Thursday, January 29, 2015

It’s all about profile...

In this day and age, everyone has a profile... Facebook, Instagram, Houzz, Twitter. We are browsing profiles daily trying to get a snapshot of what a friend is up to or what a restaurant is like. Most browsing is done mindlessly to pass time or when relaxing in front of the TV.

In the investment world, understanding tenants and their needs is fundamental to ensuring your property remains attractive and achieves premium rents. The profile of your tenant is so important – it's what impacts your rental income and ultimately the return on a property. Having quality tenants is key to minimising your investment risk.

So what trends are we seeing?

Across our seven leasing hubs, the top five things we find tenants are looking for (in order) are: air conditioning, built-in robes, a dishwasher, undercover car parking and a gas cook top. This is first hand feedback on what makes a property attractive and marketing these items is what's getting people through the doors!

Tenants these days are also very savvy, know what they want and are doing a lot of research on a property before coming through an open inspection. This means they have bedroom sizes, bathroom condition and what the property should be worth at the front of their mind. 

Over the last 18 months we've found that the typical tenant profile is increasingly young professionals and families, with a large number of applicants between 22 to 35 years in age. When comparing to this time last year, our team has never seen so many people applying for quality homes.

Most tenants are also being smart about their ability (or inability) to make rental payments. A trend we are seeing over the last 12 months is that tenants are only applying for properties which are within their budget... and it very much ties in with the new era of tenant.

Why do we think we are seeing this new tenant profile?

Our team often discuss trends in the office and one reoccurring topic of conversation is tenants testing before they buy, sussing out what areas they want to live in and what type of property would be suitable. This might seem at odds with current buying conditions, (low interest rates and very affordable housing in Adelaide) but it has been extremely competitive to purchase a home in the past six to nine months, with many buyers missing out at auctions.

In addition to this, many young professionals are able to afford to rent top end properties, securing these from $700 to $1,500 a week. With expendable cash, many can live in their dream home as a tenant, but can not necessarily afford to enter the same high end bracket of the market (coming up with the deposit as well as the regular mortgage payments, council rates etc.), should they decide to purchase.

It's interesting to see where tenants needs are going, but what counts is how best to use this information in terms of dollars and cents.

If investors can use the trends in the market to tweak or upgrade certain areas in the property they can significantly reduce downtime between tenancies and attract a quality tenant who will not only look after your property but want to stick around!

Unlike many other profiles out there that we browse through mindlessly, understanding tenant trends and needs is an absolute must for investors. 

Thursday, January 22, 2015

The Great Australian Dream

As we celebrate Australia Day this long weekend, I can't help but think how special it is to be in the business of helping people achieve 'The Great Australian Dream'... Home ownership. 

We are so lucky to live in Australia for so many reasons. One of these reasons we see in the real estate business is the relative affordability of residential property, and the ability to own land outright... which Australians often take for granted. This might seem odd, but being able to actually buy a property and own it indefinitely is not something everyone in the world has the luxury of. 

When I worked in real estate in London, this concept took a bit to get an understanding of. I was selling 'Fixed Leasehold' properties to people where the value of a property was not just determined by its characteristics and location, but was impacted by how long the leasehold on the property remained to run. For example, if a property only had 20 years left on the lease it dramatically impacted the value versus a lease of 100 plus years. 

As an Australian, the idea of buying a house and knowing that technically it still wasn't 100% yours was something I struggled with. This is not just 
common in the UK. Fixed term 'ownership' is common in other countries like in China and India 
as well. My experience in the property market in the UK helped me realise how lucky we are in Australia, where we have the opportunity to pass property down through generations if we choose. 

So on Australia Day, think about this... with interest rates at the best levels we have seen, and with Adelaide having one of the most stable property markets globally, and affordable, why not go after The Great Australian Dream? 

Many are! In the first two weeks of January Toop&Toop experienced 146% more buyers in the market than the whole month of December. Last weekend alone there were 992 buyer groups out at Toop&Toop inspections. This is an incredible number of people looking at property right now!

We have 135 inspections this long weekend, 28 auctions scheduled over the next two weeks of January and another 23 auctions already scheduled for the first two weeks of February! Jump on board and just go after your dream.  

I understand firsthand how tough it is for buyers looking for property right now. I had been looking for a place since August last year, and was on the buying roller coaster... the ride that while you're waiting to hear back on an offer you've submitted, you get excited thinking of all the things you want to do to the new home... only to find out your offer was unsuccessful... or going to an auction feeling confident that 'this is the one'. I was even speaking to our finance team (Funding Options) and they helped me analyse my situation to make sure I was getting the best financial deal which could then potentially increase my property budget... I was getting quite disheartened but eventually I found my new home the day before Christmas Eve... and ironically, I settled on the property yesterday, on Australia Day weekend!

There is no denying it, it is a hot market with a lot of competition out there! Legally I couldn't buy anything Toop&Toop were selling and I couldn't utilise our technology because of this – but you can. We have a VIP service for buyers to help them with their search which is different from the industry property alert information you sign up for. Our VIP service gives buyers access to Toop&Toop properties which are not yet visible to the public. Sign up to get alerts direct to your inbox instantly, daily or weekly depending on your preference. This service is not designed to SPAM people, it's designed to give serious buyers a head start by letting them know what's coming onto the market before the public find out. Register as a VIP by visiting 

So as I start to unpack this Australia Day weekend, and settle in to my new home, I know I will be reflecting on just how lucky we are to live in a country where we have the ability to own our own piece of Australia and just how lucky I am to be working in an industry where I get to help people achieve their dream every day! 

Thursday, January 15, 2015

Dissecting the information from the noise.

There has been a lot of talk this week regarding the economy and where it is heading for 2015. In particular, there has been a lot of discussion on the Australian housing market while the economy is thrown into the spotlight as we embark on a new year.

January is the time we reflect on the year that was, make new resolutions and when the 'best of' articles start to circulate. No matter what the content – shares, property or even celebrity gossip, we stop to recap on the previous year and start to look ahead.

We have clocked over to 2015 and reflection is inevitable, especially in the investment and economy sphere – but does there come a point when reflecting and predicting becomes unhelpful? 

It seems that all this information is putting a haze over the economic world. Analysts are forecasting property and economic information and as an everyday consumer, I've seen my behaviour start to change... even just slightly. I'm wondering when the best time to lock my mortgage into to a fixed rate is and when I should change over some Aussie dollars for my overseas holiday? I'm yet to do either, because there is so much forecasting information coming through – I don't want to act too soon and it's too hard to wade through it all.

Whether it's holding off planning an overseas trip as you're waiting (fingers crossed) for the Aussie dollar to bounce back, or not purchasing a property because you are hoping rates or prices will drop... it seems that at this time of year, reflection can so easily take over from making decisions. Clearly as a community, people are out buying and renting property. The key is: don't do nothing.

As an active buyer, seller or investor, it can be difficult to determine exactly when the best time to act is. The age old question is: When is the best time to get into the market? This past week has certainly added a layer of haze in the decision making process. Interest rates, the Australian dollar and general news on the property market appears to be adding confusion and making it difficult to dissect the information from the all the noise.

As agents, we are in the field every day. We see first hand what is happening at the buyer, seller and tenant levels of the market. Whilst we are not in the forecasting space, we do know what is happening right now – in terms of numbers of people attending our open homes, what areas are the most popular and what the feedback is from buyers/tenants.

So what are we seeing on the ground?

Buyers are swarming quality properties. One of our Sales Partners alone saw over 126 groups through his properties this past weekend! 

On the investment side, the demand for high end properties is extraordinary. There are simply not enough available to meet the current needs of our clients. The relocation activity at this time of year has further heightened the already tight market. One of our properties in Greenhill was leased in a staggering 12 hours for $950 per week! We spoke of the high end market at the end of last year, but it seems things have tightened even further. This is great for our investors, but unfortunately there are a lot of quality tenants who are missing out.

Applications are coming through thick and fast with upwards of eight being received at quality properties. We are also seeing 'stickier' properties that have been on the market for a number of weeks starting to move. 

These are very positive signs for investors and from this level of demand and activity, we are seeing rents move upwards. Around our seven offices and leasing hubs, it's not uncommon to see multiple applications coming in offering $10-20 over the advertised rental price. 

There are macro-economic factors at play in any market and they are 'must-use' guides. It's when the information creates a haze of confusion, and stops you from otherwise acting in the market that you can end up missing out on great investment opportunities. Time to exchange my Aussie dollars...

Thursday, January 08, 2015

2015... Already off to a blistering start in property...

As the first full week of 2015 comes to a close, it is clear that real estate doesn't stop to make resolutions. While traditionally most agencies take the first few weeks of January to launch into the New Year, we always get started immediately...  and we have always had sensational January sales. It's not just the weather that's hot right now; the real estate market is running hot based on 2015's first week!

There is huge demand from both buyers and tenants who certainty haven't taken any time off looking for their next property and are eager to secure a place ASAP to start their new year! 

Toop&Toop recognised the opportunity late last year. As most who are on the open inspection circuit know, Toop&Toop have our award winning, and sophisticated selling system called VirtualAgent (Va). In November and December, Va recorded 4100 buyers attending Toop&Toop inspections. This simply confirms the huge buyer demand in Adelaide that continued right up until Christmas. Given traditionally there is limited stock on the market in January, properties on the market at this time often achieve premium results. Buyers are hungry to see properties, and are starved of choice. 

Similarly, the rental market has shown no indications of slowing down and our leasing team worked over the Christmas period, while once again the majority of the industry traditionally doesn't. As a result, properties over this time leased extremely well and very quickly. Several leased in under 4 days and one this week was listed and let within 24 hours. The number of tenants looking for properties right now is quite astonishing, and they are far more active than previous years.

Some added stimulus this week as financial experts were quoted in the media as having changed their minds on how interest rates will go in 2015...They are now tipping  that rates will hit record lows before they eventually go back up, and with any rise minimal. With the talk of already all-time low interest rates dropping again, buyer demand is almost certain to continue and potentially rise further. 

Our team is in full swing, refreshed and feeling pumped up. We have 59 inspections this weekend and a hectic 27 auctions scheduled for January! 

So if you are ready to sell, or perhaps a Landlord wanting to rent out your investment, we need to hear from you while things are running so well. Buyers, be sure to speak to our team or register as a ToopVIP to see properties first, before they are released to the public.   

The year couldn't have started off better for sellers, it's an exciting time in real estate and we can't wait for the year ahead.

Happy New Year Everyone!!