Rental Yield

How to Increase Your Rental Yield

Rents are definitely on the rise but increasing the rent is not the only way to increase your yield. You can also decrease your expenses and decrease the length of your vacancies.

Here are seven tips:

1. Increase the rent. This is the primary income producer but know your market.
2. Decrease the rent. This applies to those who are still suffering vacancies. You can go through prolonged vacancy periods when your rent is set too high that chew up all your profits.
3. Prepare a depreciation schedule. The tax office offers this deduction. So why not take advantage of it? Many investors don't realise that depreciation is available on older buildings too - not just brand new apartment blocks.
4. Consider pets. Half the Australian population has pets. So you can broaden your market by allowing your tenants to have pets.
5. Make your property more attractive. The time to do this is when you have a vacancy. This attracts tenants and allows you to increase the rent.
6. Include air-conditioning. Properties with this feature rent for an extra $10-15.00 a week over those without it. Not only will you be able to claim depreciation on it, but you will also attract a wider range of tenants lessening any chances of a vacancy.
7. Keep the property looking smart. It is recommended every 5 years to give your property a good overhaul and every 10 years a full refurbishment. This keeps the tenants happy and minimises vacancies.

If you have a real estate need or question feel free to phone me Noel Thompson Principal Professionals Logan Lifestyles on 0418 517 525 or call into our friendly office at Waterford for further assistance.

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Investment Properties

Investment Properties Still Popular

Australians still love their property and in uncertain times in the stock market investments that you can touch and feel are getting increasing attention from investors.

Plus there are still plenty of areas where demand continues to be strong despite the higher interest rates and Logan is certainly one of them.

"Property as an investment class is always popular and Australian home ownership remains a fundamental part of the Australian psyche", comments Real Estate Institute of Australia president Noel Dyett.

Property fundamentals never change, too "what matters most is position, position, position. None of the fundamentals change regardless of whether interest rates are going up or down or bumping along" Dyett adds.

To understand position you need to look at transport, community amenities and schools.

"climate, convenience and lifestyle are the overriding factors driving property hot spots" according the Bernard Salt, KPMG partner. "But if you can add another factor - like infrastructure - it will give a burst of appeal because if the lifestyle equation of the town changes overnight it can have a rapid effect on property values".

Record migration levels, rental property short shortages and a generation of baby boomer's looking to re-locate are some of the forces behind price buoyancy.

One thing to remember in investing, make sure you can service you debt. There maybe a dearth of rental properties but you can't keep increasing rent forever to meet higher interest rate costs.

If you are interested in viewing investment properties or have and investment query feel free to phone me Noel Thompson Principal Professionals Logan Lifestyles on 04185 517 525 or call into our friendly offices at Browns Plains or Waterford for immediate assistance.

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Purchasing a Home Extra Costs

Budget for Extra Costs When Purchasing a Home

When purchasing a home be sure to account for all the costs beyond the purchase price itself.

HERE IS A SUMMARY

• Stamp duty, this is a compulsory tax charged on any exchange of property at the time of purchase

• Legal fees, generally a conveyancing firm or solicitor will need to be hired to analyse and oversee all documents. A title search is always needed to assure outright ownership and that there are no legal encumbrance's.

• Building and pest inspections, necessary inspections to identify all potential defects in the buildings as well as in the environment and to look for termites and other pests.

• Council and water rates.

• Mortgage insurance, this may or may not be applicable depending on the funding source and their requirements.

• Home and contents insurance expenses generally you will want to be fully covered for fire, damages and theft.

• Moving expenses this covers the removal fees.

• Disconnection and re-connection of utility services this includes telephone, electricity, gas and internet connections.

• Strata levies when moving into a strata unit these are quarterly assessments for property maintenance and leisure services.

There are concessions available for First Home Buyers on some of the above. A $14,000 grant is offered through the State Government to counter the effects of the GST on home purchases. Plus there are concessions for stamp duty.

If you have a real estate question or need phone me Noel Thompson Principal Professionals Logan Lifestyles on 04185 517 525 or call into our friendly offices at Browns Plains & Waterford for immediate assistance.

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First Home Saver Case Studies

Here are two examples given by the Federal Government of how a First Home Saver Account actually works.

1. A couple Belinda and Josh Smith each open up an individual First Home saver Account when the scheme opens on 1 October 2008.

Both of them earn an identical wage of $61,000 so they decide to put aside 10% of their individual salaries into their respective accounts. Each one then receives a 17% government contribution on the first $5,000 of their contributions made to their accounts each year.

After 5 years Belinda and Josh will together have saved a deposit of approximately $88,500 to use towards the purchase of their first home.

If they had instead decided to for go the government plan and get a term deposit with the same 7% earnings rate and the same yearly contributions their total deposit for the house after 5 years would be about $75,900.

This means that the First Home Saver account would have earned Belinda and Josh an extra $12,600 over 5 years because of the extra contributions of the Government.

2. In a second case study 19 year old Ria saved $1,000 per year for 4 years while attending university. She then started working and contributed $5,000 per annum for the next 6 years.

With the First Home Saver Account she would have accumulated a home deposit of $50,400 by the age of 29.

If you have a real estate need or question fee free to phone me Noel Thompson Principal Professionals Logan Lifestyles on 0418 517 525 or call into our friendly office at Browns Plains or Waterford for further assistance.

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How to prepare for a Storm

A storm is on its way. What can you do?

• The first thing is to clean your gutters and downpipes of any debris. This is because run-off from rain can back up under the eaves and into your ceiling causing structural damage.

• If safe and you have permission from your local council you should trim any overhanging or dangerous limbs from trees that are growing around your property. Large tree limbs can cause major damage to buildings if they fall and can also block access to your property, close roads and damage power lines.

• If a power line is involved you can also seek assistance from your electricity supplier.

• The next thing is to clean up the yard of any loose items as well as those on your balcony. This prevents things like deck chairs from becoming dangerous missiles in high winds. Other items of concern include light-weight garden furniture toys and even pet accessories.

• Another major concern is securing the material on your roof. Make sure it’s in good condition so water will be prevented from leaking inside.

• And don’t forget to park your car under secure cover and away from trees. Of course you’ll also want to make sure any children and pets are indoors.

• Finally keep a list of emergency numbers on your fridge or in a handy place. These will be very handy should any emergency arise.

Have a real estate question or need? Feel free to phone me Noel Thompson Principal Logan Lifestyles on 0418 517 525 or to call into our friendly offices at Browns Plains or Waterford for immediate assistance

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Auctioning Advantages

The Advantages Offered by Auctioning

Martin McNamara of Australian Property Monitors touts auctions for enticing buyers before an actual price is set — providing the agent gets the price range right.

“If it’s a unique property or one that will get a lot of interest an auction is the best way to determine the true price. People can come to open inspections and evaluate the property independent of the price — they can develop an interest for the property first rather than being tainted by the price.”

So McNamara warns: “If you over-egg the cake a lot of people won’t be prepared to negotiate. That’s why sometimes if you’re not absolutely confident of the price you’re putting on your property you should take it to auction.”

Auctions require an intensive 3-week lead-up campaign. As an example a $700,000 property can cost $10,000 to market for auction. While initially this is more you do have to take into account that the private treaty marketing period can drag on for months because there is no cut off date and no set program.

One thing an auction does is it gives you the opportunity to get top-dollar. All you need are two interested parties who really want it and you’re away. On the other hand as Louis Christopher says: “The auction price will only be as high as the second highest bidder’s price.”

If you’re considering selling feel free to contact myself Noel Thompson Principal Professionals Logan Lifestyles on 0418 517 525 or to call into our friendly offices at Browns Plains or Waterford for immediate assistance.

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Selling Pointers Planning

Selling Pointers

If you are planning to sell a property, here are some tips.

Be sure to promote your property. Make sure you invest sufficient funds to allow your agent to do their job properly. Keeping your property a secret will hinder your chances of success.

Plan to use your funds to promote your property. Don’t rely on agent-paid advertising. Skimping on advertising monies may come back to haunt you in the form of a lower selling price.

Let your agent tell you the best mix of newspaper, proper signage, internet, window cards, open inspections, etc. A coordinated mix of strategies works best and your agent has all the experience of their other properties.

Maintain flexibility. Don’t stick to your guns unnecessarily. If your marketing strategy isn’t working then change tack in one or more areas.

It’s extra important to realise that an early offer in your sales campaign that’s reasonable will often prove to be your best offer. Plus if you’re buying then it will enable you to move more quickly to buy back into the same market so you can also get a similar fair price.

You must also stay in tune with the market. While you can’t control it you can at least follow it. Properties that are priced right always sell no matter what the market conditions happen to be.

If you have any questions about real estate or would like assistance in locating a property feel free to phone me Noel Thompson Principal Professionals Logan Lifestyles on 3299 7733 or 0418 517 525 or to call into our friendly offices at Browns Plains or Waterford for prompt attention.

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Property Manager Role

The Role of a Property Manager

The first thing a property manager does is help to keep you legal in everything you do relative to your tenant. It is the manager’s job to thoroughly acquaint themselves with the obligations and responsibilities of both the landlord and the tenant including any new changes in the law.

The next thing is that a property manager will greatly assist in choosing the right tenant one who will pay on time and properly care for your property. By formalising the screening process you remove the onus of having to vet the various applicants yourself. Plus property managers can access credit reports and know how to interview references.

Keeping your property in tiptop shape is important to attracting tenants. Your property manager will not only field any tenant calls for repairs on your behalf but will also periodically inspect your property to see that it’s being properly maintained. They also only use reliable tradespeople whom they can employ as needed.

On top of this your property manager will handle all transitions in tenancies making sure a condition report is properly filled out at the outset and that the final inspection professionally assesses all wear and tear on the property to determine any needed repairs maintenance or damages.

They will then attend to collecting any outstanding debts, and don’t forget the monthly collections of rental and slow payment follow-up that’s part of their on-going services.

If you are an investor and would like to talk about managing your property feel free to phone Noel Thompson Principal Professionals Logan Lifestyles on 3299 7733 or 0418 517 525 or Sandra Reynolds Senior Property Manager on 07 3299 7733 or call into our office at Waterford for immediate assistance.

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Buying the Right Property

Tips for Buying the Right Property

A simple rule of thumb for investors is that you most often make your profits when you purchase the property. So buying at the right price becomes paramount.

By focusing your research and time on a particular geographic locality, you can develop an “investment comfort zone”.

So the first thing to do is to choose a geographic locality in which to concentrate your study of the market. You might choose an area of high capital growth. Or maybe just your own neighbourhood.

The best places for investment have good rents, low vacancy rates and are popular places to live.

You’ll also want to choose an area you can afford to invest in. No point in looking at areas in which you can’t afford to buy.

Now that you have chosen your area, the next thing is to develop your expertise in that same locale. Study price ranges, rental market data including vacancy factors, plans for potential infrastructure additions, planned developments, employment statistics and trends, school locations, transport, and local council matters. The latter includes town planning and zoning rules and regulations.

The next step is to acquire investment skills such as negotiating techniques, knowledge of
finance, tax laws, and risk minimisation. All this will aid building an investment portfolio.

Finally is the ability to act when the right property arises. Because with all of the above, bargains will start to stand out to you.

If you have any questions about real estate or would like assistance in locating a property feel free to phone me Noel Thompson Principal Professionals Logan Lifestyles on 3299 7733/0418 517 525 or to call into our friendly offices at Browns Plains or Waterford for prompt attention.

http://www.llr.com.au

Federal Government First Home Saver Accounts

First Home Saver Accounts

The Federal Government has instituted a new savings plan for First Home Buyers. The idea is to assist Australians to boost their savings for a deposit on their first home.

In order to be eligible for the tax-free withdrawal for a first home, the owner of the account must have put in a minimum amount of $1000 per calendar year for four financial years.

However, the contributor can be anyone. All contributions must be from after-tax income and a tax deduction cannot be claimed.

The Government will make a flat 17% contribution on the first $5000 of savings to the First Home Saver account in any year.

Investment earnings (or interest) that accrue in the account will be taxed at a maximum of 15% as well. But all Government contributions will be tax-free.

Withdrawals from a First Home Saver account which are used to purchase or build a first home will be tax free. The First Home Saver account has a $75,000 balance cap, after which no further personal contributions can be made.

The Scheme will commence from 1 October 2008.

To open a First Home Saver account you will need to:

• Be aged 18 to 65
• Have not previously purchased or built a first home in Australia to live in
• Not currently have or previously have had a First Home Saver Account
• Provide a tax fi le number.

If you have a real estate question or need, feel free to phone me, Noel Thompson, Principal
Professionals Logan Lifestyles, on 0418 517 525, or to call into our friendly offices at

Browns Plains & Waterford for immediate assistance.

http://www.llr.com.au