Newsletter - Inner Circle April 2020

Inner Circle

There is opportunity amongst the uncertainty 

It seems much more than a month has gone by since we last brought you news on Victoria’s property market, with the Coronavirus situation in Australia rapidly unfolding. As you read this we hope that you are safe and that your family stays that way for the duration. 

Everybody wants to know what impact COVID-19 will have on property, but it’s too early to know. Amidst the uncertainty, however, we know that property is a stable and safe investment class, particularly during times like this, and now is an opportune time to be buying. See our Expert Insight below to find out why. 

The rules for real estate have changed to date, with open home inspections and public auctions now longer allowed for time being. Despite this we are still buying and selling on behalf of clients though our wide network of contacts in real estate, legal and financial circles. Property is still open for business. 

We anticipate that transaction volumes will slow, but for those looking to buy Melbourne still offers some the best prospects of all the capital cities, and our confidence in the city’s property market remains unchanged. The latest CoreLogic figures from February show Melbourne had reached a record high for housing values with growth of 10.7% over the past 12 months.  CoreLogic’s numbers show Melbourne real estate prices have climbed 32.4% over the last 5 years, compared to Sydney’s 24.7%. The return on investment is clearly much stronger in Melbourne over time. We’ve witnessed many ups and downs in the market over the years and we know this is the case over the long term, and will be again when the market recovers. 

Melbourne’s relative affordability to Sydney – with the median dwelling price still 20% cheaper – and the fact that it has the strongest economy in Australia will continue to attract people to the city to buy and rent. Population growth is the biggest driver of property price growth in the city, with Melbourne having the strongest growth of all the capital cities. 

In addition to Metropolitan Melbourne, Victoria has very attractive regional areas. New research by RMIT University mapping health and liveability across Australia’s 21 largest cities found our state had the most liveable regional cities, including Geelong, Bendigo and Ballarat. 

No matter what happens over the months to come, Property Mavens is open and here for you. If you need help – whether you’re buying or selling - from a qualified and highly regarded buyers’ agent and seller’s advocate, contact us for some advice today. 

7 reasons you should be investing in property during the Coronavirus scare:

1. Property is more stable than the share market 

The share market can be very volatile, with huge crashes during times of fear and uncertainty, just as we have seen in recent weeks, when the ASX has had record falls.  

Residential property, however, has a long history of weathering storms. While people thought property would be impacted by the Global Financial Crisis, for example, it actually proved to be much more resilient - and rebounded faster and stronger. 

2. Property is a safe investment 

Property is immune from panic selling because it takes time to transact a sale. 

Investment-grade property will always hold its value and has built in cash flow protection, attracting good tenants who deliver rock solid income to investors.  

Australians understand a well-selected property is an investment which stands the test of time, retaining value despite incidents such as viruses, terrorism and stock market crashes. People will always need somewhere to live after all. 

3. Bonds markets have a hidden flaw 

Bonds seem ultra-safe in market downturns, but when the panic is over they can become vulnerable. Bond values (their market price) move in the opposite direction to their yields (interest rate). When investors rush to buy bonds, the yield moves down as we’re seeing now.  

When a crisis is over and investors offload bonds, capital values typically fall, leaving investors who aren’t tied into daily movements holding an asset with a falling price.  

4. Banks are likely to continue favouring residential property 

With so much uncertainty, Australian banks may pull back their lending to businesses, especially risky ones. But to maintain their market share, banks are likely to maintain or even increase lending to homebuyers and property investors as this is a more stable business for them.  

5. New Victorian Residential Tenancy Act requirements 

The introduction of new legislative requirements effective from July this year may prompt some landlords to exit the market This could see a reduction in the number of properties available on the rental market, especially in poor locations.  

Fewer properties available for rent will bolster tenant (and buyer demand) for the well selected properties that remain, creating opportunities for investors. 

6. The tax system and bank lending favours property 

For investors, being able to access 80% lending (or higher) for negatively geared property is a major advantage. You can access negative gearing for shares, but banks will typically only forward you 50% of the value and only for selected stocks.  

7. For pre-approved buyers, now is the right time. 

Many willing buyers with pre-approved loans will move ahead - seeing it as a case of use your finance now or risk losing it. 

If the combination of the viral scare and stock market plunge proves to be temporary, investors stand to snap up property at good (discounted) values as easily frightened buyers drop out of the market, only to capitalise when the market inevitably rebounds.  

An experienced and expert buyers’ agent such as Property Mavens can provide advice and help buyers and sellers to navigate any market. If you are a buyer or seller that needs assistance, contact us today for an obligation-free discussion. 

Fresh Start ™

It’s one of the most distressing times you can experience - separating from your partner.

Not only does it involve a lot of personal pain, a separation also has big implications for your finances, particularly your property holdings.

That’s why we introduced our Fresh Start service. Property Mavens takes charge of selling your family home or investment with.

1. An independent assessment of what the property is worth
2. Selection and management of real estate agents and intermediaries
3. Advice on maintenance, styling and landscaping to secure a better price
4. Best tactics to secure a successful sale

If you want a confidential discussion about making the right property decisions to secure your life after separation, feel free to call us on 03 9988 2266 (or have your legal counsel get in touch).

Lauren and Nathan engaged Property Mavens as their Melbourne buyers agent to find, assess and negotiate to buy their first home together in inner Melbourne.

With busy schedules, it was difficult for Lauren and Nathan to find the time research the market, find a suitable property and then assess and negotiate to buy their first home. They engaged our expertise to quickly find them the perfect property, assess the value and successfully bid at auction to secure it within an expected price range with strong competition from other buyers. 

We successfully purchased a 2-bedroom, 1-bathroom apartment within their budget, at the first auction the couple had ever been to!

If you want help to identify an investment-grade property like this one, whether it’s a family home or an investment property, click here to book a time with us to discuss your requirements. It’s 100% obligation free.

After deciding to downsize from her 2-bedroom, 1-bathroom house in Armadale, Karen sought out our expert advice to support and guide her throughout her sales journey.

After Property Mavens determined which three agents best suited her needs, Karen selected her preferred agent and the sales and marketing process kicked off. The result was a sale of $195,000 over our vendor’s reserve at auction!

As professional property buyers and vendors advocates, we know the difference between a bad selling agent and a great one! If you would like help to secure a fantastic outcome like this one, whether it’s selling a family home or an investment property, and you’re ready to get started, click here to book a time to discuss your requirements. It’s 100% obligation free.

COBURG

We bought a property on behalf of our clients Emma and Chris at the bottom of the market in Melbourne last year, for less than the quoted price range and $26,000 below land value.

The brief was to find the couple a high-performing capital growth investment property they could add value to through renovation in the future. We purchased a 3-bedroom, 1-bathroom property on 404sq m in Coburg that fitted the bill.

Since the purchase Emma and Chris have done a fantastic job of adding value to their property by knocking down the back half, extending, adding another bathroom (an ensuite) and painting the whole property.

Congratulations to them both for adding over $300,000 of value to their investment property!

If you want similar results, click here to book a time with us to discuss your requirements. It’s 100% obligation free.

AFTER

If you want to invest or buy the right home for your budget, or sell your property  click here to book a time, or call us for a chat about securing your financial independence.

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Giving back..

At Property Mavens we choose to give back to help create social change within our business model. If you use our buyers or vendor advocacy services, you will be helping to make a positive impact within the local and wider community.

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