Category: Investors

Making An Offer On A House – Where To Start | Century 21

Not sure where to start when making an offer on a house? Century 21 has you covered with the basic know-how. Browse now for more information.

You’ve been spending Saturdays driving around to open inspections. You’ve weighed up the pros and cons of each house you’ve looked at. Now you’ve made your decision and it’s time to put in an offer.  Where do you start?

Making an offer on a property you have set your heart on can be nerve-wracking. Just like any negotiation process you have to start somewhere but you don’t want to put in too high an offer and pay more than the house is worth, nor start too low and possibly miss out.

Before you put in your offer

Before you even make an offer on a house, be sure to do some legwork. Research the property thoroughly online to determine a fair market price. Look at how long the property has been on the market and check out recent sales of comparable properties in the same area.

Next, ask the selling agent who showed you around the property for some more information. Ask him or her about any previous offers and what price they think the vendors will accept. Ask why any previous offers were rejected. Request a second property inspection to be sure this is the house you want and also to get to know the agent and show serious interest.

Once you are sure you want to put in an offer, decide on the maximum price you would be willing to pay for the property and ensure your lender has preapproved a loan for this amount.

Conditional and unconditional offers

Most vendors selling by private treaty, rather than auction, set a sale price above the price they will actually accept to leave some wriggle room for negotiation. If they have a good selling agent however who has advised them wisely, this will be very close to a fair market value.

Having done your research, you will know whether or not this is the case and can decide on a fair first offer accordingly with room for the vendors to negotiate down and for you to negotiate up. It’s not advisable to put in a very low offer that could offend the vendors and stop them from negotiating with you further.

Offers can be either conditional, where you put conditions on the offer, or unconditional. It’s highly advisable to make your offer conditional on certain requirements such as obtaining finance or subject to the results of building and pest inspections. If any problems arise after you have had the inspections done, then you can use these to negotiate lower on price.

Put it in writing

Not all states require that your offer must be in writing but it’s advisable to do so anyway in order to have a record of the negotiations and what each offer and its conditions are.

This should take the form of a formal offer in writing (either letter or email) to the selling agent outlining the price you would like to offer and any conditions.

You can also offer favourable terms to the vendors such as a shorter or longer than average settlement term to sweeten your offer.

The waiting game begins

The selling agent will pass your offer on to the vendors. Be patient, wait and see the vendors’ response and whether they come back with a counter offer. Negotiations can go back and forth for some time, so consider each of your responses carefully and keep your top price in mind.

Keep the tone of all negotiations formal and neutral. Aim for a win-win for both yourself and the vendors and the process should go smoothly.

If negotiations reach your top price, then spell out that this is your limit and you are unable to go any higher. At this stage, the selling agent will likely advise the vendors to accept your highest offer.

Once a price has been agreed, you are on your way to owning your own home. The contract can be finalised and, once signed by both parties and the deposit paid, the deal is completed!

With over 3,000 offices, CENTURY 21 is the largest real estate sales organisation in the Asia Pacific region. We’ll help you purchase the property of your dreams. For more information on making an offer on a house, buying or selling, please get in touch with a local member of our team now.

 

 

 


0 comments | Posted by Administrator on 07/12/2016 at 3:30 PM | Categories: Buying - Investors - First Home Buyers -

Making An Offer On A House – Where To Start | Century 21

Not sure where to start when making an offer on a house? Century 21 has you covered with the basic know-how. Browse now for more information.

You’ve been spending Saturdays driving around to open inspections. You’ve weighed up the pros and cons of each house you’ve looked at. Now you’ve made your decision and it’s time to put in an offer.  Where do you start?

Making an offer on a property you have set your heart on can be nerve-wracking. Just like any negotiation process you have to start somewhere but you don’t want to put in too high an offer and pay more than the house is worth, nor start too low and possibly miss out.

Before you put in your offer

Before you even make an offer on a house, be sure to do some legwork. Research the property thoroughly online to determine a fair market price. Look at how long the property has been on the market and check out recent sales of comparable properties in the same area.

Next, ask the selling agent who showed you around the property for some more information. Ask him or her about any previous offers and what price they think the vendors will accept. Ask why any previous offers were rejected. Request a second property inspection to be sure this is the house you want and also to get to know the agent and show serious interest.

Once you are sure you want to put in an offer, decide on the maximum price you would be willing to pay for the property and ensure your lender has preapproved a loan for this amount.

Conditional and unconditional offers

Most vendors selling by private treaty, rather than auction, set a sale price above the price they will actually accept to leave some wriggle room for negotiation. If they have a good selling agent however who has advised them wisely, this will be very close to a fair market value.

Having done your research, you will know whether or not this is the case and can decide on a fair first offer accordingly with room for the vendors to negotiate down and for you to negotiate up. It’s not advisable to put in a very low offer that could offend the vendors and stop them from negotiating with you further.

Offers can be either conditional, where you put conditions on the offer, or unconditional. It’s highly advisable to make your offer conditional on certain requirements such as obtaining finance or subject to the results of building and pest inspections. If any problems arise after you have had the inspections done, then you can use these to negotiate lower on price.

Put it in writing

Not all states require that your offer must be in writing but it’s advisable to do so anyway in order to have a record of the negotiations and what each offer and its conditions are.

This should take the form of a formal offer in writing (either letter or email) to the selling agent outlining the price you would like to offer and any conditions.

You can also offer favourable terms to the vendors such as a shorter or longer than average settlement term to sweeten your offer.

The waiting game begins

The selling agent will pass your offer on to the vendors. Be patient, wait and see the vendors’ response and whether they come back with a counter offer. Negotiations can go back and forth for some time, so consider each of your responses carefully and keep your top price in mind.

Keep the tone of all negotiations formal and neutral. Aim for a win-win for both yourself and the vendors and the process should go smoothly.

If negotiations reach your top price, then spell out that this is your limit and you are unable to go any higher. At this stage, the selling agent will likely advise the vendors to accept your highest offer.

Once a price has been agreed, you are on your way to owning your own home. The contract can be finalised and, once signed by both parties and the deposit paid, the deal is completed!

With over 3,000 offices, CENTURY 21 is the largest real estate sales organisation in the Asia Pacific region. We’ll help you purchase the property of your dreams. For more information on making an offer on a house, buying or selling, please get in touch with a local member of our team now.

 

 

 


0 comments | Posted by Administrator on 07/12/2016 at 3:30 PM | Categories: Buying - Investors - First Home Buyers -

First quarter of the year sees home values stabilise

The recent release of the RP Data-Rismark Hedonic Daily Home Value Index results for March showed that national home values rose 0.2 per cent in March 2012 – a potential sign that the Australian housing market is stabilising.  The market has remained unchanged for the quarter ending 31 March 2012; this flat result is the strongest result since March 2011 when values increased by 0.7 per cent.  

According to the managing director of Rismark International, Ben Skilbeck: “While the housing market remains soft, the zero per cent change over the first quarter of 2012 demonstrates that it is consolidating its position following the decline seen in the calendar year 2011.”

Over the month, the resource rich states delivered the strongest gains with Perth rising 1.4 per cent, Darwin up 1.1 per cent and Brisbane increasing by 0.8 per cent.  

The Index saw that the flat result seen over the March quarter was largely driven by the Sydney housing market which achieved the strongest gains over the quarter, with values rising 1.1 per cent.  Values were down across many of the other capital cities with the most significant drop recorded in Adelaide where dwelling values were down 1.5 per cent.  

Rismark’s Ben Skilbeck points out a number of factors that indicate an improvement in housing market conditions may have occurred over the past few months.  

“The ratio of national house prices to household disposable incomes is currently below the decade average.  Additionally, according to the ABS housing finance data, both the value and number of loan approvals for the purchase of established dwellings are at levels not seen since November 2009.  First home buyers as a proportion of home loans approved are back to levels not seen for two years,” said Mr Skilbeck.  

Charles Tarbey, Owner and Chairman of CENTURY 21 Australia said of the results: “While we must note that much of the improvement seen in the housing market is due in part to the Sydney market which rose 1.1 per cent over the quarter, we are nonetheless seeing signs of a potential stabilisation of home values. 

“Other factors such as strengthening auction clearance rates and improving demand from first home buyers are certainly encouraging indicators of both the current state of the national housing market and the potential for continued improvements over the course of 2012,” concluded Mr Tarbey.  

For more information about available property purchase opportunities in your area, please contact your local CENTURY 21 agent. 


0 comments | Posted by Charles Tarbey on 10/04/2012 at 10:17 AM | Categories: Finance - Property Management - Investors - First Home Buyers - State of the Market -

A good time for buyers in the housing market

The residential property market can sometimes be a confusing space to navigate, especially with the media attention it often generates and receives.  The views of property commentators, as well as the constant flow of data released, often appear to be conflicting, with the media conveying sometimes contradictory signals to buy, sell, or hold. 

I consider myself fortunate to be in the position I am, as I have access to our internal company data as well as the experience and opinions of the thousands of real estate agents in the Century 21 network, who are spread right across the entire country.  Having contact with such sources allows me to keep a firm grip on what’s happening in the market, in both capital cities and rural areas. 

At the moment, with the conditions that we’re seeing across the national market, it is my feeling that those who are ready to buy are positioned quite nicely.  According to internal CENTURY 21 data, which is a reflection of all CENTURY 21 offices across Australia, residential sales volumes are down of late – we have seen a decrease of 30 per cent from where they were around this time last year. 

And with transactions down, there are still significant levels of stock on the market; our figures indicate that there are approximately 67 per cent more properties for sale across the national CENTURY 21 network than there were at around the same time last year. 

Add to these figures the findings of the recently released RPData-Rismark Home Value Index, which saw a national decline of 1.3 per cent in capital city home values over the quarter to February 2011. 

So what does all of this mean for buyers? The fact that property transaction volumes are down could suggest that the market is currently wary and approaching purchase decisions with some trepidation.  If this is the case, then we are looking at a period where demand is low, which ironically can help to create favourable conditions for buyers.  The levels of competition that would otherwise need to be contended with are lower, which allows for some breathing space when it comes to making a decision, as well as giving you room to negotiate on price. 

And with the Reserve Bank of Australia deciding last week to keep interest rates on hold for the next month at least, buyers who require financing have another window of opportunity to obtain mortgages with favourable interest rates. 

It would appear therefore, that the property market in its current state may hold some good opportunities for those who are in a position to make a purchase.  I would suggest that these people make the most of this period and devote some time to researching and comparing the various properties and financing opportunities that are available.

Remember that our CENTURY 21 real estate agents all over the country are happy to answer any questions you may have about the properties that are available for purchase and general market conditions in your specific area. 


0 comments | Posted by Charles Tarbey on 08/04/2011 at 11:25 AM | Categories: Finance - Investors - First Home Buyers - State of the Market -

Should you buy a house or an apartment?

It seems to be a very common question when it comes to buying real estate, particularly for first and second-time buyers – will it be better decision to purchase a house or an apartment?

As a starting point, the factors that go into making this decision are mostly personal preferences.  These include whether the property is an investment or to be your residence, the location that you’d like to live in, how many people will be living in the property, what types of maintenance you are prepared to carry out personally, and so on and so forth. 

Investment vs. Primary Residence
Many investors find apartments to be easier purchases for a number of reasons.  Apartments do not necessarily require the larger amount of external maintenance (e.g. gardens, pools) and attention that an individual house will need, and the building’s strata manager/committee will usually take care of most building and remedial work that is required.  However, having this advantage comes at the cost of strata levies to the investor, which may have an adverse effect on the rental income that the property delivers. 

Investors should also consider the length of time they plan to hold on to a property for and the capital gains desired from the investment.  Using historical pricing as a guide, we have seen that both houses and apartments experience value gains; over a short to medium-term period, houses and apartments appear to show similar price gains, however over the longer term houses may see larger growth in value. 

For investors, rental potential and income are other factors that require consideration.  Many real estate agents believe houses to hold appeal for a larger market of renters, including families with children and pets, who may steer clear of apartment living.  Houses also often allow a higher rent to be charged. 

Having said this, however, price is obviously a factor that will be of pertinence to many buyers, whether purchasing as an investment or home.  While some apartments can be more expensive than houses (e.g. penthouses with water views in costly suburbs), in general terms, houses are usually the more expensive purchase, especially if you are comparing properties in the same area.  Apartments therefore may be a more friendly purchase option, especially for first-time buyers.      

Location & Space
High density housing is commonly found in city areas and suburbs that are only a short distance from the CBD.  Thus, if you desire an inner-city lifestyle, an apartment may be the best property option.  However, if you wish to live further away from the city and have enough room to accommodate several people including children and pets, you may find the extra space (both internally and externally) that a house usually provides may be more appropriate for your situation. 

In the end, the choice between an apartment and a house very much comes down to your personal circumstances.  By thinking about your needs and thoroughly researching the property market at the time you wish to buy, you should be able to reach a decision that is suitable for your situation.

If you would like advice regarding your situation and the decision to buy a house or an apartment, please feel free to visit one of the many CENTURY 21 offices around Australia.         


1 comments | Posted by Charles Tarbey on 04/04/2011 at 9:25 AM | Categories: Buying - Investors - First Home Buyers -

It's time to get serious about going green

From a real estate point of view, I think we can definitely say that the benefits of including green features in a property certainly go beyond the aspiration of owners to be environmentally friendly. 

From the data that has been coming out for a couple of years now, as well as the attitudes of buyers that our agents are seeing in the marketplace, I am becoming firmer in my stance that the inclusion of environmentally sustainable features in new buildings or renovation projects is increasingly necessary for property owners looking to attract as many buyers as possible when selling.    

Putting aside for a moment the positive feelings you may get from doing your bit for the environment, it really doesn’t make financial sense for green features to be ignored, especially if you are renovating or building from scratch.  Not only can such features assist with reducing the costs of operating your property, without them you may actually find its value suffers. 

For example, solar (including hot water systems and roof panels) and LED lights are two proven green technologies that can both save you money and make your property more attractive to buyers. 

A recent survey suggests that Victorians are leaning towards green features in their homes.  According to the 2010 pulse practitioner and consumer survey released by the Victorian Building Commission, Victorian building consumers are placing increased value on environmental sustainable building, with 85 per cent of respondents rating it as important. 

These findings echo the conclusions of the 2008 report Energy Efficiency Rating and House Price in the ACT, published by the Department of the Environment, Water, Heritage and the Arts.  The study, which was the first of its kind in Australia, found that a significant relationship exists between house price and energy efficiency rating, evidence that the residential market values the energy performance of a property. 

I don’t think it’s surprising that such a value is placed on green features in a property, especially given the recent increases in the cost of living and expectations that it will continue to rise.  People will be searching for innovative ways to cut costs, and what better place to start than in your own home? What this means is that buyers will and are starting to lean more toward properties that are energy efficient when making decisions about a real estate purchase. 

Thus, when it comes time to sell, the presence of green features in your property will ensure that it appeals to both those who wish to be environmentally responsible and others who recognise the cost savings that accompany reduced energy use. 

Although individual circumstances differ, I strongly encourage all readers, especially those who are building from scratch or renovating, to consider including environmentally sustainable features in their plans.  Not only will you be having a positive impact on the environment, you could be improving the value of your home.


0 comments | Posted by Charles Tarbey on 21/03/2011 at 10:05 AM | Categories: Investors - State of the Market -

Home intelligence could add value to your property

It’s pretty hard to ignore the speeding train that is technology these days.  And I’m the first to acknowledge the opportunities for business that technology offers – over the years CENTURY 21 Australia has been able to utilise and embrace various innovations to achieve considerable success in the Australian real estate market. 

Beyond the office though – what types of technology do people wish to incorporate into their homes? As real estate agents we definitely focus a lot on beautifying, styling and readying a home for sale, and considering the value add potential of any cosmetic improvements that are made during a renovation or rebuilding process. 

But over recent years it is becoming apparent that people are increasingly placing value on the existence of technology in their homes.  And I’m not just talking about an entertainment system that ensures your DVD player is connected to your television, I’m referring to an entirely interconnected network that pretty much allows you to wire your home to respond to your every whim. 

An article by Paul Best recently appeared on the Sydney Morning Herald website, entitled ‘Unlimited control of your life’, which considered the ways that average suburban homes around Australia are turning into ‘smart homes’.

According to the article, processes of automation including controlling lighting, security, access to the house, communications and media distribution are usually what people first imagine when they think of technology in the home.  Recent advances however, as explained by Michael Staindl of Smart Systems, means that these intelligent systems are integrated, and your property’s lighting, security, heating/cooling, entertainment and communications all work harmoniously. 

The article uses the example of a security system which lets your cleaners in at prescribed times each week, and sends you an SMS when they come and go. 

The article surmises that the advent of such technological innovation in homes has been driven by the iPhone and iPad.  The apps available on these devices have given users a large amount of intuitive functionality and have started people thinking about what else is possible. 

The article leaves us with the message that smart homes are becoming increasingly standard, which gives home owners something to think about, even those who do not consider themselves to be all that technologically savvy. 

Incorporating technology into your home could be worth considering when renovating or building from scratch, as it seems to have the potential to not only make your life easier in the short term, but also could also add value to your property when it comes time to sell. 

 


1 comments | Posted by Charles Tarbey on 15/03/2011 at 11:30 AM | Categories: Buying - Investors - State of the Market -

Good news for the rural housing market

It is no secret that rural Australia has had a tough time of late.  With the plethora of flash natural disasters experienced across the nation over the past few years, as well as extended periods of ongoing drought, it has been hard for our farmers to catch a break, as well as to encourage city-dwellers to consider a move inland. 

Australia is an incredibly urbanised country, with approximately 82% of the Australian population living in major metropolitan regions (Source: Federalism and Regionalism in Australia – Rural Australia and the need for reform). 

And with Australia’s growing housing shortage and worsening affordability in our cities, our rural communities could be good options for people looking to relocate out of Australia’s urban centres. 

The attractiveness of these options was reinforced with the recent release of the Australian Commodities report by the Australian Bureau of Agricultural and Resource Economics and Sciences which revealed that earnings from Australia’s commodity exports are expected to rise by 14 per cent to a record $251 billion in 2011 – 12.

This is excellent news for the residential property market in rural Australia, where such strong expectations for our commodity markets could very well translate to solid growth in rural property prices and an increased demand for many rural homes. 

It is my prediction that properties or rural homes that are in, or positioned close to, the areas that benefit the most from increased prices on world markets and bumper harvests, can expect to see the strongest growth in values. 

There is a good possibility that the strength of Australia’s commodity markets will see rising demand for rural real estate over the coming years, with farmers enlarging their current holdings, ex-rural based Australians returning to the country, and new players entering the market. 

There is no doubt that most Australians appreciate the beauty of rural Australia.  And with the state of housing affordability in our capital cities, it wouldn’t surprise me at all if some people start to consider a move to the country.  If commodity prices continue to improve, as we have seen predicted, they will act as further incentive for people to relocate to the fresh air and open spaces of rural Australia. 

 


0 comments | Posted by Charles Tarbey on 15/03/2011 at 11:28 AM | Categories: Buying - Investors - State of the Market -

Land Sales Volumes Down, Prices Rise

Those who have read this blog before will know that the continuing issue of housing affordability in Australia, and my concerns/frustrations in response, are not foreign concepts. 

Last year there were numerous publications considering the situation;  September saw the release of the Real Estate Institute of Australia’s Deposit Power Housing Affordability Report, which recorded the sixth consecutive quarterly decline in housing affordability in Australia.  Prior to that, the Housing Industry Association and the Commonwealth Bank jointly released their Housing Affordability Report in August, which found that housing affordabilities were at record lows around Australia. 

Following the release of both of these reports, I commented on the necessity of government action to develop a strategy to at least make some inroads into the situation. 

And with the recent release of the September 2010 Quarterly Land Report by HIA and RP Data, I find myself writing about the issue again.  The report found that land sales volumes were at their lowest point in a decade, while land values had increased. 

These figures don’t really surprise me – it takes a lot to build a property.  With the costs of the land itself, your legal requirements, council approvals, designing your home, and the supplies and labour needed to construct it, starting from scratch can be a tremendously expensive exercise.  And if land prices rise, this may not be a viable option for many potential home owners. 

So they are then left with the option of buying an established property, thereby adding to the housing shortage we already face, as opposed to lessening the pressure. 

With Australia already looking at a substantial housing shortage (JP Morgan estimated the shortage to be around 180,000 homes in its Economic Research and Global Data Watch 2010 report, while the Federal Government’s Housing Supply Council 2010 Report suggested the shortage was closer to around 200,000 houses), it is imperative that sufficient land is released to address the growing demand for housing. 

Essentially, governments at all levels need to recognise the growing housing affordability crisis facing Australians and formulate solutions to take action.  For example, the rezoning of more areas to increase medium density housing may be a way to help overcome the shortage. 

Unfortunately, when it comes down to it, it will be Australians that suffer from this housing situation, especially first home buyers.  If land is too expensive, sadly it will usually just lead to more expensive homes for consumers. 


0 comments | Posted by Charles Tarbey on 31/01/2011 at 9:57 AM | Categories: Property Management - Investors -

Using Property Data to your Advantage

And we’re off! I hope everyone enjoyed their Christmas and New Years and for those people who took time off work – had a nice, relaxing break.  2010 has now officially passed, and the team at CENTURY 21 Australia are gearing up for what we believe will be a very busy year for real estate in 2011. 

For one reason or another, people often find themselves making ‘life’ decisions around New Years.   I think it ties into the idea of resolution-making - the start of another year represents a watershed and people are determined to finally go after what they may have been planning for awhile. 

Selling a property and moving into a new type of home (e.g. downsizing from a house to an apartment) or different area (e.g. leaving the suburbs and relocating to an inner city setting) quite often arise as some of these resolutions. 

With the thought that many people may be thinking of moving at the moment, I thought I would use this blog to talk about how both buyers and sellers can make the various types of property data work to their advantage. 

In my view property data is a significantly underused tool; when employed it can give people delving into the property market some great insights into timing, locations and other important notions.  I have a feeling that many people don’t quite know how to find nor decipher the available data and thus shy away from it, not realising the benefits that it could afford them. 

The first step is to know what types of data are available – and realise that it’s not all just about sale prices.  Bodies such as the Australian Bureau of Statistics, as well as specific property data companies such as RP Data, release information covering many topics, such as the number of listings at the moment at one time, the level of housing finance being sought after and granted, the number of houses selling at auction, just to name a few.  

The trick to being smart about using data is to develop an understanding of how the relationships work between different variables.  For instance, if auction clearance rates are down but sales rates are constant, this doesn’t mean that properties are not selling but it may indicate that properties are being passed in at auction with a sale privately negotiated after the fact. 

Both buyers and sellers can then take this information to uncover opportunities.  For sellers – if you can see that the market is not supporting auctions at a particular time, perhaps make plans to prepare for private sales negotiations.  For buyers – take advantage of the lower competition at the auction and be immediately ready to begin discussions with the vendor and agent as soon as the property is passed in. 

Other types of property data such as median price and growth rates will give you an indication as to how much you should be looking to sell for, or pay, as well as which areas are either heating up or slowing down. 

 If you are interested in using property data to your advantage, then I think it definitely pays to stay abreast of the news over a substantial period leading up to when you are looking to buy or sell.  Many property journalists will take straight statistics and figures and highlight the greater meaning – reading such stories will help you to develop an understanding about what the figures indicate and how this can help you with your property plans.   


0 comments | Posted by Charles Tarbey on 10/01/2011 at 9:56 AM | Categories: Buying - Property Management - Investors -