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Monthly Archives: May 2016

Purchase The Proper Townhouse

Twenty years ago, townhouses had a reputation of being poorly built and in the wrong location, but over the last 10 years that perception has been turned around.

Townhouses are delighting owners nationwide. But if you’re buying with an eye to investment, the difference between a townhouse with great growth potential and a less impressive performer is not always apparent to the untrained eye.

To guide us in buying the right townhouse, spoke to two experts: Michael Finger, Director at Ray White, Double Bay, smack in the middle of Sydney’s exclusive eastern suburbs; and Paul Osborne, founder of Secret Agent, a buyer’s agency specialising in inner Melbourne.

I started by asking our experts what accounted for townhouses’ image makeover in the last 10 years. Osborne told me that from around 2000: “There was a concerted push back into the inner city  and what many buyers found were old terraces which were cramped, had rising damp and lacked natural light.”

“Putting up new townhouses on small blocks of inner city land was the developers’ response. These two and three level buildings created more accommodation and their elevation delivered natural light and a view over the rooftops that older houses lacked.”

And how is the townhouse market playing out now? Finger told me that in Sydney, townhouses are being snapped up.

“The older ones come at an attractive price point for younger couples entering the market. At the higher price level, what’s driving interest is downsizing empty nesters. With the uptick in the market, this older generation have been able to sell the family home and see a townhouse as a better alternative than an apartment.”

“Many downsizers look at high rise buildings, but the owner corporation levies are often lower for townhouses. Some strata apartments are charging two thousand dollars a quarter, even five or six thousand dollars a quarter, which is just ridiculous.”

Purchase Beach House Tips

beach-house # Pick the right beach

The right location needs the right beach to ensure it is a popular destination for all sorts of visitors.

Long swept beaches with clean breaking surf are always popular, but even better is a location which also has a protected swimming area for smaller children.

Prime beachside areas play host to a number of different past times, like surfing, sailing, scuba diving and boating, which attract high income visitors at different times of the year.

Don’t forget night-time either – seaside towns with a smattering of good restaurants and at least one decent late night watering hole are favoured by families with grown up children and holidaying groups of young adults.

The further south you travel, the more important it is to ensure your beach spot is close to winter activities like craft markets, wineries and national parks.

# Find the right location

The best performing beachside locations are within 2.5 hours drive of a major metropolitan area, particularly those with access to a major highway.

Look for small seaside towns in a region with a multi-faceted local economy, which provides a strong local rental market all year round.

Don’t be tempted by areas with a lot of high rise development and fly in visitors. These locations can have large numbers of new units added to a small market in a short period of time which makes these properties vulnerable during a downturn.

# Pick the right property

The best results for properties in seaside towns tend to be from houses, not apartments, especially properties about the same size as a standard suburban house.

Tiny beach huts and sprawling mansions often perform quite badly during cyclical downturns.

Start your search around the middle of the local price range and hone in on a three bedroom houses around 10 minutes walk away from the township.

The best properties will be in a relatively quiet bush setting and have a generous balcony or outdoor entertaining area and plenty of storage for boats and water sports equipment in a lock up garage.

And of course it should be close to a favoured beach – no more than 20 minutes walk.

Once you’ve found a likely candidate, I’d recommend searching through back copies of the local newspaper, paying particular attention to past events like flooding or bush fires.

# Have the right time frame in mind

Properties in coastal resort towns usually have greater price volatility and lower capital growth than those in capital city markets.

If you invest your hard earned money into a seaside property, you may have to be quite patient to see good results, as anyone trying to sell a beach house during the GFC can testify.

But a smart buy in the right location can pay good long term dividends to the shrewd purchaser.

About Conveyancing

When you’re finally able to make your dream home a reality it may come as a rude shock to discover it’s not quite the fairytale it’s cracked up to be. With your dream pad comes legal costs and responsibilities that you’d rather push to the back of your mind. Enter your fairy godmother – aka your conveyancer.

“Conveyancing” is a pretty scary word for many first-time home buyers who are in the midst of grappling with a host of other real estate jargon.

Unfortunately, it’s a necessary step in the purchasing process – and something that can’t be avoided. Regardless of whether you’re buying a poky inner-city apartment or a sprawling McMansion on the water you’ll need to get some conveyancing done.

Conveyancing is the process of transferring the legal ownership of property from one person to another. It is made up of three essential steps – investigation, negotiation and paperwork.

This includes everything from checking the contract of sale and applying to the local council for a current survey and building certificate, to enquiring with relevant government departments and attending settlement.

While you are allowed to do this yourself, unless you have a legal background you have to wonder why anyone would take this route. You already have to deal with the to-ing and fro-ing of obtaining finance and then there’s the stress of the move itself!

It makes sense to leave the pile of confusing paperwork to the professionals. Not only will this ensure the process goes as smoothly as possible, it will take some of the pain out of the whole experience.

Conveyancing costs

Conveyancers on charge as little as $500 and go up to around $1000. This flat fee normally includes all the basics, and your conveyancer should provide you with a breakdown of all costs.

If you don’t think the purchase or sale is going to be straightforward you should consider hiring a solicitor. A conveyancer can only give you legal advice about the property, whereas a solicitor can advise you about the property and many other legal matters, such as tax matters and inheritance.

Whether you opt for a conveyancer or solicitor make sure they have a licence and professional indemnity insurance. Indemnity insurance is obtained in order to offer protection to a buyer (and a lender) where there is a defect in the title which cannot be resolved. While this should be used as a last resort, it’s absolutely crucial.

All care, no responsibility

While your conveyancer or solicitor will review the contract it will be up to you to double-check the details. There’s a good chance your conveyancer has never set foot in your property so they’ll be relying on you to pick up any oversights. The house contract should detail absolutely everything, from the number of parking spots on the title to any permanent window fixtures.

If you do decide to go it alone, do yourself a favour and purchase a DIY Conveyancing Kit. The kit can normally be found for around $80 and contains a step-by-step guide to all the necessary procedures, as well as all the documents required.

Regardless of which conveyancing method you choose it’s a good idea to have another set of eyes (preferably trained ones!) check over the contract.

Signing a contract that you don’t really understand is a big no-no – in fact it’s the fastest way to lose your dream home. Once you’ve signed on the dotted line the contract is binding and if something is awry even the most high-priced lawyer will have trouble rectifying the situation.

There’s no better reason to forgo the responsibility from the start and let your conveyancer work their magic!