Category: Perth Property News

Waiting for Proof the Perth Market has Bottomed (You may want to rethink your strategy)

 

Homebuyers and investors waiting for proof the market has bottomed out may want to re-think their strategy.

The practice of sitting back and waiting for confirmation the market has definitely bottomed out could be a costly move.

Many buyers want to have certainty, so they stay away from the market until they see strong evidence of price growth across the board.

This tendency means when the market is at around the bottom, there are less takers and it can present the perfect opportunity for astute buyers to potentially snap up a bargain from a keen seller and give you a head start on others.

Making the most out of property investing is about the right property choice and time spent in the market, rather than trying to time the market – and this is certainly true for the Perth market right now, so if you delay buying, you risk missing out.

Selecting your ideal property

However, buyers must remain aware that just because there are properties available does not mean they are good investments and selecting the right property is crucial. Similarly, some sellers are still asking too much, and those overpriced properties will be left sitting even as the market turns.

The majority of our enquiries are for add-value properties – those where the price is good to start with and then offer potential for adding value quickly, making it even better. People are wanting to be more in charge of their own destinies – I guess because the market has messed them around a little in the last few years.

So being back in control of decisions relating to their financial security and future is paramount in the minds of investors in the Perth market. Self-Managed Superannuation Fund buyers, and those people looking to escape the rat race through investment are key players at present.

They are buying now because sentiment is turning and for the good properties there is already competition, meaning prices may soon start to edge up.

Choosing the right suburb

Choosing the right suburb is critical. Areas close to the city, the ocean or river are where people most want to live. Next best is having easy access to these lifestyle attractions along with others such as shops and cafes.

Being close to work opportunities and good schools ranks highly and fly-in fly-out workers want easy access to the airport.

Areas that have good long-term prospects – not just flavour of the month and not just because next year is expected to be good – you need it to continue being good.

Also, where you can get good add value opportunities, whether they be renovation, subdivision, development, future rezoning or just that extra X-factor that sets it apart from others.

If you want more information about property investing, why not read our Property Investing Beginner’s Guide eBook.

If you’re not sure what type of strategy would best for you or you would like to learn more about different strategies, why not download our 4 Strategies to Success fact sheet.

Or, if you’re ready to talk about buying your first home, why not complete our Getting Started form to get the ball rolling.

Need finance?

If you’re ready to invest and you’ve got any questions about finance, call us for a free Financial Health Check: 08·9381·7450 or download our Finance Services information.

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Property Wizards believes everyone has the right to the knowledge to help you accumulate wealth, no matter your background, education or income.

We can help you unlock the potential of the real estate market for your family through savvy property selection, negotiation on price and conditions, development expertise and the magic of robust research.

Regardless of market conditions, our research, local knowledge, and access to silent sales means we find the hidden gems that can outperform the market in capital growth and rental returns for long term wealth creation.

Importantly, we’re able to provide property investors and homebuyers with the same level of representation that property sellers have benefited from for years.

Your property portfolio is your path to financial freedom and the lifestyle you’ve been longing for.

Property Wizards takes away the stress of buying a property and saves you money at the same time. We can show you how, or you can sit back and let us do all the hard work for you.

 

 

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What the Federal Budget means for Perth investors

Looking at the Federal Budget
We’ve had a month now to digest the Federal Government’s May 9th Budget release and the impacts its measures will have on the real estate industry. Housing affordability was an important feature of this budget, with several implications for first home buyers and investors. No matter what your interest in property, we’ve outlined the key measures here.

If you are an Australian investor:

In the lead up to the budget, the media reported a lot of chatter about sweeping changes to negative gearing. Despite this, the Government has chosen to support the property market by maintaining most of the current capital gains tax and negative gearing rules, with two main exceptions.

If you’re looking interstate for investment opportunities, bear in mind that the deduction for travel expenses associated with your investment property has been removed. And if you have previously travelled to inspect your property and also have a bit of a holiday, you can no longer deduct the portion of travel costs relating to your property.

The depreciation allowances have been changed for investment properties purchased from 9th May 2017. Going forward, plant and equipment depreciation deductions can only be made on expenses that you incur personally, or on a brand new property. Plant and equipment assets installed by a previous owner, such air conditioners, dishwashers, carpets and curtains, will no longer be claimable. You will still be able to claim eligible plant and equipment depreciation on assets in investment properties you owned prior to 9th May, and you will still be able to claim depreciation on capital works deductions (for example, the installation of a patio) carried out by previous owners.

The Budget also includes $1.3bn for an agreement to deliver housing supply targets, $1bn towards removing infrastructure impediments to development, and will increase the CGT discount for investments in affordable housing. These measures are designed to both contribute to downward pressure on prices and encourage the development of new housing stock, making housing more affordable.

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If you are a first home buyer:

Housing affordability is one of the cornerstones of this budget, and the measures outlined above are designed to make it easier for you to get into your first home. Investors are being incentivised to increase the housing stock available, pushing down prices.

To make it easier for you to save your deposit, you will be allowed to salary-sacrifice up to $15,000 per year for up to two years into your superannuation fund, which you will then be able to access for a deposit at concessional tax rates. These contributions from your pre-tax salary may then also lower your tax bill, meaning more money in your pocket at tax time.

Other measures in the Budget include the promotion of rent-to-buy and other shared equity schemes, and encouraging over-65’s to downsize their family home by allowing them to make a non-concessional contribution of up to $300,000 from the sale into their super fund, freeing up larger houses for families.

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If you are a foreign investor:

This budget has made it tougher for you to purchase an investment property in Australia. You will still be required to buy a new property, however developers are now limited to selling no more than 50% of a development to foreign investors. Further, there have been changes to foreign resident’s capital gains tax, with the rate increasing to 12.5% and the threshold dropping from $2m to $750,000. You’ll also want to have a great property manager on board, with homes vacant for more than 6 months incurring a levy of $5,000+.

Overall, the measures introduced in this Budget are likely to have a positive impact on Perth’s real estate market, making properties more affordable and boosting the available supply. The removal of travel expenses will encourage local investors to return to the Perth market, rather than looking to Sydney or Melbourne, and the removal of plant and equipment depreciation deductions should provide a boost for new properties, which is great if you’re pursuing a yield based investment strategy. While you may have some concerns about being out of pocket on second-hand properties, the right older home in a good location will still be a superior investment if you’re pursuing a capital growth focused strategy.

If you want more information about property investing, why not read our Get Ready to Invest in Property eBook.

If you’re not sure what type of strategy would best for you or you would like to learn more about different strategies, why not download our 4 Strategies to Success fact sheet.

Or, if you’re ready to talk about buying your first home, why not complete our Getting Started form to get the ball rolling.

Need finance?

If you’re ready to invest and you’ve got any questions about finance, call us for a free Financial Health Check: 08·9381·7450 or download our Finance Services information.

Connect

To stay up to date with our latest information, property news and blog posts, you can subscribe, or follow us on Facebook and Twitter.

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Saving tips for first homebuyers (NEWS)

Property Wizards was recently approached by The Sunday Times Real Estate Magazine to provide advice and savings tips for first home buyers.

Here’s what director Trevor Dunkley had to say.

With the Perth property market at the bottom of its cycle and interest rates still low – for now – it’s a great time for first home buyers to get into the market.

However, there are several things to consider when it comes to saving for that first home loan and being aware of the pros and cons of the government’s first home owner’s grant. (more…)

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On the move – Perth property market on the rise again (ANALYSIS)

While there’s been a lot of focus on the downturn in the Perth property market, there’s plenty of good news coming in.

A number of sources have revealed that Perth’s property market has reached its low and is starting to show signs of improvement. (more…)

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Low interest rates add to the appeal of the Perth property market (TIPS)

Perth, Western Australia, viewed at night reflected in the Swan River.

We already know it’s a great time to invest in property in Perth.

With the Reserve Bank of Australia’s decision last week to keep the cash rate at 1.5 per cent, this certainly adds to the appeal of getting into the Perth property market.

So while interest rates have stabilised, they are likely to rise. So if you’re ready to buy, the time really is now.

What should you do next? (more…)

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Is it really a buyer’s market? (Q&A)

 Hand on old door (old house, renovation, knock-down)

“It’s a buyer’s market!” you probably keep hearing. Perth’s current property market is a buyer’s market! The time to buy is now!

To dig a little further and find out if it really is a buyer’s market, and what this means for investors, we asked Property Wizards director Liz Sterzel what she thought. (more…)

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Median house prices – magical or misleading? (Q&A)

Hand Pushing The Button House by phanlop88 - resize

Whether you’re just starting out in property investment or you’re a seasoned pro, you’d be familiar with the term, median house prices, and have probably spent countless hours scouring newspaper articles and real estate data trying to digest and distil them.

But what do they really tell you and what else do you need to know to make sense of them?

Well, we thought we’d break it down for you. We asked Property Wizards Buyer’s Agency director Trevor Dunkley for his insights on median house prices. (more…)

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How to pinpoint the next real estate hot spot! (Q&A)

Suburbs overhead view

Want to know how to pinpoint the next real estate hot spot? Of course you do. That is a question we get asked all the time here at Property Wizards.

So we thought we’d save you some time, and go straight to director Liz Sterzel for her thoughts.

Many people want to invest their money in property, but choosing a suburb that offers maximum growth can be a daunting and confusing experience. So how do you isolate great growth areas?

Here’s what Liz says: (more…)

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First home owners grant increase – what does this mean for you?

Making a plan

Thinking about buying your first home? Taking advantage of Perth’s current property market and the Federal Government’s First Home Owner’s Grant (FHOG) is a great place to start. But do you understand all there is to know about it?

Following the state government’s announcement of a boost to the first home owner’s grant, we thought we’d break it down for you. (more…)

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New year, new you, new home? Why you should make property investment a New Year’s resolution! (TIPS)

iStock_000017108927Large

A new year often inspires a time to reflect – on your personal goals, health goals, financial goals. They’re called New Year’s resolutions for a reason. Have you made any?

If property investment has made your resolutions list or is part of your 2017 financial goals, now is a very good time in the Perth market. And if it hasn’t, perhaps it should!

If you’ve been umming and aahing about buying an investment property, now is a great time to make it happen. (more…)

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What you need to know about property development (TOP TIPS)

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So you want to buy a property to develop or subdivide, but not sure where to start or what to look for?

Knowing how to secure a property with superior development potential can be difficult, especially if you are just starting out.

Here are our top tips for a successful development project: (more…)

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Why waiting can be a costly error in property investment (eBOOK)

beach-contemplation-man

While it’s one thing to rush and make poor decisions under pressure, waiting for “the right time in the market” can prove equally costly, and may not be a smart property investment strategy.

In periods like this, when the Perth property market is at a low, many investors become increasingly concerned about whether or not it is “the right time” to enter the market.

But, such a situation provides the perfect illustration of why waiting to get into the real estate market can be costly.

By the time buyers who’ve held off realise the theory that there is a “right time” to enter the market is flawed, they’ve already missed the boat. (more…)

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5 ways to find your ideal investment property location (eBOOK)

beach-cafe

Location, location, location, they say. But how do you snag a property investment in your ideal location or predict which suburbs are likely to perform well?

Research, research, research. That’s the obvious place to start. But it’s knowing what to research and what to look out for that counts.

Here’s our five go-to research strategies to help you find your ideal investment property location. (more…)

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The plus side of Perth’s property market (eBOOK)

Perth, Western Australia, viewed at night reflected in the Swan River.

While there are plenty of negative news reports about Perth’s property market, it’s time to report the good news.

The quiet property market actually provides positive opportunities for potential investors and tenants because it offers more choices, less competition and more room to negotiate.

With more properties available, buyers can take their time and assess all their options to find a property that ticks the right boxes – for both their investment and their tenants. (more…)

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Building wealth by subdividing – benefits and pitfalls

home-plot-plan-by-supakitmod-resized

Any investment presents risks and rewards that must be properly understood before buying.

This is certainly the case when buying property for redevelopment. You can keep yourself occupied, but all your hard work could be for nothing if you’ve not done your homework.

“Less than 1 per cent of development-potential sites generate a profit”

You may be surprised to hear that small developments are by and large not profitable.

Less than 1 per cent of sites advertised as development-potential sites generate a profit for the new owners. In fact, the really good, profitable sites for a buy/develop/sell strategy generate just 15 per cent profit.

Don’t be greedy and hold out for the traditional 20 per cent yield properties as they are so few and far between you may miss out on few good deals by chasing a big one. (more…)

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