M A Y
M A R K E T
2 0 1 9
P U L S E
C21
PUBLISHER Century 21 Australia Pty Ltd
CONTRIBUTORS Kathryn Madden Tim Neary Tim Lawless Chris Gray On The Move Bradley Beer
EDITORIAL ENQUIRIES Century 21 Australia (02) 8295 0600
ADVERTISING ENQUIRIES Century 21 Australia
WELCOME TO THE
MAY 2019 ISSUE OF
C21 MARKET PULSE
(02) 8295 0600
DISCLAIMER We have in preparing this information used our best endeavours to ensure that the information contained therein is true and accurate, but accept no responsibility and disclaim all liability in respect of any errors, inaccuracies or misstatements contained herein. Prospective buyers and sellers should make their own enquiries to verify the information contained herein. All information contained in the CENTURY 21 Australia Pty Ltd website is provided as a convenience to clients. All links to property prices displayed on the website are current at the time of issue, but may change at any time and are subject to availability. For more information on our Privacy Policy please refer to: www.century21.com.au/privacy
C O N T E N T S M A Y
DREAM HOME WISHLIST
02-03
2 0 1 9
MOVE SMARTER
How to create your dream home wishlist.
Winter energy hacks.
Home Beautiful Magazine Editor, Kathryn Madden
On The Move
EXPANDING NETWORK
04
CLAIMING DEPRECIATION
C21 opens in rising regional NSW market.
Are you claiming depreciation on your
Real Estate Business Journalist, Tim Neary
investment?
08
10-11
BMT Tax Depreciation, Bradley Beer
HOUSING CORRECTION
05
Dwelling values fall in April as rate of decline eases.
12
Three tips for purchasing at auction.
Corelogic Head of Research, Tim Lawless
THE PROPERTY TIDE
AUCTION STRAGEY
06-07
OPEN HOMES A selection of properties for sale with
The tide could be turning.
Century 21 from right around Australia.
Your Empire CEO, Chris Gray
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DREAM HOME WISHLIST
How to create your dream home wishlist BY K AT H R Y N M A D D E N ,
EDITOR, HOME BEAUTIFUL MAGAZINE
It’s happened to the best of us: you turn up to a house inspection on the hunt for a modern twobedder with parking, but find yourself so enamoured by the home’s soaring period ceilings that all your preconsidered requirements fly out the pretty sash windows. Consider it the number one tool on your house hunt. Compiling a prioritised wishlist will help separate your needs from your wants, and
GET VISUAL
GO BACK TO BASICS
We’re not suggesting that
Now it’s time to reel it in. What
manifestation is the answer to
are the absolutely essential
all your property aspirations, but
requirements for your home and
visualisation is a savvy starting
lifestyle? Important considerations
point. Envision your perfect home
are the minimum number of
in all its glory – the size, the style,
bedrooms, minimum number of
the suburb… Keep it semi-realistic
bathrooms and minimum size. Other
(shelve your Tuscan villa pipedreams
must-haves might include a garden
for now), but still think freely. This
or deck, off-street parking or an
will help tap into your desires and
internal laundry. Location may be
get you thinking about how you want
paramount – perhaps you want to
to live. Sure, ocean views may fall
be within walking distance of your
outside your budget, but perhaps
children’s school – or maybe you
you’d settle instead for easy access
have your heart set on a certain
to a beach or bay. Scrawl down all
cluster of suburbs. Also consider
your ideas to refer back to later.
liveability: is renovating an option, or are you keen to find a home and
keep you on track in the search for
move straight in? List these non-
your dream home.
negotiables on a sheet of paper.
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ADD THE NICE-TO-HAVES Below your must-haves, start noting down the features you deem appealing, but not essential. A walk-in wardrobe? You wouldn’t turn it down, but it’s not make or break. It might be the same for a pool. Interior features could also fall into this category – think hardwood flooring and stone countertops, as well as central air conditioning or a fireplace. Check in with your abovementioned visualisation notes as you go, picking out the elements that are enticing, but also attainable.
CONSULT THE EXPERTS Finally, round out your list with some expert intel. The agents at real estate Century 21 will share some “value” items to consider tacking onto your list. As the name suggests, these are features that will add value to your property over time. Think a great bathroom, dual-pane windows, or close proximity to top schools. While these items shouldn’t take over your wants and wishes, they’re nevertheless worth keeping in mind as you navigate the inspection circuit (now armed with a handy priority list, so you never swerve off course again!)
ABOUT THE CONTRIBUTOR Home Beautiful is Australia’s fastest growing homemaker brand. With beautiful original photography, gorgeous styled stories and signature inspirational how-tos, Home Beautiful is simply one of the most loved, most recognised and commercially successful brands in Australia. Article Link: https://www.homebeautiful.com.au/financetips-for-homebuyers-and-property-owners
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CENTURY 21
EXPANDING NETWORK
C21 OPENS IN RISING REGIONAL NSW MARKET
B Y T I M N E A R Y, JOURNALIST AT R E A L E S TAT E B U S I N E S S
Century 21 has announced the opening of a new office in the central west region of New South Wales, as it expands its presence in the regional markets of the state. Century 21 has opened the Century
our clients and we will continue to
our 2019 brand campaign that
21 Central West office in Forbes, in
always have their best interest in
includes our partnership with
regional NSW.
mind,” she said.
popular television show House
The principal of C21 Central West
Century 21 owner and chairman
is Tara Kelly.
Charles Tarbey said the new team
With more than 20 years of
has hit the ground running.
real estate experience, Ms Kelly
“Tara and her team have already
officially opened her Century
positioned themselves as fantastic
21 business in front of her team, family,
assets within the C21 network, contributing
friends and
ideas to further
representatives
enhance the
from the
includes
team.
an online
in full swing with properties and editorial featured in the current issue of Home Beautiful magazine, appearance on The Morning Show, and sponsorship of House Rules.”
hub, training
said that
platform,
she and
propriety CRM
her “highly
and marketing
skilled” team of
collateral,” he said.
professionals will
Central West region of NSW.
with Seven West Media is already
resources
Ms Kelly
the Forbes area, located in the
“The 2019 marketing campaign
which already
corporate
management services throughout
team’s success.
C21 offering
Century 21
offer sales and property
Rules will contribute to the new
Mr Tarbey said that Ms Kelly has what it takes to succeed in this industry. “It is always a pleasure to have
“We have built our reputation on
successful operators like Tara join
providing outstanding service to
the C21 family, and I am confident
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The story Century 21 opens in rising regional NSW marketw, first appeared on Real Estate Business (REB). Article Link: https://www.realestatebusiness.com.au/ breaking-news/18519-century-21-opens-inrising-regional-nsw-market
HOUSING CORRECTION
DWELLING VALUES FALL IN APRIL AS RATE OF DECLINE EASES
BY T I M L AW L E S S , CO R E LO G I C H E A D O F R E S E A R C H
Dwelling values across Australia continued their downward trajectory in April, falling by half a percent over the month to be down -7.2% over the past twelve months and -7.9% lower since peaking in September 2017. Although housing values are broadly trending lower, the rate of decline has been easing since moving through a monthly low point in December last year when national dwelling values fell -1.1%. According to CoreLogic head of research Tim
in the rate of decline is attributable to an easing in the market downturn across Sydney and Melbourne
South Australia also avoided a fall.
progressively moderating back to
The broad-based nature of lower
-0.7% in April. Similarly, Melbourne
housing values highlights that while
values were down -1.5% in
the rate of decline has eased, the
December, with the rate of decline
geographic scope of lower dwelling
improving to -0.6% in April.“
values remains broad.
Other property market insights
Values were down by -0.9% in
supporting a subtle improvement in
Hobart, signaling a weakening
housing market conditions include a
across what has been one of the
rise in mortgage related valuations
strongest capital city markets for
activity (as indicated by CoreLogic
value gains and leaving Canberra as
platform data), an improvement in
the only capital city where dwelling
ABS household finance data for
values were up over the month.
February, and the fact that auction clearance rates are holding around the mid-50% range across the major auction markets. Tim Lawless said, “While none of these indicators could be described as strong,
Lawless, “The improvement
pace of month-on-month falls
the current
“...the current trend in the data implies that housing market conditions may have moved through the worst of the downturn.”
where values were previously falling much faster. In December last year, Sydney dwelling values were down -1.8%, with the
trend in the data implies that housing market conditions may have moved through the worst of the downturn.”
In April, dwelling values fell across every capital city apart from Canberra, while regional areas of Tasmania, Victoria and
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Annually, national dwelling values were down -7.2%; the largest annual fall since the twelve months ending February 2009, which was associated with the Global Financial Crisis. Across the capital cities, Sydney (-10.9%) and Melbourne (-10.0%) are both now recording doubledigit annual declines, followed by Perth (-8.3%) and Darwin (-7.1%). The largest gains are in Hobart (+3.8%) and Canberra (+2.5%), while Adelaide is the only other capital city to remain in the black over the past twelve months (+0.3%).
THE PROPERTY TIDE
THE TIDE COULD BE TURNING B Y C H R I S G R A Y, C E O, YO U R E M P I R E
Chris Gray began his property investing journey when he was 22 years old. With only $35,000, he spent the next nine years learning about investing firsthand, and applying that knowledge to his own portfolio now worth over $15m. In my 25+ years as a property investor I’ve declared many times that I never try and time the market – I buy when (1) I’ve got the deposit (2) I can get a mortgage and (3) when I’ve got the cash buffer to take me through the next few years. However, most property buyers don’t think like that and many of them are waiting for the bottom. If that’s you, then like auctioneers often say at the auction ‘I’m giving you fair warning…’ – I’m saying the bottom could be almost here, so
you might want to get ready and get moving. Changes in the property market are often caused by the softer side of things rather than hard facts and figures, so consumer sentiment – how people are feeling – often has more effect than the interest rate you are paying or the size of your tax rebate. So, what’s happening?
The Royal Banking Commission seems to have been forgotten about and not many people are talking about it these days – it’s last year’s news. Sure, there are some changes coming up, especially around interest only loans changing to principal and interest (P&I) in the future, but for many that’s a few years away and so it’s not in our short-term worry horizon.
06
The RBA is talking about interest rates dropping which excites most people with a mortgage. Even if the banks don’t pass most of it on (by blaming wholesale funding rates or crying because they’re not making enough money these days), it will still give people a positive feel.
3. RATE SERVICEABILITY
1. THE ROYAL BANKING COMMISSION
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2. INTEREST RATES
Banks are saying that the high P&I interest rate serviceability figures they’re being recommended to use are now too high and need to be reduced. The banks need to make money, the governments need the banks to make money to keep their high international risk ratings and so that means they need to lend. No one thinks we’re in danger of being in a bubble as prices have already fallen and so I think there’s a good chance they’ll relax the borrowing criteria and start lending again.
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4. FEDERAL ELECTION
Many of our property markets
The election is upon us and
anyway. Sydney is supposedly the
whatever way the vote swings, at
worst at minus 14% but some areas
least it will be over. Most people are
are still rising. I know my market
indecisive and sit on the fence over
(median priced, blue chip, inner
an upcoming decision. But after it’s
city, second hand) is potentially
happened, people just take whatever
only down 5% on average and that’s
medicine is being dished up and
if you are forced to sell or refinance
then they move on.
– for most they’re sitting tight and
haven’t been that wildly affected
won’t even know about a short-term
5. THE CHANGES TO NEGATIVE GEARING
blip downwards. So, if you’re not like me, and you still want to time the market, this
ABOUT THE CONTRIBUTOR
Labor has been blasted about their
could be the sign you’ve been
Chris Gray is CEO of Your Empire, a buyers’
proposed negative gearing changes.
waiting for.
agency that buys homes and investments for time-poor people – searching, negotiating,
If they don’t get in, it won’t matter. If
renovating and managing property on their
they do get in, then they still need
behalf. Chris has spent over 10 years as the
to make those changes and we all
host of ‘Your Property Empire’ on Sky News
know how often politicians deliver
Business channel, where he’s interviewed
on their promises. And it could all be
various heads of property research
grandfathered anyway so the sooner
companies and major industry figures. Chris is a qualified accountant, buyer’s agent and
you make a decision the better your
mortgage broker. For more information visit
chance of not being affected.
www.yourempire.com.au, www.chrisgray.com.au and follow Chris on Twitter: @ChrisGrayEmpire.
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MOVE SMARTER
WINTER ENERGY HACKS BY ON THE MOVE The days are getting shorter and the leaves are falling, which means only one thing – winter is nearly upon us. With increased use of heating and lighting also comes the concern about high winter energy bills.
If your home is well insulated the
your wifi router need to be on when
heat should still be retained.
you are out? Everything adds up and in winter, when we know our energy
MOVING THIS WINTER? RUG UP!
bills will be high, it helps to be just
When you step into your new
HOT WATER BOTTLES
property for the first time, resist
that little bit more diligent.
the urge to crank up the heating
It may seem terribly old fashioned
immediately. Moving day is a most
and perhaps it reminds you of your
energy inefficient day, with doors
Nanna, but sometimes, the classic
On The Move has some practical
getting left open to for movers,
ideas still work. Fill a hot water bottle
tips you can use throughout the
deliveries etc. and it will just never
and place it in your bed early in the
colder months to keep those
be warm enough. A better idea is to
evening. By the time you’re ready to
bills down.
layer on jackets and a beanie - just
get in everything will be toasty
until the last box is in the house and
and warm.
These tips are easy to incorporate in your everyday life, and implementing even just a few of them throughout winter could make a difference on your energy bill.
TIMING IS EVERYTHING Sometimes an hour makes all the difference. If you already have your heating on a timer, switching it off an hour earlier will reduce your usage.
the last visitor is gone. Then you can turn on the heating and enjoy your new home!
ENERGY CULPRITS
ABOUT THE CONTRIBUTOR
We are all familiar with how much energy our large appliances use,
On the Move is Australia’s leading service connections specialist providing a one-stop service for electricity, gas, phone, internet, pay TV and insurance.
but what about the others? A digital
Since 2004 On The Move has partnered with Real
photo frame that is permanently
Estate agencies and other organisations to give
connected to power, or the gaming
their customers a convenient and seamless move-in,
consoles on standby power – does
lights-on experience. https://www.onthemove.com.au/
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C L A I M I N G D E P R E C I AT I O N
ARE YOU CLAIMING DEPRECIATION ON YOUR INVESTMENT?
BY BRADLEY BEER, B M T TA X D E P R E C I AT I O N
With the end of the financial year just around the corner, it’s time to remind investors to organise a tax depreciation schedule for their investment properties. The Australian Taxation Office (ATO) requires property investors to report income earned from an investment property as part of their annual income tax return. The ATO also allows investment property owners to claim deductions for the wear and tear which occurs to the building structure and its fixtures over time. This claim is called deprecation.
take full advantage of property
perform a detailed site inspection
depreciation and are missing out on
to take measurements, notes and
thousands of dollars in their pockets.
photograph each of the assets
Another reason investors fail to claim depreciation is because they assume that their Accountant will look after all of the deductions they can claim for their property. However, depreciation claims require the expert advice of a specialist Quantity
an investment property contains. They will also liaise with relevant authorities such as local councils to gather the information necessary to complete the comprehensive tax depreciation schedule for the owner. A depreciation schedule will provide information
Surveyor. The
for the two types
ATO recognise
“...depreciation is a non-cash deduction. This means an investor doesn’t need to spend any money to be eligible to claim it.”
Quantity Surveyors under Tax Ruling 97/25 as one of a selected group of professionals
Unlike other expenses an investor
with the
can claim, depreciation is a non-
knowledge
cash deduction. This means an
necessary to estimate
investor doesn’t need to spend any
construction costs for
money to be eligible to claim it.
depreciation purposes.
Research shows 80 per cent of
Expert Quantity Surveyors, like the
property investors are failing to
team at BMT Tax Depreciation, will
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of deductions an investor can claim, the ‘capital works’ deductions for the building structure and the depreciation of ‘plant and
10
equipment’ assets. It will also outline the deductions using both the prime
CENTURY 21
cost and the diminishing value method. The investor can speak with
their Accountant for further advice
residential properties (where
Given the changes to legislation
on which method best suits their
contracts exchanged after 7:30pm
surrounding the depreciation of
individual investment strategy.
on 9 May 2017) can no longer claim
plant and equipment assets, it is
depreciation on existing plant and
important to ask questions and
equipment assets located within
seek further advice from a Quantity
their property. However, there are
Surveyor to discuss potential claims.
Investors should also be aware of some important details regarding changes to depreciation legislation. There are some key dates and factors investors need to be aware of. On 15 November 2017, Parliament passed the Treasury Laws Amendment (Housing Tax Integrity) Bill 2017, which brought about some major changes to ‘plant and equipment’ depreciation claims. The legislation changes mean that owners of second-hand
still thousands of dollars to be claimed by Australian property investors, as there has been no change to ‘capital works’ deductions or building write-offs, which typically make up between 85 to 90 per cent of an investor’s total claimable amount.
ABOUT THE CONTRIBUTOR Article provided by BMT Tax Depreciation. Bradley
Investors who have already
Beer (B. Con. Mgt, AAIQS, MRICS, AVAA) is the Chief
purchased prior to this date can
Executive Officer of BMT Tax Depreciation.
continue to claim depreciation
Please contact 1300 728 726 or visit
deductions as before.
www.bmtqs.com.au for an Australia-wide service.
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A UC T I O N ST R AT E G Y
THREE TIPS FOR PURCHASING AT AUCTION Auctions can be intimidating, especially if you’re a first home buyer or have never attempted to purchase at auction previously. But it can be a fun experience and has the potential to result in a great purchase.
1.
FA M I L I A R I S E YO U R S E L F WITH THE PROCESS If you have time, attend auctions of similar properties to what you are looking for and in the same suburb. Listen and watch the process and become familiar with how it works. This will allow you to form a better understanding of the local market and to get comfortable with the auction process.
Here are three tips for buying a home at auction:
2.
SET A BUDGET It is easy to get caught up in the pace of an auction and the desire to win. Overcome this temptation by setting a budget before you start. Know your upper limit and be strict with yourself on stopping at that limit. However, also consider having a small contingency set aside in case the difference between winning your dream home and not getting it is a matter of $1000 – $2000. Over the lifetime of your loan and property ownership, a small amount of extra money may be worth spending if you truly feel the property is worth purchasing.
3.
BE INFORMED
Ensure you have done your due diligence on the property itself. Make sure you have a building and pest inspection in hand and all your finances prepared. If possible, have your solicitor to look over the contracts in place prior to auction. Make sure that you know what conditions are in place, as most auctions require a deposit to be paid on the day. C21 MARKET PULSE
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1. CHECK THE WORK STATIONS
double check if there are any new
A house needs the essentials: a
to pay more for a beach view, only
bathroom, kitchen and laundry.
to find that beach view will soon be
However, if you’re visiting multiple
obscured by an apartment building
properties it can be easy to
or shopping centre.
areas of development happening in the suburb, because you don’t want
skip over a careful analysis of those rooms. If you’re looking at apartments, then the laundry can
4. DO YOUR RESEARCH
be particularly illusive. Make sure
If you plan to buy an apartment
to check the exact location of the
be sure to get a strata inspection
laundry, that there’s enough room
report and familiarise yourself
in the kitchen to be functional and
with any levy fees, past, current or
the layout of the bathroom.
future issues, future plans for the building and any maintenance or
2. KEEP THE FUTURE IN MIND
repairs that need to be done. It’s important to know what money you might be expected to cough up.
Although you may just be buying your first property, are you planing to have children? Or planning to get a pet? Do you need a space where you can work from home? Do you need a garden or are you happy with a courtyard or balcony? These are all important questions to keep at the forefront of your mind when viewing a property, because a onebedroom unit with a small balcony might suit your life now, but it isn’t going to cater to a couple with a child and a dog. Try to future-proof your investment so it can grow and adapt as your life changes.
3. SPEND SOME TIME IN THE AREA You don’t want to move into your brand-new home, only to discover it’s under a flight path, the suburb has heavy traffic or is slated for development. Spend some time getting to know the suburb and familiarise yourself with the traffic situation, the noise situation, and if it has facilities such as a doctor, dentist, supermarket and chemist within easy reach. It also pays to
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