The auction market is still performing strongly but vendors of higher-end properties are opting for private sales instead of risking their home at auction, experts warn.

Real Estate Institute of Australia president David Airey warns that although the Melbourne market recorded a 68% clearance rate, the top-end is still struggling with discounts a common occurrence.

"The average price was only about $800,000. People at the top end have decided the best way for them to sell is through private sales, rather than risking through auctions. That’s the same across Australia, where the lower end is moving, but the higher end is more average."

Airey points to the sheer number of pass-ins occurring in Melbourne. The REIV figures suggest 325 properties were passed in, and Airey says more of these would have been likely in the top-end areas.

Christopher also believes the market in the top-end properties is moving slowly.

"It’s a very difficult market to read. I’d say the top end is quite patch. You could get some very good sales, but there are still records of properties that aren’t performing particularly well at all. It’s definitely a patchy market."

However, other markets have remained strong, these experts say. Melbourne managed record a 68% clearance rate out of 1,031 auctions, according to the REIV, with chief executive Enzo Raimondo pointing out that rate hasn’t changed during the past eight weeks.

"In light of the very high number of auctions this weekend the clearance rate of 68 that was achieved is a very healthy result and demonstrates that underlying demand is good," he said.

Some analysts predicted prices might drop due to the sheer number of listings. Auctions have backed up over the past few weeks due to the AFL Grand Final and the subsequent replay, while the upcoming Cup Weekend has brought forward some sales.

"Including this weekend’s activity, the REIV has seen average weekly auction listings increase by around 30% compared to winter; interestingly, the clearance rate for spring has not changed substantially, with around 68% of homes selling during the first eight weeks of spring."

Airey agrees, saying the result was "a particularly solid one".

But the rest of the country hasn’t performed so well. Christopher says Sydney’s result in the mid-50s reveals neither buyers nor vendors have negotiating control.

"That result represents a market equilibrium, where neither buyers nor sellers have control. However, that result does indicate that there could still be price rises occurring there."

"Outside Sydney and Melbourne, and putting Canberra aside, it’s a pretty weak market out there. I would argue prices are falling in southeast Queensland, and Adelaide is looking very slow as well."

Christopher also points out activity in the Northern Territory, which he says is becoming scarily bubble-like. "Darwin is a market that is looking very scary at the moment and very bubbly. When it turns, it’s going to be a steep ride down."

According to Australian Property Monitors, Sydney recorded a 56% clearance rate out of 501 auctions. Total sales came to $149 million.

Adelaide recorded a 63% clearance rate out of the 48 auctions on the market, with total sales coming to $9.9 million, while Brisbane recorded a rate of 30.4%, with 57 total auctions coming to a sales total of $4.8 million.

Story by Patrick Stafford www.smartcompany.com.au

The International Monetary Fund has warned that Australian real estate prices might be overvalued.

In its latest World Economic Outlook, cautions that a reversal in prices could hit consumers who have speculated on rising values.

"Given assessed mild overvaluation, a potential correction in house" prices "could hit household wealth and consumer confidence," the IMF has warned.

The cautionary language follows recent comments from the Reserve Bank that Australia’s property market shows "welcome signs" of cooling after earlier interest rate rises and the withdrawal of government stimulus.

Early fears of a property bubble have emerged after housing prices rose in the year to June.

The Reserve Bank’s head of financial stability, Luci Ellis, said yesterday that the Australian property market did not appear to be overheated.

However she said: "Buying an asset because you expect the price to rise in the future, well, that is actually the academic definition of a bubble. So that would be undesirable and seen as a problem."

In an earlier development, the Fitch ratings agency said it planned to "stress test" the impact of any downturn on banks and insurers.

Story by Peter Ryan Yahoo 7 Finance

A confluence of building approvals, housing price and population figures this week are likely to all point in one direction: the failure of housing policy in key markets to keep pace with the nation’s needs.

And there’s no sign of that changing. In just three weeks, the Australian Bureau of Statistics population clock will quietly tick over the 22,500,000 mark. On Wednesday the March quarter ABS demographic release is likely to show population growth continuing to ease from last year’s peak (the one beaten up by the Coalition during the election campaign) but is still decidedly strong.

The Federal Treasury’s Red Book briefing to the new government spelt out that strong population growth was probably inescapable, but added that it “is not necessarily unsustainable … it need not adversely affect the environment, the liveability of cities, infrastructure and service delivery", so long as governments planned well.

Well there’s not much sign of that. Federal and state housing policies have demonstrably failed but there’s no meaningful change. Tax treatment is a no-go area, infrastructure investment to make the most of what we have is lagging, social housing experiments are pretty much just that, experiments, and co-ordination of the three levels of government remains a rare exception rather than a rule.

The scariest story in yesterday’s press was the Sun Herald property watch column by SQM Research managing director, Louis Christopher. He was specifically addressing the Sydney market but this has plenty of relevance elsewhere:

“SQM’s vacancy rate series also reveals a tight rental market with only some slack at the very affluent end of the market place. Vacancy rates are at 1.3 per cent and ever tighter in Sydney’s west at a dire 0.7 per cent. And from what I can see there are no significant increases in new housing developments in the next two years for the local market.

“This is scary stuff and means only one thing for rents. Our forecast is for a Sydney-wide average rise of 5-7 per cent a year for at least the next two years. The west could record an even higher growth rate of 8 per cent-plus.”

Rent rises of that order encourage renters to try to buy – but if the new stock isn’t there, it increases price pressure that attracts Reserve Bank attention. While the RBA believes we don’t have a housing bubble, it has no interest in allowing one to develop. Having railed without apparent effect about the importance of increasing housing supply, Governor Glenn Stevens is left with the unpalatable task of heading off housing inflation with his blunt instrument while facing the bigger challenge of the terms of trade wealth surge.

Some real estate markets around the nation – most notably the Gold Coast’s many empty units – may be wobbly, but the Sydney and Melbourne influence remains strong.

The day after its demographics release, the ABS will publish its August building approvals numbers. No-one’s expecting much. While there have been signs the big banks are a little more open to business, property developers generally continue to be persona non grata.

APRA continues to monitor banks’ exposure to property very closely and I’m hearing stories of the big four starting to be more ruthless in clearing out their problem loans in the sector. They’re looking to quit loans that were sharply written down over the past two years. Catch-22 is hard at work though – buyers are scarce as the banks won’t provide the credit to enable them to buy.

The whole process is delaying the increase in housing supply the nation needs to avoid affordability worsening and to gradually wean us off expectations of ever-rising residential real estate. Our spend on dwellings as a proportion of GDP has been more or less flat for the past six years – and an increasing share of the spend has been on extending existing houses, rather than building new ones.

With our population growth, that is not sustainable. The RBA has told us as much a number of times. And now the clock is ticking.

Michael Pascoe is a Business Day contributing editor. Source: www.smh.com.au

Sydney’s yo-yoing auction clearance rate slipped to 57 per cent amid the bumper 588 weekend listings. There had been a 61 per cent success rate the previous weekend.

Clearance rates have averaged 67 per cent so far this year, the weakest weekend result being 51 per cent in early July.

The easing success rates, combined with the high number of properties on the market, has prompted suggestions that better buying conditions were on the way.

”It’s moving towards a buyers’ market, but I wouldn’t say it was there quite yet,” said John Edwards, chief executive of the real estate monitor Residex. ”Clearance rates consistently below 60 per cent is a buyer’s market.”

It was the second busiest Saturday this year – falling short of the super Saturday in March when 70 per cent of the 680 vendors sold their houses and units at auction.

Given school holidays and the grand final, there are just 170 auctions scheduled next weekend.

The weekend’s highest sale was a three-level, cliff-top Vaucluse house which sold pre-auction for $4.3 million. The six-bedroom house last traded at $4.1 million in 2007, reflecting a subdued 1.3 per cent annual growth.

Another Vaucluse house, a modernist house designed by Tobias Partners, was passed in at $6.7 million. It was initially listed early last year with $8.5 million-plus hopes. The three-bedroom, four-bathroom house was built in 2007 after the 696 square metre block cost $2.75 million in 2005.

In 2007 a neighbouring residence sold for $8.5 million, and although that house was new at the time, keen observers of Vaucluse real estate thought the latest offering was superior in design and finish.

Figures from Residex show Sydney’s price growth fell last month by 1.45 per cent to a $658,500 median house price.

Sydney unit prices also fell 1.16 per cent in the month to a $468,000 median. However, country NSW’s median house price rose 1.88 per cent to $342,500, according to the Residex data.

The Labor government’s agreement with independent MPs could help with property values in regional Australia, Mr Edwards said.

The government’s pledge to invest in building affordable homes in regional cities and to spend on infrastructure could be one of the most significant policy shifts of modern times, he said.

”Just the development of 15,000 new homes in regional Australia suggests a capital outlay in the order of $3.7 billion. I have for a long time suggested that the only way to solve the unaffordability crisis in our capital cities is to create growth in our regional areas and in turn encourage a good percentage of our city dwellers to relocate to a better lifestyle. This process will by its very nature reduce the capital growth rate in our most unaffordable capital cities but it will in the longer term be beneficial for society and ensure there is no housing bust that is so often suggested by many.

”It will cause a better balance between capital growth and rental returns in the future.

”This is because cities will have tighter rental markets with higher rental costs due to lower investor activity because of dwelling cost and expected lower capital growth rates.”

Story by Jonathan Chancellor Sydney Morning Herald

Larrikin carpenter Scott Cam, of Channel Nine’s Domestic Blitz, gives us his top ten tips for home reno projects. Scott tells us about essential tools for the DIYer’s toolbox (see our DIY section), the move towards building with sustainable wood products and gives us an insight about builders’ beer etiquette.

What are essential tools for the home handyman?

Scott: “The main thing to remember – when you are a home handyman or woman – is to not go too big too early and not have power tools that could cut your fingers off. So, I think hand tools are the most essential thing.”

Toolbox essentials

• Screwdriver set
• Pliers
• Multigrips
• Tin snips
• Wire cutters
• Hand saw
• Square pencil
• Level and shifter

What is the best power tool someone could buy? Or should weekend renovators just hire large tools?

Scott: “The most important power tool you can have is a cordless drill, one with a hammer component so you can drill into masonry or concrete or brick.”

“I don’t like the concept of people that aren’t really up there on power tools to go out and hire a nine inch power saw because it’s so easy to injure yourself with those. So if you hire power tools, make sure they’re small ones.”

What’s your favourite power tool?

Scott: “I’ve got about 300 power tools and 10 circular saws. I really like my chainsaw – it’s petrol driven – and my big circular saw. You have to be very experienced to use a big chainsaw and it can be dangerous for the home handyman.”

What is the most important building tip to remember when revamping your home?

Scott: “Be prepared to make sure you budget. Be careful of variations. If you’ve got a plan, stick to that, and don’t change things along the way because that’s when you get into strife and you’ll run out of money.”

“And be prepared, when you’re in old homes and you’re knocking a few things down, that you’ll have to rewire the whole place, as there’s no point putting wiring in when you’re half way through – so there’s $10,000.”

* Scott advises renovators to check the plumbing and electrical on homes more than 40 years’ old.

Where is the line between home renovation and home demolition?

Scott: “It’s based on your foundations. If you’ve got bad foundations from the start, which a lot of houses had in the old days, (when) they used to just lay the foundations straight onto the ground with no footings. Sometimes a builder or an engineer may need to get involved and say, ‘look there’s no point in renovating, here, it’s best to knock this down’.”

Easy building project for the weekend renovator?

Scott: “Without a doubt it’s to put a deck on the back of the house with a pergola over the top – creating a new room – an extension. It’s an easy extension to do and make it covered, so it’s all-weather.”

“You put a little clear roof on the pergola you knock-up; and a deck underneath that, put a table and chair out there, some blinds coming down to protect against the wind and the rain, and you’ve got yourself a full extension of your house. And even when it’s pouring with rain you can sit out there. It’s without a doubt, an easy way to add value to your home and get a better standard of living.”

Are people moving towards using more sustainable products? Are the products more expensive? Any special precautions people should take when using these products? For example, embedded nails.

Scott: “We use a lot of plantation timber these days in the building industry and I also use a lot of recycled hardwood, which is quite expensive, but it’s a great feature timber. It’s very hard for the home handyman to nail into second-hand hardwood – you’ve got to be on your game!”

“As far as treated pine is concerned, it’s the way to go for your outdoor stuff because it lasts a lot longer and the price is cheap. I think that’s the way we are going in this industry, if we don’t do that, we’ll run out of timber, so we’ve got to start using the stuff they can grow in the pine plantation.”

But if you’re after a bargain, visit a demolition yard, or scout around a house block where someone is demolishing a house, to get second-hand timber. This timber could have embedded nails in it – so take care!

The best advice for our weekend carpenters?

Scott: “Know your limitations, and once you start something, make sure you finish it! Don’t take two years to build it – start it and finish it!”

“And the other thing is, make sure you get beers nice and cold for the 5 o’clock knock-off. There’s nothing finer than sitting at the end of the day and having a cold beer and admiring what you’ve accomplished for that day. It just doesn’t get any better. It’s magnificent!”

Do you think the internet is helping people with renovation/building information? Is it making the building industry lose (or gain) business.

Scott: “I think it’s a great thing that people are doing stuff at home and people are getting stuck into it. I’m not real good on the internet, I need to get in there a bit more myself, but a lot of my friends go onto the internet and find out information.”

“If people do get out of their depths and go a bit hard, then it’s great work for us to come along and fix those things.”

* Article written by Angela Erini

Source: www.realestate.com.au

THE sale of a Karrinyup home without the owner’s knowledge by a Nigerian scammer has prompted an investigation by five government agencies and a warning to real estate agents to beware of fraud.

Roger Mildenhall, 64, was living in South Africa when his $485,000 Perth property was sold in June by someone posing as him.
The money is gone, but WA’s Registrar of Titles Bruce Roberts said Mr Mildenhall would be able to apply for compensation for his losses.

The Commercial Crime Division of WA Police, Consumer Protection, Landgate, the Real Estate and Business Agents Supervisory Board (REBA) and the Settlement Agents Supervisory Board (SASB) have joined forces to investigate the fraudulent sale and consider measures aimed at minimising the risk of a repeat occurrence.

Similarities to an attempted fraudulent sale of a West Perth apartment in 2008 will also be studied as part of the extensive review.

REBA Chairman Mark Cuomo said real estate agents had reported several other cases of attempted fraud recently and the number could rise.

“The fraud attempts might increase after the success of the Karrinyup case,” Mr Cuomo said.

“All real estate agents must now be increasingly vigilant against these types of scam attempts and carry out extra checks to verify an owner’s identity, particularly those who are selling local property while overseas.

“It would be an effective fraud-prevention practice that, if a property owner changes their postal or email address, they should send a confirmation to the old address to make sure the new address is genuine. Similarly, if phone and fax numbers change, try the old number to double check.

“We would also suggest to agents to ask questions of absentee owners that only the real owner would know, perhaps about the last sale or characteristics of the property.”

“Agents could also consider asking for selling fees up front, as scammers will most likely be discouraged from pursuing the sale or will make up excuses as to why they can’t pay them.

“The onus, however, is on the agent to exercise due diligence in these situations and to be extra vigilant. It is imperative that agents adequately manage the risks involved in these sales, and, ultimately, if there is any doubt, they should report their suspicions to the proper authorities and not proceed with the transaction.”

Officer-in-charge of the Major Fraud Squad Detective Senior Sergeant Don Heise said both these cases involved scammers from Nigeria with possible collaborators in South Africa.

“It appears there was an interception of the landowner’s mail in South Africa, where the fraudsters stole his identity and falsified a number of documents. These were then sent to the relevant real estate agent in Perth,” Det Snr Sgt Heise said.

Characteristics of the 2010 successful scam that could be a warning to absentee home owners, real estate agents and settlement agents are:

· Notification of a change of contact details, email and postal addresses of the property owner prior to the sale request;

· Sale was communicated as urgent for business or other personal reasons;

· Promise of future sales through the agent as an incentive to cooperate with a speedy sale and settlement;

· Documents from Notary Public in Nigeria, verifying documents and identity;

· Request for a short-term loan before settlement;

· English in some of the correspondence very basic or poor.

Commissioner for Consumer Protection Anne Driscoll said scams are now becoming more professional and more elaborate.

“The forging of signatures and the production of fake documents is, in some cases, highly professional so these scam attempts may not be so easily spotted. It’s important that all businesses have a system in place to verify the legitimate owner before money changes hands, especially if the person they are dealing with is unknown to them and comes from overseas.”

A checklist of what agents should consider includes:

· Check signatures with those that may already be on file from previous transactions

· If official documents look suspicious, have them independently verified by the issuing authority

· If a request for change of address is received for the property, send confirmation to old address as well

· If being asked to sell house remotely, ask questions about the property that only the real owner would know

· Consider a 100-point identity verification system which includes passport or driver’s licence with photograph and signature, as well as independent proof of address from employer or local council

In another fraud case originating in Nigeria, a number of Perth businesses have lost thousands of dollars in a ‘Yellow Page’ scam.

Consumer Protection earlier listed an alert on their website warning the public of a scam involving letters sent by a company calling itself “Yellow Page”.

This company advises the recipient of the letter that payment is outstanding for an advertisement for their business and demands payment of AUS $1548.00.

Police are urging business owners to be vigilant when processing invoices.

To date detectives have seized more than 1,500 envelopes destined for potential business victims and intercepted more than $140,000 worth of cheques sent back to the scammers.

Source: www.perthnow.com.au

Every year at exactly this time ‘Spring Fever’ hits the real estate market as owners all over Australia shout “enough!” and put their homes up for sale. Your Investment Property looks at how you can make your place stand out from the crowd in this frantic selling season. The ‘stay at home’ nature of a long, cold winter can lead to some life changing thoughts and deeds. There’s nothing like spending a great deal of time in your home to make you feel dissatisfied with it.

The vast majority of niggling irritations can be eliminated by the simple application of a new coat of paint to the living room walls, or a radical change of curtains. Some homeowners, however, emerge from winter with plans for a more permanent cure for their dissatisfactions. In real estate parlance, among those in the know, this is referred to as ‘we gotta sell this place and get something bigger/ smaller/closer/cheaper/in better condition … (insert your own personal gripe here, as appropriate.)’

Spring has always been the traditional time for properties to appear on the market in a rush. Recent mini-boom conditions in parts of our bigger cities have, however, led to a pretty healthy winter selling market as well.

But for those owners who are particularly garden conscious, or whose homes only look their best when the natural light starts reappearing through the windows, spring is the peak time to show their homes to their best advantage. In the 16 selling weeks between 1 September and 24 December, the race is on to sell and re-buy as fast as ink can dry.

Hands up those who can spot the obvious problem with the above scenario. Gold stars to those who said ‘oversupply’! If masses of houses are launched onto the market in one short period of time, how will yours be noticed? Will your aspirations for a wonderful new dwelling be skittled in the rush? How can your home stand out, be noticed, be loved and, above all, be bought?

It’s a jungle out there, and you need to start wielding your machete, today.

The view from the street

The sign is about to go up. People are going to be openly invited to notice your place. Human nature dictates they will also be judging it on some pretty tough criteria. Let’s look at some of them.

How’s your front gate looking? Need a coat of paint, a replacement of a paling, new hinges? Will it creak when it’s opened unless it’s oiled?

Would weeding help in the front patch of garden or paving? Are your edges neat? If winter winds have killed off your plants, get them out and put in some ‘potted colour’, such as petunias, which are inexpensive and look welcoming. Don’t forget to take their identification tags off! You want to make them look older than yesterday.

Take garbage bins out as late as you can and take them in as soon as they’re emptied, if possible. When they’re out, make sure they’re well closed so that no marauding cat or dog can get into them.

A flowering pot by the door is an attractive touch. If your finances won’t run to anything grand, borrow something grand from a friend or concentrate on filling a pot with an attractively scented shrub.

Your front windows should gleam, and don’t ignore the front door. Washing the front door may look odd to the neighbours but a good scrub will quickly remove street grime. Polish the door knob while you’re at it. Security doors have a habit of squeaking so get the oil can to it. If your doormat’s ratty, buy another one.

A side driveway should be free of clutter, such as skateboards or bikes, and any garage door should be shut. If there is evidence of mould on a pathway or driveway, get in the experts to wield one of those high pressure water jets or ask your hardware store for a solution you can paint on and sweep off.

View from the back

Around the back of the house, repeat the tidy-up plan, mow the grass and put outdoor furniture into configurations that suggest you use and like the backyard.

If you have a pool, you know about grief. If it has emerged from winter looking like something only a frog could love, start an improvement program right away. You don’t want the pool smelling of chemicals on your first open for inspection, so tackle the job slowly and systematically. Some sellers are tempted to give the house a lick of paint all over. This can be a very expensive idea, and half the potential buyers will hate the colour. The other half will be wondering what damp, cracks or other atrocity the paint is hiding. Unless it’s really bad, hose accessible walls down and leave the paint job to the next owner.

Sheds, storerooms, lean-to laundries, any room at the back of the house must be very neat. Gardening equipment should look organised; pool equipment tucked away. Rakes, brooms and other long-handled items can be clipped into storage units nailed to a garage or shed wall.

The inside story

Look at each room as if you’re seeing it for the first time. Now we need brutal honesty.

• Is it as clean as it could be?

• Is it cluttered? (90% of the people reading this would say ‘yes’ to that one)

• Do the carpets need cleaning?

• Boards need polishing?

• Curtains need dry-cleaning?

Natural light is a vital selling point for Australian homes, so concentrating on this aspect of every room is your first priority.

• Clean the windows

• Pull back curtains

• Pull up blinds

• Open the slats of the venetians

• Are your hallways or staircases Black Holes of Calcutta? You will be amazed at what a skylight can do, and for a very reasonable price of around $500– $1,000 per skylight

• If a room’s light will be enhanced by a coat of paint, go for a few shades lighter. This has the added benefit of making the room look bigger

A common ruse used by many sellers, which also relates back to light, is timing the open inspections for the hour when the most light appears in the most rooms. This may take a few days to figure out, but it’s worth the trouble. A cold, damp or stuffy house is a turnoff. Get the heaters into action or open the windows, as appropriate, before your inspection times to get the right ambient temperature and smell into your house.

Speaking of smell, at some inspections you go to, there will be the distinctive smell of fresh coffee brewing or of a cake baking. And Vivaldi’s Four Seasons playing in the background seems almost compulsory at some of the more up-market inspections. Fresh flowers will help. Freesias have a wonderful scent that will fill a room – but don’t overdo it. Back to clutter. Why do you think God invented garage sales? This is your big chance. The acid test for differentiating between ‘clutter’ and ‘precious’ is ‘do I want to spend hours of my life wrapping and boxing this stuff, unwrapping it at the other end and finding somewhere to put it?’ If the answer is ‘no’, it’s clutter. Sell it. Give it away. Remove it from your life. If you have been ruthless and your house is still museum-like, start wrapping and boxing some items and store these boxes with family or friends.

Coverings and cockroaches

Threadbare or worn carpets can be covered by borrowed/bought rugs. If carpet cleaning looks like a must, give yourself a good week after the cleaning appointment before your first ‘open’.

Give yourself at least two weeks after the pest sprayers have been in to remove dead bodies, or you’ll find would-be buyers finding bugs on their backs in every cupboard they open.

Floorboards, lino, tiles and cork floors can all be made to look like new. Ring the manufacturer or umbrella organisation (eg, a timber industry body) for care instructions.

Now, turn your thoughts to dirt, often a close relation of smells. Small children’s fingermarks on the walls, dog or cat fur, stains on the sofas, grey tile grouting, a fat-trap griller – all these are terrible turnoffs to would-be buyers, even if their homes look just as bad, if not worse!

Dirt and smell

Here are some quick solutions for getting rid of dirt and bad smells:

• Sprinkle some baby powder on the carpet before vacuuming for a fresher smell.

• Restrict your pets’ movements for ‘the duration’ so that you don’t have to vacuum every cushion or check in every corner for dead ‘treasures’ they’ve brought in to show you.

• A scrub with sugar soap will remove fingerprints, and it’s also good for those greasy rooms like the kitchen and any adjoining family room.

• Stains on sofas that will not come off call for a throw-over cover or slip cover. These are available in chain stores.

• A mouldy shower curtain should be replaced, and solutions to the perennial tile grouting nightmare include scrubbing it with a toothbrush and bicarbonate of soda (not a lot of fun), attacking it with an anti-mould solution or applying new grouting.

• The smell of damp can be eliminated, or at least disguised, with a product such as Damp Rid. If you have blocked drains, invest in a plunger or get the plumber out to visit.

Little maintenance jobs you’ve been putting off, like another coat of enamel here, or a touch-up on the skirting boards there, should be next on your list.

Lastly, tidy the places you think nobody would ever look, because people look everywhere these days, including in cupboards, wardrobes (even if they’re not built-ins!), medicine cupboards, inside the oven – nothing should surprise you. Leave these tidying and cleaning jobs for last, but don’t neglect them.

A common experience of sellers who’ve gone through the major spring clean outlined above is to fall in love with their homes all over again! If that happens to you, remember, there’s always next spring.

Selling your home checklist

• Have you informed your neighbours about inspection times? They may keep the noise down and even help you by sprucing up their gardens
• Have you cleared the bedrooms of clutter and removed unnecessary furniture? This will help highlight large bedrooms and make smaller ones look bigger
• Have you washed the curtains and blinds?
• Have you cleared all the junk from your verandas or the side of your home?
• Have you remembered to clean the windows?
• Have you checked that your home and contents insurance covers household items damaged or stolen during inspections?
• Is the garden looking the best it can?

Have you arranged for the pets to be looked after during inspections

This article has been republished with permission from Your Mortgage

It’s one of those clichés you’ll often hear in real estate … properties that are priced appropriately are selling. It seems so obvious, really. When you’re making such a big investment surely you’d only do it at the right price? But of course buying houses is emotional and there’s so much more that goes into it than rational thinking about whether it is money well spent. It could be the look and feel, the layout, or the location that sways one buyer to pay a whole lot more than the rest.

If you want to look at how complicated human decision-making is just look at how we pick which political parties will win government. Now that there’s a federal election looming, we’ll all have more than enough opportunity to gawk from the sidelines as votes are won or lost on looks, tone, sound, hair colour, and a little bit of policy, real or perceived.

Nevertheless, when it comes to houses, a lot of real estate agents are saying that buyers are being a lot more careful, and really weighing up where to put their dollars. Less competition from other buyers is providing house hunters with more choices, and they’re taking their time, choosing wisely, and demanding properties are up to scratch.

It’s one of those clichés you’ll often hear in real estate … properties that are priced appropriately are selling. It seems so obvious, really. When you’re making such a big investment surely you’d only do it at the right price? But of course buying houses is emotional and there’s so much more that goes into it than rational thinking about whether it is money well spent. It could be the look and feel, the layout, or the location that sways one buyer to pay a whole lot more than the rest.

If you want to look at how complicated human decision-making is just look at how we pick which political parties will win government. Now that there’s a federal election looming, we’ll all have more than enough opportunity to gawk from the sidelines as votes are won or lost on looks, tone, sound, hair colour, and a little bit of policy, real or perceived.

Nevertheless, when it comes to houses, a lot of real estate agents are saying that buyers are being a lot more careful, and really weighing up where to put their dollars. Less competition from other buyers is providing house hunters with more choices, and they’re taking their time, choosing wisely, and demanding properties are up to scratch.

Agents are saying many vendors are yet to catch up with the swift market cooling of the last couple of months and want higher prices than buyers are prepared to fork out.

I saw a great example of the old price-is-right mantra this week when I spied a sandstone home for sale. Double fronted, it looked like the perfect family pad – except that its immediate neighbour was the car park of a sex shop, and only four doors down, across the road, was a train line. Oh and it had a pretty busy road a few doors the other way.

It could have easily been a house that languished on the market while the vendor held out hoping that the prestige of the neighbourhood that it bordered might rub off. But the vendor was either in a hurry to sell or had a good sense of where the market was at because the home was priced at about $200,000 less than comparable places just a few streets away. On the first open there was a surprising buzz – not quite a swarm – but a healthy hum of activity from house hunters.  And less than a week later, a big SOLD sign was slapped up out the front.

Part of the problem for vendors is the market has been moving so fast lately that it’s hard to keep up. One moment it’s hot and the next it’s not. In pockets there’s still plenty of buying action, for example one Sydney agent says she had 53 people inspect a property in the trendy inner west over the weekend. But in others, real estate agents are ringing around trying to drum up interest.

When you’re selling working out what price you should go for is hard. But just as house hunters are told to find up to a dozen recent comparable sales when they are researching a house’s value, vendors can do that too. The advice for house hunters is to look at the prices places nearby have sold for in the last six months, being careful to compare apples with apples by finding properties that have similar land size, bedroom numbers, layouts and car parking. Sales in the last three months are particularly telling.

If you’re a vendor and you want to find out where the buyers’ thinking is in terms of money, you’d do well to do that research. That way you will find out which direction the market is going in your area, and will be using the same pricing method as your buyers. Of course, if you decide your home has special features and it’s worth holding out for a better price, you might just be lucky – after all spring is just around the corner and the warmer weather brings out the buyers.

Story by Carolyn Boyd – Domain.com.au

Don’t let the slow real estate market keep you from having the home of your dreams. You don’t have to move, you just need to improve. And this is the perfect time to do so.
Never before have all the stars been so perfectly aligned to facilitate the remodelling needed to give you your perfect palace. Materials costs have been lowered to increase sales, building contractors have reduced their fees to attract more clients, and interest rates are the lowest they have ever been. If you’ve ever wanted to tackle a home improvement task, this is the time to do so.
Here are five good places to start:

1. Kitchen Remodel - If your kitchen is tired and run down, this is a great time to remodel it. Cabinet manufacturers are pricing more competitively, granite prices have fallen, and contractors are itching to work. The contractors that were busy building homes during the housing boom are now fighting each other to get the kitchen remodelling jobs, and the homeowner is the one who wins. Since it is the kitchen that is said to sell the home, the improvements you make now will benefit you greatly when the market turns around and you put your home on the market.

2. Bathroom Remodel — No longer just a place to shower and shave, bathrooms have been elevated to spa status. If your bathroom doesn’t measure up, this is a fantastic time to bring it up to date. Popular improvements this year include heated flooring, natural materials such as stone and wood, multiple shower heads with massaging jets, higher counters with vessel sinks, and soft colours with mood lighting for that ultimate spa experience.

3. Bedroom Addition — There is always great value in adding another bedroom to your home. Whether you create an ultimate master retreat, a welcoming guest room, or a home office, the extra room will always increase your profits when you go to sell. The long line of craftsmen needed to implement a room addition are all willing to bargain now to get your job. From the architect to the contractor, to the carpet salesman, they are all offering the best deals in years.

4. Decks — Outdoor entertaining is a huge trend with homeowners, and adding a deck is a great way to welcome your friends to the great outdoors. From a simple square deck to a multi-level masterpiece featuring an outdoor kitchen, materials and labour costs have come down to make this an ideal time to take on that outdoor living project.

Story by Barbara Green – http://www.housingwatch.com
Barbara Green is The Design Diva and owner of Sensibly Chic Interior Design. She creates one of a kind interiors that reflect your taste, lifestyle and budget.

A friend is thinking of selling her house. It’s an upmarket place in a swish spot. Would it be appropriate, she asked me, for her to be there during the open homes, keeping the agent company? Maybe serving wine and cheese to tempt would-be home buyers (it’s a nice home, and her buyers are likely to enjoy that kind of thing), and to answer any questions about the property.

It’s generally something not done in Australia but it’s not uncommon on TV lifestyle shows to see the vendors, having spruced up their place, springing forward to open the door for house hunters, and then guiding them around the property while the agent lurks in the background.

Being on site during open houses could go either way. One of the things that makes buyers fall in love with homes is that they can imagine themselves living there, and they might find that hard to do with the owner on hand. Many also like the freedom to open and shut drawers, check if the toilet flushes properly and jump up and down on the floorboards, to see if everything is in working order.

You would have to be thick-skinned when showing your own house because buyers don’t generally hold back in letting their thoughts be known about the state of a property, the choice of paint colours or even the furniture. Sometimes it’s just the house hunter talking through what they might change to make it their own, but for sellers who’ve worked hard on getting the place to be just as they want it, that might not sound so nice. Then again you’re selling and it won’t be yours soon anyway, so you’d just have to grin and bear it, really.

On the plus side, you would get to hear first hand what it is that buyers don’t like about your place, and you might have the opportunity to make a few changes before future open homes.

As a would-be buyer I think I’d be 50-50 about whether I wanted an owner present while I was snooping through their place. Not that I’m rifling through their drawers (honestly) but it’s hard to meaningfully "inspect" something under pressure. It would be great to be able to ask the seller about the ins and outs of the house – however, I would not want them looking over my shoulder every step of the way. I’d be comfortable if they were there, but perhaps confined to the front room or the kitchen, on hand if I had any queries.

Real estate agents might not be so keen to have the owner hanging about either, or would want to set some ground rules about price quoting and impromptu negotiations.

Then there’s the question of whether having an owner on hand would add to the value of the property, or potentially detract from it. And sometimes that might come down to mood and manner because let’s face it, not all of us are people-people, if you know what I mean.

Carolyn Boyd is a property journalist and keen follower of Australia’s housing market.

Buyers are prepared to pay more for a Melrose Place-type environment.

When good neighbours become good friends, it can not only make apartment buildings much more enjoyable places to live but also boost the price of the property.

One of the key things professional strata record searchers look at in apartment blocks or complexes when they’re examining buildings on behalf of potential purchasers is how friendly, harmonious and happy the residents are.

"That’s definitely something that’s included in our strata reports," says the director of I&D Strata Searching, Matt Trachtenberg-Ray.

"What a lot of people fail to understand when they move into strata buildings is that they are moving into a community and the harmony of a building is just as important as how much they have to spend on fixing the concrete."

For as well as such harmony making a building a far more pleasant place to live, with neighbours chatting in lifts rather than enduring stony silences and greeting each other on common property, it also means it’s much more likely that disputes will be settled quickly and amicably rather than through expensive legal action.

"It’s the tone of a building that’s important," says the president of the Institute of Strata Title Management, David Ferguson. "A good building that’s supportive of the social fabric can be like having an extended family and, in turn, not to have a friendly building can be disastrous.

"It’s incumbent on people, and especially office-bearers, to make people welcome and run the building in a positive way. Where a building is known for a good living environment, there’s more demand for apartments and inevitably the competition will force prices up."

That might mean buildings that host book clubs, wine-tasting evenings, playgroups, social occasions, sporting ventures and even – such as in the case of the city’s Highgate building – group holidays in far-flung destinations, such as Yemen.

At the vast Jacksons Landing in Pyrmont, for example, there are Friday drinks, BYO dinners, quarterly meals in local restaurants, tennis, a singing group, dog-owner get-togethers, newsletters and an annual Christmas charity fund-raiser concert.

"A lot of people now know each other as a result of them and it really enhances the building," says Regina Knowles, who organises many of the events. "It creates a very friendly atmosphere, which people love."

Smaller buildings can be just as welcoming. In JoAnn Holloway’s 12-unit complex in Bexley, there’s an affable ambience. In-house dinner parties for residents are a regular occurrence and everyone pitches in if there’s a problem.

"It makes it a very happy place to live," Holloway says. "Occupants are always happy to help each other with chores, like moving furniture, gardening and even rescuing washing from the clothes line if it rains.

One elderly resident often passes on home-made biscuits and enjoys having a chat, while one time, when I was sick, a neighbour immediately offered to help and dropped off a meal. It’s wonderful."

It all comes down to attitude, says the vice-president of the apartment owners’ peak group, the Owners Corporation Network, Brian Wood. If people say hello when they pass each other and engage rather than ignoring each other, it oils the wheels of a building.

"A good atmosphere in a building is completely fundamental," he says. "If you have a good relationship with other owners, then you’ll get disputes or problems being resolved sensibly and practicably rather than escalating stupidly."

Indeed, friendliness is the very reason that Robert Dodds recently decided to buy into the Motto building in Erskineville. He was happy to buy a one-bedroom apartment for $510,000 – $20,000 over the reserve – because he has friends already in the building who say it’s a very sociable place to live.

"During inspections I got the feeling that it’s a bit like Melrose Place," says Dodds, in reference to the American TV show about the comings and goings of people in an apartment building.

"I liked this apartment’s big balcony, which will be great for entertaining, but the residents seem to be young professionals who are all pretty outgoing and friendly. It looks like a great place to buy into."

Midday at the oceana

On a sunny weekend, there can be any number of residents socialising over a glass or two down by the barbecue, cabana and pool at Elizabeth Bay’s 65-unit apartment building Oceana.

"It’s just a very friendly building, with great amenities, which we all share with goodwill during warmer days," says Ross Appleton, who’s lived there for nearly four years.

"We’re a diverse group of demographics and age groups but we do interact well and socialise with each other."

There are many formal, organised activities but, every Christmas, everyone gets together over drink and food. And after each AGM – instead of, as in some buildings, trying to tear each other’s throats out over disputes – everyone socialises, with wine, beer and nibbles laid on.

In addition, if there are any major issues happening, such as the proposal to extend the nearby Elizabeth Bay marina, nearly every resident is happy to sign a petition. "If there are any disputes in the building, the sociable, friendly atmosphere enables us to work out a way around it," Appleton says.

Oceana chairman Paul Johnson says it was a deliberate strategy to create a cordial feeling throughout the building. "We wanted to help people communicate more and it’s often much easier to raise issues when you’re talking over a beer," Johnson says. "It works very well."

Ice-breaker at horizon

Having a concierge in an apartment building often provides a pivotal point for residents to get to know each other, says lawyer Richard Gration. At his building, Darlinghurst’s Horizon, people will often stand and chat to the concierge and others will join in, helping to create a friendly atmosphere for everyone.

"The concierge is a significant factor in pulling people together," Gration says. "It’s almost an ice-breaker that gives people the ability to make contact with one another.

"We also have regular organised social functions for residents, especially designed to facilitate neighbours meeting each other. They are always very well attended, with around 80 to 100 people."

One resident paid caterers out of his own pocket for cocktail food while, for Horizon’s 10th birthday, a penthouse owner opened up his $15 million apartment for a function, which was attended by about 150 residents. There are also discussions happening about a tennis day on the complex’s court.

"A friendly atmosphere also means that the number of neighbour disputes tends to be a lot lower than that you’d expect from a building with 260 apartments," Gration says. "People feel they can talk to one another like adults rather than rushing off to the courts or to the CTTT."

Playgroup the key at Pacific Place

Enterprising apartment residents at one north shore complex have set up a playgroup to enable parents and toddlers to get together in a novel experiment to ensure a friendly atmosphere.

"This is great," says mum Linda Prankerd, watching her daughter Alexandra, 1, play with her little friends from neighbouring apartments at Chatswood’s Pacific Place.

"I’ve lived in quite a few complexes but people here have worked really hard to make this one extremely friendly."

The chairman of the 221-unit Epica building in the complex, Gerry Chia, organises an annual social that has now expanded beyond his building to include all four of the strata’s on the site. There’s also been a tai chi group at the complex, a card club, quilting club and all manner of social activities.

In an effort to increase the range — and allow the playgroup to meet even in wet weather — all the residents are now chipping in to pay for a community centre to be built at the complex.

"I think many people expect apartment buildings to be soulless places and that they’ll be lonely in high-rise," Chia says. "But that’s certainly not the case here. Of course, not everyone wants to be social but we’re ensuring it’s friendly for everyone."

Story by Susan Wellings –www.domain.com.au

I’ve been thinking lately of setting up the lounge in the toilet. The dining room table too, and maybe the kitchen, if I can squeeze it in. There’s the obvious matters of hygiene to overcome but at a pinch, you can always do at least some of the ho-hum toileting stuff in the old kitchen sink, as shown by New York Post editor Col Allan when he was on Aussie shores.

In this chilly weather it’s been easy to sort out where the warmest, sunniest part of the house is. Yes, the smallest room in the house is also the brightest, while the places you actually want to spend time in (for longer than it takes to read the morning news or a trashy mag) are darker and cooler than a cave.

In an old house it’s easy to think ‘well that’s how they did things 100 years ago’. But the loo in question is actually in a newish rear extension that also houses the south-facing kitchen and dining area. Someone needed to give that draughtsperson a compass and show them which way was north.

It’s little wonder that we have one of the highest environmental footprints in the world (per capita) if this is how we continue to design houses. Short of hanging out in the toilet all day, or the bedrooms (which also face north), enticing though it is to sleep until lunch, the only way to get warm in the "dark zones" that are the living areas is to really crank up the heater. Last power bill? $600. And that’s not even including the gas for the main heater, so you can probably factor in another few hundred dollars there. If the house design is hurting my hip pocket, it’s also sucking up a more natural resources than it has to.

The place I’m talking about is a rental. If it was mine I’d be tempted to call in a builder to sort the mess out. But realistically, it’s much harder and way more expensive to fix something once it’s built rather than just plan it well in the first place.

Admittedly it doesn’t help  that it’s a home with gorgeous old high ceilings, up near which there’s probably a metre-thick blanket of warm air floating, hovering enticingly above our heads. But I can live with them, they look great and help keep the house cool in summer, even though they’re not recommended in modern green homes.

But a home that takes advantage of the lower-in-the-sky winter sun and baths the living areas in warmth is high on my wish list at the moment. Building codes such as BASIX in NSW have done a lot to raise awareness amongst home builders that the direction you face your main living areas is important. But it seems there’s still a fair way to go.

It makes sense that as energy prices rise over time, home buyers will also be prepared to fork out more for energy-efficient properties that keep them comfortable and cut their utility bills. We’re not there yet … but we can only hope the day comes soon. Then many more homes would be designed with such basic but vital things as the path of the sun in mind.

Carolyn Boyd is a property journalist and keen follower of Australia’s housing market.

She writes for domain.com.au

There’s no denying that when it comes to property investing and making money from renovating, first impressions count. Changing the first impression of a property is the second highest returning “add value” technique. Here’s why…

BY ANA STANKOVIC

In this day and age most potential buyers start their search for properties online. They look up the locations they’re interested in, enter their budgetary constraints and select certain property profile details that they require.

Only once they’ve got the search results of this initial selection do they start prioritising which of these properties interest them. Out of the ones that look interesting to them, they’ll go and drive by a number of them and have a look at them from the outside before narrowing it down even further to a select few that they’ll actually inspect.

If a potential purchaser has two properties which are in the same area, have similar profiles (number of bedrooms, bathrooms and parking spaces) and are similar in price, which do you think they’ll be more interested in:

-       the one with peeling paint, falling down fence, big bushy plant hiding half of the façade, green eaves, rusted garage door, etc., or

-       the one that’s neatly presented and looks light and modern.

The answer is simple. It’s human nature to judge a book by its cover, but it’s only because they’re trying to imagine themselves living there. It doesn’t matter how good your renovation is inside if you can’t get potential purchasers through the door to actually see it.

It’s a numbers game. The more people come inside and inspect the property, the more are likely to be interested and pursue purchasing it, creating competition and pushing the price higher. So it’s in your best interest to get as many people through the door as you can.

Winning Formulas for Success on average gets around $4 for every dollar that we spend on renovating that first impression of a property.

So how do you work out what immediately needs to change with your first impression? There’s a simple way that a colleague of mine suggested a few years ago and it works a treat.

Stand on the opposite side of the street from your property and turn around so that you’re facing away from it, turn around and face it for five seconds and away again.

Anything unappealing that caught your eye in that time should be neutralised or removed. If there was a bright color, falling down verandah, rot, big plant, etc. – anything at all that stood out in a negative light – it needs to be addressed.

Once you’ve done this, have a look at other homes in your area that are in the next price bracket from your property – what are they doing? You want to increase the value of your home so it pays to try and get your property to look more similar to higher priced ones in the same area.

Ana Stankovic is well known as one of Australia’s leading renovating-for-profit specialists and is regularly featured in prominent industry publications, expos and continually educates investors. To find out more or sign up for Ana’s free newsletter, visit www.RenovateAndProfit.com.

Story from the API Blog

Having an understanding of median sale prices can add an extra dimension to your property purchasing skills.

Take care not to confuse median sale prices and average sale prices, the two numbers can vary enormously.

Averaging adds up property prices in a list and divides by the number of properties. The median price is the figure in the middle of a range of numbers arranged from lowest to highest.

So, if you have  11 properties, the median price would be the price of the 6th property from lowest to highest. There will be five properties below it in value and five properties above it in value.

Median and average prices can be quite similar if the prices form an even range from high to low. However, if the list of  11 properties has  eight low priced and only  three  high priced properties, the median value will look low compared to the average value. Conversely, with three low priced and eight high price properties, the median value will be higher than the average value.

Median prices are usually quoted by suburb/area or by a time period.  Suburb figures are usually calculated on the previous 12 months. Areas with less than 10 sales during that time don’t give enough data to generate relevant figures.

Comparing different areas with similar median prices can help make better sense of what median prices are all about.

Capital city medians are a good guide for suburban house prices, however houses within five kilometres of the CBD will have a much higher value than the median price for that city.

While median prices can assist as broad indicators and allow comparisons between cities, looking at recent comparable property sales in specific areas will always give the clearest understanding of the market you are in.

The best understanding of property values will be a combination of both median pricing – a macro view – and individual property sales in your target area, giving a complementary micro view.

Story by Sally Howes Domain.com.au

Overall lending for property is on a slide and on the surface that looks like bad news for property investors. But a deeper look at the numbers suggests there is an upside.

Australian Bureau of Statistics figures show the number of home loans dropped by 3.4 per cent in March, following a 1.8 per cent fall in February. It’s the eighth fall in the past nine months.

Approvals for investment loans, however, are going the other way with a 3 per cent jump in March. Looking over the longer term, the trend becomes clearer with investment loans up by 24 per cent on this time last year and home loan approvals down by 30 per cent from six months ago.

When combined with a demographic analysis of an area, lending patterns can give us a very good indication of what is likely to happen to property prices in these markets.

For example in a suburb such as Glebe in Sydney’s inner west about 55 per cent of all property is owned by investors.

Investors target this kind of area because there is a strong tenant demand due to the closeness to the city, university, shops and cafes.

A significant jump in investment lending is a clear sign investors are active in the market. When this happens they compete for property in places such as Glebe and put significant upward pressure on prices.

About 45 per cent of people in Glebe own the property they live in so there will be a level of softening demand from buyers but it will be compensated for by the investors.

This differs greatly from an area such as Kellyville in Sydney’s north-west. Investors control only about 13 per cent of property in this area.

Although it is a great area to live and raise a family in, Kellyville does not have the kind of infrastructure that tenants are looking for. Therefore demand from investors is weak and will have minimal impact on property values.

However, about 85 per cent of property in Kellyville is owned by people who live in their property so the drop in owner-occupier loans is likely to have a significant impact on demand.
If interest rates continue to climb and demand continues to soften, the chances of property values falling are increased.

The property market is made up of various sub markets that can be pulling in different direction at the same time. As an investor, it is vital to understand which market you are getting yourself into and how to interpret the raw data that will affect the growth pattern of the property you wish to buy.
America’s favourite investor, Warren Buffett, once said: "I’d rather be vaguely right than precisely wrong."

Once you get your head around how to interpret raw data you will have a greater chance of being "vaguely right" and therefore a successful investor.

Mark Armstrong is a director of Property Planning Australia, www.propertyplanning.com.au