Talking Apartments

Regardless of your political persuasion if you are a property investor you would have been pleased to see negative gearing and capital gains tax rules remain unchanged after the recent Federal Election.

With those issues off the table it is back to business as usual when it comes to property tax. One important property investment tax deduction that is occasionally overlooked is depreciation. This is where the notional decline in the value of buildings, plant and equipment can be claimed as a tax deduction. With June 30 fast approaching this is one thing to get onto ASAP if you haven't already.

Mike Mortlock is the Managing Director of MCG Quality Surveyorand heads a team of highly qualified professions who can advise you on how much you are able to save off you tax bill by getting a depreciation schedule on your investment property.

To find out if you can benefit from a depreciation schedule contact Mike on Phone : 1300 795 170 Email : [email protected]

As you will hear in my discussion with Mike it is a complex field but one that can save you thousands.

Just had a very enjoyable catch up with Jordy Catalano and Tim Fleming on the current market and future direction of apartments.

Five years ago Jordy Catalano and Tom Hywood launched Apartment Developments to bring the disparate offering of off the plan apartments to one place. Both Jordy and Tom are the sons of media heavyweights and injected fresh energy into a burgeoning sector.

Since then AD Group (as it is now known) has grown to cover three distinct markets being -

Apartment Developments  - Off the plan Apartment Sales

House & Land Developments - Land sales & house and land packages in new communities

ID Development Business to business platform to manage development sales

Tim Fleming is the General Manager of AD Group and apart from an illustrious football career with the the Richmond Tigers (amongst others) spent many years at REA group (realestate.com.au) through its formative years when real estate advertising on the internet was still a hard sell.

It took me a while to get Tim and Jordy in the same room to talk to me about AD Group and how they see the apartment market but I finally did it.

Listen in for a very frank and fascinating chat with what they are up to and how they see the outlook for apartments and the property market generally.

 

 

Just had a very enjoyable catch up with Jordy Catalano and Tim Fleming on the current issues and future direction of apartments.

Five years ago Jordy Catalano and Tom Hywood launched Apartment Developments to bring the disparate offering of off the plan apartments to one place. Both Jordy and Tom are the sons of Fairfax media heavyweights and injected fresh energy into a burgeoning sector.

Since then AD Group (as it is now known) has grown to cover three distinct markets being -

• Apartment Developments - Off the plan Apartment Sales
• House & Land Developments - Land sales & house and land packages in new communities
• ID Development Business to business platform to manage development sales

Tim Fleming is the General Manager of AD Group and apart from an illustrious football career with the the Richmond Tigers (amongst others) spent many years at REA group (realestate.com.au) through its formative years when real estate advertising on the internet was still a hard sell.

It took me a while to get Tim and Jordy in the same room to talk to me about AD Group and how they see the apartment market but I finally did it.

Listen in for a very frank and fascinating chat with what they are up to and how they see the outlook for apartments and the property market generally.

How refreshing it is to hear Abbie Freestone talk about community living. Assemble Communities are very focused on ensuring apartment living does not mean a compromise to someones quality of life. It is easy to say and perhaps harder to deliver unless you turn the entire apartment development model upside down and consult closely with the future residents to provide what they want.

With their print and subscriber partner Assemble Papers and developer Make Ventures Abbie explains how being dedicated to housing and shaping the culture of people living closer together plays out in the real world.

Most of our discussions on Talking Apartments focus on the financial and capital market side of apartments to keep you on top of the market and help with decisions about owning, buying, selling, and managing your property investment so I have been so pleased to chat to Abbie and found just what I was looking for.

Abbie has a background in Urbanism & Architectural communications and as you will hear she lives and breathes urban communities.

Abbie generously gave us her time to let us know what they are up to.

Six months ago when I caught up with Leigh Warner the big issue was the decline in foreign buyer due to extra taxes and the difficulty for them to obtain finance.

Now in February 2019 we are talking about the challenges for pretty much everyone getting finance.

The impact of the Royal Commission into the financial services sector and the resultant self imposed or regulated measure have had a significant impact on the apartment market. In some ways the tighter lending market has been the impetus to a correct a market that has enjoyed several decades of solid growth.

Leigh Warner is the National Director for Residential Research at Jones Lang Lasalle and has just released his findings on the residential apartment market for the major capital cities in Australia. Listen in as Leigh reviews what is going on in each capital city market and what is in stall for 2019 and beyond.

If you would like to read the full research papers for each state you can download them here.

Brisbane Residential Market - Research Paper

Sydney Residential Market - Research Paper

Melbourne Residential Market - Research Paper

Adelaide Residential Market - Research Paper

Perth Residential Market - Research Paper

The Residential Tenancies Act and several other pieces of legislation controlling the rules that govern how people lease property between each other is changing.

This impacts peoples lives including a tenants home and an owners very large financial livelihood and it is complex to get it right. As societies expectations change and the way our cities and towns operate so must the rules that govern how we live. Technology changes also play a part. Hopefully your property manager is up to speed so you don't need to worry but we just want to help you out.

Hayley Mitchell - Director of Mitchell Property Training is 100% focused on making sure everyone understand the forthcoming changes. Not just professionals managing rented accommodation every day but owners and renters the like. We were delighted when she agreed to speak to us and give us the goods on what the major changes are and what people need to know.

To check on how the changes will play out in practice we asked Kelly Thomas - Team Leader at Wood Property Partners to join us for the chat. Kelly runs the Property Management team and has over 12 years of property management experience.

Between Hayley and Kelly they are able to unpack the changes for you and even predict how these are playing out in the market already.

Here are some valuable links for you to check out more detail about the changes.

Consumer Affairs Victoria

Victorian Government

Most property around Australia has enjoyed solid growth for about 20 years save for a few bumps along the way. We are now in a downturn and who knows for how long or how deep but most people are suggesting we are about 6 to 12 months into a 2 year slump.

To find out how to sell your apartment in a tough market we need to speak to someone who has experience and worked in property cycles since the mid 1980's. Ray Wood (yes related.. my brother) worked as a real estate agent in Melbourne from 1982 and now coaches and supports agents across Australia and Canada. He has a unique expertise and can talk about selling in a tough market with a lot of authority. I hope you get great value from our chat.

He is a blog pulled from our discussion...

You want to sell your apartment but are worried it is perhaps not the right time given the market is weaker.

Firstly if you are selling and buying in the same market conditions, then it is a net sum game as you may sell for less than you hoped, but you will also buy cheaper. In weaker markets there are generally fewer properties for sale making it harder to find the property you want so consider buying first and then selling second if you can arrange it.

The big question in weaker markets is how to market and sell your property for the very best price. To answer this let’s understand why the market is weaker and how to circumvent the issues.

There are a few factors at play but the single biggest issue across all categories of property is finance. By this I mean the difficulty in buyers being able to borrow money. The banks and second tier lenders have all tightened up there lending practices by lending a lower percentage of the price, fewer interest only loans, scrutinising loan application more, and limiting exposer to particular types of property or locations. This is driven from APRA (Australian Prudential Regulatory Authority) and findings from the recent Royal Commission into Financial Services.

Now we know obtaining finance is the problem, how do we adjust the marketing to help buyers through this and pay you the highest possible price.

Hire the best agent

Now more than ever, you need a great agent and especially one that has seen and worked through difficult markets before. This means they will have 10 -15 years experience, be well equipped to advise you, work hard and be able to dig deep into their kit bag of experience to negotiate a sale at a good price. They will also give you the right advice on every step set our here.

Method of Sale

When someone bids at auction, that is an offer on an unconditional basis. ie. They can not bid subject to finance or building inspections or anything else. If they are concerned about how much finance, they will be able to get they will either not bid at all or only bid to a lower price. Private sale allows negotiations on a subject to finance basis giving a buyer more confidence of offering a higher price knowing it is subject to their finance being approved. Some property still suit Auction but just not as many as in a boom market.

Length of Marketing

The normal 4 weeks marketing may not be long enough. Especially if one or two buyers are knocked back on their finance application and your agent needs to go back and agree another sale. This could mean the sale process takes 5 or even 6 weeks.

Be ready from day 1

Internet ads and staging (furniture) hire costs last 4-6 weeks and because the negotiations may take a bit longer than usual you need to make every day of your marketing count. From the day your property hits the market your agent must have contracts of sale available, presentation perfect, all maintenance items completed, inspections arranged, brochures printed, sign board in place, letter box drop done, etc