Thursday, April 27, 2017

Is now a good time to sell my home?

"Is now a good time to sell?" This is one of the most commonly asked questions of our team from sellers in the real estate market.

Following the long weekends, Easter and the school holidays, some sellers have been worried about whether or not they should wait until the passing of these events to put their home on the market, concerned about the possible impact they could have on their campaign.

The fact is... in a wonderful city like ours there will always be something on! Just take a look back at the past two months. We have had the Clipsal 500, The Adelaide Fringe, the commencement of the AFL season and long weekends. More recently this month we have had the Easter break, school holidays, ANZAC Day and not to mention Mother's Day is just around the corner too!

With 32 years experience in the real estate market we've recognised that with the right sales strategy, these events aren't a distraction to the market, in fact they can be the exact opposite and enhance your property's sale campaign.

It is our job as agents to be aware of what is happening out and about in the community, and assess how this could influence buyer behaviours throughout the sale of a property. Considering these factors and working strategically to leverage them, can often lead to a very strong campaign.

Team Toop has tried and tested powerful and emotive marketing techniques to capture attention and create a connection with buyers throughout property campaigns. Through doing this we've learnt that you will always spark your target buyer's interest no matter what time of year it is.

However, for this to work successfully it's important to have an agent that understands the power of emotive marketing, is aware of what is going on in the community, and is able to construct a campaign that is specifically designed to make it easy for as many people as possible to see and visit your property. They must have the ability and mindset to leverage opportunities where more people than usual are out and about, such as long weekends and school holidays.

Once you have attracted and captured this interest, potential buyers will come to your open inspections, regardless of what might be happening. If a buyer is truly interested they 
will visit your home!

Throughout the first quarter of 2017, we continued to see low stock levels nationally in the market, maintaining real urgency for buyers. Over the last eight weeks, we had 612 brand new buyers register for our ToopVault service. This is on top of our 8,686 existing buyers. During this time we have sent 71, 565 property email alerts to these registered members. We are seeing
first-hand that buyer demand for property is certainly exceeding supply.

At Team Toop, our experience in leveraging great market conditions with a large amount of buyers and using strategic marketing techniques to engage them, we are able to achieve fantastic results for our clients no matter what exciting events are happening in 
this beautiful city of ours!

Wednesday, April 19, 2017

Landlords, you are the beneficiary of a strong sales market

The sales market has remained strong over the first quarter of this year. We've seen properties sell well-over their reserve price at auction, buyers putting in quality offers after first open inspections, and property sales creating new 'million dollar suburbs'.

Often when the sales market is running hot and confidence is high, the rental market slows, and vice-versa. However, it's been very interesting to see that during the current cycle, this hasn't been the case... Landlords have been a beneficiary of the strong sales market.

Let me explain.

Many people have been successful in selling their home, but when the shoe is on the other foot and they are looking to buy, they have found the market to be very competitive. As a result, many buyers have entered the rental market as a 'stop-gap' between homes, tipping the demand from the sales market into the rental market.

At Toop&Toop we like talking in facts and figures. We record the number of tenants that attend our open inspections live on iPads, so we can produce instant reports from the field to our Landlords.

So what are the numbers saying? Our team have seen a 45% increase in tenants attending our open inspections over the past quarter (Q4 2016 to Q1 2017).

Adding to the strong conditions, we have also seen very low stock levels on the rental market. Our vacancy rate was at a record low level of 0.29% in metropolitan Adelaide last week (compared to the industry average of approx. 1.7-2.0%). This is a staggering number and is the sign of a very tight market.

Currently our property management team have almost half the number of properties available for rent than we did 6 months ago. We are finding that many tenants are choosing to renew their lease, rather than looking elsewhere to rent as there is simply a limited number of homes available. How long will it last? With a number of residential developments in the pipeline, the conditions we are seeing right now will likely ease over the next 12-18 months as additional supply enters the market. We believe the metropolitan Adelaide market will however, remain a steady performer in the long-term - as a result of the underlying affordability of property in our state compared to other capital cities.

At Toop&Toop we're excited about investing in Adelaide. We see our role as agents is to be proactive to ensure landlords can make the most of the market conditions throughout the property cycle and optimise their returns.

Suzannah Toop

Thursday, April 13, 2017

The hunt is on for Adelaide’s million-dollar lifestyle!

We are experiencing a strong start to the year 
for luxury homes in Adelaide's real estate market. Homes in sought after suburbs across our city remain tight, and as a result when they are launched to the market they are being snapped up quickly, with many being sold discreetly off market! Our median house price 
is strengthening, which indicates significant growth in our top end property market, that is driven purely by demand outweighing supply.

According to RP Data, it's specifically Adelaide's eastern suburbs that have proven to be the most exclusive areas to live after recording some of the top prices on SA's property market in 2016. College Park topped the list with a median sale price of $1.864 million. Unley Park came in second, at $1.602 million, and then Rose Park recording a median sales price of $1.325 million. Other popular areas included Leabrook, 
St Peters, Toorak Gardens and Malvern. 

Adelaide's eastern suburbs are some of the most tightly held in the nation and with the increasing demand from buyers to get into these luxury areas, we are seeing our property prices for lifestyle homes continue to rise. While demand for these homes is occurring right across Australia, our Adelaide property market has been recently highlighted in the media nationally for our consistent growth and value for money in the top end market. As a result of this, we are starting to experience an increase in enquiry from Eastern State buyers in Melbourne and Sydney who are looking to relocate or purchase an investment property here in Adelaide. 

For these Eastern State buyers, it's the lifestyle that our South Australian properties can offer that is truly unmatchable. For people living in the Eastern States, purchasing a home only minutes from the CBD on thousands of square meters of land or a property with acreage that is only a 25-minute drive to the CBD including 'peak hour' all for under $10 million is simply unheard of!

Adelaide's current top residential property sale sits at $7 million in the prestigious suburb of Gilberton. This property is situated under four kilometres from the heart of the city on over 4,000 square meters of land. When you compare a magnificent residence like this with what you could purchase for the same amount in the Eastern States, you quickly begin to see why our luxury market is capturing the nation's attention. For example, if you were to purchase a property of similar calibre in Melbourne you would be looking at a price of $12 million or more, and in Sydney, you would need to be spending in excess of $20 million!

Team Toop has some incredible luxury homes 
on the market and in our ToopVault, that are 
positioned throughout some of Adelaide's finest suburbs such as Walkerville, Malvern and Toorak Gardens. In March alone, we had 870 buyer groups visit our million-dollar plus homes. This long weekend we have 32 homes available for inspection over $1 million dollars and 4,357 buyers registered, interested and receiving 
alerts in this specific bracket of the market.

There's no doubt luxury homes in Adelaide are in demand and with so many buyers in the market, the million dollar hunt will be on this Easter long weekend. From all of us at Team Toop we hope you have a very Happy Easter! 

Thursday, April 06, 2017

Property investors... the downside to popularity

The property market has been in the national spotlight for some time now. From predicted booms and busts, to discussions on negative gearing and stamp duty, property is consistently a hot topic across Australia. But it seems this popularity and attention (particularly off the back of Sydney and Melbourne) is now starting to create an unfavourable position for investors across Australia. Investors are being impacted, on two fronts.

The first... regulatory bodies are focussing on curbing investment activity. They're putting the brakes on growth by enforcing banks to reign in their housing investment loans.

So what's the impact on investors? 

Banks have raised the interest rates for investment loans so it is now more expensive for property investors to borrow funds than owner-occupiers. Under the new reforms, a $400,000 loan can typically cost an investor an increase of $100 a month with the latest rate hikes. And if you are currently an investor with an interest-only loan, you may see an uplift of up to 0.31% on your variable rate. These types of increases are unprecedented in recent years. And it's now no longer purely the Reserve Bank of Australia (RBA) driving interest rate changes. We saw this earlier in the week when the major banks raised rates prior to the RBA meeting. The environment is changing.

The second... as the popularity of property grows, house prices continue to rise, however rents are not keeping up as seen on the eastern seaboard.

This trend is particularly noticeable in Sydney suburbs where buyers are parting with $1.3 million to secure a two bedroom unit without a car park. While investors are still flocking to purchase these homes, what they may not realise in the buying frenzy, is these properties are achieving rents of $700 per week... at most. With property prices sky rocketing, rents are not keeping up and yields are deteriorating.

Looking locally at our returns of up to 5.5%, it's no wonder there is demand to purchase property in cities such as Adelaide, and even Hobart, where affordability and stable returns are creating a favourable investing environment. We see the Adelaide property market is in good stead to weather the impact 
of the changing lending and market conditions that lie ahead. 

So how can you take steps to protect 
your investment?  

More than ever, property investors or their managing agent will need to be proactive with those areas that can be controlled. Obtaining tax depreciation schedules, tailoring a maintenance plan for your property and receiving quality advice on your funding will 
no longer be optional... it will be a must.

For this reason, at Toop&Toop we have moved our focus to a holistic investment approach. In addition to the day-to-day property management, our team work closely with a range of experts to ensure our clients have access to the best advice in each core specialty.

In this changing environment, it's important to be prepared so that you don't experience the downside to popularity. Be sure to reach out to me or our property management team to have a chat.

Suzannah Toop