Tag: buying real estate

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Expert Tips RENO ADDICT

The nine experts you need before investing in property

By Bradley Beer

While property investing is one of Australia’s favourite pastimes, it doesn’t mean it’s always an easy ride. There are ups and down and certainly rewards to reap, but you do have to put in some groundwork and planning to become a successful investor.

While this can seem overwhelming at times – especially for first time investors – the good news is that you don’t have to go it alone. There are professionals whose very job it is to help you along the way. In fact, it is recommended you have a property investment team of sorts – each player with a different role to help you towards  investing success.

As the team captain you get to pick the players, but there are the nine experts you should consider including on your team:

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  1. Accountant and/or Financial Advisor

A common goal of property investing is financial reward, but you need to use your money wisely. An accountant will help you manage your money and advise on any tax changes you should know about, as well as help you claim everything you’re entitled to. A financial advisor is slightly different and looks at your financial situation more holistically. They can help you determine your financial goals and set a realistic plan to achieve them. Ideally, your accountant and financial advisor may be one in the same, but both of these services are incredibly useful.

  1. Real Estate Agent or Buyer’s Agent

When you’re searching for your first or next investment property, it’s good to have a real estate agent or buyer’s agent you can trust. Their commission should be transparent, they should have a thorough knowledge of the local market, have a deep understanding of your requirements and be proactive in helping you find your ideal investment.

  1. Property Manager

While some investors may be tempted to self-manage their property, there are a lot of risks involved in this approach if you don’t have the knowledge or time to manage this effectively. A good property manager will help you secure quality tenants, be on top of any damage, will save you time, tell you of any requirements and will help take some of the emotion away from the process. As their fees are tax deductible this shouldn’t be looked at as an unnecessary expense.

  1. Mortgage Broker

In the past year, mortgage brokers have been gaining market share in Australia.  The 2017 Property Investment Professionals of Australia (PIPA) investor confidence survey revealed that 83 per cent of respondents are hoping to finance their next loan via a mortgage broker, up from 71 per cent last year. If you’re looking to purchase a new investment property, it may be worth speaking with a mortgage broker to help you find the best product to suit your situation and your finances.

  1. Conveyancer

There’s a lot of complicated paperwork involved in purchasing a property including the contract of sale, mortgage documents and other paperwork related to the transaction. It’s best to enlist the help of a qualified and reputable conveyancer to do this legal legwork for you. They’ll help decipher any complicated terms and conditions and translate the legal jargon. While you’re not legally obliged to hire a conveyancer, it should help you reach settlement sooner and with a lot less stress.

  1. Quantity Surveyor

Ensure you get a quantity surveyor that specialises in property depreciation to prepare your tax depreciation schedule. A specialist quantity surveyor is worth having on your team as they will ensure you’re claiming everything you are legally entitled to. A specialist will also keep on top of any tax changes so you don’t get on the wrong side of the Australian Taxation Office (ATO). The ATO recognises quantity surveyors as one of only a few professions which possess the required construction costing skills to calculate the cost of items for the purposes of depreciation.

  1. Building Inspector

It’s essential that you get a building and pest inspection carried out before you buy a property. The last thing you want is to buy a property only to later find it’s actually riddled with termites or structurally unsound. A trusted building inspector will help you determine if you have a quality property on your hands and can save you from forking out thousands on surprise repairs and maintenance after the time of purchase.

  1. A mentor

It’s great to have someone who is an experienced investor who you can turn to for advice and learn from their real life experiences. Investing in property has its ups and downs so it’s nice to have an investor friend on your side to help, even if it’s just to chat about your situation and investing plans.

  1. Yourself

While you don’t need to be an expert to invest in property, it’s important to arm yourself with some basic knowledge of the market to keep on track of how your investment is performing. It will also give you more confidence when dealing with other professionals to ensure you’re not being taken for a ride. There are many resources out there you could use to improve your investing knowledge from books, blogs, magazines and online resources to information nights and investing courses.

–Bradley Beer (B. Con. Mgt, AAIQS, MRICS, AVAA) is the Chief Executive Officer of BMT Tax Depreciation. 
Please contact 1300 728 726 or visit www.bmtqs.com.au for an Australia-wide service

Buy property with friends and increase your tax deductions

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RENO ADDICT

Using a buyer’s agent: would you?

Buyer’s agents are becoming increasingly popular. After all, who wouldn’t want someone who speaks the language of inspections, appraisals, contracts, settlements and price negotiations to do your bidding?

Kristy - Agility Property reno addict

Kristy Smith, owner of new boutique buyer’s agency, Agility Property, does this and more, also providing related services such as interior design and property management. Believing buyers typically represent themselves with limited market knowledge — while sellers are represented by an agent — Kristy thinks it’s time for a level playing field.

“Hiring a buyer’s agent gives you a balance of power during research and negotiation,” explains Kristy. “You have the best information, knowledge and experience on hand.”

Kristy also plans to give this power to her clients through a new app set to launch in March. “Some buyers want to stay involved in the process but just need guidance. So the aim of the app is to simplify and enhance their experience, and it’s obviously available anywhere and anytime of day.”

A whopping 88% of property purchases were handled by a professional buyer’s agent in the US according to a 2013 study undertaken by American National Association of Realtors and according to Kirsty the trend will continue to rise in Australia too.

Find out more about Agility Property.

Would you use a buyer’s agent? Have you used one with great results? We’d love to hear your experience in the comments.

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RENO ADDICT

5 questions with our real estate guru Mark Foy

As the principal director of Belle Property Surry Hills, Mark Foy really knows his stuff. Not only has he been the number one seller in Sydney’s Darlinghurst for the last three years, he also has a long history of exceptional sales results in the broader inner city. So we thought there was no-one better to answer the difficult questions on where to spend the big bucks when renovating for profit, how to pick the best agent and how to buy a property when you really have no idea what you’re doing! Mark will be Reno Addict’s go-to guy for all things real estate.

mark foy reno addict

1. What is ‘buyer beware’ and what should I look at?

Buyer beware basically means buyers need to do their own due diligence on a home. They can’t expect all the information to be given to them. If you’re buying a house you need to get a building inspection done or if your buying an apartment you should get a strata report done; a strata report is like a building report, it shows you the financials and the history of the building so you understand what you’re buying into. Also other things like doing council searches and seeing whether there’s going to be a building popping up across the road are important to do; it’s not the agent’s duty to disclose, but rather the buyer’s duty to seek out that information through their solicitor. And finally the buyer should have the contract reviewed by a lawyer prior to exchanging.

2. What value does a new kitchen add to a house?

It definitely adds a lot more salability to the property. You’d definitely get your money back and possibly a bit more. A kitchen is such a critical part of the house, you spend a lot of time there entertaining and preparing meals; so I think updating a kitchen for a sale is important.

3. How should I go about selecting an agent when selling?

The most important part of selecting an agent is understanding their experience. Are they local and active within the area, do they speak to buyers in the region and are they in touch with the market? You also have to find out how they’d go about handling the selling process. Starting from how they conduct their open homes and communicate with the owner and potential buyers, all the way through to picking an auctioneer come auction day. All these things come into play and they’re the things I’d want to know.

4. What are the big-ticket items to concentrate on when renovating to sell?

More important than kitchens and bathrooms is presenting a property that’s got a certain feeling about it. When a buyer walks into a property you’ve only got one chance to create that emotive feeling and it’s not through having a nice kitchen! It’s through making sure it’s furnished nicely, that it’s looking sleek with a new paint job, that the floorboards look nice or there’s a new carpet, that the garden’s presented well, that there’s music playing and then that it all comes together by being represented by a fresh looking agent out the front. All those things come into play, so that’s what I’d be focusing on when you’re renovating.

5. How much notice should I take of building inspection reports and should I ever buy without one?

I’d definitely get a building inspection report, 100%! It’s $400-500 and it’s peace of mind. Buyers aren’t builders and they don’t know what to look for, I think it’s critical that you get one. However, one thing to consider when you’re reading a report is the builders that do them are always going to describe the house in its worse condition, because realistically they’re protecting themselves. But in saying that it depends what and where you’re buying. If you’re buying an old 150-year-old house in the inner city then you need to understand that it’s going to need work done. However, if you’re buying a brand new house and it’s getting a bad condition report, then there’s something wrong. Therefore it’s important you consider where you’re buying and how long the building has been erected for.

–Contact Mark via his website or submit a question for him here.