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Investors Reaping Rental Yields

By RentalSolutions
July 14, 2014  -- Updated 1805 AWST

Australia's leading building and population hotspots have revealed strong market conditions in certain territories, which is good news for property investors. The Housing Industry Association (HIA) has published Australia’s top 20 building and population hotspots, with the ACT suburbs of Crase, Bonner and Casey topping the list. Crase saw its population rise by 58.1 per cent during 2012/2013, coupled with $112 million in new dwelling approvals.

“Present conditions tend to favour buyers when compared to a few years past, which means homebuyers and investors have become pretty savvy when it comes to capital return and rental yield considerations,” said local Mortgage Choice franchisee Susan Tan.

Melbourne CBD came in at number four with over $381 million worth of new dwelling approvals and a population growth of 22.7 per cent. Eight of the nation’s 20 leading hotspots were located in Victoria, with markets in Western Australia, NSW and Queensland also featuring on the list. HIA senior economist Shane Garrett described the absence of Tasmania and South Australia from this year’s list for a second year as “disappointing”.



Three people have been arrested and charged in connection with the attempted fraudulent sale of a home in Western Australia.

By RentalSolutions
July 7, 2014  -- Updated 1805 AWST

Three people have been arrested and charged in connection with the attempted fraudulent sale of a home in Western Australia.

The news comes hot on the heels of two WA agents who had their licences revoked after the misuse of trust accounts in the state.

According to a joint statement between the Department of Commerce in WA and the Australian Federal Police (AFP), two Nigerian men and a South African woman were arrested in Johannesburg on July 2 in relation to the fraud.

The arrests follow a five-month investigation by the major fraud squad of the WA police, with the assistance of the AFP, who worked closely with the South African authorities.

All suspects are charged with fraud, forgery and uttering, and they'll appear in court on the charges later this month.

It’s alleged that Raine&Horne Mandurah, which was managing the Greenfields property on behalf of its South African owner, received an email from the offenders in February pretending to be the real owner, and successfully changing the contact email address the agency had on file.

The investigation revealed that two weeks later, a request to sell the property was received; agreements were signed with forged signatures and exchanged electronically. It added that the property was then put on the market.

It has been further alleged that in March an offer was made on the property and accepted by the pretend owner.

The Department of Commerce said as a result of the offer, documents were sent by the agency to the real owner’s address in South Africa by post, while the email address had been changed, the physical address on file had not.

Commissioner for Consumer Protection Anne Driscoll said real estate agents cannot afford to let their guard down when it comes to these fraud attempts.

"Unfortunately these fraud attempts will undoubtedly continue, so all agents need to be vigilant at all times and have the processes in place to detect these fraud attempts at an early stage,” said Ms Driscoll.

“It is an essential part of the identity verification procedures for any change of contact details by an owner to be confirmed by the real estate agency by sending a notification to the original addresses, both physical and electronic, that are on file. This will alert the real owners at an early stage if their details are being changed fraudulently,” she added.

Real Estate Institute of Western Australia president David Airey confirmed to Real Estate Business that it provides its members and their staff with training to identify scams and ID fraud.

“It's a big issue for agencies,” he said, adding that staff at agencies need to stay vigilant and keep alert for changes of email addresses and bank accounts.

He warned that WA has been targeted more than other states for some reason, and as result, "we require property owners to undergo a rigorous 100 point ID check when listing their property”.



A tax depreciation expert has said approximately 80 per cent of landlords are not making the most of their properties' depreciation deduction.

By RentalSolutions
June 20, 2014  -- Updated 1805 AWST

A tax depreciation expert has said approximately 80 per cent of landlords are not making the most of their properties' depreciation deduction.

BMT Tax Depreciation director Bradley Beer told Residential Property Manager that as a property manager all of your clients are landlords that are investing in property purely to make money now and in the future.

“The items in a property or in a building wear out over time and the tax office lets us claim a deduction based on that wear and tear, and effectively it means more cash in your pockets,” he said.

“As a property manager, just knowing there is some money there and knowing you can get some sort of indication of how much that money might be [is important].

“That way a landlord can potentially take that off to the accountants, ask some questions about their tax return and just make sure that investment is working as hard as possible for them to get them the maximum return,” he added.

Mr Beer said it is important property managers have a good knowledge of a depreciation schedule.

“Knowing that when you renovate there are more deductions, knowing that new property gets more deductions, but knowing that there are deductions on any kind of investment property that can be assessed before you spend any money to see how much money will be there is really important,” he said

“Probably another important thing for renovators is understanding what depreciation means.

“If you are a renovator or your clients are going to renovate and they throw things away then they are going to be able to scrap some stuff, so they need to talk to the specialists before they do these renovations; not just after, like a lot of people seem to do,” he explained.



Figures released by SQM Research this week have revealed tenants are beginning to wield the upper hand over landlords

By RentalSolutions
June 19, 2014  -- Updated 1805 AWST

Figures released by SQM Research this week have revealed tenants are beginning to wield the upper hand over landlords, with the number of residential vacancies decreasing marginally.

Across Australia vacancies fell 0.1 per cent during May to record a vacancy rate of 2.2 per cent and a total of 65,075 vacancies nationally, according to SQM Research. “This result clearly reveals last month’s jump was indicative of a genuine increase in rental dwellings onto the market, and not merely a seasonal spike,” SQM Research said in a statement.

“With Canberra, Melbourne and Darwin being the only capital cities to record monthly decreases, vacancy rates appear to have remained elevated for the most part, strengthening the forecast that the rental market appears to be swinging in favour of tenants.”

SQM Research’s Asking Rents Index has also revealed that on a monthly basis, rents have remained completely flat, with no change to the capital city average – remaining at $528 for houses and $416 for units.

According to SQM Research, stagnation in these figures reflects the difficulty landlords would have increasing the asking price for their properties, in a market with increased supply of rental dwellings.

SQM Research managing director Louis Christopher said rental growth this year has been patchy as a result of the moderate increase in supply of available rental properties.

“I believe vacancy rates will continue to gradually rise over the course of 2014, with the longer-term view that the large increases in building approvals will translate to higher vacancy rates in 2015 and 2016,” he said.

“Overall, it is going to be increasingly difficult for landlords to lift the rent for the foreseeable future,” he added.



Perth Rental Market Unchanged.

By RentalSolutions
February 2, 2014  -- Updated 1805 AWST

The rental market in Perth saw a small rise in the number of available properties during May, but median rents remained stable.

According to the president of the Real Estate Institute of Western Australia David Airey, it was the north eastern suburbs that saw a modest lift in stock.”

“The City of Swan and Kalamunda experienced the highest percentage of new rentals coming onto the market, followed by Kwinana and Rockingham in the south west region.

“There are now almost 5,400 rental homes across the metropolitan area available for lease, and typically these rent for $440 per week for a unit or villa and closer to $460 per week for a house,” Mr. Airey said.

Perth’s rental vacancy rate continues to remain oversupplied, hovering around four percent, according to Mr. Airey.RS



Commodity prices have declined from their peaks but in historical terms remain high

The Reserve Bank has chosen to keep the official cash rate on hold at 2.50% p.a. following their first meeting of the year. Governor Glenn Stevens flagged stability was needed to continue to foster growth in 2014, calling overall conditions “very accommodative.”

“Commodity prices have declined from their peaks but in historical terms remain high,” said Mr Stevens.

“In Australia, information becoming available over the summer suggests slightly firmer consumer demand and foreshadows a solid expansion in housing construction. Some indicators of business conditions and confidence have shown improvement. At the same time, with resources sector investment spending set to decline significantly, considerable structural change occurring and lingering uncertainty in some areas of the business community, near-term prospects for business investment remain subdued. The demand for labour has remained weak and, as a result, the rate of unemployment has continued to edge higher. Growth in wages has declined noticeably.”

The RBA also noted that inflation in the December quarter was higher than expected, and the decline in the Australian exchange rate, which has helped balance economic growth.

By RentalSolutions
February 4, 2014  -- Updated 1805 AWST

RP Data figures show home values rising 1.2% in January, taking the annual capital gains across combined capital cities to 9.8%.

“The improved housing market conditions have provided a substantial flow on effect to the housing construction sector as developer confidence improves with housing market conditions,” said RP Data National Research Director Tim Lawless.

“Dwelling approvals are up close to 22% over the 2013 calendar year and there have been consistent rises in the number of new home sales. We expect housing market conditions to remain buoyant while mortgage rates remain so low, however further rate cuts are looking like an outside bet at best.”

Looking ahead, the RBA said they expect growth to remain below trend for a time yet and unemployment to rise further before peaking.

JP Morgan strategist Sally Auld told the media additional rate cuts aren’t off the cards, based on softening incomes and no meaningful upturn in employment figures. She flagged August 2014 as a likely month for a cut to fall.

Experts remain divided over whether rates will fall further than 2.5% in 2014, or whether they’ll adjust further as the year progresses.



Recommendation for Kim Turner of Rental Solutions Property Management

By RentalSolutions
February 2, 2014  -- Updated 1805 AWST

This letter is my personal recommendation for Kim Turner of Rental Solutions Property Management.

When searching for a property manager for one of my properties, Kim Turner came highly recommended by a personal friend. Having dealt with property managers in the past I found their performances average so I decided to go with Kim as I trusted my friend’s opinion.

After a brief meeting with Kim I noticed a level of enthusiasm which I had not experienced previously and without much hesitation I decided to hand over the property to Kim for management. Another important point worth noting was that Kim was happy to relinquish the property management if he failed in his ability to deliver. This again showed a level of confidence I had not experienced previously.

Kim is a highly proactive individual who has a great ability to assess his clients and select quality tenants, removing a lot of risk for the owners in the process. Within a short period of time Kim had the property rented out delivering far better returns that any of my previous property managers. This progressively resulted in me handing over all my properties to Kim to manage. The results were exactly the same for all the properties. High returns with quality tenants.

Kim has made property rentals a stress free experience for me and I highly recommend him to anyone who needs quality service in the area of property management.

Should anyone need to have a brief discussion about Kim please do not hesitate to contact me. Kind regards



PM accused of not disclosing the house was haunted!

By RentalSolutions
December 3, 2013  -- Updated 1805 AWST

We received an email last week, from a fellow Property Manager based in the Eastern Coast, of the supposed non-disclosure pertaining to a leased property that is haunted.

It started when a tenant called the property manager inquiring about the recently leased property saying, "is there something you need to tell me about the property?" Unsure with what the lady was talking about, she proceeded to advise that the manhole cover had moved. Still not sure with what 'material fact' were withheld, the property manager asked if the tenant has been broken into or if anything had been stolen.

During the discussion, it occurred to the property manager that it had been incredibly windy that day and that wind probably just got into the roof cavity and the conversation ended there.

A few days later, another windy day, it happened again. The lady called again on suspicion of what the property manager 'haven't told her.

After a lengthy discussion, the tenant accused the property manager of failing to advise the house was haunted.RS