A sudden increase in the planned stock supply of inner-city apartments should have us singing if we’re to believe spruiked reports of a huge housing shortage. However while the need for affordable rental accommodation is growing, with recorded low vacancy rates in many inner city suburbs, high-rise apartments are unlikely to satisfy the large number of homebuyers struggling to get a foot on the property ladder.
BY CATHERINE CASHMORE
Plans have already been rushed through for a rumoured 35 per cent increase to the existing supply in Melbourne with no regard for numerous complaints by both residents and council who argue existing suburbs are not able to cope with an escalation in congestion, not to mention the visible impact high rise has in diminishing house prices in neighbouring streets. The projects are largely marketed towards investors both here and overseas who currently see our strong dollar as evidence of a safe investment haven. Unsustainable rental guarantees are often offered as an incentive to buy in, however once the guarantee expires rents drop and purchasers are left struggling with higher costs and little, if any, capital growth. Read more →
Many experts encourage investors to diversify their portfolio. By investing in a variety of assets the theory is that you reduce your risk. If one asset isn’t performing well, another might be doing better and it can therefore balance out.
I’m not sure I subscribe to this theory though. That may have something to do with my bias towards property – for obvious reasons. But I think if you’ve found an investment that works then why not stick to it? Why put money into the sharemarket or other forms of investment simply because experts recommend diversifying?
BY VANESSA DE GROOT
If you stick to one type of investment you can improve your knowledge base and hone your skills in that area. If it’s property you can find the best ways to finance your portfolio, you can work out what are the best types of property to buy and even how to renovate and perhaps make even more money on your investment.
If you stick to the sharemarket then you can do the same – you can become skilled at when to buy and sell perhaps, as well as what shares to buy and how the market works.
Read more →
The most common reason people make any investment is to set up a comfortable nest egg for when they retire – and property is no exception. The last thing anyone wants to happen to their retirement fund is to watch it go up in flames and have to start from scratch.
BY DAMIAN SMITH
And while the right choice in property can often seem lower risk than stocks, remember you can’t wrap a rental property up in cotton wool or watch it 24 hours, seven days a week. But if something happens you want to know you and your investment are protected.
Luckily there’s a range of insurance options for property investors that will cover both the property and the hand paying off the mortgage. I can’t stress enough the importance of insurance when it comes to your investment property. It’s something you should consider as soon as you are ready to make the purchase. The big three that you should consider are: landlord protection insurance, income protection and life insurance. You should also consider home and possibly home and contents insurance if you have furnished the property as well. Read more →
One of the arguments you’ve heard from me in the past is that our property values will be underpinned by (amongst other things) a shortage of houses. You know – the old supply and demand equation – and that it’s out of kilter as we’re not building enough houses for our growing population.
BY MICHAEL YARDNEY
But when we talk of a housing shortage it’s important to remember that there isn’t one property market. And there isn’t a housing shortage everywhere.
While there are definitely some areas where there’s more demand than supply, like in some of the lifestyle inner suburbs of Melbourne, Sydney and Brisbane, there are other areas where there is no housing shortage. Read more →
Why would you pay a real estate agent tens of thousands of dollars in commission to sell your property to the next-door neighbour? And why should agents who make such close-to-home sales pocket full fees?
Believe it or not, these sorts of sales happen all the time all over the country with sellers paying not only sales commissions and marketing/advertising expenses but also, in the case of sales by auction, the auctioneers’ fees and other not insignificant auction expenses.
BY TIM O’DWYER
This is the reason that, whenever I see clients putting their properties up for sale, I strongly suggest that the first thing to do is to approach the neighbours. Not just next door, of course, but for a block or two in all directions. You might be surprised to find, I say, that someone not too far away may be very interested in buying your property. And, if not your neighbours themselves, friends or family of theirs might turn out to be keen to buy your property. Trust me, this is not wishful or fanciful thinking on my part. You have only to read the weekend newspapers’ auction reports for occasional proof. Read more →
Freshly released results from the Mortgage Choice 2010 Consumer Sentiment Survey show the desire to buy property is so intense among Australians that they’re prepared to make sacrifices to get what they want.
Around 35 per cent of the 1061 Australians surveyed indicated they will buy a property within the two years to November 2012, with 36 per cent planning to purchase an investment property, 33 per cent their next home and 31 per cent their first home.
Of those, some 60 per cent said they would have to make some kind of sacrifice in order to be able to buy property.
BY VANESSA DE GROOT
The top five sacrifices survey respondents were prepared to make were: cutting back on spending (84 per cent), missing out on an overseas trip (50 per cent), buying a less expensive property than desired (35 per cent), remaining in their current job (30 per cent) and taking on an additional job (20 per cent).
Starting a family was also named as a sacrifice people were prepared to make for property. Read more →