Apr 27
0

Negative gearing reduced to schoolboy debating

By | Economy, Investment, Negative Gearing, Property Research, Real Estate, rent | No Comments

Negative gearing reduced to schoolboy debating

“Negative gearing reduced to schoolboy debating” states one of our most respected papers today. It was also said that the only thing worse for a government than houses becoming more expensive is houses becoming cheaper…. so Mr Turnbull has now set one of the big issues for the coming election on negative gearing. Rather than keep repeating what negative gearing is all about, take a quick lesson from our FAQ page click here (8th question down on the list): http://propertyinvest.co/property-investment-frequently-asked-questions-faqs-information/

This is the 4th blog we’ve written on negative gearing in the last couple of months simply because it’s such a hot topic! I do think this is the best headline we’ve seen yet; a headline that really captures what all the fuss is about – lots of shouting, lots of claims and counter claims, big assertions and at the end of the day ‘schoolboy debating’ with a confusing outcome.

The Prime Minister says no change to negative gearing or capital gains tax

The Prime Minister says no change to negative gearing or capital gains tax

So let’s just try and summarise again what the two sides are saying. Let’s look at the current Government position and Mr Turnbull first:-

  • No change at all to people who wish to buy an investment property things to go on as is.
  • No change at all to capital gains tax things to go on as is
  • No change at all to our current system – nothing is going to change!

Hopefully this is quite clear to all.

Now for the leader of the opposition who does want some change to property investment and people hoping to purchase an investment property to assist with building asset for their future. Firstly, for those who currently own investment property:-

  • No change at all to people who own investment property
  • Slight increase in capital gains tax (maybe?)
  • No change at all to everything else

Quite clear? Mr Shorten will ‘grandfather’ current rules so no one who currently owns investment property will be affected by new rules. The big change he does intend making is that negative gearing will not be allowed on older investment properties purchased after 2017. However, if you purchase a brand new investment property, then there will be no changes at all!

Hopefully this makes the implications of all the debate simple and clear.

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Apr 27
0

When will Sydney House prices boom again?

By | best investment, Economy, News, property cycle, Property Research | No Comments

When will Sydney House prices boom again?

The question already being asked, now that Sydney house prices seem to have peaked is “When will Sydney House prices boom again?”

House prices drop in almost all of Sydney’s suburbs over the last two quarters has seen the median house price dip below $1 million.

investment property growth in six years time?

investment property growth in six years time?

Many state that after a three-year property boom, Sydney’s house prices have fallen for the last six months indicating that the boom is clearly over. In fact, with the exception of 2012 which was a pretty ‘flat’ year in Sydney, the boom just over actually started in 2010. This makes the growth ‘boom’ period nearer to five years rather than just the last three years. Of course, the only areas that showed any good growth in from 2010 to 2013 were the Eastern Suburbs, Lower North Shore and Inner West. After the lull in price growth during 2012, we then saw the ‘ripple effect’ take hold as price increases rippled out to our outer suburbs. This was all quite predictable although the large percentage gain on median property prices over this period was a surprise to most. It just wasn’t expected to be such a big boom!

Since September 2015, when the median house price reached $1,045,000, the median Sydney price has fallen below the $1 million mark. The big question is “Where to from here?”

If history is any guide, the next boom is only five or six years away…. it nearly always is after the peak of each growth cycle.

We just need to keep a close eye on supply tightening up, Sydney population growth, the general economic conditions, unemployment and job growth, increasing rentals and affordability based on how much our average pay packets increase over the next few years. When we see all of the above begin to increase demand, then we’ll know that we are at the beginning of our next Sydney growth cycle.

Read more click here; http://goo.gl/oPgD2e

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Apr 21
0

Good news for Sydney’s first home buyers

By | best investment, Investment, Market, property cycle, Property Research, Real Estate | No Comments

Good news for Sydney’s first home buyers .. . and not much to worry about for property investors

So Sydney has a median price below $1million again. The latest data published by Domain shows that a median priced Sydney property will only cost $995,804! This is an almost 4.7% drop from the peak prices of six months ago.

property-bubbleInterestingly, this percentage drop is slightly more than the house price drop of 2008 to 2009 at the height of the global financial crisis. It is the largest drop since the end of the last Sydney house price growth cycle of 1996 to 2003. For those with longer memories of the end of the last growth cycle in Sydney, it’s not a lot to be concerned about and in fact, is pretty much the expected outcome after such a long and large period of price growth.

We should try and cast our mind back to 2004-2006 after the end of the last Sydney ‘boom’ in 2003. The next headlines which we will be seeing pretty soon will concern the number of investment properties sold off plan to property investors in 2014/15. As prices drop and we approach an oversupply of units, bank valuations will not nearly match the prices paid by investors in these ‘late purchase’ off plan investments. A bank valuation of say 15% less than the purchase price may mean that the potential buyer can only borrow 15% less than was originally intended. Investors will not be able to borrow enough to settle and/or will walk away losing their deposits on units that are now not worth as much as they are paying for them. The result will be that more inexperienced developers will be forced into liquidation and there we have a whole new set of headlines coming our way.

Maybe I’ll refer you back to this blog in a few month’s time when the first headlines appear. The moral of this story?  It’s all cyclical.

Apr 21
0

Sydney’s rental affordability crisis for low income earners

By | Investment, Market, News, rent, Research | No Comments

Anglicare’s recent survey into affordable rent in Sydney and the Illawarra has found that it getting almost impossible for couples on Newstart allowances or and single pensioners to find a rental property they can afford. It’s not much better for pensioner couples.affordable properties

If they want to live within 20 km of the Sydney, then it becomes impossible to find any investment property that can be rented by people on our lowest incomes.

The survey found only 76 properties advertised across greater Sydney and the Illawarra on April 2 and 3 would not leave someone on income support payments facing rental stress. Rental stress has been defined as spending more than 30% of income on accommodation.

This is maybe not too surprising with the huge growth in property prices reported in Sydney over the last 5 years but it is maybe more surprising to find that  only nine properties were found in the Illawarra.
Read more: http://goo.gl/LuOeGT

Apr 21
0

How to make money by understanding property cycles

By | best investment, finance, Investment, property cycle | No Comments

McGrath Real Estate Shares lose 31% after trading stop

One of our best known Real Estate personalities, John McGrath, has proved just how well he understands the cyclic nature of the property market. He has not made his money on buying and selling investment property this time but in McGrath Real Estate Shares when he floated his company on the ASX at the top of the property growth cycle in Sydney in December 2015.

Mr McGrath listed his company on the ASX at the peak of the Sydney housing boom, at the obvious peak of his company’s earning potential and walked away with a cool $30 million plus for his efforts. Will it make such a difference now if McGrath Real Estate Shares lose 31%.Mcgrath

Like many other experienced commentators, Mr McGrath expected the market in Sydney to cool after December 2015 and was suggesting that investment property investors should look at South East Queensland as an area with much higher potential for short-term growth than the ‘hot’ Sydney market. It is very surprising that Mr McGrath is now reported to be claiming,

“an unforeseen low volume of listings and sales in the first half of April, particularly in the north and north-western suburbs of Sydney, has led to an earnings downgrade for the 2016 year.”

McGrath, which listed in December, has seen its share price fall by as much as 31 per cent when it came out of a trading halt. The share closed down 40¢ to 90¢. They last traded on Thursday at $1.30. I suppose the big question must be, was this really a much larger drop in the market than he expected when the float papers were prepared at the end of last year?

To us, it does demonstrate the power of understanding the property market and timing things correctly to get the most out of your investment – whither it is real property investment or just selling up your Real estate Company!

Full story: http://goo.gl/FSBEq2

Apr 04
0

Population increase – more property investment required?

By | best investment, Investment, News, Properties, Property Solutions | No Comments

More overseas-born Australians today than in the last 120-years  

The percentage of Australian residents born overseas has increased every year for the past 15 years and, in June last year, reached 28.2 per cent, or 6.7 million people. This is the highest percentage rate since the late 1800s.

population

 

Data from the Australian Bureau of statistics released this week shows that the percentage of people born overseas has increased again. Little wonder, with these still very large new migrant numbers the demand for housing is growing and we see more and more of our suburbs in the larger cities with median prices going over $1 million. Little wonder that low income earners are finding it almost impossible to find and rent affordable places and little wonder that our vacancy rates for investment property are still very low and below what most would term a balanced market.

A surprise for some shows that residents from the UK remain the largest group of overseas-born residents at 5.1 per cent of the population. Kiwis make up the next largest group at 2.6 per cent, followed by 2% China, 1.8% India and 1% for both the Philippines and Vietnam.

Victoria, again, welcomed the largest number of interstate migrants with a net gain of 10,200 people making it our fastest population growth state, followed by Queensland with a net gain of 8800. NSW suffered a loss of 6600 although it did received the highest number of overseas migrants totalling 66,100 last financial year so the population of NSW is still growing strongly even although we have the highest number of people leaving the state to go interstate.

Little wonder the demand for rental of investment property is increasing in various parts of the country. Keeping an eye on these figures is important in choosing the best suburbs for property investment but the numbers should also give property investors confidence in finding permanent renters for their property investment.   Read more: http://goo.gl/nbrirR

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~ Lime Property Solutions

Apr 04
0

Australian Real Estate Agents Aren’t so Bad!

By | best investment, News, Properties, Property Research, Property Solutions, Real Estate | No Comments

Australian Real Estate Agents Aren’t so Bad when you view some of these headlines from overseas!

Some Terrible Real Estate Headlines

  1. Government introduced the Fair Housing Enforcement Program – helps rid Real Estate industry of discrimination and ensures a level playing field for buyers of all ages, races, disabilities and economic positions!
  2. Property is resold multiple times, making profit each time for the agent!
  3. Government is cracking down on Airbnb rentals.
  4. Huge Increase in Stamp duty for properties over 1.8 million!
  5. Prices May crash as World Cup Finals move location!

 

All of the above are recent stories from around the word concerning property and property investment; fortunately non are from Australia! To read the full story go to : http://goo.gl/14EmKh

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~ Lime Property Solutions

Apr 04
0

Good information for your next investment property

By | best investment, Investment, News, Properties, Property Solutions | No Comments

Good information for your next investment property – choosing the best design for an investment property

An increasing number of Australians over the age of 40 are turning to share housing, with this in mind we have some good information for your next investment property.

As house prices and rents climb, more and more 40 plus year-olds are finding that the only way they can really afford to rent, particularly in the inner suburbs of our cities, is to move in with a flat mate.

This should guide clients interested in property investment in their selection criteria for a good apartment. Of course, the first thing we look for is a property that will be most appealing to future owner-occupiers in the area; we consider our exit strategy before we purchase. Another critical factor to consider is the investment property’s appeal to local renters. Now with an increasing number of single mature people looking for shared housing, as well as the very significant numbers of young professionals also looking for share accommodation, it is essential to ensure that your new property investment has at least one bathroom for each bedroom.

A recent Domain article highlights the increasing number of Australians over the age of 40 turning to share housing. Their data comes from share house listings service flatmates.com.au.

Between the start of January and end of February this year, the number of people over 40 looking for accommodation on the website jumped – relative to the total number of people looking – 20 per cent year on year.

It’s not surprising when we see the median rental price for an apartment in Sydney is $500 a week and it’s not much less for a well located apartment in our other major cities.

The concept of Share accommodation is no longer just housing for those moving out of the family home or for students; sharers have become far more diverse and include anyone from young professionals, single mums to retirees and or downsizers.

It’s information property investors should note when looking for that new investment property.

Read more: http://goo.gl/ksiQWI

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~ Lime Property Solutions

Apr 04
0

Sydney Auction clearance rates

By | Auction, Financial, Investment, News, Properties, Property Research, Property Solutions, Research | No Comments

Sydney’s auction market – A tale of two cities?
Sydney Auction clearance rates are in the news again. The Sydney weekend home auction market may have passed its biggest test of the year so far. Another ‘Super Saturday” has passed (aren’t most Saturdays ‘super Saturday’s now?)  and according to those deeply entrenched in the Real Estate industry like our fiends at Domain, it was all good news.

Thanks to our extremely expensive areas of the inner west, lower and upper north shore and the northern beaches recording clearance rates of over 92% in the lower North Shore to 85% in the inner west, we can ‘boast’ a reasonably healthy Sydney clearance rate of 75.8%…… So the question is how does a North Shore clearance rate of over 92% translate to a Sydney clearance rate of 75.8%?

Well a closer look at greater Sydney will show a clearance rate of approximately 0% in the few auctions in the Blue Mountain, The Central Coast showed only 57.9% while one of Sydney’s strongest growth areas in 2015, The South West was way down at just 45.7%

The past weekend’s Super Saturday of auctions may well prove to be the biggest auction day of the year for 2016.

Auction-market

 

There were 911 homes listed for auction on Saturday, which was well below the all-time auction record of 1128 set over Easter Super Saturday last year at this time. Sydney Auction clearance rates.

The inner-suburban, higher-priced regions continue to show good results, in sharp contrast to outer suburbs to the west where clearance rates remain considerably lower.

Full story: http://goo.gl/spsZc2

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Apr 04
0

Brisbane prices set to rise with increasing employment

By | News, Properties, Property Research, Property Solutions | No Comments

Unemployment falls again and South East Queensland is the outstanding performer

Brisbane prices are set to rise with increasing employment. The unemployment rate dropped back to 5.8 per cent in February, as the job market grew and the participation rate shrank.

The official rate compares with 6 per cent in January.

‘Great news for Queensland’

brisbane

 

Queensland’s unemployment rate has tumbled to its lowest level since November 2011 at 5.6% just marginally higher than NSW. Lower unemployment is a factor which will affect Brisbane house price growth. Lower unemployment in Queensland is being accompanied by better state economic performance, also an indicator of further property price growth.

The Australian Bureau of Statistics said on Thursday that employment edged up just 300 in the month, with almost 15,900 new full-time jobs offset by a fall of 15,600 in part-time jobs. This compared with economists’ expectations of a net 13,500 gain.
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http://goo.gl/a4ZkWO

http://goo.gl/4bYOOB

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~ Lime Property Solutions

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