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 Media Release – 9 May 2012
In the light of the federal budget, which has just been handed down, First National Real Estate says the government should have delivered on the GST promise of abolishing stamp duty and that home buyers should also do their bit to support the Australian property market.
“Australia’s soft property market will continue to tread water unless major changes are made. We need more new housing stock to come onto the market, indirect costs to be reduced, inefficient taxes such as stamp duty to be abolished – preferably all three!,” Ray Ellis, CEO, First National Real Estate said.
“And while HECS-like schemes are commendable for assisting home buyers to pay their stamp duty obligations, it should be a matter of reducing, or better still, getting rid of stamp duty altogether and that falls on everyone’s shoulders.
“A struggling property market affects all Australians, as it is a key driver of the nation’s economy and represents a burden for all to share. This is why home buyers should do their bit and continue to put pressure on governments to live up to their GST promises.”
Mr Ellis said property taxes are reducing home buyers’ ability to purchase new homes, whether they are first home buyers, upgraders, downsizers or investors.
“The real issue for the property market is that buyers aren’t buying and part of that reason is the exorbitant extra costs associated with buying a property,” Mr Ellis said.
“These extra purchase costs mean it is more cost efficient for home owners to consider renovating or think outside the box and look at dual occupancy type solutions.
“The excessive cost of developing vacant land has stalled the process of newly built home stocks coming onto the market, which is having a devastating impact on the market overall.”
Last year, stamp duty accounted for 37% of total property related taxes in Australia and Mr Ellis believes the reliance of Governments on property taxes to boost their coffers should have lessened over time with the introduction of the GST, but the opposite trend seems to be occurring.
“We were promised a reduction in taxes like stamp duty when the GST was introduced. Not only has it stayed, nationally, stamp duty has risen, due mainly to increases in NSW and Victoria according to industry figures,” Mr Ellis said.
“And yet, property taxes were cut in WA and NT, and government revenues actually increased.
“What seems to be happening is that stamp duty is putting new homes beyond the reach of many, so fewer homes are selling overall, reducing revenue raised through these taxes to governments,” Mr Ellis said.
“But basic economics is at play here, if the stamp duty was lowered more homes would sell, both home owners and governments would see increased revenue.
“Consideration could also be given to abolishing stamp duty and recouping those lost taxes through a more equitable means where the whole population pays – not just those who have saved for a new home.
“Perhaps we should increase tax paid on luxury items such as tobacco or alcohol, or fast food items.”
According to Mr Ellis, making home ownership too taxing is a short-sighted and quick grab for cash by governments and should be ‘stamped out’ as soon as possible so that everyone can achieve their home ownership goals.
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For further information contact Stewart Bunn, National Communications Manager, First National Real Estate, on 0413 624 317
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 The 50 basis point cut made by the Reserve Bank (RBA) last week sent a positive signal and may improve consumer confidence, but don’t expect a sudden resurgence of demand says one of the nation’s foremost property forecasters, Michael Matusik.
Over the past decade, the connection between cheaper money and housing market improvements has been broken, he says, by artificial stimulus like government first-home buyer grants and building boosts. These have distorted the normal property cycle, inflated demand and prices, and have made the housing market more cyclical than it used to be.
Underlining Matusik’s point is the fact that despite falls of nearly 1.5% in mortgage interest rates in the past year, new housing starts have continued to decline, and, soft April home values show that despite a somewhat stable start to 2012, national home values have slipped 0.7% year to date.
Market ‘hole’ coming
With a raft of government incentives coming to an end, demand that has been brought forward may soon lead to a ‘hole’ that could last three to six months, or longer says Matusik.
Research reveals what’s ending, where and when…
What will it take to lift the market?
Residential property, especially new housing stock is over-taxed. If we’re to lift new housing starts, Matusik says we must:
- Increase the speed of population growth.
- Increase the supply of raw land across urban Australia
- Reduce approval times and unnecessary compliance red tape
- Allow the market to dictate demand
- Have new property valuations based on rental returns, not market comparisons
- Reduce taxation on property (HIA research shows this is up to 40% of a new home’s final price)
- Remove GST on new construction
- Remove stamp duty from off-the-plan sale.
However, the biggest problem affecting demand is the current oversupply of property for sale. Buyers are simply spoilt for choice and too many vendors are unrealistic in their expectations.
Healthy supply levels run at about 200,000 homes for sale at any given time. Australia currently has 400,000. Even a 1% or 2% drop in interest rates is unlikely to make an impact on their salebility, unless it is combined with sharp market pricing and aggressive marketing.
Make a decision
Matusik has some sharp advice for vendors who are overpriced, have been for sale far too long, and ‘who haven’t got a clue’.
He suggests that with rental vacancy rates running at just 1.7%, they should…
- Renegotiate mortgage finance
- Take their property off the market
- Lock into a low fixed-interest rate for a couple of years
- Rent the property out
And for those who really need to, or want to sell…
- Understand their dwelling’s value and accept the market – rip the bandage off and move on!
- Assign one good agent (multi-listing is sales death in a buyer’s market)
- Give your agent a short time frame to sell – 30 days
- Require offers on signed contracts – no verbal offers
Promote, promote, promote
You can’t sell a secret.
So, vendors who want to stand out from competitors must invest at least 1% of their home’s predicted sale price in marketing. Without some serious marketing push, there’s just no chance of standing out. Get professional photos taken and set an asking price – recent research shows 75% of buyers don’t even lift the phone to make an inquiry on properties without an asking price.
As with selling a car, presentation must be immaculate, every single time a buyer looks at the property. Clean the windows, light the fire (if you have one), trim the garden, plant or display fresh flowers and open all the curtains.
As Matusik correctly says, many may disagree with his views. However, for vendors who have a property that has languished on the market for more than six months, smaller or lesser actions are simply like re-arranging deck chairs on the Titanic.
Click For more information on regional locations eligible for government relocation grants:
Victoria
New South Wales
       
Click here to start searching for your rural escape!
The inaugural Regional Victoria Living Expo revealed the strength of interest amongst Melburnians to move to regional centres and smaller townships throughout rural Victoria says official event partner, First National Real Estate.
More than 8000 people streamed through the doors last weekend at the Melbourne Convention & Exhibition Centre where regional centres, business and career opportunities, educational options, housing options and cultural diversity were showcased.
Speaking about the success of the event during parliamentary discussion last week, Victorian Deputy Premier, Peter Ryan said the opportunities in the regional parts of Victoria are absolutely huge.
‘I am thrilled to be able to say that at the expo all 48 of the rural municipalities were represented.
‘A number of mayors and councilors have reported back to us since the expo that they have received inquiries from a vast array of people with different forms of expertise who are now actively pursuing the prospect of being able to move into regional Victoria’ Mr Ryan said.
First National Real Estate confirms it received a significant response at its display booth where thousands of properties throughout regional Victoria were showcased, and representatives from a multitude of its regional offices were on hand to discuss the various attributes of each area.
‘Research released by Peter Ryan indicates 11 per cent of Melbourne’s metropolitan residents, around 450,000 people, are contemplating moving to regional Victoria in the next 3 years. A further 39 per cent are talking about making the move in the near future’ said First National’s communications manager, Stewart Bunn.
‘First National has over 80 offices throughout both metropolitan and regional Victoria so our members are exceptionally well placed to share their knowledge of regional markets, housing values, growth opportunities.
‘We were not surprised that throughout the course of the weekend, over 300 people registered with First National to receive property alerts, or to start the sale of their Melbourne property so they can achieve their escape to the country.’
Since the expo, First National Real Estate has received further enquiry, nationally, from people wanting information about the various incentives and grants on offer from state governments nationwide.
‘What this reveals is the extent to which Australians are changing their views towards regional relocation’ said Mr Bunn.
‘Historically, we’ve been a nation of coast-dwellers but despite the recent softening of house prices in our capitals, the price of metropolitan living continues to trend upwards. As our population grows and the infrastructure of our cities is stretched, more Australians are contemplating the benefits of our regions.
‘As work patterns change and regional employment opportunities improve, the prospect of buying a regional property, reducing the size of your mortgage and enjoying a less stressful lifestyle appears to be very much in the minds of Australians’ said Mr Bunn.
In acknowledgement of this trend, First National Real Estate has introduced ‘Lifestyle’ and ‘Rural Specialists’ amongst its staff throughout regional Australia.
‘These regional members of our network focus on helping people in metropolitan locations make the shift to regional areas by sharing information, demystifying country property and working closely with our city members to facilitate the process’ said Mr Bunn.
The Victorian government has launched a new website, www.goodmove.vic.gov.au which aims to assist people interested in making the move to regional Victoria with all the additional information they’ll need.
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Issued by: First National Real Estate
For further information contact:
Stewart Bunn, National Communications Manager, First National Real Estate, on 0413 624 317
       
 First National Real Estate was represented at the Financial Review Commercial Conference in Sydney, last month, where industry experts spoke about the generally positive outlook for the commercial sector.
2012 is the third year of recovery since the GFC and, although sentiment is still a little fragile, there is definite growth in demand, especially in Sydney and Melbourne.
However, it’s also said that foreign investment dollars would flood into the Australian commercial property market if the Australian dollar fell significantly.
Despite the current exchange rate, investors from Germany, other parts of Europe, Canada, Singapore and elsewhere in Asia are particularly active and most residential tower sites sold in Melbourne over the past year were bought by Asian developers.
International investors are more confident in the Australian economy than domestic investors; they’re still finding it difficult to source finance and lack confidence in the government.
Our local banks are vulnerable to shocks from Europe because of their dependence on wholesale capital markets. This presents a real risk to the Australian commercial real estate market. Fortunately, China-led commodities demand should continue in the short to medium term and this will shape Australia’s real estate markets.
Headwinds may be coming for the Victorian office market, which is more likely to suffer the effects of weakened traditional office occupying businesses. On the other hand, strengthening demand in resource markets is positively affecting Perth.
       
 SOURCE: Melbourne Weekly, 25 Apr 2012
Can’t live in em, can’t sell em. Rarely would anyone say this of near-new flats a stone’s throw from shops and transport.
But such are the woes of the student rental market that some investors are now taking a loss of more than 30 per cent to get out of it.
Worst hit are those near Swinburne University in Hawthorn, which saw a spate of private developments between 2004 and 2010, mostly catering for international students.
But declining enrolments, no capital growth and lender wariness have seen student flats languishing on agents’ books sometimes for three years.
Market analyst SQM Research tells a sorry tale: three of the four stalest listings in Hawthorn are for student flats awaiting a buyer since 2009.
“It’s extremely difficult to sell these student only properties,” says one agent, who prefers not to be named. “In terms of investment, the original owners have, for the most part, resold for less than the purchase price. From the agent’s point of view it’s a total waste of time.
“I don’t know what will happen to these properties long-term. We had a few in Queens Avenue (Hawthorn). People paid $160,000 off the plan and sold for $110,000. They’d held them four to five years in some instances.” Most student flats are 25-30 square metres and some are only 15 far below the 50 preferred by banks. A letting agent may charge eight per cent to manage them and students often leave after 12 months.
First National O’Donoghue agent Nick Pane, who is selling a $149,000 flat in Hawthorn, says although such flats are hard to resell they get good rental yields between six and 10 per cent, when most Melbourne rentals are lucky to yield three per cent.
“A buyer who has other properties that are negatively geared may buy something like this, positively gear it and use it to offset the other ones that will appreciate in value,” he says.
And to sell at a profit, says Catherine Cashmore: “You have to time your selling to when there’s a large student migration coming in. And that just hasn’t been happening in Melbourne.”
       
 Media Release – 24 April 2012
Home renovating is proving an increasingly popular alternative to buying a second home and First National Real Estate has some helpful advice for home owners about to embark on a renovation – incorporate energy smart ideas where possible.
“The impending introduction of the carbon tax and popular reality home renovating TV shows have spurred further interest in this growing trend, so now is the time for would-be renovators to look at how they can make their homes more energy efficient,” Ray Ellis, chief executive of First National Real Estate said.
“An energy efficient renovation will improve the comfort and economy of the home, and may even push up the sale price to meet the growing demand by home buyers for energy efficient features.
“It can be as simple as ensuring windows and skylights are positioned to capitalise on the sun’s warmth and other simple design features are incorporated, especially those that add up to less reliance on electricity and gas to power the home and so reduce energy bills.”
According to Mr Ellis building and design features should consider north-facing living area where possible, to take advantage of the sun which will provide warmth in winter and an abundance of natural light year round.
General design features could include:
- Grouping rooms with similar uses together to create ‘zones’ in the house, which can be separated by doors so that only occupied areas, can be heated or cooled.
- ‘Wet’ areas should be placed close together to reduce the need for long water pipes resulting in a more efficient hot water system and lower plumbing costs.
- Ceiling heights kept as low as practicable to reduce heating and cooling costs and increase comfort levels.
- Choose ‘Fit-for-purpose’ building materials for optimal results
- Window are fitted properly and placed to minimise heat loss in winter and heat gains in summer.
- Curtains or blinds are also a great way to reduce heat loss in winter and heat gains in summer.
- Ceilings, walls and in some cases, floors, should be insulated to their appropriate level with no gaps left.
- Draughtproofing strips and weatherseals fitted to doors and windows leading to the outside to reduce unwanted air leaks and draughts (which can account for up to 25 per cent of heat loss in winter).
- Select energy efficient and cost effective heating and hot water systems.
“By getting some expert advice, a renovation can incorporate energy efficient design principles and improve both the liveability and value of your home,” Mr Ellis said.
       
 Media Release – 23 April 2012
A 25-year-old mother edged out some of the state’s most impressive youths to win the ‘First National Real Estate Leadership and Innovation’ category leading to the ‘Premier’s Young Achiever of The Year’ award in the Southern Cross Young Achiever Awards on Saturday night.
Held at Tasmania’s Wrest Point Casino before an audience of 600, The Southern Cross Young Achiever Awards were hosted by television presenter, Jo Palmer and are designed to acknowledge, encourage and promote the positive achievements of Young Tasmanians aged between 14 and 28 years of age.
Cait Clarke won the award as a result of her contribution to youth and community projects around the state as well as her efforts as a councilor in her hometown of Kentish, north of Hobart, which have been widely reported in local media.
‘Cait is the youngest person elected to a local government role, is chairman of the Kentish Youth Council, works with the social inclusion action group and is a Road Educator Volunteer (REV) mentor’ said Ray Ellis, chief executive of the 450-office strong Australasian real estate group.
First National sponsored the category of the Young Achiever Awards as part of its national programme of corporate giving, which includes support of Red Cross Emergency Services’ work preparing Australian communities for natural disasters, coordination of response, and recovery.
‘Leadership and innovation is what First National Real Estate is all about, as evidenced by our leading Tasmanian offices in Burnie and Hobart who have won industry awards at national level, showing many a larger mainland based estate agency what Tasmanians are capable of.
‘As a network, we support the young people of Australia who look at how to change things for the better.
‘It’s what the great state of Tasmania is crying out for; commitment to strong leadership and the ability to imagine more creative solutions to today’s challenges. People like Cait define not just where Tasmania is heading but who Australia is in the 21st century’ said Mr Ellis.
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Issued by: First National Real Estate
For further information contact:
Stewart Bunn, National Communications Manager, First National Real Estate, on 0413 624 317
Related articles
       
 Generally speaking, regional areas do not offer startling growth rates, however, they often have their own micro economy which may have benefited from a major business relocating from a metro area, or, as a result of tourism. Some areas also benefit from being on the path of major air, road or rail links.
Also, regional property prices don’t generally fall as fast when market conditions turn. Prices are far less elastic. The latest housing data shows that over the past 12 months, Melbourne home values fell by 5.4 per cent whereas regional areas fell by just 2.5 per cent. Having said that, it’s important to point out to our city cousins that Melbourne’s home values are still up by 45.5 per cent since the start of 2007. Victoria’s performance, by Australian property market standards, has been outstanding in recent years so it’s not surprising we’ve seen some moderation of prices over the past 12 months.
       
 As First National is official partner of the Regional Victoria Living Expo, we’ll be taking a look at some of the reasons people move to regional areas of Australia and the types of benefits they find when they’ve completed their move. With state Governments offering incentives, what’s the buzz about and what sorts of benefits can you expect if you move from a metro area to a regional centre?
We tend to find that people relocating from metro areas are firstly surprised at how much more convenient country living really is and what it offers, not just for families, but also for retirees and working couples or individuals.
People quickly discover that day-to-day activities like trips to the supermarket or doctor are remarkably less frustrating. Even if they do have to travel a few more kilometres than they did in the city, the absence of traffic congestion and snarls often makes the journey so much faster and enjoyable. Plus, parking is usually much easier and waiting times shorter. And… people are, almost always, more welcoming.
The next most common discovery is that, contrary to popular metropolitan opinion, a social life in the country can be every bit as sophisticated as that of life in the big smoke. The reality is that when you get to the country, you’ll soon discover that you’re no pioneer. Plenty of urbanites have already found their way to the regional location of your choice and have already been enjoying the lifestyle benefits for years.
Naturally, property prices are usually much more affordable in regional locations so, whereas you may feel somewhat squeezed by your metro digs, a regionally located home is likely to gain you features you could only have dreamed of in the city.
Obviously, it’s not all a bed of roses but this post is about some of the benefits. We’ll get to some of the pitfalls and things to watch out for in future posts.
 So, if you’ve been dreaming about making your big move, don’t just keep watching re-runs of ‘Escape to the Country‘. If you’re in metro Melbourne, get yourself along to the Regional Victoria Living Expo (April 27-29) and, if you’re anywhere else in Australia, post your comments or questions below and First National will do its best to provide the answers.
You can also Tweet your questions to @RealEstateCast
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 Each year, toddlers continue to drown in backyard pools so safety must always be a First National property manager’s primary concern.
The unfortunate truth is that drowning can happen at any property if appropriate precautions aren’t taken. Royal Life Saving – the national body for water safety in Australia – campaigns hard to get all households to check their pools to ensure safety. They also send the message to local councils that pools need to be checked to ensure compliance with safety standards.
There’s no doubt, with the degree of public distress at each drowning, backyard checks and adherence to the Australian standards for pool safety will become a bigger issue over time.
Where a rental property has a pool, the managing agent holds some responsibility for the safety of the pool and the tenants. Obviously property managers cannot ensure toddler supervision, or that tenants don’t prop the pool gate open, so keeping pool safety top-of-mind is crucial.
However, agents do bear responsibility for ensuring the tenant is informed about pool safety and supervision, and that the pool surroundings and equipment meet minimum standards.
First National encourages Landlords to talk to its Property Managers, to make sure they understand the requirements and their legal responsibilities when they own and investment property with a swimming pool.
We also talk to our tenants, ensuring they understand their responsibilities with their pool. We provide clear documentation concerning what they are expected to do and what the safety requirements are.
Our property managers also regularly turn to pool professionals, such as PoolWerx, to ensure they’re fully aware of changing Australian safety standards. We recommend Poolwerx to all consumers as they can quickly let you know if your pool doesn’t meet the necessary safety criteria.
Taking action to ensure your pool is safe is vital to reducing the risk of a tragedy. By taking action today to ensure your pool is well maintained and safe, you are actively helping to reduce the incidence of drownings.
Visit www.homepoolsafety.com.au for further information and checklists or contact at First National property manager for advice.
       
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Media Release – 9 May 2012
