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PRE-PURCHASE INSPECTIONS A MUST
You are about to make one of the biggest purchases of your life - a real estate property. Why wouldn't you want to know the quality of your asset-to-be?
Whether new or old, every property should be inspected prior to purchase. There are basically three reasons for doing so.
First, you want to know the true condition of the property and any problems or faults it contains. The second reason is that the pre-purchase report may affect the purchase price. You may want to negotiate a lower price in view of the cost of an essential repair named in the report. Or you may request the owner to rectify the situation before proceeding with the purchase.
The third reason is that further investigation of a problem may be necessary by a third party specialist from another profession altogether.
You will also be best served by getting independent building & pest inspectors as opposed to a tradesperson. That way they won't be plying their trade, but, instead, will give you a straight-forward assessment of maintenance issues and possible white ant problems.
The idea is to get to the source of problems, not just their symptoms. Painting over cracks doesn't stop rising or falling damp for example. Other common concerns often need knowledgeable attention are leaking roofs, cracking tiles, drainage problems and white ant damage.
If I can be of assistance in any matter pertaining to real estate, feel free to phone me on 07 3286 1266 or call into our friendly office cnr Middle & Doig Streets, Cleveland.
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BUYING A PROPERTY GIVES FINANCIAL SECURITY
It's great to own the property you live in. Not only can you decorate the place exactly how you want it, but it's a significant step in becoming financially independent as well.
One significant benefit is that you will actually start to systematically save money. Paying rent just sees dollars flow away to the landlord, but paying a monthly mortgage returns the principal portion to your pocket. And with inflation in the picture, your mortgage payments will get relatively cheaper as your income goes up.
Another way of looking at things is what will happen when you retire?
If you are a renter, your rent will be constantly advancing with inflation, and your fixed retirement income will increasingly decline as your rent eats into your savings.
The forces of inflation are what really makes the difference. As a renter you will constantly witness rent increases. The lure is having a greater disposable income in the early stages of renting. But over time this advantage disappears.
The way mortgages are generally structured, the early years see more interest than principal being paid off. But as the years advance the opposite becomes true. Not only this, but other investments you make are taxable, where as all the capital accruements in your own home are tax free. You are also in a much better credit position should you need to apply for a loan.
If you have a real estate need or question, feel free to phone me on 07 3286 1266 or call into our office cnr Middle & Doig Streets, Cleveland.
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When is a Good Time for Negative Gearing?
Put simply, negative gearing is where you borrow enough money on a property to ensure that the total outgoings exceed the income it earns. Outgoings include loan interest on the loan and such things as rates, maintenance, land tax, and insurance. It creates a tax loss, which can be offset against other taxable income in certain cases. Negative gearing is only worthwhile on an investment property which is fully leased.
To make negative gearing work, you must have the prospect of capital growth. If there is no capital growth, then you are only funding losses.
Property is a growth asset. The whole issue of negative or positive gearing is a red herring. The real reason is to build equity. It's the quality of the asset that decides whether you become financially independent, not the gearing.
So, is there a real prospect of capital gain on property at the moment? To put it another way, has the property decline bottomed out. The market has been flat for about 3 years, and there is good reason to expect that property values will come off of their low point in the next 12 to 18 months or so. But a recovery will not be sudden, it takes time for property values to rebuild. Good property holds its value best in any decline, and it is the first to rise in value when the market stirs.
We at Professionals Cleveland can advise you on any real estate matter. Call into our office corner Middle and Doig Streets, Cleveland. |
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Property Inspections
A house is the biggest purchase most of us are likely to make and unfortunately a 'road test' is out of the question. However, property inspections can help ensure there are no nasty surprises
Building and pest inspection are essential pre-purchase reports. They alert you to any faults in the property or issues of concern, and they also help you negotiate with vendors on price, and budget for repairs should you proceed with the purchase. Inspectors must be licenced, and you can easily check their qualifications for the task.
What you pay for an inspection can vary widely, as can the quality of the reports, but asking the right questions before you commission an inspection can ensure you get value for money.
A building inspection should report on all accessible areas of the property, both inside and out, including roof space and under floor. The report must comply with the Australian Standard (AS 4349.1). Pest inspections detect termites and other destructive pests that may be present but have not yet done visible damage.
In the case of an auction, inspections must be carried out before auction day as once the hammer falls you are committed to the purchase whatever you later learn about the property. In the case of private sale, you have more leeway and can make offers subject to inspections, but as the information can be valuable in price negotiations, it is beneficial to have the information sooner rather than later.
We at Professionals Cleveland can help you on any real estate matter. If you have an enquiry, feel free to call me on 07 3286 1266 or call into our office Cnr Middle & Doig Street, Cleveland.
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SETTING THE RIGHT PRICE HELPS THE SALE
There are two factors to every sale. First, what do you, the seller want to recoup for your property? Secondly, what does the buyer want to pay?
Too often sellers consider only the first half of the equation and consequently, find themselves taking too long to sell, losing out on the initial momentum that new listings carry.
Like all markets, supply and demand will dictate the sale It all comes down to what the buyer is prepared to pay. Unfortunately, there is no fixed price for homes in real estate. Prices can vary like the weather.
And just like every seller wanting the highest possible price, so every buyer wants the lowest possible price. This means if a buyer can get the equivalent of your house for a better price elsewhere in the neighbourhood, they will go there instead.
This is not to say that sellers aren't entitled to a good return on their investment. You just have to make sure that your price will attract a buyer. To make sure of this, a seller should do the same market research as would a buyer. This way you will know your competition and can more easily gauge the market and the right price.
As local agents in the area, we have a day-to-day knowledge of what's happening in the market. If you would like a free appraisal of your property as well as an estimate of the price range at which it would sell, give me a ring on 07 3286 1266 or call into our office cnr Middle & Doig Streets, Cleveland. |
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SAVE MONEY WITH RENOVATION ECONOMIES
While building costs are rising, there are ways to renovate that cut costs substantially. Here are some tips:
Hiring an architect who has experience in renovating can save thousands of dollars. They can often find economical ways, for example, to add space with a tight design. Rather than adding a living space, an architect might suggest moving a kitchen to expand the existing living space. Or they might open up the floor plan by opening the house to the outside and adding a deck to the exterior.
Another innovation is to abandon adding onto a building and to instead put up an independent structure. This avoids messing around with the original building altogether. You don't have to worry about matching materials, the wiring etc.
Another tip is to always design to standard dimensions for materials. All materials, doors or windows that need custom cutting will add costs to the project. It's best to design timber keeping in mind it comes in lengths measured in 300-millimetre increments.
An additional idea is to thoroughly document any plans. The more extensive the drawing, the more details provided, the less liklihood of a cost over run.
One economy measure to keep in mind as well as to minimise any demolitions. You can also shop for recycled materials including fittings.
Finally, you can even get pre-designed and pre-costed additions.
If you have a real estate need or question, feel free to contact me on 07 3286 1266 or call into our office cnr Middle & Doig Streets, Cleveland.
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Tips for Purchasing Land
While most land for sale today is contained within huge subdivisions containing hundreds of lots, there are still blocks of land randomly for sale to choose from.
Just like buying a house, location is usually the single most important feature when buying land. How close is it to employment centres or a CBD? Is transportation readily available?
Of course, your interests mandate. Maybe you like cafes or are a keen golfer. Obviously you'll want to be near amenities that you fancy. But if you're an investor, you have to consider potential purchasers. Shopping centres and schools are important to families as may be childcare facilities.
Another consideration is size. Smaller blocks are in fashion because down-sizing is so prevalent as well as single-person households. Sheer economics also counts, especially for first home buyers. Lots come as small as around 400 square metres. The other option is to go for a 600 to 800 sqaure metre block for those needing a family home.
The shape and aspect also need considering. A block needs to be deep enough to build on and, hopefully, get some sun. Having a view is optimal.
Quiet settings are popular as are corner lots. And it's always good to be on the high side of the street. Be sure, too, to check for any covenants on the property. You want to know about restrictions for both yourself and your neighbours.
If you wish to view some properties for sale, feel free to phone me or call into our friendly office cnr Middle and Doig Streets, Cleveland. |
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