Preparing your Home for Sale – part 2

Knowing your target market is the key to selling your home for more in any economy.

If you focus in on your target market, you can channel all of your enhancements to give you the best returns. Get advice from your agent and attend a lot of auctions in your area, of similar size and style homes to yours, to see who the bidders are. You cannot dress a property for sale without knowing who would be interested in buying it. You want to give people what they want.

Showing off your home in its Sunday best may mean sending your pets to the kennels, replacing your comfy supersized sofa with something more befitting the space, or moving the entertainment centre away from the patio doors. It might not be as comfortable and homey, but buyers are not interested in how you live, they are trying to visualised how they will live. For this reason, the experts will advise you never to sell a house unfurnished. Even if you have a bland or an empty spare room with no obvious function or use, you need to give it purpose.

Hire the right pieces of furniture to turn it into an office, a home gym or a child’s bedroom. People are going to be buying the whole house so you have to look at every room. Buyers want it presented for them. They don’t want to have to think, they want to see exactly where they can place their furniture if they fall in love with the property.

When it comes to cosmetic improvements, you need to be careful. You don’t want to be seen to be covering up faults with the home, especially major faults such as flooring or rising damp, because they will be found in the building inspection. Even so, if you are selling a house that is ripe for renovation, you still need to show off its potential and the same sprucing tips apply. The golden rule is to present your house to the best of your ability and budget, and you will always get a better price in the end.

Here are some tips:

Clean, clean, then clean some more, especially the windows.

Make cosmetic improvements in and around the house. If it’s broken, fix it.

De-clutter and store off site.

Ensure every room is presentable; the whole house is on sale.

Depersonalise; you don’t want buyers to feel they are invading your space.

Downscale your furniture but retain some warmth.

Steam clean all furniture, carpets and curtains, especially if you have pets.

Outside, the garden should be neat and trim.

Even a small courtyard needs a chair and some big pots of color.

Be honest and sell your house for what it is.

Tags: home staging
December 10th, 2009  |  Posted in Selling Tips  |  No Comments »

Preparing your Home for Sale

The housing market is in bloom and home owners everywhere are preparing to put their biggest assets on show. For vendors who exhibit their properties to their greatest potential, the end results are likely to be far happier.

Statistics show that good property presentation can increase the sale price by 5 to 7 per cent. So if you are considering listing your home, snap on the rubber gloves, pack away the family photos and send your pet on vacation.

Sprucing up your place for a sale calls for a certain amount of time and energy, though for an extra $20,000 to $40,000, it is worth the effort.

Most houses will require detailed cleaning, clearing out and fixing up and probably some painting, hiring and styling too. But where do you start?

The first thing you need to do is to get rid of the clutter. You cannot see what you have to work with or what needs doing unless the tapestry is clear, so take out everything you don’t want or are not using. Less is more. After you identify the excess furniture and personal clutter you will need to store it all off-site. After the house is cleared, you can begin to tackle the repair and maintenance work, fixing joinery and replacing broken tiles and window panes.

Depending on the condition of the property, it may also be worth re-sanding the floors, painting the walls or laying new carpets. If you don’t want to spend much, invest in some great accessories – a gorgeous fruit platter, a vintage clock or fabulous coffee machine.

This will not only look impressive in situ, but you get to take them with you when you go.

If the whole process starts to feel overwhelming, you can always call in the professionals.

Though many real estate agents regard themselves as “renovation rescuers” they will often suggest enlisting the help of an interior designer to maximise the success of your selling campaign.

A number of people and firms are in the business of styling houses for sale. They can provide a consultation to help you get started or, if you prefer, can come in and completely overhaul your house, usually in about a day. They will rearrange and present your house to stunning effect, hire furnishings – furniture, linen and accessories – and bring in the decorators and gardeners. There is nothing unscrupulous in doing this, it is just opening up the house to show its best potential.
Since most sellers are likely to be blind to the appeal and faults of their own home, it is important to have an objective viewpoint. If you live in the house you get used to certain aspects, you may be more concerned about a small crack rather than the overall image.

A fresh pair of eyes can see the real selling points of the house and then emphasise them.

Tags: home staging
December 10th, 2009  |  Posted in Selling Tips  |  No Comments »

Trends in Home Sizes – Australians lead “Home Obesity”

Australians are piling on sitting rooms, family rooms, studies and extra bedrooms at the fastest rate in the world, with the size of our homes overtaking those in the US as the world’s biggest.

The typical size of a new Australian home hit 215 square metres in the past financial year, up to 10 per cent in a decade, according to the Bureau of Statistics data compiled for Commonwealth Securities.

US figures show the size of new American homes shrinking from 212 square metres before the financial crisis to 202 square metres in September.

New homes in other parts of the world are far smaller, with Denmark the biggest in Europe at 137 square metres and Britain the smallest at 78 square metres.

Almost half of the $250 billion spent on housing each year was on alterations and additions, with one in every seven new houses simply replacing existing houses that have been demolished. Australians had so many holiday houses that the latest census found eight per cent more dwellings than households.

Sydney houses are by far the nation’s biggest with new free-standing houses typically spanning 263 square metres – providing more than 100 square metres of indoor space per person. But the high proportion of townhouses and apartments in Sydney pushes the average dwelling size down to 205 square metres, just below the Australian average and about the same as in the US.

Another way of looking at it is the number of bedrooms. Around 20 years ago only one in every six homes had four or more bedrooms, and by 2006 it was one in every 3.5 homes.

While the fast pace of population growth points to the need for more and more homes, we are living in the biggest homes in the world. The simple fact is they could be better utilised.

The average household size has crept up from 2.52 to 2.56 people in 2007-08.

It may not seem remarkable but it appears to be the first increase in at least a century, and perhaps the first since European settlement.

It does make sense. Population is rising, as is the cost of housing and the cost of moving house, so we are making greater use of what we have got.

Children are staying home longer and more people are opting for shared accommodation.

The key question is whetherit is permanent or temporary. If sustained, it will save us building 166,000 homes.

Tags: housing trends
December 10th, 2009  |  Posted in building  |  No Comments »

Buying My First Home

How much do I need upfront?

The largest hurdle is generally getting your deposit together, although there are a number of other costs you need to be aware of.
How much do I need for a deposit?

If you have started saving you can start to look at buying once you have around 5% of the purchase price.

If you have between 5% and 20% of the purchase price, you may need to pay what’s called Lenders Mortgage Insurance, which enables us to lend you a larger percentage of the purchase price. This can be included either in your upfront costs or in your loan repayments so that it’s spread out over the term of the loan.

The estimates below do not take into account the money you need for upfront costs.
How much do I need for a deposit Purchase price     Minimum deposit
With mortgage insurance     Without mortgage insurance
$200,000     $10,000     $40,000
$300,000     $15,000     $60,000
$400,000     $20,000     $80,000
$500,000     $25,000     $100,000
% of purchase price      5%     20%

If you have a deposit of over 20%, you can avoid the extra costs of Lenders Mortgage Insurance.

These figures may differ if you are self-employed and applying for a low doc loan. For more information, read up on low doc loans for the self employed.
What if I don’t have a deposit?

If you don’t have a deposit, there are a number of options that can help you get your home sooner.

You may be able to use a guarantee from your parents (supported by a mortgage over their property, or a term deposit) as equity to assist you with your home purchase. These are generally referred to as family guarantees.

Another option is our Deposit bond, which lets you go ahead with a purchase before you have an actual cash deposit. It’s useful if your cash is tied up in other investments, and is widely accepted at auctions.

And, if you’re eligible for the First Home Buyers Grant, you can put it towards your deposit.

Of course if you’re keen to do it by yourself we have a range of savings and investment accounts to help you save your deposit.
Review your options:

* Delay paying your deposit with a deposit bond
* Compare all Savings and investment accounts

What other costs are there?

There are other up front costs you should factor in.

This will include things like:

* Conveyancing and legal costs
* Government fees including stamp duty, although this can be included in the loan
* Title search and registration fees

You’ll also want to consider:

* Pest and building inspections (typically about $500)
* Home building Insurance prior to settlement, and possibly contents insurance when you move in.   (source www.westpac.com)

December 10th, 2009  |  Posted in Buying Tips, Finance  |  No Comments »

Suburbs where it’s cheaper to buy than rent

Buying property is becoming cheaper than renting in many suburbs across Australia, new research has found.

According to property pricing specialist RP Data research, which was commissioned by Commonwealth Bank of Australia, there are 94 suburbs across Australia where the monthly cost of rental outstrips the monthly mortgage repayment on both houses and units.

That’s up from 74 suburbs six months ago. Two-thirds of the suburbs are located regional areas with the remaining 34 percent in capital city metropolitan areas.

The biggest gap between the cost of buying and renting was in Western Australia.

Queensland
Brisbane and the Gold Coast are the key locations for buyers in metro areas, while Dysart and Moranbah are where most buyer-friendly regional spots. Click the link to open the map and mouse over the pins to get information about prices in each location.

New South Wales
Darlington in inner Sydney is the key metro location, while Dubbo and Coomba Park are where most buyer-friendly regional spots. Click the link to open the map and mouse over the pins to get information about prices in each location.

Australian Capital Territory
There are just two locations within the ACT where buying an apartment is cheaper than renting. Click the link to open the map and mouse over the pins to get information about prices in each location.

Victoria
Regional Victoria has the biggest gap between buying and renting while three Melbourne suburbs favour buyers.

South Australia
Adelaide has one suburb where buying is cheaper than renting, while the Whyalla area remains a hotbed for buyers looking in regional areas.

Western Australia
Most of WA’s buyer hotspots are clustered around the north west part of the state. Click the link to open the map and mouse over the pins to get information about prices in each location.
Northern Territory
There are two locations where buying is cheaper than renting in the Northern Territory, both in Darwin.

Tasmania
Tasmania is included in the research for the first time with seven locations where it is cheaper to buy than rent.

The biggest savings can be made by buying resource rich areas of Western Australia (in one town it is nearly $4000 per month cheaper to buy a house than to rent it).

Indeed, four of the top five locations in WA offer savings of more than $1000 for buyers.

December 9th, 2009  |  Posted in Buying Tips, For Investors  |  No Comments »

Unit Blocks May Provide Their Own Water

Unit blocks an other strata-titled properties could collect, manage and recycle water on site to take pressure off mains water – and potentially sell the oversupply to neighbors, a University study suggests.

Individual unit owners could communally own their water and wastewater supply infrastructure in order to service their water needs. Water shortages during the recent drought have renewed concerns about the sustainability of urban water management, but with local systems owned communally it would take the pressure off the government-owned systems and save considerable power that is currently consumed pumping water over large distances.

Such decentralisation of water management could signify that local water is sufficient to service the occupants of the scheme and provide irrigation for the grounds of a development. It could also allow for on-selling any excess water to third parties to help pay for a system’s operational costs.

Redevelopments of inner-city sites in areas with high rainfall were strong candidates for the systems, so there could be an increase in housing without putting pressure on existing water infrastructure.

This can be done by installing communal rainwater tanks and greywater or blackwater treatment and recycling systems. In this environment, wastewater treatment plants can be connected to sewer mains to guarantee the safe discharge of untreated water.

The key findings of the study were that body corporates should retain ownership of all infrastructure and employ a resident or facility manager to monitor an maintain the system.

Properties with 50 to 250 or more units should have a water technology company operate their facility and the lots should be individually metered to provide water-saving incentives, the report said.

December 9th, 2009  |  Posted in Uncategorized  |  No Comments »

What Happens When You Convert Motel Units Into Dwellings

Interpretative Decision (ID) 2008/136 by the Australian Tax Office (ATO) points out that if a unit was previously a motel room then its first sale as an independent dwelling will subject to GST.

This ID considers a motel that was constructed before GST was introduced, where the units were owned by the entity that constructed them and had been operated as a motel.

The units were strata titled and sold individually without any substantial renovations.

Commercial residential premises and the first sale of new residential premises are subject to GST on sale if the owner is registered for GST.

The ruling states that an individual unit did not qualify as commercial residential premises but the change of use made each unit a new residential premises.

The concession that if new residential premises are used as a rental for a continuous period of at least five years then their sale would not be subject to GST could not apply because they had been used in a motel business.

Properties used for residential accommodation before December 2, 1998 are not subject to GST when later sold. Residential accommodation is not defined in the relevant legislation but in this ID the ATO concluded that a motel business was not within this reference to residential accommodation. As a result the taxpayer had to remit GST on the sale of an old unit that had not been substantially renovated.

Tags: tax
December 8th, 2009  |  Posted in Taxation, legal  |  No Comments »

Shopping Around Pays For Borrowers

Borrowers who assume there is no competition in the home loan market could be missing out on thousands of dollars in savings. A significant disparity has opened up between lenders on interest rates, fees and credit policies in the last 12 months. There tends to be a widespread view that all banks are the same, offering pretty much the exact same products with the exact same requirements. However when you make comparisons between lenders, it quickly becomes clear they are not all the same. Borrowers can potentially save thousands of dollars by shopping around for a deal that better suits their needs. One of the big differences between lenders was how much of the purchase price of a property borrowers could get access to. There are lenders requesting an LVR (loan-to-value-ratio) of 88 per cent with a deposit of 12 per cent, compared with a lender at the other end of scale that is requesting only a five per cent deposit. If you paid a 12 per cent deposit on your dream home valued at $500,000 for example, the lender would require $60,000 – versus $25,000 if you were required to pay five per cent of the property’s value. Also, once the LVR is more than 80 per cent, the lenders mortgage insurance premium kicks in – and this, too, varies between lenders. Borrowing limits could also differ between lenders, with some offering a $60,000 income earner up to $250,000 in finance, while others would provide up to $300,000.

Tags: mortgage brokers
December 8th, 2009  |  Posted in Buying Tips, For Investors, Interest Rates  |  No Comments »

Rental Hotspots Of Australia Part 2

The highest concentration of renters within Perth applies in West Perth where 62 per cent of local dwellings are rented.

West Perth, of course, abuts the CBD but it also flanks the grounds of the University of Western Australia.

There can be little doubt that the best markets for renters in Australia, outside the “company towns” operated by mining groups, are those places strategically positioned between the university and the CBD.

However the rental hotspot logic that applies so consistently in Sydney, Melbourne,

Brisbane and Perth evaporates in Adelaide and Hobart.

For some quite odd reason the highest concentration of rental properties in Adelaide is in the inner northern suburb of Blair Athol where 62 per cent of local dwellings are rented.

In Hobart the rental hotspot is in suburban Rokeby where barely 43 per cent of dwellings might be described as rental.

What seems to be happening is this: in the largest Australian cities the ability of students to commute from suburbia to university on the CBD fringe is limited due to congestion.

As a consequence students rent in specialised communities such as Carlton and West Perth, whereas in other places there is more of a mixed rental community, namely Waterloo and Fortitude Valley.

In the smaller and commuter-friendly cities of Adelaide and Hobart students and office workers for that matter are just as likely to be interspersed with mums and dads in suburbia. These cities have not become large enough to warrant their own student suburbs which are of course dominated by renters.

The lesson for investors is this: students, yuppies and other professional transients are good for business.

December 7th, 2009  |  Posted in For Investors  |  No Comments »