Newsletter - Inner Circle March 2019
Inner Circle
Smart buyers are confident, and active!
A recent survey by ME Bank found almost four in five Melbourne homeowners were confident their property value would hold strong during 2019, despite forecasts to the contrary. The survey found more than a third were confident their house price would actually grow over the course of this year.
Confidence is what drives the property market, and there are plenty of positive factors going in Melbourne’s favour, including population growth and a strong economy. From what I’m seeing, the smart buyers are currently active. Some buyers are cautious and waiting for the market to ‘hit the bottom’ before they take action. There danger here is that there isn’t one market; they won’t know it’s the bottom until prices start to increase. They also mistakenly assume they will qualify for finance for the exact amount they want to borrow.
While CoreLogic data shows property values in Melbourne have fallen over the past year, over the past 20 years they have actually grown by a whopping 274.6% - the strongest growth in the nation, including both capital cities and regional areas. It’s also interesting to note that in regional Victoria prices have actually grown by 5% over the past 12 months, the third highest growth of all capitals and regional areas, and over the past two decades regional Victoria has seen a dwelling value increase of nearly 180%. That’s great news for our clients who have engaged our services over the last 6 years to buy them property in Ballarat. Recent data compiled by Terry Ryder of Hotspotting.com.au found there were 81 suburbs in Melbourne where median prices have risen by more than 10% over the past year. Ryder says it’s the outer ring areas that are performing well, in local government areas including Brimbank, Hume, Casey, Melton, Frankston, Whittlesea and Wyndham. Remember however that past performance does not dictate future performance. Supply and demand considerations and multiple growth drivers still need to be taken into account.
If you want help finding an investment-grade home or investment property in Melbourne or elsewhere in Victoria in the current market, contact us for some advice today.
In other exciting news this month, we are proud to announce Property Mavens has been selected from 2000 entrants as a finalist in the Australian Small Business Champion Awards 2019.
We are always honored to be acknowledged for our work. Fingers crossed for a win on April 6 in Sydney!
In the life cycle of most property buyers, there are 5 Life Stages of Property Buying.
How do you do this successfully, especially when the market is changing?
In this informative webinar Terry Ryder will be speaking with Miriam Sandkuhler of Property Mavens about how to minimise the risks of buying and selling at those different stages and in a changing market.
She will discuss what the stage are, the factors that need to be taken into consideration when buying or selling, and strategies you can use to minimise risk and maximise profits. Register HERE
And finally, a word of warning for buyers and professional services partners. There is a flurry of newly graduated ‘buyers’ agents’ in the marketplace, having completed a five-week non - RTO online course and now passing themselves off as ‘experts’ with NO experience. They have a slick pitch, but many have never worked in the industry before! Obtaining a sales reps certificate, then obtaining a full license in NSW (in a mere three months) to secure a full license in Victoria via mutual recognition is appalling and SCARY. It took me a minimum of two years of practical experience before I could apply for my License in WA. I did a six-month Diploma of Property, then I had to be interviewed in front of a panel of my peers to secure my license. Years of working in the industry as a buyers’ agent or selling agent and having transacted property in the 100's or 1000's is what generates experience and expertise. I have 20 years’ experience. Consumers are paying buyers agents a fee to spend their money on what is their most valuable asset. With so many inexperienced players on the market, it's more important than ever to ask about your buyers’ agent's experience before engaging them. Make sure they are also a REBAA member, whereby we practice to an industry code of conduct.
If you want help finding an investment-grade property in Melbourne or elsewhere in Victoria from an experience and qualified buyers’ agent, contact us for some advice today.
What is the fallout from the Banking Royal Commission?
In early February we saw Commissioner Hayne submit his final report for the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry to the Governor-General, which was then tabled in Parliament.
Since then we have heard a lot about the findings and 76 recommendations across the financial sector. There will likely be further fallout over the coming months, with potential criminal or civil action to come for the way companies have treated customers. Much of the focus to date, however, has been on mortgage brokers, with a recommendation that trail commission is banned and that there should be a move to a consumer-pays model rather than lenders paying mortgage brokers. This latter recommendation in particular has the potential to have huge implications for not only the mortgage broking industry, but borrowers, It’s unlikely many consumers would want to pay themselves, as it would be an additional cost on top of the many existing ones, and that means they will lose access to a great service.
Mortgage Brokers provide an invaluable service. Just like buying property, there is so much complexity when trying to analyse loan products that it’s simply not possible for borrowers to do the same for themselves. On top of that, brokers provide structuring for future loan expertise that the average borrower wouldn’t understand the importance of. You can rest assured banks will always structure for their benefit and security first and not that of the borrower. Mortgage brokers keep the banks competitive. It’s imperative that 33,000 brokers are not put of a job, which would in effect save the banks trillions of dollars in fees, while allowing them to capture buyers and provide biased advice and limited product selection. It will serve the banks (especially the Big 4) and not consumers.
The Federal Government has put their support behind mortgage brokers from the start, at least in terms of not supporting a move towards a consumer-pays model. We’re glad that after lobbying, the ALP has revised its position from implementing all the recommendations of the Royal Commission, including supporting a consumer pays model for mortgage brokers, to proposing lenders instead pay brokers a standardised upfront commission. While we will see what happens in the coming months, we hope mortgage brokers will continue to remain sustainable to foster competition amongst lenders and get borrowers a better deal, as well as protecting their interests.
For expert advice on where and what you should buy in the current market, and how to secure finance for the purchase, contact us today for an obligation-free discussion
Wendy engaged Property Mavens’ services as a Melbourne buyers' advocate to assess and negotiate to buy her home in Fitzroy North.
With a super tight budget and struggling to price property in a slowing and changing market, Wendy needed our expertise to assess the value of property, provide her with certainty in choosing the right property type and protect her interests in the buying process. And our carefully considered strategy and advice worked!
We purchased this 1-bedroom, 1-bathroom apartment under budget and below the vendor’s price, swiftly securing it despite competition from other interested parties.
Wendy had one chance to get her property purchase right, and we helped her to do just that. This was to be her home and security to retire into and not only did we need to take into account local amenity, a very tight budget, minimal owners corporation fees, size and resale considerations, but her health and mobility concerns.
“10/10 The best part of dealing with Property Mavens was the regular communication regarding the buying process and especially the negotiation strategy…Overall I am really delighted with Miriam, the experience exceeded my expectations.”
As professional property buyers we know the difference between a bad property and a good one and where to buy to generate the strongest return on your money. 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.
Yarraville
As a partner in a financial services firm who regularly refers their clients to us, Tim and his wife Natasha wanted to develop a property portfolio within their SMSF.
After determining a capital growth strategy and working with a strict budget, searching commenced in a high-performing cluster of suburbs. Our search ended with the purchase of the perfect property for our client’s needs - a 2-bedroom, 1-bathroom house in the popular residential pocket of Yarraville, close to amenities.
The property was purchased at market value during auction and in the three years following the purchase in 2014 the property grew in value by 54.5%, or more than 18% per year. This growth was more than double that for the overall market over the same period, which was just 21.8%.
If you want similar results, click here to book a time with us to discuss your requirements. It’s 100% obligation free.
If you want to invest or buy the right home for your budget, click here to book a time, or call us for a chat about securing your financial independence.
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