Tag Archives: market

How to help your children up the property ladder

How to help your children up the property ladderFor anyone trying to buy a home in today’s market, recent conditions aren’t particularly accommodating. According to the Housing Industry Association’s Affordability Report, the affordability index dropped by 6.4 per cent over the December quarter. This has pushed the rating to 75.6 (a score of 100 represents a balanced market). A mix of incredible price growth and a supply shortage has helped see to this.

In these circumstances, young first home buyers could find it tough to break into several city’s markets, and are often being priced out of their own region. If your kids are struggling to get a foot on the property ladder, there are a few ways you can lend a hand.

Let’s take a look at how you can do this:

Putting a deposit

CoreLogic’s monthly indices show that the average value of houses across Australia’s five biggest cities was $757,330 by the end of January. In Sydney, Australia’s densest city, this figure was a whopping $993,770. Clearly, buying real estate in Australia is more costly an affair than its ever been, making it a journey just to save for the initial down payment.

If you want to invest into the future of your children, why not give them a one-off cash gift that will go toward a deposit. Not only are you speeding up the saving process for them but keeping them motivated and with their eyes on the prize.

Put your home as collateral

For those picking up a home loan for the first time, lending conditions aren’t usually in their favour from the get-go. With no property of their own to put as collateral should things go south, they present a greater risk toward lenders.

If your child is in this situation, it can help immensely to put yourself forward as a guarantor. This means that you’ll put your own home down as collateral for the mortgage, which can help lower the minimum deposit that they have to commit by quite a bit. It could help them to buy a homeand get a foothold in the market much quicker, as well as keep them motivated.

The great thing is that it won’t cost you a cent, but can fast-track your child’s property journey significantly. However, there are obviously big risks to this. Just make sure they have the income and financial stability to make those repayments or you could, in the worst-case scenario, lose your home. Speak with a financial adviser to see if such an approach is right for you and your young adult.

What will add the most value to my home?

What-will-add-the-most-value-to-my-homeProviding a home for yourself and your family will undoubtedly involve significant expenditure throughout your life, but when the time comes to sell up and move on, you want to make sure that you get the best value possible. After all, this is somewhere full of memories and experiences, not to mention an asset you invested thousands in over the years. Renovations and cosmetic improvements offer the greatest opportunities to add value to your home. However, in the world of selling houses, not all upgrades are created equal. Some can increase the chances of a sale, but some might make it more difficult. More often than not you aren’t willing to drop enormous sums of money on serious structural renovations, but a few carefully chosen upgrades can improve the chances of a successful sale later on. But how do you choose between renovating one room over the other? Kitchens are often seen as the showpiece of the home It can be very tempting to pour all your resources into making one particular room spectacular, but simple cosmetic changes like a lick of paint on the walls, updated appliances or new tiles and countertops might provide a more profitable sale than fullscale renovations. Also think about bathrooms, living spaces like lounge rooms or outdoor eating areas, or even painting the exterior. Certain projects add more resale value than others. Investigating comparable houses in your neighbourhood, checking property data on your particular suburb or region and consulting with a real estate agent will help you get a clear idea about where your money will go the furthest. It’s all about balancing the price of the upgrades with the actual value of your home, and trying not to overcapitalise. Figuring out your target market is a big point to note. For example, a young family might want more open living space and a fenced backyard, compared to retirees who might require fewer rooms, manageable stairways and more storage. Once you understand what areas your target market places value in, adjusting your house to meet those needs becomes more straightforward.

Tips for finding a good investment

Tips for finding a good investmentProperty investment is a big financial commitment so you want to make sure you get the best bang for your buck. Whatever your long term investment goals, there are a huge array of factors to consider when choosing the ideal property. Here are some ideas to get the ball rolling.

Location counts

Finding the right location for your investment is half the battle. It drives the price and rental returns – and can make your foray into property investment a successful one. When you’re looking for a property do your research. Ask local real estate agents and property management companies about the health of the market. Glance across advertised rental prices and yields – and keep an eye on vacancy rate statistics.

Remember that trends are more powerful than individual results, so consider areas where high growth is expected.

There could be times when you can’t find tenants immediately but these statistics will prepare you for this. In any case, a low vacancy rate suggests you’ll find tenants easily. All this information can give a good idea of the demand for rental property in an area. Depending on your investment goal, you want an area where demand surpasses rental supply – after all, you don’t want an empty property!

Know your market

If you’re renting the property out, understanding your target market is equally important. Families have different preferences than young couples, while retirees are at the other end of the spectrum than students. Look for features that prospective tenants will like. Tenants might appreciate off-street parking, a garage or lots of storage space. It all depends on your target market.

Well-maintained properties often secure higher rents, so consider how much work you will have to do to bring the property up to scratch. A run-down or damaged property may not be worth the investment in the long run.

3 questions to ask a real estate agent when buying a home

3-questions-to-ask-a-real-estate-agent-when-buying-a-homeDeciding to buy a home is a big move, and there are many variables involved in the process. One factor to always consider is the dealings with real estate agents, and making sure you get the most information possible before you decide to make an offer on a property. Here are three questions to always ask a real estate agent when buying, to position yourself nicely for a great offer.

Are you licensed?

This is a simple first step, but you can never be too sure. All real estate agents must be authorised by their relevant local or state authority, so you should either ask for their accreditation or look it up online yourself when you begin speaking to an agent about a property.

How long as the property been on the market?

This is a great introductory question when you begin thinking about how much you want to spend on a home. Compare the length of time it has been on the market with the medians and averages available on research sites like RP Data, and you can get a good idea of whether a house is seeing a lot of interest. If it has been on the market for longer than the average, the vendor and agent might be open to negotiation.

Why is the home being sold?

This can give you a big advantage when buying a home. For example, if the vendor needs to sell the home because they are moving soon, it will put them on a limited time frame, giving the buyer leverage to move in with a swift but reduced offer that could be accepted. If it is being sold for less pressing reasons, sellers may wait it out for a higher price.

Agents usually work for only the buyer or the seller, not both – contact an agent to act on your behalf for excellent results when you purchase property.