A Sad Haircut

The Barber I’ve been going to for the last decade has closed its doors, so I had to look around for someone else that was close to home and would do a good job.

After searching Google, I found someone within three minutes from home.

I rang. It was an Italian voice on the phone saying, “yes, come around straight away”.

It turns out that he had only been operating the business for seven months. As I walked in, I noticed that he was open seven days a week and it seemed as though he was the only one there.

It turns out that he had been working for some else for the last fifteen years and thought it was time to launch out on his own—a bold move.

It turns out that he paid $50,000 too much for his premises and was stitched up with a bank loan at 7.5% interest.

He thinks he did well. 

If he had used me as a buyer’s agent, I could have told him that the property he bought had been on the market for nearly two and a half years and they would have sold it at a heavily discounted price if it had been negotiated strongly.

I also would have been able to set him up with a 4.5% commercial loan through a broker/s with integrity. And he would have paid it off in ten years instead of sixteen without having to work seven days a week.

Buyer’s agents are not well known in Perth, and it is disappointing that hard-working buyers don’t know that we exist and could be securing a much better deal than they can by doing it alone.

It is for this reason that I choose to spend my time as a buyer’s agent looking after time-poor people who have limited knowledge of the market, and want someone to negotiate the best price for them and set up their finance in the best way.

Next time you’re thinking of purchasing a property, allow me to represent you as a Buyers Agent. I can help in selecting your property and negotiate the best deal for you. I’ll help make your property purchase stress-free and, quite likely, save you a bunch of money.         

https://buyingperthrealestate.com/buyers-agent/

PS. It was a great haircut!

In 2020, fear is the new black.

Fear is back. With a vengeance. This time it’s not the economy scaring people, it’s called coronavirus.

The OECD says that Australia may be “one of the worst affected economies” from the coronavirus outbreak. At the same time, another headline screams, “Houses to Hit Record Prices in Weeks”. 

We are already seeing Investors entering the Real Estate market in Perth, after shifting their funds from the share market to a safer long term investment in the Property market. As one investor said, “I have lost big time on the share market cause of the Coronavirus  Scare, but my real estate investments are still returning a regular monthly return and the asset is still good.”

With such varied opinions – and in full knowledge that media often ‘hypes’ a story to attract readers or viewers – how are we to act if we are buying in today’s real estate market? And what effect, if any, will the coronavirus have on the Perth property market?

Well, first, what about “No Chinese buyers”! The percentage of buyers from China has long been over-estimated in Australia, especially in the day-to-day housing market. Homes will continue to sell well without foreign buyers.

Generally speaking, prices in the Perth Real estate market are unlikely to be impacted unless the coronavirus escalates severely. 

Perth real estate values are relatively low, and there’s only one way the market should go: Up! 

People still need to buy homes. Indeed, we Western Australians see our homes as sanctuaries. A home is the one place most of us feel safe.

What will or should change, however, are habits. Just as we are now taking sensible precautions in our daily lives, so must we take precautions in our real estate lives.

The one thing that must stop is hordes of strangers wandering through family homes. As buyers agents, our clients give us a detailed brief, and we do all the looking for them. We present them with recommendations, and once a home or property investment is selected, we negotiate the lowest price possible, following the transaction through to settlement. 

This process is how buyers agents in Perth earn their fee.

It’s incredible how few buyers realise an obvious point: There are 10,080 minutes in a week. And yet, when you want to buy a home, there are typically 30 minutes in a week to inspect most home opens with real estate agents.                               

This is where an experienced buyer’s agent in Perth can save you time and money. We’re looking all the time.

With the coronavirus scare, it’s your chance to appoint Buying Perth Real Estate to do all the groundwork for you, so you can enjoy being home safe with the family.

As a buyer, you probably don’t want to inspect homes with hordes of other strangers – many of whom may be coughing and sneezing.

If you see a home you like, you simply advise your buyer’s agent and let them do the groundwork for you.

As to the big question of whether prices will drop because of the coronavirus and whether you should delay your decision, the truthful answer is: no one knows. 

It’s unlikely, but the more significant point is: if you are a home buyer looking for a family home in Perth, what does it matter?

If you are buying a home and upon consulting with your buyer’s agent, you are confident you can safely enter the real estate market. And, if you intend to live in that home for many years, how will it affect you if, after you buy, your home’s value drops? 

While that may briefly concern you, a price drop will make no difference to your enjoyment of your home.

Buyers often ask: When is the right time to buy? The answer to that question, if you are a family home buyer (not an investor) is this: The right time to buy is when you find a home you love that you can afford. Never mind what is happening in the rest of the world. Focus on what is happening in your world. 

As always, of course, in all aspects – financial and health – your priority should be to stay safe. The only thing we have to fear is fear itself.

When will the local market gain again?

In their recent analysis of the real estate market across the nation’s capitals, domain.com.au put Perth under the microscope with the following insights.

Perth

To buy property in Western Australia is totally different to other parts of Australia and in fact throughout the world.

Perth’s rental market has strengthened over the year, reflected in rent price increases and a falling rental vacancy rate.

Median asking rents for houses in Perth were up 5.7 per cent in the year to September, to $370 per week. This marks a recovery from a rental price trough of $350 in September last year. It is also the strongest annual growth rate in house rents for more than six years, when the mining investment boom was ending. Nonetheless, Perth remains the cheapest capital city to rent a typical house.

Perth units saw a similarly strong rise in rents year-on-year, at 3.3 per cent (although unit rents remained unchanged over the quarter, at $310).

Rents increased the most in Perth’s inner suburbs over the past year, while rents were unchanged in Mandurah.

Perth has seen the second steepest annual decline in the rental vacancy rate behind Darwin. The rental vacancy rate fell by 70 basis points to 2.7 per cent in September 2019.

These figures point to a tighter Perth rental market. While this is not good news for renters, it may be a sign of a broader turnaround in the Perth property market. Stronger population growth, combined with a slowdown in new housing construction, is seeing vacant properties being slowly absorbed. The WA economy is also rebounding, driven by improving conditions in the mining sector.

Republished from domain.com.au, October 2019

Who’s on your side when you purchase a property?

If you’re buying property, you may fare better with a Buyer’s Agent on your side.

Using a buyer’s agent to assist in purchasing a property has not been well used in Western Australia to date, but in the Eastern States, using a Buyer’s Agent is becoming increasingly popular.

‘Having a registered buyer’s agent on your team can be a brilliant move because we can invariably buy at a better price than the average home purchaser can do,’ says Clive Elliott from Buying Perth Real Estate.

Clive Elliott is a seasoned real estate agent having operated his own agency for many years. These days, he works primarily as a buyer’s agent.

“The days of real estate agents taking prospective buyers around to homes offered by other agents when their listings don’t match what the buyer wants, have virtually gone,” he says.

“It concerns me that in many cases people who are time-poor settle for a home below their expectations while other people are not strong negotiators, so they end up paying more than they could have,” he said.

A buyer’s agent’s job is to find properties that match the brief from a buyer.

The search made by a buyer’s agent considers the offerings of numerous agencies and sometimes off-the-market properties.

“Many people forget that a real estate agent is paid by the seller to get the best price possible whereas a buyer’s agent, knowing this and having worked in price negotiations, is motivated to work on behalf of the buyer,” Mr Elliott said.

“We can often cover our entire fee and more by having the knowledge of current property values and knowing how to negotiate accordingly,” he said.

With more extensive knowledge than most people of the property market, a buyer’s agent can also source a property for investors with better prospects for capital growth or rental yield and seek out properties being sold off-market’ (sometimes known as ‘silent sales’) which never appear publicly.

“We also help our buyers to ensure they have included the correct conditions in their offer to purchase and when needed, assist them in obtaining suitable finance brokers and conveyancers,

“All up, a buyer’s agent removes a lot of stress from property purchasing, saves the buyer a huge amount of time in searching for the right property, and we invariably save the buyer quite a lot more than our fee for service,” Clive said.

To learn more about how a buying agent works, you can visit buyingperthrealestate.com.au

The Best Property Buying Opportunities in Australia Are Right Here in WA!

Every now and again we’re asked by purchasers whether it’s best to buy now, or wait, in the hope that prices will drop further.

They’re mindful of the real estate adage: ‘timing is everything’.

The answer varies, but it’s fair to say that 2019 represents a good time to enter the West Australian property market – whether as a first home buyer, a homeowner upgrading to a more substantial home, or as an investor.

Some key factors lead us to think that 2019 represents a great opportunity.

1) Affordability
Several months ago, it was announced that WA had become the most affordable state for property in Australia.

According to a housing affordability study produced by the Real Estate Institute of Australia and the Bank of Adelaide, only the Northern Territory and the ACT were more affordable.

The report also found that the proportion of income required for meeting loan repayments in WA improved to 22.7% in the September 2018 quarter, a decrease of 1.2% from the June 2018 quarter, while the average loan size reduced 4.6% to $339,943.

By comparison, the proportion of income required to meet loan repayments in NSW is 36.6% with an average loan of $469,589.

Further, rental vacancies across Perth are down to 2.6% – a significant decrease from 9% a few years back.

Rental vacancy rates have decreased dramatically in quite a few locations, and if the common trend ensues, rental yields will begin rising when the vacancy level falls below 2.5%.

2) Massive new mining investment forecast
It seems set to happen all over again!

2014 saw the end of a property boom in WA driven predominantly by massive spending from the mining industry on mine site expansion and large scale construction.

Forecasted investment in upcoming projects in the Goldfields and Pilbara regions totals around $75 billion.

This spending on infrastructure and mine site expansion includes projects related to Iron ore, Lithium, Liquid Natural Gas, Mineral Sands, Gold Mining, Urea production, and a Nickel smelter.

As these projects get underway, there will be considerable demand for workers.

Already, demand for skilled professionals has risen dramatically, leading to an increase in the tempo of top-end property sales with median prices of exclusive localities experiencing substantial gains.

The Western suburbs have fared nicely as well as the Canning Riverside suburb of Mt Pleasant.

The median price of homes in Mt Pleasant has increased by 26% in the 12 months to March 2019.

People who purchased while the prices were low have fared very well, and there is little doubt that the next few years they will see further capital growth.

According to reports, around 40% of Perth suburbs experienced price growth over the year. We believe this represents an opportunity.

By contrast, quite a few suburbs – particularly those in the outer areas – have seen decreases in the median price as supply has consistently exceeded demand.

The question arises: how long will it be before they see a turnaround as well?

Massive demand for tradespeople and semi-skilled workers will likely follow the current demand for professional workers.

This influx of people will likely generate a significant increase in business confidence and, as a result, rental vacancies will decrease markedly to follow a similar pattern as the previous mining construction boom.

As the cycle goes, the property market will strengthen across the board, making 2019 a golden opportunity for people to buy in areas where prices are at their lowest.

3) The Election!
If the Labor Party wins the upcoming election, we can expect them to take action on negative gearing in the 2020 budget.

Their current platform is to allow negative gearing on established homes purchased before its budget. From then, negative gearing will only apply to new property purchases.

Timing is everything, so we make a point of monitoring the prices of established suburbs with strong investment potential.

These investments will have excellent long term rental potential, and if you hold for the long term, there is potential for strong capital growth.

Opportunity
The current market presents an excellent opportunity. We would urge prospective buyers to act soon rather than leaving their move to the point where everyone is trying to get in for Fear Of Missing Out. FOMO is real, but it’s not quite a reality. Yet.

Buying Perth Real Estate are experts at helping investors and homeowners to find properties that best suit them – saving them time and money.

If you’re considering a move, call us for a chat. There’s no obligation, and you will be surprised to discover what BuyingPerthRealEstate.com can do for you.

Clive Elliott – Principal