Thursday, August 18, 2011

Latest Property News from Ted Hanson

Friday 19 August 2011
Chalices a signal of spring

WHILE a magnolia tree in full bloom is a joyful sight, the highlight for me is the emergence of the first pink bud on my deciduous M. x soulangeana. And the first one emerged last week. It was a magical and symbolic moment. Hopefully, it's a sign that the cold, grey days of winter are coming to an end and spring is around the corner.

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Taking advantage

Lower fixed rates have been enticing Australian borrowers to review their home loans recently, as lenders continue to bring out special product offers.

The average three-year fixed term interest rate (the most popular type) has not been this low since October 2009 and new home loan deals are constantly being released, according to independent mortgage broker Mortgage Choice.

Company spokesperson Kristy Sheppard said this week that more than one third of the broker's lender panel has reduced interest rates on some or all of their fixed-term home loans in the past week, some more than once.

"They are reacting to changes to their funding costs, subdued home loan demand and uncertain economic conditions by re-pricing fixed rate loans and continuing to bring out attractive loan offers in the hope of boosting the flow of customers walking through their doors", Ms Sheppard said.

"Borrowers are the overall winners in a landscape that provides more affordable home loan choices."
She warned, however, that mortgage holders considering switching loans and/or lenders should not be influenced solely by the interest rate.

Exit fees for the current mortgage should be considered, as well as other aspects of the new loan such as initial and recurring costs, ability to make extra repayments and redraw, flexibility, lender service and how long it will take to be approved.

"If choosing a fixed rate, investigate rate lock fees for securing today's offers and be aware of possible break costs if you decide to switch again during the fixed period", Ms Sheppard warned.

"Also consider how you will feel if you lock in and then watch interest rates fall down the track", she added.

An increasing number of borrowers are weighing up their home loan options via online comparison calculators. In the first fortnight of August, comparison website HelpMeChoose saw a 32% increase in refinancing enquiries when compared to the average for July.

"Online comparison sites are a great starting point for exploring loans, but nothing beats a thorough home loan health check", MS Sheppard advised, adding that working one-on-one with a mortgage broker who has a large lender panel allows the opportunity to compare your product against hundreds of others.

Does my garden look big in this?

Just as the clothes we wear can make us look slim or large, so too can the plants in your garden have an effect on its appearance, making it look tall, spacious, unkempt or squashed.

A few clever placements in a flower border along the line of the fence can make your property seem larger. Likewise, the shape of the garden beds and the paths and spaces between them will add to the illusion of distance.

If your back yard is short, try running a garden bed along each side, tapering away slightly towards the farthest end from the house. This will have the effect of making the landscape appear more distant.

When choosing plants to create the illusion of space, follow these general rules:

Group coarse-textured landscape plants near the house, medium-textured plants next and fine-textured plants farthest away.

Place plants with `warm' flower colours, such as yellows, oranges and reds, nearest the house.

Place plants with blue colours in the distant part of the landscape. Along with the blues, include some pinks and mauves.

Plants with silver or gray foliage provide a unifying base colour throughout the border.

Shifting the focus

The current carbon tax debate has drawn a strong focus onto housing design and energy saving products since pricing will impact both on materials used and the running costs of the home, a leading architectural body noted recently.

Archicentre State Manager David Hallett said considering the carbon tax is planned to be introduced in July 2012, it is prudent for people to consider its impact when planning a building project which can take up to twelve months to commence.

"Ultimately the cost saving starts with the design and siting of the home including making provision for natural light in the main living areas and the orientation of the home to gain the maximum benefit for passive solar heating and provision for water harvesting," Mr Hallett said.

"This is the stage where all of the ideas are assembled and thought through to ensure the best design for the budget is worked out.

"This stage can also be the most expensive time for new home builders or renovators, if they make a mistake on the original design and have to undertake costly variations, (which are) the greatest reason for cost blow outs on projects," he said.

The proposed carbon tax is a catalyst for people to look differently at housing design, materials and size, Mr Hallett said.

The first step is orientation to maximise the home's northern aspect, where exposure to the sun is easiest to control. Eaves and pergolas can be precisely designed to block the summer sun, yet still allow desirable winter sunshine to penetrate.

"It is important to prioritise rooms based on access to views and solar orientation," Mr Hallett said.

"An open-plan kitchen and living area, for example, should have top position, while bedrooms or bathrooms require less daylight, as they are largely used for short periods of time, or at night," he added.

By zoning the home, unused areas can be closed off, and cooling and heating appliances can be designed for maximum efficiency and minimum use.

Archicentre have compiled a checklist of improvements to the home to accommodate the coming changes:

· Insulate the ceiling
· Weather seal windows and doors
· Fit blinds, curtains or drapes
· Buy high star-rated appliances
· Install solar panels
· Replace single flush toilet cisterns with dual flush cisterns
· Upgrade the heating system to a more efficient design
· Install a rainwater tank
· Upgrade your hot water service
· Fit a grey-water diversion system
· Upgrade windows using double glazing or other high tech-glass
· Build a pergola or verandah to provide shade when needed

Renovating with pets

Renovating can be stressful, with timelines, budgets, noise, dust, living out of half the house at a time. If it's tough on us, imagine the effect it has on our pets, who just don't understand that knocking down that wall, ripping up the floors and putting new surfaces in the kitchen is going to improve their lives.

In fact, their whole world is likely to be turned upside down and they may react in unexpected ways. Placid dogs may become aggressive in the face of perceived threat, or may run away just because the gates are left open. Cats will invariably leave and not be seen again until it's all over. They may also feel the need to "mark their territory" where you least want it.

Here are some tips for making sure that your furry (feathered, fishy) friends are as comfortable with the chaos and change as possible:

Prepare your pet beforehand by changing some of its patterns - such as where it sleeps and eats.

Make sure your pet is micro chipped or wearing a collar with identity tags in case it `leaves home'.

Try to always have an area of the house where the pet(s) can stay out of the way of the tradesmen, noise, etc. If possible, keep that space familiar to the animal so that it knows where it is and can still feel like it is part of the family.

If all else fails, have a "foster family" or boarding kennel lined up. Remember that if you do this, the animal may be confused when it comes home and will need to be reassured with familiar items such as furniture, eating bowls or bedding.

Consider traffic
Before you buy a home, consider the traffic effects of surrounding roads and facilities. Visit the property at different times of the day to get an idea of traffic patterns, congestion, parking availability and noise. Allow for seasonal differences. For example, if the home is near a school, traffic patterns are likely to be very different during school holidays than at other times of the year.

Have your island and sail it too

At some stage we've all thought about sailing a yacht to a private island. Now it's possible to own both in one.

The people at Yacht Island Design like to do things differently. Using a twin-hull ship design (known as SWATH), they have built a large, flat surface area on deck to incorporate conceptual designs such as an island complete with guest cabanas, bar and mountainous volcano with a waterfall feeding into the on-deck swimming pool. Spread over two decks within the volcano, the owner's suite affords views to the front of the yacht and from behind the waterfall.

Thursday, August 11, 2011

Latest Property News from Ted Hanson

Friday 12 August 2011

The Power of Auction Marketing

A few weeks back Southern Estates held 3 on-site auctions, with 2 selling under the hammer at above reserve prices. The 3rd property in Cordeaux Heights was passed in, as the interested parties could not purchase under auction conditions. Last week we negotiated and exchanged the sale on that property - also above market expectations. The auction marketing allowed us to identify the right buyers and achieve a great result for our clients.

Coming into spring, now could be the right time to achieve the best result for your property. Contact us on 4229 5344 to discuss how our auction campaigns can realise your property's full potential.

Finance steadies

Housing finance remained unchanged in June following positive results in the previous two months, according to data released this week by the Australian Bureau of Statistics.
In seasonally adjusted terms, the number of commitments for owner occupied housing finance was flat (0.0 per cent). This follows a rise of 4.4 per cent in May and of 4.8 per cent in April.
In trend terms, commitments for owner-occupied housing finance rose 1.0 per cent. The number of commitments (trend) for the purchase of new dwellings rose 1.9 per cent, the number of commitments for the purchase of established dwellings rose 0.9 per cent and the number of commitments for the construction of dwellings rose 0.9 per cent. In seasonally adjusted terms, the total value of dwelling finance commitments excluding alterations and additions fell 1.4 per cent.

Peter Jones, Chief Economist Master Builders Australia, said that the figures show the market has found a floor after eight months of interest rate stability.

"Despite some improvement seen in recent housing finance numbers the pace of recovery is likely to be slow, particularly given the strong headwinds still facing the industry", Mr Jones said. "Longer term, the weak underlying level of housing finance signals that the residential building industry will be unable to meet a serious undersupply of housing that has arisen, risking higher rents and house prices as more people chase less stock."

He added that Master Builders will continue to push for the need to address inefficient developer charges, land release regulations and the approvals process as part of reforms to remove impediments affecting the supply of housing.

What puts buyers off your home?

How much do you suppose a pile of crunchy dead bugs on a windowsill will affect the selling price of a $500,000 home? How about a life-size skeleton hanging in the closet, or an open coffin in the basement with a dummy vampire inside? Or an overly-ripe kitty litter box under the kitchen table?

The National Association of Exclusive Buyer Agents (NAEBA), an industry body in the United States, conducted an online survey of their members to rate the things they found most annoying when showing a home to prospective buyers. The results of the survey are revealing, surprising, and sometimes downright weird. Here are the top twelve things the agents reported as most off-putting when showing a home:

Broken door locks preventing access to the house.Pet deposits in the back yard or dirty cat boxes.Missing light bulbs.Sellers that ask you to remove shoes and then have wet carpet or dirty floors.Having loose stairs or missing banisters.Low hanging dining room light fixtures in a vacant home.Closet doors that fall off or are not adjusted properly.Going into a vacant home and hearing animals in the walls.Dangerous children's toys left out.Dead cars in the driveway or yard.Political signs.Dead birds or animals in or around the home.

Silliness aside, there is an important lesson here for home sellers to have a good look around your house to make sure that things you tend to overlook may not be a distraction or distasteful to prospective buyers. Imagine you are a stranger, or take a friend or relative for a walk through - they will often notice things you don't (such as cobwebs, pet smells, or an overgrown garden).

Building expected to recover
Residential building is set for a roller-coaster ride over the next few years, according to a report released this week by industry analyst and economic forecaster, BIS Shrapnel.

The Building in Australia 2011 Report shows that the impact of residential building is forecast to be minimal in 2011/12 after being negative in 2010/11. BIS Shrapnel's Managing Director, Robert Mellor, said that the value of new dwelling starts is forecast to remain relatively flat - up one per cent - in 2011/12. "Despite weakening net overseas migration inflows, which have fallen from a record 300,000 persons in 2008/09, to an estimated 165,000 in 2010/11, construction nationally still remains below the level of underlying demand, although in some states the market is closer to balance", Mr Mellor said.

The report shows that the flat level of construction will set the scene for an improvement in residential dwelling activity in 2012/13.

After the lull in 2010/11, economic growth is forecast to strengthen through 2011/12, underpinned by strong rises in resource investment, which will in turn result in higher net overseas migration in response to increasing labour requirements. Moreover, dwelling activity is now well below underlying demand nationally, with this shortfall focussed in Queensland, Western Australia, and New South Wales.

BIS Shrapnel forecasts two interest rate rises in 2011/12, saying that with the rate of economic growth accelerating, this should still be able to support a rise in residential demand in those states where pent-up demand pressures are emerging.

As a result, the value of new residential building commenced is forecast to rise by 10 per cent over 2012/13.

"The gains are expected to be roughly felt equally across new houses and multi unit dwellings, with the upturn concentrated in Queensland, Western Australia and New South Wales", Mellor said.

"These states will experience a rapidly rising dwelling deficiency, while affordability has also improved after solid income growth and weak price rises in recent years.

In the other states, recent high levels of residential construction have meant that underlying demand and supply is more balanced and there is little upside."

The residential building upturn will be short-lived, however, and the subsequent downturn in residential construction will result in a substantial underlying deficiency of dwellings emerging across most states. Meanwhile, prices in most states are also expected to have declined in real terms and affordability will have improved.

Mellor predicts that through this period, non-residential building is expected to ease, freeing up additional capacity for residential construction into the subsequent cycle and allowing new dwelling construction to reach a higher level from 2016.

"The challenge will be for an adequate level of new land supply to be available to meet this potential upturn in demand", he concluded.

Improve your Location
Whether your house has water views or is next door to an electricity substation, make sure potential buyers are aware of the best features of your neighbourhood.

Fill your agent in on all the local amenities and how they have affected the quality of your life.

Prospective buyers who will be inspecting your house want to imagine themselves living there - and the more they see of the whole picture (schools, restaurants, transport, hospitals) the easier that is.

Raising the standards

Possible loopholes in the national energy rating scheme could prove costly to homeowners, according to consumer advocacy group Choice.
Choice warned this week that while energy efficiency can save households thousands in bills, instances of cost cutting by some builders and developers and poorly trained assessors are compromising the effectiveness of standards.

Industry concerns about the existence of collusion between sellers and assessors and the questionable use of energy rating software have also been drawn into the spotlight.

Choice spokesperson Ingrid Just said that currently, a new home's energy rating is assessed at the design phase rather than upon completion of the work. "We have seen evidence of dramatic discrepancies between promised versus real energy efficiencies once a home is built," she said.

Ms Just cited the instance of a home in north-western Sydney that allegedly required more than $100,000 worth of additional work to meet minimum energy and building compliance standards, despite already being certified for occupation. "The home owner was shocked to discover that the energy star rating they were given on paper was far less than the reality," she said.

At a time of rising energy bills, consumer confidence in energy ratings is crucial, especially ahead of the planned national roll-out of energy ratings for existing homes in 2012, according to Choice.

A recent government study into house prices in the ACT showed that an energy rating improvement of one star will increase a home's market value by 3 per cent.

"The whole point of energy ratings is to give credible information to consumers about the energy use of houses, so they can factor that into their decisions," Ms Just said.

"If homes aren't built to specifications or energy assessments aren't accurate, then buyers could soon find themselves paying the cost in higher bills and lower market value," she warned.

Prior to home energy ratings rolling out nationally Choice is asking for:* A survey of the number of newly built homes meeting minimum energy efficiency standards* Stronger regulation of post-design energy compliance for new homes* Assessors to be qualified and always chosen by the buyer rather than the building's builder, developer or seller* Greater information provided to consumers about home energy efficiency ratings and the most energy efficient ways to use their homes

Out of the frying pan, into the fire
There is an adage that you can't avoid death and taxes, as both are sure catch up with you. The latter certainly caught up with one UK man attempting to jump his way through an assumed loophole to avoid paying taxes for renovations on an investment property.

In the UK, building a house from scratch removes the 20 per cent VAT (Value-Added Tax, similar to our GST) otherwise incurred when refurbishing or renovating, the UK Daily Mail reports. To avoid the fee, the property investor demolished the house to start the construction fresh, disregarding the fact that the nearly 200-year-old house was registered as part of a conservation area, and that any demolition would require special consents.

He has subsequently been fined nearly AU$128K for the illegal demolition and a further $78K in costs from the council. The size of the fine is said to reflect the judge's determination that the man should not benefit from the sizable savings he'd hoped to attain.