguishers and blankets can be the difference between catastrophe and a fire that is put out quickly, resulting in minimal damage to people and property,” continued Charles Tarbey.

“It is important to get fire safety right. Recognising potential fire risks within your property and acting to minimise them will help to ensure the safety of all occupants as well as the dwelling itself this winter,” concluded Charles Tarbey.

Household fires can be devastating – so be prepared and take the necessary steps to avoid one occurring in your property this winter.

A finance health check could save you thousands

Tue, 10 Apr 2012 00:17:59 GMT

The home loans market is a competitive one, with a plethora of lenders offering various incentives and low rates to encourage you to borrow from them to purchase a new home or investment property. And while property purchasers will likely dedicate a good deal of energy to ensure they have secured the best mortgage, it can then be easy to put a home loan to one side once finalised, without checking regularly to see if there are improved, more cost effective options available.

A lot can happen over the life of a mortgage and an individual’s circumstances now may be very different to when he or she first purchased a property. For example, income may have changed, or you may have held the same job for a longer period. These factors and others can have a material effect on the mortgage package and interest rate you are eligible for.

And with movements in interest rates and banks varying their lending criteria and introducing new products, it’s certainly a wise move to regularly approach a mortgage professional for a home loan health check.

According to Harry Bozin, the Head of CENTURY 21 Home Loans, a finance health check is important for both home buyers and investors. In the case of investors, “a finance check-up is vital as the loan package is a major contributing factor to a successful real estate investment.”

The home loan review process can achieve a number of things. Firstly, it could result in lower repayments. Secondly, it could lead to the identification of a more suitable package for your current situation, or end up saving you thousands of dollars in interest because a review of your circumstances results in a loan with a lower interest rate being selected.

Harry Bozin also notes that for investors, working with a mortgage professional to consider the health of your mortgage could “present an opportunity for you to unlock the equity you’ve accumulated and acquire another investment, or make upgrades to your property.”

Whichever way you look at it, it’s definitely a good idea to review your finances regularly, particularly in changing times. An accredited mortgage consultant can help you to identify the best loan product for your circumstances, which may be the product you currently have or a new one, taking into account not only the interest rate but also a variety of other critical factors.

If a finance health check interests you, the accredited mortgage consultants at CENTURY 21 Home Loans provide a free, no-obligation home loan health check service. To take advantage of this service and make sure you have the best loan package for your situation, please visit www.century21homeloans.com.au to contact the company.

First quarter of the year sees home values stabilise

Tue, 10 Apr 2012 00:17:59 GMT

The recent release of the RP Data-Rismark Hedonic Daily Home Value Index results for March showed that national home values rose 0.2 per cent in March 2012 – a potential sign that the Australian housing market is stabilising. The market has remained unchanged for the quarter ending 31 March 2012; this flat result is the strongest result since March 2011 when values increased by 0.7 per cent.

According to the managing director of Rismark International, Ben Skilbeck: “While the housing market remains soft, the zero per cent change over the first quarter of 2012 demonstrates that it is consolidating its position following the decline seen in the calendar year 2011.”

Over the month, the resource rich states delivered the strongest gains with Perth rising 1.4 per cent, Darwin up 1.1 per cent and Brisbane increasing by 0.8 per cent.

The Index saw that the flat result seen over the March quarter was largely driven by the Sydney housing market which achieved the strongest gains over the quarter, with values rising 1.1 per cent. Values were down across many of the other capital cities with the most significant drop recorded in Adelaide where dwelling values were down 1.5 per cent.

Rismark’s Ben Skilbeck points out a number of factors that indicate an improvement in housing market conditions may have occurred over the past few months.

“The ratio of national house prices to household disposable incomes is currently below the decade average. Additionally, according to the ABS housing finance data, both the value and number of loan approvals for the purchase of established dwellings are at levels not seen since November 2009. First home buyers as a proportion of home loans approved are back to levels not seen for two years,” said Mr Skilbeck.

Charles Tarbey, Owner and Chairman of CENTURY 21 Australia said of the results: “While we must note that much of the improvement seen in the housing market is due in part to the Sydney market which rose 1.1 per cent over the quarter, we are nonetheless seeing signs of a potential stabilisation of home values.

“Other factors such as strengthening auction clearance rates and improving demand from first home buyers are certainly encouraging indicators of both the current state of the national housing market and the potential for continued improvements over the course of 2012,” concluded Mr Tarbey.

For more information about available property purchase opportunities in your area, please contact your local CENTURY 21 agent.

Rate hold accompanies stabilising housing market

Tue, 10 Apr 2012 00:17:06 GMT

At its April meeting held last week the Reserve Bank of Australia elected to keep the official cash rate on hold at 4.25 per cent for the third consecutive month. From our perspective at CENTURY 21 Australia, this move will help to create ongoing stability for those Australians considering the purchase of a property.

According to CENTURY 21 Chairman and Owner, Charles Tarbey: “This move suggests that the Reserve Bank of Australia is relatively comfortable with current economic conditions for the time being and, at a time of comparatively low interest rates, will encourage many Australians to act on a property purchase.”

In his statement following the announcement, Reserve Bank Governor Glenn Stevens noted that recent information does not suggest that a deep downturn in the world economy is occurring, while also recognising that it is expected to grow at below-trend pace this year.

He also touched on the Australian economy, saying that growth in domestic demand ran at its fastest for four years in 2011, driven by private spending. Despite this, “the balance of recent information suggests that output growth was somewhat below the trend.” Glenn Stevens also noted that there are differences in performance between sectors, and considerable structural change is occurring.

Regarding inflation, a key influencer of monetary policy, Governor Stevens mentioned that inflation was expected to be within the 2 – 3 per cent range over the coming one to two years. According to the Governor: “At its next meeting the Board will have a chance to reassess the outlook for inflation, taking into account not only data on demand and output but also forthcoming information on prices.”

Interestingly, in concluding Governor Stevens noted that the Board’s view was that should demand conditions materially weaken, the inflation outlook would provide scope for easier monetary policy. According to the Governor: “At today’s meeting, the Board judged the pace of output growth to be somewhat lower than earlier estimated, but also thought it prudent to see forthcoming key data on prices to reassess its outlook for inflation, before considering a further step to ease monetary policy.”

Thus, depending on the nature of key data sets which are to be released prior to the Reserve Bank’s May meeting, there may be the potential for a rate cut next month. The next few weeks will certainly be an interesting time of information release and commentary to say the least.

For more information on real estate in your area, please feel free to contact your local CENTURY 21 Australia agent.

Get to know your new neighbourhood before buying

Tue, 10 Apr 2012 00:17:06 GMT

There are several features about an individual property that can influence your decision to purchase it. It is for this reason that many prospective buyers will visit numerous properties, and then a property of interest on a few different occasions, before finalising their purchase decision.

And while the attributes of a home are very important, so too is the area in which it is situated. After all, they don’t say ‘location, location, location,’ for nothing. The area surrounding a home, including physical landscape, and access to public transport and lifestyle facilities, can have a sizeable impact on how suited a property is to your needs and situation. Location should therefore be considered to ensure your purchase is a successful one.

There are a number of different ways by which you can look to investigate a suburb of interest. One such method is to visit the area at different times of the day and night and over a weekend. This will give you an indication about the traffic the area experiences, for example, in morning and evening peak hours. It will also help you to see if the area is a busy one, and give you some idea of the demographics of the residents who live in the area.

If access to public transportation is important to you, such as for travelling to work, you may like to test out the area’s various services before committing to a purchase. This might include driving to your area of interest one day and catching a bus or train to and from work – as though you live in the area. This should help paint a picture of travel times, conditions and accessibility to you.

If lifestyle is an important consideration for you, you might like to visit a local dining precinct and investigate an area’s restaurant, café, and pub and bar offerings to see what you would be able to enjoy if you were to live in the suburb.

All in all, by considering both the individual features of a home, as well as the area in which it is located, buyers can better ensure that their property purchase is a successful one. By investigating elements such as accessibility to public transportation, lifestyle amenities and the general feel of an area, buyers will likely be able to form a more holistic opinion about a potential property.

For more indepth information about properties available for purchase, as well as regarding an area of interest, please feel free to contact your local CENTURY 21 real estate office for professional, expert advice.

Renovating for profit – tips from Chris Gray

Sun, 25 Mar 2012 22:48:59 GMT

It’s the Holy Grail for many property investors – buying a property, renovating it, and then selling it for a profit. But while it sounds relatively simple, there are many investors who have had misfortune when pursuing this strategy, due to budgets and timeframes blowing out, arguments erupting and the like.

Chris Gray, host of Sky News Business’ ‘Your Property Empire’ and Financial Judge on Network Ten’s ‘The Renovators’ has had nearly 20 years of experience in the residential property industry, particularly in his role as CEO of Empire – which searches, negotiates and renovates properties on behalf of time-poor professionals. He recently shared with CENTURY 21 his thoughts on what property investors need to know in order to complete a successful renovation on time and on budget.

1. Choose properties that need mainly cosmetic work

Chris advises that investors avoid properties with structural damage, as this is often when expensive problems occur. According to Chris, if you already own the property you definitely need to leave that part to the experts.

2. Find a valuer

Chris notes that one of the biggest misconceptions investors have is that the more they spend renovating a property, the more profit they will make. This isn’t always the case and investors need to be careful of undercapitalising as well as overcapitalising. A valuer can tell you if your $30,000 kitchen renovation will actually add $30,000 to your home’s value.

3. Be realistic when doing it yourself

According to Chris, most novice renovators attempting DIY go under budget when estimating the costs. His tip is to double your expected cost and timeframe and then work out if you’re still going to make a profit.

He also advises that investors add up the cost of taking time away from a job or family and see if the potential profit outweighs the potential risk.

4. Use a project manager

Chris advises that there are too many risks involved in managing a project alone. Some tradespeople capitalise on investors’ lack of experience – in terms of cost, timelines and attention to detail. Handling the renovation yourself could save money initially, but hiccups along the way might turn your $40,000 renovation into a $60,000 - $80,000 job in the long run – not to mention the added time it might take. Each week you go over time is a week’s lost rent or extra mortgage repayment.

According to Chris, using a project manager will often get you access to trade prices rather than retail, so it may well pay for itself straight away.

Chris notes that when investors do their research, purchase a property well, renovate correctly and with the right advice, renovations go well - potentially resulting in owners earning tens of thousands of dollars in equity in the first year alone. According to Chris, “even if the property market hasn’t moved in your local area, renovations can create artificial growth in your property’s value.”

For more information about Chris Gray, please visit www.yourempire.com.au