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Property Market update:  
The elephant in the room

What a start to 2020, firstly with the bushfires and now with the Coronavirus, yet the property market is proving to be extremely resilient with auction clearance rates still well in excess of 75%.

The coronavirus is all over the news at the moment. Besides the obvious serious health risks, the coronavirus could have serious impacts on the property market. The Australian property market is affected by the state of the Australian economy. So, if the economy is affected by the coronavirus, there will naturally be a flow-on effect but it is important to understand that the impacts could potentially be positive or negative.

Firstly, with regard to the economy, the economic impact of the declining tourist numbers is likely to be fairly widespread. That’s because our economy is heavily dependent on the spending of Chinese tourists and students, as well as on Chinese export revenue.

The latest PriceWaterhouseCoopers analysis forecasts that the Australian economy could suffer a combined $2.3 billion drop in revenue from fewer Chinese tourists and students visiting our shores.

China is also easily Australia’s largest export market, currently generating over $93 billion in annual revenue for the Australian economy! Any downturn in the Chinese economy due to the impacts of the coronavirus will hurt the demand for Australian commodity exports like iron ore and coal.

While the economic impacts are starting to be felt, the impact on the property market is yet to be fully understood. On the positive side people tend to view property as a fairly safe investment during economic uncertainty (especially compared to the share market). It is also worth noting that as a property investor you still receive rent (assuming the property is attractive to tenants), regardless of the direction of the market.

There is also a strong likelihood of further rate cuts by the Reserve Bank (RBA) making it even more attractive to buy property. As of the 3rd of March, the RBA did cuts rates by .25%, which was immediately passed on by the banks.

Now the negative impacts could be the affordability issue, particularly if unemployment increases which will have a negative impact on demand. Similarly less Chinese students would decrease rental demand as well as less overseas property buyers.

Unfortunately, no one has a crystal ball to be able to accurately predict the future. We can’t be sure how the coronavirus health crisis will pan out globally or for how long it will last. We also can’t be sure how it will affect the Australian economic outlook or our property market.

While it is important to regularly monitor Australian property news to stay informed of the latest market developments, make certain to take a balanced approach and look at the facts rather than speculate or get caught in the wave of negative media.

Our advice always remains that if you are in a position to buy now and you do your research, property can be a great investment regardless of what is happening within the current economic climate.

Property Management update


Changes to our rental laws are on the way...

Did you know that as from July 2020 there will be a number of new renting laws that we must abide by?

Some of these laws include: -
  • Non-Urgent Repairs - Renters can apply directly to VCAT for non-urgent repairs if the rental provider has not carried out notified repairs within 14 days.
  • Urgent Repairs – New guidelines will be issued by The Director of Consumer Affairs Victoria regarding timeframes for responding to urgent maintenance repairs.
  • Rental Providers must pay back Renters  - for the cost of urgent repairs (or replacement if the fault cannot be repaired) within seven days of the renter giving written notice of the reasonable cost of the repairs.
  • Pets in Rental Properties - Renters can keep pets at a rental property with the written consent of the rental provider. A rental provider can apply to VCAT for an order that it is reasonable to refuse permission.
There are a number of new terms, including ‘rental providers’ and ‘renters’, to be used. The new rental laws refer to landlords as rental providers, tenants as renters, tenancy agreements as rental agreements just to name a few.

Buyers Advocate Property Management Team pride ourselves on creating an unsurpassed property management experience for all clients, rental providers and renters alike.  If we can assist you in managing your investment, please contact Lily or Rachel on (03) 9818 4499.

 

Our Vendor Advocacy Services


Did you know we offer Vendor Advocacy?

A service within our broad range of offerings is Vendor Advocacy.  We can assist clients in taking the time, stress and pressure out of selling a home or investment property, delivering focused experience and expertise in all aspects of a property sales transaction.

We are able to provide an independent valuation of your property. Our Advocates are experienced advisers who will guide you objectively through the sales process.

Our role as a Vendor Advocate is to act for the seller, to appoint a suitably qualified real estate agent. This ensures at all times that selling agents do what they say they will do, charge a fair and reasonable fee for their services, act impartially when introducing buyers and market and promote your property professionally and effectively.

Our fee is deducted from the sales commission, so it won’t cost you anymore to engage our service to assist you to sell your property.

Let us help you sell your property. Contact one of our experienced Buyer’s Advocates on (03) 9818 4499, for an obligation free discussion.

 

Recent client purchases


We have had a busy start to the year with some great properties secured for our clients. Here are a few examples.
 
Home Buyer in Windsor (February 2020)
Buyer’s Advocate – Sam Lally
 
We originally knocked this property off from the search, with the belief that it would sail over our clients budget, due to its position in the block, the overall size of the property, its orientation and recent sales within the block itself. After receiving a call from the agent the night before the Auction and having the frank discussions we have with selling agents, this one was back on the table. We turned up, put our hand up, and secured the prize.
 
Home Buyer in Croydon South (February 2020)
Buyer’s Advocate – Sam Lally

 
A massive turnaround from a Wednesday open for inspection where the client was driving past the house; we had the property secured for them by Friday afternoon. After receiving a phone call on Wednesday night from the client about this property we swung into action on Thursday morning, with most of the due diligence carried out by lunchtime. A final Friday morning inspection of the property so further items could be checked off and an offer was made against three other interested parties. All of which, had already made an offer prior to us. It’s usually our questioning techniques of the selling agent that puts our clients in front of the crowd to secure the home. On this occasion, a win for our clients.
 
First Home Buyer in Thornbury (February 2020)
Buyer's Advocate - Leigh McConnon
 
This was a truly unique 1 bedroom apartment as it offered 80 sqm of courtyard space on title. Given its position it was always going to attract a lot of attention. With 6 bidders at auction this proved to be the case and with a good aggressive opening before controlling the bidding we were able to deliver a successful result for our client.

Tip of the month:

Buying in a good school zone

If you are looking to buy a home and want to know what public school zone a property is in there are lots of resources available on-line to help choose what is most appropriate for your kids. As a starting point you can put in any address into the following website www.findmyschool.vic.gov.au to locate what government school zone the property is in. This will provide information on both primary and secondary schools.

A school catchment area or a school zone is the geographical location where a government school’s core intake of students must live. Catchment areas ensure every student from Prep to Year 12 is able to enrol at their local government school. Your local government school (primary or secondary) is the school which is closest to your home.

A property located in a great school catchment area may add 10%-15% to its price. This is also important for property investors to consider as this could have a significant impact on the capital growth of their investment.
High-performing school Zones create strong competition for real estate as all parents want a great education for their children whilst avoiding the high costs of a private education. High-performing government school zones are as valuable as garages, pools and bedrooms. They can add as much value to a home as any of these major items.

There are approximately 4 million Google searches on schools every month. The value placed on education is a high commodity and taken very seriously by a high percentage of Melbourne’s population.

Many schools state that your home must have been your principal place of residence for a year or more to be eligible, while other schools simply state that you must be a rate payer within the zone. So make sure you’re clear on the rules before you start to plan.

Being in high performing school zone can be a great investment over the long-term. Both for your child’s education and their inheritance. Owning a property located near a good school, that ticks all the boxes will become an even more valuable commodity in the future, as the nation is only becoming more and more populated.
 
Copyright © 2020 Buyer's Advocate Australia, All rights reserved.

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88-90 Burwood Road
Hawthorn, Vic 3122
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