G’day Nathan….

My concerns are the same as yours… size..resale…refinance one day etc

That is a small unit, and your resale market is restricted. However it is going to be a problem in that the overall market is softening and I would ignore the asking price. It is no point in thinking that others would pay the asking price but can’t get it financed.

The reality is…it’s not sold. You could also assume that it’s not worth $150,000 or it wouldn’t be their after 2 months if it was. So it’s worth less than $150,000. Make an offer of $130,000 and be prepared to have the Agent chase you.Stand firm for a week or so… it’s been there 2 months.

I would still caution you in buying anything that has not sold after 2 months given the market 2 months ago was still reasonably strong.

It’s cheap but ….for a reason

Cheers

Bill

Bill O’Mara
Real Estate,Mortgages,Share Market Strategies.
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G’day Enduser…

In my opinion it’s beeen over for some time.
Just the last bit of steam until a likely .5% interest rate rise in December. Even those that don’t want to accept it will come to realise that the Markert has had its day and falls of 10-25% in some areas will happen. So that’s the end of a six year Bull Run.

Certainly, Property is a long term investment and goes in 5-7 year cycles generally. As you make your money when and where you buy we probably have a good 2 – 3 years of consolidation ahead of us. Do your research now, for the next cycle or pick up on forced sales. Next year will be an opportunity to maybe buy 2 year options, in the start of a buyers market….. take your time.

Cheers

Bill

Bill O’Mara
Real Estate,Mortgages,Share Market Strategies.
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G’day…

Be aware that Real estate Agents do not give a Valuation. They are supposed to give you a “Market Appraisal”. The difference between an MA and a sale price is generally 90% to 94% of the MA is achieved in a Sale.

Agents tend to tell the Vendor what he/she wants to hear to get the listing. So take most (not all) MA’s with a grain of salt. Other Agents don’t do any research and are totally incompetant.

If you find a good agent they are worth there weight in gold and can make/save you tens of thousands of dollars. Trust your gut feeling.

Bank Valuations are vbased on comparitive sales ie Properties sold..not the asking price.

Cheers

Bill

Bill O’Mara
Real Estate,Mortgages,Share Market Strategies.
[email protected]

G’day….

Real Estate Agents recommend Auctions for a couple of reasons and you should avoid them like the plague as a buyer or a seller.

(1) This method allows them to avoid giving the Vendors a Selling Price when listing the Property
They do this because of the fierce competition from other Agents in listing properties. Owners can invite it upon themself as their greed blinds them to reality. Agent(a)tells the truth and says $500,000 Agent (b) says $530 – $550,000 (c) Agent says “we should put it to auction”.

When questioned on a price… he says” that’s the beauty of an Auction you just need a few strong bidders and blah, blah, blah…then proceeds to talk of the “Sales that went $x above reserve”

Vendor is sucked in and even writes out a cheque for the Advertising costs. The market place has been conditioned to pay for advertising for an Auction and thats reason number (2) $2,000- $5000 and at times heaps more for the Auction Advertising .

The Agency that listed the property for Auction now realises the Vendor needs to see some action…buyers are initially told Mid to High Fours…. to get as many at the auction as possible. Now they spend the next few weeks conditioning the Vendor down in price. He’s been dreaming of “above reserve sale” and allowed to think like that for a little while.

As the Auction draws nearer they tell the vendor ” the market is telling us Low $500’s so you’ll have to be realistic with your reserve price.

From here on in, the relationship begins to sour
but the vendors done his dough and the Auction is in a weeks time. The rest is history…repeated week in week out all over Aussie. Property doesn’t get near the Reserve, Vendor encouraged to “put it up for sale as some buyers won’t bid until they know it’s on the market” maybe a bit more but generally it’s all over bar the shouting.

Yes, of course there are exceptions… but generally speaking, unless you are selling something really unique avoid auctioning your property. Many buyers will not go to or bid at Auction, yet no buyer refuses a sale by Private Treaty.

That’s not to say that Private Treaty Sales by Agents are much better. With nearly 30 years in the Industry I wouldn’t feed half of them. However the Vendor generally gets the Agent they deserve… They won’t admit it… but they usually list with the Agent that gave them the highest estimated selling price.

Is it any wonder that, on average properties sell at 94% of the initial asking price and only 2% of the Public are satisfied with the Agent the engaged.

I’ve probably said more than enough…

Cheers

Bill

Bill O’Mara
Real Estate,Mortgages,Share Market Strategies.
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G’day Westan…

I always calculate net yield…. thanks, as I shouldn’t assume everyone else does too.

Cheers

Bill

Bill O’Mara
Real Estate,Mortgages,Share Market Strategies.
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G’day fullout…

The yields the same because it is calculated on the Purchase price of the property. So won’t matter what you do, the yield will be what it is.

To me the IRR would be my return on my own cash in the deal…cash on cash return I think Steve calls it… the best indicator… after the true yield that you keep getting.

Hope that helps

Bill

Bill O’Mara
Real Estate,Mortgages,Share Market Strategies.
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G’day…

With a PO Box No at Broadbeach…I don’t like your chances. I’d be going back to the Agents in Vic. unless they are gone too.

Doesn’t sound like a good investment does it?

Bill

Bill O’Mara
Real Estate,Mortgages,Share Market Strategies.
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G’day….

I absolutely have no time for Real Estate Franhises/Systems. The buyer of the franchise seems to think they need their hand held and are gutless wonders. Jenman flogs off his “system” and takes a % of T/O from those that are too lacking in self confidense to go it alone. Imagine doing biz with an agent that is not confidident enough to fly his/her own flag.

However only 2% of the population trust R/E Agents
not because of dishonesty so much but sheer incompetance. It is far too easy to get a job in R/E and the sooner they get rid of the “part timers” the better.

Of course there are dishonest agents, but they are a minority… the majority are unskilled and tell the Vendor what he wants to hear…then the rot sets in.

Neil Jenman…promotes Ethics and he is on the right track. His cause needs to be funded so many agencies subscribe to his “system” and pay for the privelege. He is resposible for their actions I agree… and Agency’s do get terminated. Bad luck if you got lumbered with an Agency that should never been in the system. So don’t knock a bloke for running his own race. It does “differentiate” his services and that is the key to a successful Business…. give him a go.
He has been on this “ethical Bandwagon” for 10 years…already he is in part responsible for legislation in the atrocious Auction System.

Cheers
Bill

Bill O’Mara
Real Estate,Mortgages,Share Market Strategies.
[email protected]

G’day C2…

As I’ll be away for 3 days.why not post your PFA?

Cheers

Bill

Bill O’Mara
Real Estate,Mortgages,Share Market Strategies.
[email protected]