October 21, 2017

What is rentvesting and is it a good idea?

Who doesn’t want to have their dream home? Owning a home is a great achievement. However, with the ever increasing prices of real estate in Australia, it has become difficult to enter the market. People who cannot afford to buy their dream home enter the real estate industry through rentvesting.

This is the process of renting a home and investing in property that you can afford. If your dream home is a three-bedroom home in the city centre, the prices obviously are high and you may not be able to afford it as of the moment. With rentvesting, you will rent the property that you want then buy a property in an area where prices are within your budget. You can turn it into investment property which can help you pay your rental payments.

Is rentvesting a good idea? Here are some points to think about:

Your purchasing power doesn’t affect the lifestyle that you want.

Rentvesting enables you to live your preferred lifestyle and at the same time, have an extra income and build your property portfolio.

You can have a property sooner and with a smaller deposit.

Rentvesting allows you to enter the property market sooner, which will help in building equity. Eventually, you can use the equity to buy another property as investment.

Buying an investment property offers tax advantages.

Rentvesting comes with deductible costs such as interest payments, property maintenance, insurance, as well as depreciation. Take note that it is better to seek advice from an accountant so you will better understand the taxation advantages that you can get from your property.

You can make smart decisions when purchasing a property.

Buying a home comes with a lot of emotions since it’s your dream and you already have a picture in mind of the kind of life that you and your family will have when you live in the house. On the other hand, buying an investment property doesn’t come with emotions that you have when buying your dream home. When it comes to the investment property, you think about its potential ROI.

So, is rentvesting a good idea? It really depends on your goals. Bear in mind that this method of entering the real estate industry is not for everyone. Make sure to understand how investing in real estate works and determine if rentvesting will work well for you.

Do you think rentvesting is a good idea? Share your real estate tips in the comments section.

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More affordable options to enter the property market

Getting into the world of real estate investment obviously costs money, and with the ever increasing demand for houses and properties, you can expect real estate in Australia to become more expensive especially in prime locations. But this does not mean that you cannot go into the real estate industry. There are actually several more affordable options that you may want to look into so you can get started with investing. Here are some of the options to take into account:

1. Family equity loan

In this option, parents can serve as guarantors on a loan and even offer their home as security, while the principal borrower’s name will be on the loan as well as in the title.

2. Buy with other people

This option involves more than one buyer of the property. It can be with family or friends and the loan will be split among them. Bear in mind that banks implement different rules when it comes to lending and joint loans so make sure to study the terms carefully. You can also ask a lawyer to explain things that you’re not sure of. Also, buying property with other people can be risky. It’s essentially a business partnership and challenges may arise later on if one of you wants to sell the property, for instance.

3. Rentvesting

Enter the market sooner with this option that involves renting where you want to live while buying affordable property and putting it up for rent. Since the property is cheaper, you may not need to save a lot for the deposit. The major advantage of this option is that it enables people to live where they want and at the same time, use the investment property to grow their savings.

4. Consider properties in regional or rural areas

In general, homes are more affordable in rural areas compared to those in cities. Of course, it’s a matter of preference but as far as affordability is concerned, this is a good way to enter the real estate industry without shelling out a lot of money for deposit. Just make sure that the property is suitable for your needs and lifestyle.

These are some of the affordable options that you can consider if you want to enter the market and you don’t have enough funds for the investment. Do your research and choose which option works well for you.

Got other tips on investing in real estate investment? Share your real estate advice in the comments section.

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How to Search for Your Dream Home and Stay within Your Budget

Buying real estate in Australia is a milestone that needs careful consideration. After all, it costs a lot of money, and a lot of factors come into play when investing in real estate. When it comes to your dream home, you obviously look out for various details to ensure that your home has everything you wish for. But before you get caught up with all of these, make sure to keep these guidelines in mind so you can find your dream home while staying within your budget:

Know your budget and stick to it

As with buying any other major purchase, it is always important to determine what you can afford and stick to it.  It is very easy to get carried away, especially when details of your dream home are concerned.  Just think about what you can spend on your dream home and work around that amount.

Identify your needs

Do you wish to move in right away or do some renovations? This is an important factor as it will affect the type of home that you look into.  You can stay within your budget if you will get a house that’s ready for moving in. However, make sure that it meets your dream home requirements.  On the other hand, it will cost more money to buy a home that you want to customise to fit your needs. Take note that if you’re looking at a house and it’s close to being beyond your budget, you won’t have any funds left to renovate it.

Choose the right builder

With so many builders out there, it is wise to do your research before investing in real estate. Look for one that has been in the industry for several years. Have a shortlist of potential builders and check their portfolio. You can also seek advice of family members and friends who have experience in investing in real estate in Australia. It is likewise important to ask about insurance and warranties.  Getting a building permit is usually done by the builder, but confirm it just in case.

Check the neighbourhood

Make sure that the community suits your needs. Check if establishments such as banks, local shops, schools, and restaurants are near your area.  Proximity to major roads and public transportation is also one thing to consider. You can likewise talk to residents so you will have a clear picture of what it’s like to live there.

Got other real estate tips? Share your ideas on investing in real estate in the comments section.

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10 Features of a Good Suburb

The real estate industry in Australia is continuously growing, with more and more homes and real estate investments being offered to people with varying needs and preferences.

If you’re looking for a good suburb for residence or you’re investing in real estate, you’ll find a wide range of resources online, informing you about what to look for. But what does a good suburb entail? Here are 10 features that you may want to take into account:

1. Location

If there’s a single real estate advice you can get, it’s choosing the right location. A game-changer in the industry, the location should be at the top of your list. A good suburb is located in an area that is surrounded by or close to establishments and facilities that you need for your everyday life.

2. Easy access to transportation system

Whether you have your own car or not, it pays to be close to main roads and public transport links, particularly buses and trains.

3. Schools and centres for child care

Families usually look for areas that are close to good schools and child care establishments.

4. Employment opportunities

A good suburb is near offices and other establishments that offer employment for people in surrounding areas.

5. Recreational facilities and parks

Another feature that makes for a good suburb is the availability of amenities and areas where people can play sports or do their hobbies and interests. These can include basketball courts, jogging and/or cycling paths, etc.

6. Shops and supermarkets

The presence of a range of retail stores and supermarkets significantly adds amenity value to a suburb.

7. Hospitals and medical facilities

We need medical care at certain points in our lives so it is essential to live in an area that is near hospitals, clinics, and other medical facilities.

8. Population demographics

If you have kids, you may want to live in a neighbourhood with families and children as well. In this case, the age and structure of the population add value to a suburb.

9. Views

It may not be a basic necessity but for others, views matter when it comes to looking for a good suburb.

10. Mix of housing types

An area with numerous rows of identical homes is not that appealing to a lot of people. A good suburb should have a good mix of different types of houses with their own property attributes.

Got other things worth considering about real estate in Australia? Share your real estate tips in the comments section.

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The Benefit of Home Staging When You Sell Your Property

It has always been said, “first impressions last”. This can’t be any truer when it comes to real estate in Australia. When you have an important meeting to discuss a major project with your boss, you do everything in your ability to ensure that all aspects are taken into consideration – from the details of the presentation, the venue, to the clothes and shoes that you will wear. The same holds true for real estate investment particularly in selling your property. You need to make sure that it is visually appealing to the market so you’ll have more prospective buyers and make a sale at the right price. To ensure that your property is ready for buyers, you need home staging.

Home staging is a marketing strategy that is proven to sell a property much quicker and at a better price compared to those that are not maintained and presented as a marketable product. For both homeowners and real estate agents, this can save them money and time as a properly staged home can be sold more quickly, eliminating the need to do home opens all the time.

Want to know more about home staging when planning to sell a property? Here are some things to consider:

Seek real estate advice

Consult a professional home stager or property stylist as he/she knows more about how to present your property and make it attractive to a wider range of buyers. He/She can likewise give you real estate advice on marketing materials and even choosing the right real estate agents.

Home staging comes with an assessment and report 

An experienced home stager or stylist will first analyse what needs to be done. Properties vary, but changes can include de-cluttering, paint job and repairs, thorough cleaning, and removal and/or addition of furniture.

Compare professional home stagers

There are different kinds of experienced home stagers, so it is essential to take some time to do research and understand their offerings. Real estate in Australia is a big industry and you obviously want to trust your property in the capable hands of a home stager who will manage your property staging project until you list it for sale.

Investing in real estate involves a lot of factors, and when selling a property, you obviously want the house to be sold as soon as possible and at the price that you want. Keep these tips in mind so you will reap the fruits of home staging when selling a property.

Got other tips on real estate in Australia and home staging when selling your property? Share your ideas in the comments section.

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Why a Building and Pest Inspection is Important When Buying a Property

Investing in real estate in Australia is likely to be the greatest financial decision you will ever make. If you’re buying your very own property, one of the most important things that you should do is acquiring a building and pest inspection.

You should keep in mind that a building inspection report and a pest inspection report are two different things. The former identifies any structural issues which could have a significant impact on the property. The latter examines the property for any pests and the damages that it has caused.

We’ve gathered some reasons why a building and pest inspection should be on every property buyer’s checklist before investing in real estate in Australia.

Building and pest inspection is a money and life saver

According to a CSIRO report, 32% of houses in Australia have a presence of termites. The average cost of removing them can go up to $7,900 depending on the type of property and the infestation of the building.

You can avoid this big financial mishap with a building and pest report. A professional will evaluate the overall condition of the property such as the:

  • Interior and exterior of the building (windows, doors, floorings, ceilings and etc.)
  • Roof space
  • Under-floor space
  • Foundations
  • Wiring
  • Plumbing
  • Electrical and air condition systems

It’s highly recommended that you do some inspections prior to making a real estate investment as these building and pest reports may reveal any hidden problems the property may have.

It tells you the current status of the property beforehand

A building inspection tells you the current condition of the property you’re looking to buy. Whether the real estate is old or new, it’s essential to know about this for safety reasons and costing concerns for your future maintenance and repairs.

You can check the Building Codes and Standards of Australia to make sure that the property you’re interested in adheres to the standards. If not, you will be responsible for the expenses of bringing the building up to the code.

You can negotiate for a lower price

Even if the reports show a few minor flaws, you can use the information you have as a bargaining tool. The price of the real estate will need to coincide with the state and condition of the property. You can try and negotiate a lower price or alter the contract or settlement terms of the property you’re eyeing to buy.

Conducting a building and pest inspection is a must for every home buyer. It’s better to know the problems early on as this can lessen your future expenses, and guarantee the safeness of your property.

Did you conduct a building and pest inspection before buying your property in Australia? We’d love to hear your story!

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Why You Should Pay Attention to Hipsters Before Investing in Real Estate

Real estate in Australia isn’t immune to the trendsetting abilities of hippies and hipsters. They can change the perception of a suburb from ‘dirty, down and low growth’ to ‘Edgy, cool, and with a price heading to the stratosphere’.

Taste are always evolving.

I couldn’t have imaged my grandmother eating anything that was Japanese, and my parents wouldn’t have touch raw fish or seaweed when they were growing up.

But if you were to look in the food court of any suburb shopping centre you’ll see people eating Sushi like it was, well… a burger with fries.

Each generation has its different goals, aspirations and needs.

But, before these changes become fully entrenched it is the hippies and hipsters who adopt them early and forge a path to mainstream acceptance.

Hippies and hipsters are all about not following the crowd, forgoing group approval to live by their personal values.

The trend hippies and hipsters driven change can also be seen in real estate. Every city has a suburb or area which you wouldn’t have dreamed of buying in until they moved in and it became cool and ‘red hot’.

As a generalisation hippies and hipsters don’t get sucked into the race to the suburbs, bigger houses, whiter fences or manicured lawns. They look for areas which are more edgy, expressive, and communal.

In an inner-city area, the difference between a ‘no way’ suburb and ‘uber cool’ is a couple of artesian bakeries, a community garden, bike parking, a yoga studio, a beard specialist barber and an alternative primary school. Redfern in Sydney is one somewhat recent example, Brisbane’s West End another.

Small country communities or beach side towns are also popular due to the ability to live an independent, ‘natural’ life; think Byron Bay, NSW or Healesville, VIC.

Once the trend setters move in and provide or demand services, these areas become quickly gentrify, and property price rise.

Now, this isn’t to say that it is only hippies or hipsters who change the shape of real estate Australia. They typically set up in areas, that have huge potential already.

Nor should you make investments, real estate or otherwise, purely on a single factor.

But before you write off areas based on your personal distaste, consider its individual merits. If the hipsters and hippies are moving in, it might be worth taking another look.

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