Home Owner Mortgage Costs to Rise

The chairman of Westpac has stated that his bank will no longer use higher-priced business loans to subsidise residential property mortgages. He maintains that funding costs have skyrocketed, and the bank does no favours to anyone by pricing home loans at unsustainable rates. If the banks weren't making such outrageous profits, I suppose home owners might agree.

Google in Real Estate

The launch of Google Real Estate Search on Google Maps in Australia, the US and New Zealand was a bit of a surprise to the property home sales industry. Google have now announced they are extending the real estate facility into the UK and German markets shortly.
So what are they actually doing? They allow free uploads of sale listings and rentals, obtaining their revenue from advertising rather than from agency subscriptions or one-off payments by owners as do the existing commercial portals.
The sort of problems that one can foresee are spurious listings designed to promote a real estate agency. If you don't have to pay to list, you could put dozens of properties on Google and just respond to queries "sorry we just sold that one, but you might like ...". The biggest battle for every real estate agency is gaining contacts who want to buy or sell, and agencies will try to exploit the Google function to obtain such contacts.
Some agencies do this now on Domain and Realestate.com, by not removing properties after they are sold, to give the impression they have more properties available than they really do have. It will be interesting to see how Google copes with this problem.
Also, Google is likely to end up flooded with properties that have been sold or withdrawn, because there is no incentive to remove your listing.
Given that potential buyers have free access to properties listed on Domain and Realestate.com, it is not immediately clear why they would also go to Google, unless Google can build up significant listings of properties that are not on the commercial portals.
As for the real estate agencies themselves, they have little motivation to encourage Google Real Estate in place of the major commercial portals, because they usually recover the advertising costs of those portals from the vendor. The main losers in all this are likely to be the proliferation of minor bit players in the internet property advertising field, which might not be a bad thing

Sustainability Declaration in Queensland

A sustainability declaration (SD Form) has been introduced in Queensland. It is a compulsory checklist that must be completed by the seller when selling a house, townhouse or unit from 1 January 2010. The declaration will inform buyers about the sustainability features of a property and increase community awareness of the value of such features. The declaration identifies the dwelling’s environmental and social sustainability features in four key areas: energy, water, access, and safety.

Sounds a great idea, doesn't it? Presumably this is in response to some huge outpouring of demand from the house buying public for this new information?

However there has been much adverse comment. One researcher claims to have spent 6 hours as part of a team of 15 lawyers reviewing the Sustainability Declaration, and says their findings are frightening.
"This Sustainability Declaration doesn’t just apply to your house. It covers the shed, garages, carports, fences, masts, antennas, retaining walls, Bali huts, pergolas, and gazebos – any structure on your land.
"The legislation says “Where the buyer incurs a loss or expense as a result of a false or misleading declaration, the seller of the building is liable to compensate the buyer for any loss or expense. A compensation claim may be made through a court.” A lawyer’s picnic. Open ended compensation claims through the courts."
Here are a few of your responsibilities under this act.
Not preparing, displaying or providing a declaration - $2,000 fine for the owner, $10,000 for the estate agent, with no excuse acceptable, no mitigating circumstances. Get detected and you get done. There is no need for the prosecution to prove that you had a guilty mind, just that you didn’t have the declaration.
Needless to say Queensland advertising is filling up with professional assessors offering to write the reports for you. Meanwhile the blogosphere is filling up with outraged remarks like "I don’t recall any of this being mentioned prior to the election just a few months ago". Still I suppose it will create more employment, spawning a whole new industry of bureaucrats.

Westpac still taking stick

Gail Kelly is desperately trying to restore her image after the disastrous recent PR from an over-the top interest increase, and a rather childish banana smoothy advert. Now Gail is talking up the importance of customer service and the bank's commitment to relationships and reliability. Isn't that exactly what the original PR problems were all about?
Adele Ferguson of the SMH goes so far as to say Westpac "has been the least kind to home loan customers", with home loan variable rates consistently an average 17 basis points above the competition.
Apparently this is the first time in a decade that the net interest margins of all the big four banks has expanded. Thank you Kevin Rudd for your assistance to the banks, but what about the poor home owners trying to pay off their mortgages during a financial crisis?

"Home Loans Set to Dive"

There were reports over the weekend that house prices will soar for the next three years. I am doubtful of this. As interest rates climb, there will be some first home buyers who over-committed, and there are already reports of investors abandoning their properties and moving into shares. Of all the signs that had indicated house prices would increase, really it's only the increasing population of Sydney that remains valid. First home owners grant is over, interest rates have gone up and are clearly going to go up more, and the NSW state government is in no position to slash stamp duty on house sales. So it seems to me time for "buyer beware" in more ways than just doing building inspections.
The SMH today rather reflects my view. "End of home grant boost to hit mortgate market", says Stuart Washington, quoting a report by the Market Intelligence Strategy Centre (MISC) that predicts a $14 billion decline in mortgage value over the next year.
MISC argues that the drop in value of mortgages written next year could be largely avoided if smaller lenders obtained new sources of lending.

Pain in the Postcodes

The SMH reports that tenants are being forced out of their homes as "large numbers" of investors default on mortgage payments. It seems to me one of the most invidious aspects of NSW property law is that if a tenant is on a continuing lease they can be given just 30 days notice if a buyer wants vacant possession. If an owner wants to move in to his investment property, he must give 60 days, which is still pretty hard on the tenant. But the 30 day rule for a new owner is surely not sufficient.
Of course, if the tenant is on a fixed term lease, then that lease is unbreakable, and the property has to be sold "with sitting tenant". Ray White Beecroft property management department attends auctions of properties that they are managing to make sure that the auctioneer tells buyers of the tenant's situation.

Bathroom Renovation Problems - grout removal

The owner of the property whose patio was grossly stained with grout during bathroom renovations has been trying to obtain fair compensation from the contractor responsible, but so far the offer made is considered quite inadequate.

What would you say was fair compensation for a brick patio changed from this to this, by grout spilt and ignored by the bathroom renovation team?The owner has spent many hours of his own time and several hundred dollars on phosphoric acid substitute, to clean off the worst of the grout, as reported in earlier blogs. Yet the renovator responsible has offered little more than to repay the cost of the materials used! If there is no improved offer, the owner will be applying to the local court for fair compensation.

Fencing Problems

The problem reported earlier (1 Dec) has been neatly and effectively fixed, as shown here.











However here is a cute photo of a dog exploiting a gap in a newly installed fence.


Ray White Beecroft property management department not only manages new fence installation, but also will work with the fence company to ensure speedy rectification of problems like these.

Meadowbank Rents going up!

According to RP Data, Meadowbank units have some of the fastest growing rents in all Sydney, with median rents jumping from $320 to $380 over the past 12 months.
Of course this might be affected by the number of new, and more expensive, properties coming on the market lately along the Meadowbank riverfront. It would be interesting to see how RP Data corrects for this.

Bathroom Renovation Problems

Another example of the problems that can arise during bathroom renovations is when contractors go through the roof to install lights (as shown here, the ventilation trunking is crushed).






The lesson is to photograph everything before renovations start! Then there can be no dispute later about what damage was caused by the bathroom renovation team.

Bathroom Renovation Problems

During the bathroom renovation discussed earlier in this blog, the tilers managed to complete all the tiling without making a hole for the heated bathrail switch (as shown here - the wording saying "sw maybe")

















and had to go in through a cupboard in the living room to find where the hole needed to be made. In the process they demolished the side of the cupboard.
The owner had to draw the state of the cupboard to the bathroom renovation company's attention after they declared the job was finished! But they then turned up and did a very neat job fixing the cupboard.

McMansions explained

There was a very good article in the Sydney Morning Herald at the weekend describing how Australia evolved into the McMansion habit. It describes how people's expectations grew from small fibro cottages at the end of the second world war to the monsters we now expect as our first houses. The key factor seems to have been the willingness of banks to lend a progressively higher percentage of the value of the house. Suddenly new first home owners could have whatever size house they wanted, and all it would need would be to pay off the mortgage. And the honeymoon interest rate seemed to make that just too easy. All very fine until interest rates start going up again.

Michael Klim comes to Beecroft!

Michael Klim came to the Just For Him menswear shop last weekend promoting his product range. Here the owner, Lisa, shows off the Klim range in her superb new shop at 1/97 Beecroft Road (between the two Beecroft traffic lights).

The shop is much larger than it appears from outside. Here is a photograph of a corner of the downstairs showroom.

Interest Rates going up again

The Reserve Bank raised interest rates for the third month in a row, again by 0.25%.
So Kevin Rudd's prediction in July that official rates would rise by almost 1 per cent within the next 12 months is nearly achieved after just four months! It's looking as though his "almost 1%" was an underestimate.
Westpac caused a bit of an upset by immediately raising their rates not just by 0.25% but by 0.45%, blaming the real cost of borrowing money from abroad.

Bathroom Renovation problems - grout removal

An update on the bathroom renovation problems reported on 24 Nov. The owner continues to apply the very effective Phosphoric Acid Substitute from Aqua mix, and it is slowly removing the ingrained spilt grout on his patio. The most successful technique he has found is to mix PAS with three parts of water and pour on each stained tile, then leave it for a while and then wash the tile with high pressure water using a Karcher.




But with about 1000 tiles to deal with, it is a slow process, and there is still a lot more work needed. The owner is now negotiating compensation from Oxford Bathrooms of Thornleigh, the bathroom renovation contractor.

Fencing Problems

Noting the recent blogs about bathroom renovation problems, I have received a complaint from a local home owner about a fence that was installed between his house and a neighbour.
















The owner has a small dog, which easily goes under the gap. It made me check on the web sites of other fencing companies and this pic shows how it should be done:
















Always the question is, what did the contract call for?

Australian Houses are TOO BIG

Yesterday I reported how Australian homes are now officially the largest in the world. Greens MP John Kaye pointed out that such large houses outrank those of any other country in the world in terms of their carbon footprint as well as their size. Large houses need more energy for lighting, heating and cooling. What he doesn't mention is that a large part of the carbon footprint of a house is in the concrete that goes into making it, so again the bigger the house the more emissions from the concrete that went into building it.

Bathroom Renovation Problems - grout removal

Following up the grout problem reported on 24 Nov, the owner has now applied a first treatment of Phosphoric Acid Substitute by Aqua Mix, with significant improvement. This first picture shows how the renovation company left the owner's patio.







This next picture shows the result of a single application of Phosphoric Acid Substitute followed by water wash.



The owner now intends to have the building cleaning firm mentioned earlier treat the whole patio, and this blog will keep you informed of the result.

Protecting our Kids

One of Ray White Beecroft's owners has had to modify his house to suit new regulations about protecting children from domestic falls. The requirement was to reduce the gaps between railings, and to raise the top of the railing. The result shows how such modifications can be done cheaply and attractively.

Also the steps from the patio were too high, so the owner had to rebuild them with three instead of just two steps.



These railings and steps were originally built fifteen years ago, and were approved back then, but a recent council inspection pointed out that the regulations have changed and the railings and steps didn't meet the new requirements.
If you are planning extensions or modifications to your house, you need to find out what the rules involve, obviously its best to build the railings right in the first place. The recent media attention to the 400 or so Australian children hurt last year falling out of windows is certainly going to increase attention paid to these regulations.

Auction Fever Easing?

Clearance rate of 68% last weekend ended a run of five consecutive months with rates over 70%.
Obviously the recent increases in mortgage rates would be partly responsible, along with the reduction in first home owner grants. Meanwhile Sydney's median house price is now a record $569,000 and climbing.

Big Rent Rises Forecast

BIS Shrapnel says Sydney rents are set to climb by 21% over the next three years. This is in part because of a significant drop in medium to high density residential dwelling construction, which this year reached the lowest level since 1987.
Another factor is the increase in home ownership caused by the first home owner grants, because each young person moving out from the family home into a new house reduces the stock of homes remaining available for renting.
Latest data from the NSW Department of Housing says rents rose 3.9% in the year to September, with the rise highest in the outer suburbs of Sydney.

Australian Houses are the biggest!

The Bureau of Statistics reports that the average size of new homes in australia is now 215 sqm, compared with 202 sqm in the United States and 196 sqm in New Zealand. In Britain the average is just 76 sqm!
Another interesting statistic is that the number of people living in each home has actually increased, only slightly (from 2.52 in 2007 to 2.56) but this is the first increase in a hundred years!

Bathroom Renovation Problems - grout removal

It seems that the grout problem referred to in an earlier blog just might have a solution. The company that did the renovations were not able to propose a way to remove the grout from the patio, so the owner did some research of his own. Found on the internet, groutmasters@aapt.net.au proposed a product Phosphoric Acid Substitute, and it looks as though that will shift the grout on the patio bricks. Now the owner is negotiating with a spray cleaning company to find out whether they can do a wide area clean instead of having to manually clean each brick in turn. This blog will keep you informed.

"House Prices to Rise Further" says RBA

In a speech that defended Australia's historically high house prices, the deputy governor of the Reserve Bank of Australia told a housing conference to expect worse and to recognise that home buyers are getting value for money! He forecast that house prices will be boosted by increased population growth and immigration, solid increases in household incomes, and substantial competition for construction workers from the resurgent mining section.

Mirvac Group changes

Mirvac Real Estate Investment Trust will be taken over by parent Mirvac Group to avoid having to sell off prize assets at bargain basement prices. The chairman of MREIT told his shareholders that the trust was near to breaking bank covenants and needed a cash injection to survive.

Man of the House - couldn't resist this one.

A guy finished reading a new book entitled, "You Can Be THE Man of Your House."
He stormed to his wife in the kitchen and announced: "From now on, you need to know that I am the man of this house and my word is Law. You will prepare me a gourmet meal tonight, and when I'm done eating my meal, you will serve me a scrumptious dessert. After dinner, you are going to go upstairs with me and we will have the kind of sex that I want! Afterwards, you are going to draw me a bath so I can relax.You will wash my back and towel me dry and bring me my robe. Then, you will massage my feet and hands. Then tomorrow, guess who's going to dress me and comb my hair?"
The wife replied, "The funeral director would be my first guess."

Bathroom Renovation Problems = grout removal

When the grouters were working in the property we have been discussing (see blog Nov 15 and others), they set up their equipment on a tarpaulin on the patio. When they left, taking the tarpaulin with them, there was grout everywhere, except where the tarpaulin had been.
The owner complained, and nothing was done for about five weeks, then the grouting team returned and spent a couple of hours with a high pressure cleaner, which had no effect other than to spread the white gunk over the clear area where the tarpaulin had been.
The owner is still discussing this with Oxford Bathrooms, the company that did the renovations.

Be Careful What You Ask For

I noticed trees being chopped down in a house near mine, so walked over to find out what was going on. They said they had DA approval (I checked later with the Shire and they had). They asked if I wanted any of their tree clippings, as mulch for my garden. I was on my way to the gym, so said yes probably, intending to talk more when we came home. When we returned, they had gone, and this was on the house directly opposite. Obviously they thought this was where I lived!




We only have a very small garden!! I got our green wheelie bin and used it to transport the very small amount I needed. Then I sat back to see what the owner of the house would say.
Imagine my relief when he came home and saw the dump and said "oh yes super"!

Pay a Fee to Pay Your Rent

The NSW Tenants Union is urging people to challenge any convenience fees imposed by managing agents or landlords in relation to various methods of paying rents. It is common for tenants to be charged for using credit cards, 1.3% being fairly standard, which adds up to several hundred dollars over a year. Most tenants are happy to pay this for the convenience. The important thing is that the agency or landlord should not insist on this method of payment.
New regulations now in draft form will require agents to offer at least one way to pay rent free of charges.

House Building Booming?

AVJennings expects to return to profitability in this financial year. The company has 9825 lots under management, equivalent to five years supply, and a majority of these are under development of have development approved.

More Homes Needed for Sydney

The state government is forecasting a forty percent increase in Sydney population over the next 20 years. However much land they find, and however much they increase the permitted population density, there is no way house prices are going to fall if that is true!
Talking of which, auctions achieved a 68% success rate over Sydney last weekend, compared with 43% this time last year (during the crisis).

Home Deposit Rules

A Reserve Bank official has suggested the size of deposits home buyers must provide could be regulated, to prevent cash-fuelled house price bubbles. Apparently Singapore and Hong Kong are implementing tighter Loan-to-Valuatio (LVR) ratios. The official stressed that this is just a proposal. The LVRs have already tightened, from 100% to 90% recently. LVRs for first-home buyers are tighter.

Bathroom Renovation Problems - bad management

The owner of the property who had bathroom renovations done, mentioned earlier in this blog (eg Nov 17), complained about some mess left behind by one of the renovator's contractors. Their response? To tell the contractor they wouldn't pay him, and to give him the owner's mobile phone number! So next thing, the owner had a weeping contractor explaining in broken English that he wasn't going to get paid for the work he had done.
This pic is only a small part of the mess, taken a month after the work finished, but the question is, who is responsible for finishing a job properly? The individual sub-contractors involved, or the company that took the owner's money? An interesting exercise in ethics, acceptance of responsibility, passing the buck, and a few other business related issues.

RBA okays further interest rate rises

The Reserve Bank accepts that the "margins on variable rate housing lending relative to bank funding costs have declined over the past two years".

Bathroom Renovation Problems - rain shower height

How high should a rain shower be?


How about 5 ft 9.5 inches (175 cms)? So even the shortest person in the family had to crouch to get wet!

Oxford Bathrooms offered to rip all the tiles out, redo the plumbing, and start again, but the owners agreed to a compromise, mainly to get the job finished.

Bathroom Renovation Problems

We have obtained some excellent examples of how not to renovate bathrooms, and will be covering these in the next few issues of this blog.

Building Problems

Ray White Beecroft had an interesting Property Management problem the other day when a rental property was found to have a ceiling starting to collapse. Removing the gyprock exposed the joists that are meant to hold the walls of the house together, and guess what. The house is about 12 years old and the original owner-builder had used the wrong type of wood clamp, and had fitted the gyprock ceiling alinged the wrong way. The weight of the roof was forcing the walls apart, and the joists were not fastened in a manner sufficient to take the strain, so the joist clamps had started opening out, allowing the walls to move apart, as in this photograph.

We did a temporary repair until the end of the tenant's lease, then to fix the problem we had to remove all the ceiling gyprock panels, jack up the joists (and hence the roof) until the joists touched again, and use the correct clamps, then fit ceiling gyprock aligned along the joists to add stiffness.
Remarkably, we had new tenants signed up ready to move in before the repairs were finished.

RAMS making a come-back?

John Kinghorn, founder of RAMS Home Loans, recently announced that conditions are now ripe to start challenging the big banks again. RAMS was forced to sell out to Westpac two years ago, but the listed entity RHG remaining from RAMS still trades and made $120 million last financial year out of morgages it retained after selling out to Westpac.
In describing his intentions, Mr Kinghorn said his shareholders might be invited to back a bid to re-enter the home loan market.
I think there would be much support for a return of the smaller lenders, to keep commercial pressure on the big banks. There seems to have been a fundamental difference between Australia and the United States. In America, small lenders went totally stupid and lent to anyone who would sign a contract, irrespective of the prospect of the loan ever being serviced. They could do this because the banks bought those dodgy debts, packaging and bundling them in ways that made it impossibe for anyone to value the resultant financial packages. And hence the global financial crisis, along with a huge crash in American house prices!
There seems to be no evidence of a similar crazy house sale lending splurge in Australia, and although there have been many mortgagee sales over the last year, many of those forced sales were due to other loans going bad, especially margin stockmarket loans. Real estate agencies have seen some houses sold for knock down prices, but in general house prices survived the crash and are now climbing again. So, welcome back, RAMS, or whatever the new entities might be called.

Interest Rates up 0.25%

At 2:30 the Reserve Bank announced a 0.25% rate increase in the cash rate to 3.5%. (this was posted at 2:33 EST, blogspot time is USA time!)

Brush Turkeys Invading Sydney

Brush turkeys were virtually driven out of Sydney during the depression because their meat, while tough, was better than nothing. They didn't return even after being made a protected species, probably because they don't like English style gardens. Now, with increasing numbers of Native Australian Bush gardens, the turkeys are making a comeback.
I have seen several of these large birds in Beecroft recently. Before deciding how to respond if a bush turkey starts digging up your backyard, please remember that they are a protected species. One minor way to discourage them is not to leave pet food accessible to them.

Investors Bracing

My Friday post may have been optimistic, as were the share traders who prompted the post by responding so enthusiastically to the US Treasury figures. While we slept on Friday night, America was backtracking strongly! While the US Treasury figures were certainly very good news, there is still much sentiment that the rally in shares has gone too far too fast, and it looks like a strong correction is now taking place.
George Soros is quoted as saying the global economy is liable to run out of steam in 2010/11, possibly sparking a double dip recession.

Home Insulation

Over the weekend the NSW government cut the home insulation installation grant from $1600 to $1200! It is not clear where this leaves people with existing contracts that are signed but not completed. Where the quoted installation cost was more than $1600, someone is going to have to make up the extra.
Ray White Beecroft's property management department has been actively promoting this government initiative to its many landlords, and currently has some 20 landlords either already installed or negotiating with installers. It will be interesting to see how the installation companies respond to the instant cut in their grant.

US Returns to Growth

Global stockmarkets surged yesterday when the US gross domestic product for the third quarter showed stronger than expected positive results. Meanwhile Norway followed Australia's lead and raised interest rates 0.25%.

How to boost your agency's listings

Did you hear the story of someone who just happened to notice his house listed as having been sold, on an estate agency's window displays? That was the first he heard about it! It seems the agency was a bit short of real listings and sales to brag about, so they just photographed a few nice looking houses and put them in the window! As sales, so people wouldn't walk in wanting to see round them.

"Housing Sales on the Wane"

A Housing Association survey found that sales of houses were down by 4.3% last month compared with August. The association attributes this to the cut in the first home owner grant.

"Prices Through the Roof"

According to Peter Hawkins of the Sydney Morning Herald "solid residential price rises in Sydney's inner west provided the springboard for a 3.6 per cent rise in Sydney house prices over the September quarter". Median price for inner west rose 5.6% to $760,000, against $700,000 in 2003 that fell back to $620,000 in 2005.
The data indicates the second consecutive quarter of price growth above 3% in the Sydney property market - the best six months since 2003!

Swimming Pool Property Management

It's the time of year when owners and tenants start wanting to use their swimming pools. And this means that property management departments of real estate agencies have to respond quickly to problems. The main problem seems to be leaking pools, and most people assume it's leaking pipework. A good clue for this is bubbles in the return water flow.
But a leaking hydrostatic valve is another common problem, that Ray White Beecroft has just rectified with one of their rental properties.
http://www.aqualinepoolresurfacing.com.au/Hydrostatic_Valve.html provides an excellent article on this - "Aqualine Pool Resurfacing recommends all swimming pool owners consider the age of their pool's hydrostatic valve when their swimming pool first starts to leak. It should be your first line of attack before obtaining expensive pipe pressure testing and leak detection services. In 50% of cases most of the water is being lost from the old worn out Hydrostatic valve."
I wouldn't agree with the 50% statement, we have had many more proven leaking pipes, but the point Aqualine make is still valid. And remember, never empty a pool negligently! If the hydrostatic valve fails, external water pressure can push the pool out of the ground!

Interest Rates Trends

Consensus seems to suggest interest rates will be raised 0.25% each of the next three months, to reach 5%, which is what people seem to believe is the appropriate rate once the financial crisis is over.

Auction Clearances Dip

Auction clearances in Sydney dipped to 62% compared with 65% the weekend before. However Ray White Beecroft had a hugely successful auction in Albert Street Beecroft, with about 80 people present and fifteen registered bidders. After over 40 bids the property was finally sold for $999,000, against a reserve of $900,000! The owner sent Douglas Macarthur a hugely grateful and congratulatory testimonial.

Harry Triguboff's views

The managing director of Meriton says the Reserve Bank raised interest rates too soon. He predicts that interest rates will peak at 5.5 per cent. "Rents will keep going up and the government will realise they can't allow the Reserve Bank to go on with their interest rates. Rates will have to come down. We have a big shortage of accommodation.
His advice to property owners - "have a little bit of patience. Hang on, charge them more rent, and enjoy".

House Sales Forecasts

The Weekend Australian Financial Review says "House buyers are expected to pursue property until the mortgate rate rises above 7%". Analysts and lenders expect little to no effect on the market following the past week's interest rate rise.

"Delinquent Loans to Jump"

Or so says Eric Johnson in today's SMH Business Day. "A rush of first home owners taking advantage of government cash incentives will result in headaches for banks over the next year as most brace for a surge in customers falling behind in payments."
Eric says that the second year is the time when most new home owners start falling behind on their loans. So if that trend is matched by rising interest rates, as now seems certain, there could indeed be a jump in delinquencies.
JPMorgan issued a report saying that australians were vulnerable to interest rises because their housing debt was close to record levels.

The Fed increases Interest Rates

What a change in the climate! Just a month or so ago everybody was convinced rates would stay on hold for months. Now suddenly after a rush of stronger than expected data the Fed has raised rates to 3.25%.

Where do Appraisals Come From?

The survey mentioned in my last blog also explored the source of buyer enquiries to real estate agencies, and found that real estate portals accounted for between 45% and 90% of buyer enquiries! However for appraisals (ie potential vendors), the results were less favourable to the portals. The majority of those surveyed reported that less than 30% of appraisals resulted directly from those enquiries. This suggests a lot of internet users contact real estate agencies from portals like realestate.com, but serious vendors are also heavily influenced by other inputs, presumably advertising, letter drops, and agency reputation.
The experience of my house sale professional contacts supports that finding. An agency like Ray White Beecroft, with its excellent location on the main Beecroft shopping arcade outside Franklins, with four superb digital window displays showing off its wares, a large property management department, and a reputation for efficient and ethical performance, gets appraisals from many sources, certainly not just directly off the web portals.

Real Estate Portals Survey

Business2 Real Estate News and Technology web site has conducted a survey of customer satisfaction covering all the major Real Estate portals. Perhaps not surprisingly realestate.com.au comes out a clear winner with 68% of respondents satisfied and less than 15% dissatisfied. By comparison Domain.com.au had only 40% satisfied and 27% dissatisfied. Apparently Homehound and Myhome both had more dissatisfied than satisfied. Google Real Estate registered 38% satisfied and 20% dissatisfied. The survey author calls this a good result given the short time that Google Real Estate has been operating, presumably on the assumption that Google Real Estate is just starting, whereas the other portals have been around long enough to have got their act together!
The survey found 85% of respondents believe Google Real Estate will increase their share of the market.

Beecroft Commercial Sale by Ray White

Ray White Commercial Eastern Suburbs sold 5 Wongala Crescent by auction for $4.95M! The block is a mixed use neighbourhood shopping centre comprising seven retail tenanceies at street leel, five first floor office suites, and four two bedroom residential appartments. The site is approximately 2043 sq m.
Well done Ray White Commercial.

Other ways to sell houses

Many years ago I met Tony Wiles of ANREPS (Australian National Real Estate Private Sales) in Perth, we were glider pilots competing in the WA State Championships. This was long before I got started in the real estate industry. I was interested in what he was doing, assisting people to sell houses themselves, without using estate agents. I confess that I didn't hold out much hope for his business.
I only got involved with real estate after I came to Sydney, ten years ago, and had no further contact with Tony, until the other day when I found Tony on Twitter. ANREPS is still going strong, twenty five years later! Well done Tony. One thing ANREPS achieves is to keep real estate agents honest! His website provides an interesting description of the battles he has had with the local real estate industry, at this URL http://www.anreps.com.au/wa/aboutus.php.

Rent of buy?

A good article in the Sun Herald today presents the good and bad sides of renting or owning a house. I liked the advice to renters "work out what type of house you want to buy later. Then invest the difference between the rent you are paying and what you would have to pay on a mortgage."
The article doesn't discuss the alternative, of buying a rental property as an investment, and living in rented accommodation. The key to that is to have a good property management agent that will look after your property effectively.

Chinese Spending Boom?

Li Yanping makes an interesting observation in today's SMH Business Day. The celebration of 60 years of Communist Party rule in China, and an eight day holiday associated with those celebrations, could trigger a tourist boom, boosting consumer spending and helping the Chinese economy to grow. And of course that would help Australia's exports.

Building Approvals Surge

According to the SMH, approval figures foreshadow a surge in non-residential building activity. Approvals in August were $8.6B, 54% above the monthly average for the last financial year.

Units catching up on detached properties

From Rpdata.com’s national research director Tim Lawless: Over the five years to June 09, units around parts of Australia have rallied to take on detached housing for capital growth. Historically, home buyers and investors believed that houses would always outperform units, and that the underlying value of the land associated with a house is the real driver for capital growth. However, over the past five years Rpdata's results prove that there has been little difference between the two property types, based on the rate of capital growth

Competition

I am writing this while watching Insight on SBS, about competition in the market place, discussing the impact of Woolworths, Coles, and increasingly Aldi. It all makes me realise how lucky Beecroft is to have just Franklins, our friendly neighbourhood supermarket. Somehow Franklins fits in well with the whole ethos of the Beecroft village shopping centre. Thank you, Franklins!

I hate web sites that con you!

I found an interesting sounding site on Google, and clicked it. Up came the offer "Find Agent", and "Find the right agent. Enter your post code" and a four digit entry window. Interested to see which of our local agents they would recommend, I typed in my post code, and all I got was an opportunity to register with SellmyCastle.com.au.
There was no response at all to my request to find the right agent!
Just for fun I went ahead and registered, which meant entering all my house details, and now I await the results.
It infuriates me how some sites use such gimicks to suck you in. If they are not going to attempt to tell me "the right agent in your post code" then why have that offer on their front page?
Oh, and it's not just on the front page. Further into the site I found a finance page, and again was invited "Find mortgage broker" and again "enter your post code" and a four digit entry window. And guess what? Entering my post code had no effect at all, just another invite to register with them.

West Pennant Hills drug house

Almost half-a-million-dollars worth of cannabis plants were seized earlier this month during a police raid on a hydroponic house in West Pennant Hills. Power company technicians disconnected an illegal and potentially dangerous link to the mains supply.
To show this wasn't a one-off, Pro-Active Crime Team officers also seized 205 cannabis plants with an estimated street value $420,000 in a raid on a house in Parkland Road, Carlingford, on July 30.
Property management officers need to be on the lookout for suspicious indoor gardens with unusually powerful lighting systems!

How Australia Escaped Recession?

Ross Gittings of the SMH makes an interesting point in today's Business Day. "Rapid growth in Australia's population has held up the economy." In the year to March, our population grew by 2.1%, the fastest in 40 years. What that means, of course, is that if GDP per head is considered, you need a rise in GDP in excess of 2.1% just to hold your position. On that basis, our GDP fell in three of the last five quarters (ie recession!), contracting 1.5% in the last 15 months.
Ross's point of course is that all this population increase requires investment in infrastructure to support the newcomers. Ross makes the significant point that while it's the Federal Government that decides to increase immigration, it's the state governments that will have to provide roads, hospitals, schools, etc to accommodate the new arrivals. And any failure to make sufficient land available will push house prices even higher.

Auction Clearance Rate Dips

Last Saturday the residential property auction clearance rate fell to 62%, off from early 70% plus sucessess. This was the steepest decline among the last five record weekends.
Average sale price in Sydney inner west was $842,000.
Northern beaches and upper north shore recorded below average 55% clearance rates.

"Death of Democracy"

Great slogan, let's hope the organisers of the protest can use it to make some progress! The Sydney North Shore protesters claim the NSW government planners are ignoring residents, taking money from developers, and turning pleasant communities into high-rise concrete jungles. Some 1500 people joined the protest and passed a resolution calling for local planning rights to be restored. NSW Planning Minister Kristina Keneally was invited to speak at the protest but didn't show.

Concern about NSW rents

The NSW Government intends to increase public housing rents for single aged-care pensioners by $7.50 a week, which is about 10% of their typical food budget. The justification for the increase is that the Federal Government is increasing their pensions by $30 a week.

First Home Buyer loans grow

SMH Business Day reports that the average loan size of new home owner loans was $269,100 in July, up from $246,500 same month last year. By comparison the average loan size for all owner-occupied housing this last July was $266,900. New home buyers are taking a third of all new mortgages, compared with 20% before the introduction of the recently introduced incentives.

Aldi made profit

Aldi announced a $72M profit last callendar year, and says it is expanding by adding another 25 stores each year alont the east coast.

New Mortgage Group?

SMH Business Day reports that Macquarie Group is setting up a new collection of mortgage brokes with the aim of increasing competition in home lending.

Foxtell Free to Air Channels

Foxtel changed the frequencies of some channels recently and got it a bit wrong, and many customers have lost free-to-air. Apparently they need to make some changes to the feed to our area, after which all should be fine.

It's all in how you say it!

An email is going the rounds describing how US Congressman Harry Reid responded to a journalist's enquiry about his great-great uncle, Remus Reid, who had been hanged in Montana in 1889 for horse stealing and train robbery.
"Remus Reid was a famous cowboy in the Montana Territory. His business empire grew to include acquisition of valuable equestrian assets and intimate dealings with the Montana railroad. Beginning in 1883, he devoted several years of his life to government service, finally taking leave to resume his dealings with the railroad. In 1887, he was a key player in a vital investigation run by the renowned Pinkerton Detective Agency. In 1889, Remus passed away during an important civic function held in his honor when the platform upon which he was standing collapsed."

Agency expanding after making a loss

The Sydney Morning Herald reports that the real estate agency McGrath, that has concentrated on prestige Sydney suburbs, reported an annual pre-tax loss of $4.8M in their latest lodged accounts. However they are confident they will make a profit in 2009 and are planning to expand into Western Australia. McGrath sold their share in REA Group, owners of http://www.realestate.com.au/, for $14.4M.

Beecroft in Bloom a stunning success

Francis of the Lions Club of Beecroft - Cheltenham reports that this year's Beecroft in Bloom was the best ever, with high attendance, excellent income to the charity, and for the first time in years excellent weather! As usual the jumping castle didn't appear, but the little black pony worked strenuously all day and lots of small children will remember their pony ride for years to come. The art gallery achieved excellent sales, and there is even talk now of forming a Beecroft Art Society!

Beercroft!

Douglas Macarthur of Ray White Beecroft found that his latest letterbox flier went out with the town called "Beercroft"! He tells me the people at the local bowling club brought it to his attention, saying they thought it was a great name for the suburb. Which at least showed that they had read his flier.

Beecroft Cocktail Party

A most successful cocktail party heralded the start of Beecroft in Bloom on Friday evening. Sponsored by Ray White Beecroft, the cocktail party heralded the opening of an art gallery held in two empty commercial offices on the upper floor of The Module.
Nearly a hundred people attended! The consensus seemed to be that the party was a great success and should happen again next year.

Lions Website

The Lions club of Beecroft cheltenham has their own web site,
http://lionsbeecroftcheltenham.org.au/activities/beecroft-in-bloom, with details of the Beecroft in Bloom festivities this weekend.
Entertainment will be provided by students from McDonald College who will perform street theatre. Music ensembles from local schools, an animal farm, a jumping castle, a small market and our Town Crier will keep all attendees informed of the activities.

Beecroft estate agency now has its own blog

Ray White Beecroft real estate agency now have their own blog, "rwbre", http://rwbre.blogspot.com/. They will be reporting on property sales locally, and on the property rental market in the area. Ray White Beecroft has by far the largest residential property rent roll in the Beecroft and Cheltenham areas, and their cover extends out to Ultimo in the city, Parramatta, and Kellyville.

Property Management Horror Story

A council raid on a south Brisbane student house has found 37 people living there.
The house mainly housed international students and had backyard portaloos and makeshift garage bedrooms to accommodate tenants.
The raid followed a Brisbane council sitting last week, where changes to the housing code were adopted to cut the number of unrelated people permitted in one dwelling from six to five.

Traffic Flow Information

A quote from Google's latest release: "Starting today, a new feature is going to make those decisions a bit easier. Traffic information on Google Maps will show you the current traffic status of many motorways, major and minor arterial routes in Sydney, Melbourne, Brisbane, and smaller areas like Wollongong, the Central Coast, Geelong, the Sunshine Coast, and the Gold Coast, to help you avoid congested areas and plan the best route from A to B. It's part of our commitment to making Google Maps an essential tool for Aussies as they go about their daily lives."

Luxury Home Prices Slashed

Relax, Beecroft owners, this headline relates to Gold Coast properties. I must say anyone who followed the hyped marketing methods used to sell those properties over the last ten or so years can hardly be surprised to see what is now happening!
The Australian today reports "the number of luxury properties selling at mortgagee auctions has soared as receivers and banks cut prices by up to 50% to meet the market". About 500 appartments and houses from new projects that have failed during the global economic crisis, or are in financial distress, are expected to be sold before December, mostly in Queensland.
This time last year, Ray White Beecroft helped Becton, the big Victorian property developer, with their takeover of two large failed developments in Kellyville and Gosford, and Becton seemed to be delighted with the service Ray White provided. Not only that, but RWB now manages about fifteen of the properties in Kellyville, after Becton sold them to mainly foreign investors.

Beautiful Tree Recovers

This incredible tree nearly died of dieback a couple of years ago but I am pleased to see it is growing back. Bare of foliage you can see the true beauty of its trunk, and I wish it a long life!

Another lovely tree felled

This beautiful tree in Murray Farm Road had to be felled because it was split, possibly by lightning. So sad, but all lovely things come to an end.

House Sale Auctions Declining?

Residential property auction clearance rate in Sydney last Weekend was 66%, the weakest since May, despite being the third busiest auction weekend this year, with 330 auctions compared with 230 this weekend last year.

MyHouseValue.com.au

They got back to me! My house is worth - ummm well it's not very clear. Their response gives the fascinating statistic that the average value of houses sold in my postcode last year was $920,000, and of flats the average was $614,500. How that helps me determine the value of my particular house is not clear.
I suspect that soon I will be contacted by a real estate agent who will ask to come and see my house to discuss its value. This is what other real estate agents do all the time, for free, without needing to go through this complicated process. It just seems unethical to me to make promises on the internet about "we will value your house" when all they really mean is "please invite me into your house so I can do an appraisal like any other real estate agent".
Interestingly, when you Google "ethical real estate agents Beecroft" the only genuine local agency that turns up on Page 1 is Ray White Beecroft.

YourEstate.com.au

I am fascinated by the range of strange real estate agencies you can find on Google. YourEstate.com.au shows up when you Google "Real Estate Agents Beecroft", but when you go there it shows one house as "withdrawn" and one house with no address given, and that's it. That house is shown as listed with five other agencies including Century21 Carroll & Partners, an agency that folded four years ago, and Chessel First National that isn't even listed by Google any more. The advert says the property is a seven bedroom house and lists the property as selling for $749,000, which makes me suspect the listing might be many years old? How do these agencies work? Why does Google still show them?
It's so much more sensible to go to a reputable agency which actually exists!

MyHouseValue assessment

I just submitted my property for valuation by MyHouseValue.com.au. I will let my many faithful followers know how the result fits in with my estimate of its value. I still remain sceptical about the benefit of doing this over the internet instead of inviting an expert like Douglas Macarthur of Ray White Beecroft to come and give you a real valuation. Except Douglas doesn't pretend to give a "valuation", he gives you an appraisal. Because neither he, nor MyHouseValue, are qualified property valuers!

Startlocal has it wrong

I checked out the startlocal website, which purports to show such things as "The Most Popular Real Estate Agents Beecroft NSW". It lists three companies that are no longer in business in Beecroft, and doesn't list the most successful real estate agency in Beecroft, which is undoubtedly Ray White Beecroft!

Cracker

I was doing some Google searches, and entered "houses for sale Beecroft". Just below Ray White Beecroft on page 1, I found a site called Cracker.com.au/beecroft. I opened it wondering what Real Estate service Cracker provided, and found there were no beecroft properties advertised for sale or rent, but there were landcruisers and shoes and anything else you could think of. You could even get "lesbian personals" if you clicked the explicit tag. I just wonder why Google selects them to be on page one for "houses for sale Beecroft"!

Luxury Homes

The total value of the top ten Sydney property sales fell 45% since this time last year, $110M compared with $198M last year. However before getting too depressed it is worth noting that in 2006 the total of the top ten sales was $87M, which suggests more that the year before September 2008 was pretty exceptional. Even in these bad times, by this statistic sales are still up on three years ago. So despite this apparently bad statistic it still looks as though Sydney homes for sale are a good place to invest.

Swimming Pools and Building Surveys

I know someone who bought a property after a building survey, and after moving in found that the swimming pool was breaking up and starting to slide down hill. Nothing in the survey report about that, except the small print saying the survey covered only the building, not other features like the swimming pool or sheds. The problem was pretty obvious when you inspected the pool, but the buyer hadn't bothered to do that because he assumed that problems would be listed in the building report. Buyer Beware!

Strata Stress

There's a good article in the Sun Herald's Investor magazine today about the research you need to do before buying a strata property. The danger is that long-term owners tend not to put money into the sinking fund to cope with major problems, preferring to have a whipround amongst the owners when the problem comes up. So if you buy into the strata just before the problem needs fixing, you pay over your fair share of the costs. The article explains how you can do a strata search through the relevant state authority and obtain a building report before purchase. These will show you the funds in the accounts, any active disputes, etc.

Beware Ozhomevalue!

I reported earlier how my wife tried to get her home valued by responding to an Ozhomevalue letter drop. Well guess what? We still haven't received any useful valuation, but we are now getting spam email from the group.
The latest email says "Recently a shocking story involving bank errors relating to your home loan aired nationally on Channel 7's Today Tonight program", and asks me to contact someone. Sounds suspiciously like those emails about Nigerians!

Ray White Sales Rocketing!

Sales for June, July and August for the Ray White real estate group were almost $2Billion, compared to $1.4Billion for the same period last year!
And that period last year was before the main credit crisis happened.

More views on House Prices

SMH Business Day Business Focus says "The NSW housing market is expected to bloom in spring as it recovers from the downturn, helped by low interest rates and the first home owners grant."

New thoughts on the Global Money Crisis

An interesting article in SMH Business Day explains how the sudden credit crunch one year ago was caused more by a loss of confidence in commercial paper, than by individual bank failures or crashing house prices. The article explains how, just 13 hours after the failure of Lehman was announced on 15 September 2008, a crisis of confidence had led to enormous withdrawals being made. Reserve Primary bank had $US785 million invested with Lehman, which was quickly revalued to 80% of that, which in turn meant RP had to sell assets to meet its legal obligations. And they found there were no buyers! As one industry veteran said, "how do you set prices for securities when nobody is buying?"
But the experts, such as Poulson and Bernanke, were concentrating on the headline grabbing problems like AIG, and the article suggests they just didn't notice what was happening to the money markets.
On the 16th September RP's trustees valued their Lehman assets as worthless. RP could no longer raise cash to meet withdrawals. "The best way to get your dollar back is to ask for it before anybody else." And everybody was asking for their money back. And the rest is history.

Rental Situation in the Beecroft area

It's strange how the statistics for rentals change so rapidly. Normally Ray White Beecroft has something like 15 properties for rent, but I notice that now they only have five. In Realestate.com there are only 12 properties advertised by all agents combined for the Beecroft and Cheltenham areas (Post Code 2119)!
The Real Estate Institute of NSW says that Sydney’s rental vacancy rate is at its lowest level in 12 months.

New housing developments

In July 824 private sector townhouses and appartments were approved in NSW, compared with 425 in June. The prime reason for the sudden increase was probably the halving of stamp duty for purchases below $600,000, introduced by the last NSW budget, and effective from 1 July to 31 December, giving savings of up to $11,000.
Although probably not very relevant in the Beecroft and Cheltenham areas, it is likely that the Northern Suburbs area of Sydney will see increasing ratios of appartments and townhouses from this refocussing of development.

Property Beats Shares

RP Data research director Tim Lawless says his data shows that Australia's residential property market has "provided superior returns compared to shares, commercial property, superannuation, hedge funds, and private equities".
Note that this blog does not attempt to evaluate such claims, but RP Data should know what they are talking about. It depends what period of time you cover. Shares have done spectacularly over the last five months or so, but they fell disastrously last year, and are still only marginally recovering from those falls. Property has not had the same fall, and is now climbing above values of a year ago.

Sydney House Prices are Going UP!

RP Data - Rismark International home value index shows Sydney remains the most expensive capital city (surprise surprise) and it recorded the third highest growth rate of 6.6%.
Rismark boss Chris Joyce says "this has eviscerated the myth that the recovery was being driven exclusively by first-timers at the cheaper end of the market".

Beecroft in Bloom flowers are out!

The Lions Club of Beecroft/Cheltenham continue preparations for Beecroft in Bloom next weekend.

Want a map, quickly?

I have found an easy-to-use quick way to get directions between any two places in Australia. Put raywhitebeecroft.com.au in as a favourite in your internet home page, and when you want directions, just click the site, click the "Contact" button, and when the map appears just type in the two addresses and up comes a Google street map with detailed directions!

Granny Flats Rules Changed

The NSW Government recently changed the rules, so that secondary dwellings will now be allowed in all residential zones and can be approved within 10 days by private certifiers.
In a recent newspaper article on this, seeking comments, one comment I liked was
"It’s about time! We have too many rules anyway. There is plenty of space around the Northern Beaches, and granny flats will help young adults, the elderly, and foreign students to find cheap accomodation."
Ray White Beecroft are researching the issue for a number of their landlords, and warn of the tax issues involved if you later sell your home after converting part of it into a rental flat.

Sales of Houses Priced over $1M are slumping!!!

Australian Property Monitors report that some 2650 houses and units were sold in Sydney for more than $1M in the past six months, compared with some 3400 over last year. The head of research says that the reason house prices have not dropped is that prospective sellers are holding off selling their property, which is made easier for them to do while interest rates remain low.
One must assume that if, as now forecast, interest rates start rising at the end of the year, more forced sales will happen and prices of these expensive properties might start falling. One property bought last year for $5.04M that failed to sell at two recent auctions was finally sold by private treaty for $3.45M last month.

Jobless Forecast Drops

All the mainstream forecasters now predict that unemployment will peak below 8.5%. Newspaper adds have increased significantly. Dunn and Bradstreet business survey found that more employers are planning to hire staff than to fire.
Obviously this should boost house prices as buyers regain confidence.

Beautiful Things in Beecroft

The "beautiful things by" shop in Hannah Street Beecroft is having a Japanese theme this week. As part of that a Sushi cooking and tasting display was held outside Jean's shop on Saturday.

Lower North Shore Sydney prices up 7.4%

Cameron Kusher of the Sun Herald says on 6 September "I am surprsised at how well the Sydney market has bounced back during the first seven months of the year". He says Sydney house prices have outperformed the nation, while units have underperformed slightly.
A key remark as far as Beecroft home owners is concerned is "It is clear that it is not just the first-home buyer segment that is performing strongly. Values in the middle and upper end of the market are also climbing."

Trees and Telephone Wires don't mix!

We had an email from a tenant early this morning saying tree branches were threatening to bring down her telephone wires (see the photo). Fortunately I have a tree pruning device, and went there and trimmed it before she got home from work! All part of the service for a top Property Management real estate agency.

Sydney house prices are already soaring!

According to property analysts Residex, Sydney prices are rising at an annualised rate of nearly 30%!
Residex suggests this is due to the various government grants and the record low interest rates.

Housing Prices Set to Soar

According to the Sunday Telegraph 6 Sep, Australia could be heading for a rampant house-price boom! The article says this will be fuelled by superannuation fund investors exploiting generous goverment concessions.
The Treasury is trying to dampen demand by winding back the First Home Owner Grant at the end of this month. But meanwhile thousands of super savers are using super funds as a deposit on an investment property. Finance firms say the amount of super savings used for property investment rose by 25% in 2008 to a record high of $44 billion!
The other reason for optimism is that the super funds are flush with money and if just $5 billion of new money entering the funds each month was invested in propeties, this would easily pick up the slack from withdrawal of the First Home Owner Grant.
"The capacity for the super industry to boost house property prices is enormous."

Investors sniff the winds of change

Interesting quote from the Weekend Australian Financial Review this last weekend.
"Rents may have stalled but that hasn't put off investors who are out at the auctions again, looking for bargains."
The article says that the rental market has weakened because first-home buyers are moving into their own properties. That's probably true in the less expensive housing areas, but in Beecroft we've seen no sign of the bottom-end rental market weakening. However I agree with the article when it says "the upper end of the rental market - properties that cost more than $1200 a week - was the first to weaken. There are fewer companies sending employees to Australia." Absolutely what we see, and what I have blogged about before.

Trees and Swimming Pools dont mix!

The other day I was helping dig out tree roots over a leak in a rental property's swimming pool pipework. Although the tree had been small, the roots were enormous! See the pic!

Free Home Value Appraisals

There is a new home value estimation, called ozhomevalue. To check it out, my wife applied, and received a printout of data from RP Data showing all the sales in our postcode over the last few months, including 3 and 4 bedrooms and a block of land. Our house has six bedrooms, so this wasn't a lot of use to us. Also of course you don't know anything about the condition of any of these homes. Why did one four-bedroom house sell for $632,500, another for $1,240,000?
The email report we received says we will be given "an estimated price", and in a follow-up phone call the caller confirmed this estimated value would be given without entering our house. How can they do that? Some houses have been extensively and expensively refurbished, with no external sign of that, yet surely that must affect the sale price? We wait with interest for this estimation of our home's value.

Economy improving

Interest rates going up next month? It's possible but so much of the improvement in the economy is due to the stimulus package, it seems unlikely they would raise interest rates and hit everyone.

Poaching Customers - Unethical not illegal

A number of real estate agencies in the Beecroft/Cheltenham area are contacting landlords of managed rental properties, trying to poach their business. In the property rental area, this is not actually illegal, although the real estate industry considers it to be very unethical.

But the privacy issues are more significant. Unauthorised use of personal information is nowadays illegal.

Having the largest local rent roll, Ray White Beecroft is the obvious target for this activity. Lydia Merrill, proprietor of RWB, never gives out personal details of her clients, so if another agency has such personal information then they must have obtained it by deception or theft. If they use that information then to contact her clients they are breaking the law. Lydia would like any of her clients who are contacted by other agencies in this way to contact her.

Rental prices in Beecroft are going up!

At the upper end of the property rental market, prices have dropped dramatically over the last year. Beecroft agencies used to advertise a number of residential properties with rents of $1200 or more a week, but the Expats and Senior Executives who used to drive this market are now in short supply. However at the other end of the market rents are definitely rising, according to Ray White Beecroft property managers. Given current low interest rates, investors are seeing improved overall returns from home ownership and there has been a lot of interest in the lower to middle price brackets in the Beecroft and Cheltenham areas.

Big Four Banks capturing home loan market

Before the economic crash last year the major banks were handling about 60% of new mortgages, but in July this year the big four captured nearly all new mortgages.

Pressure is growing on the Government to unwind the funding guarantees that have given the big four banks a huge advantage over their rivals. Smaller banks and non-bank lenders are being forced to pay twice the borrowing rate of their AA-rated bigger rivals to raise funds to provide mortgages.

Beecroft in Bloom Cocktail Party

The Lions Club is organising Beecroft in Bloom for 18 and 19 September. An art gallery is being held upstairs in the Module, commencing with a cocktail party on Friday evening sponsored by Ray White Beecroft. Tickets at $20 each are on sale from Lions Club members, Ray White Beecroft, and other participating retail outlets.

Don't risk getting on a Bad Tenant Database

How many people know about Tica and other "bad tenant" databases? These exist so that landlords and real estate agents can be warned of people with bad rental histories, typically not paying rent, damaging property, or departing without settling outstanding debts. We recently had an application to rent a property, and found the applicant's name on Tica. It seems there had been a dispute with his previous managing agency, and rather than resolve it through the Tenancy Tribunal he had just walked away from it. Now he finds himself unable to rent! In order to recover his situation, he contacted the previous agency and settled their claim against him, so the landlord was happy. However it might have cost the applicant less if he had taken the agency to the Tribunal for a ruling at the time, as the Tribunal might have ruled in his favour.

Sydney house prices rising

According to RP Data, house prices in Australia continue to rise. Capital city house prices have risen 5.9% since the beginning of the year and the national index is now 1.8% ahead of the last peak in February 2008. Of all the capital cities, Darwin came top with 10.8%, Melbourne next 8.5%, and Sydney rose 6.6%.
Perhaps the key comment is "while first home buyers did initially furnish the early momentum, upgraders and investors have now taken over the baton". Also interesting is the finding that detached house sales jumped 9.8% in NSW.

All in a days work

It's amazing how many new trades you learn as a Real Estate Business Development Manager! Today I was fixing damp in one building, arranging to remove a tree root system blocking a swimming pool pump system in another, and doing a development application with Hornsby Shire Council about dual occupancy. So much more challenging than my previous employment working as an engineer in support of the RAN's submarines!

Lost Wallet Found

A gentleman rang Ray White Beecroft to advise that he had lost his wallet while having coffee in the Arcade. A staff member ran down there and located the shop and the missing wallet. All part of the day's work for real estate companies but why did this gentleman choose to ring Ray White Beecroft?

Beecroft Blooming

The Lions Club of Beecroft/Cheltenham has put out the tulips in preparation for Beecroft in Bloom which starts 18 September.

Property of the week blown away!

I had just made a delightful new listing house for sale the "property of the week" on our website when Douglas Macarthur reported the roof has been partly blown away by the recent gales!

Local boy makes BMX track

All part of the job for a Property Manager. Phone call from angry neighbour reporting the boy in a Beecroft house that I manage has dug holes in the garden to make a BMX track! Talked to the tenant (the boy's mom) and she said yes, he did it Saturday, without their permission, and will be filling it in again next Saturday.

Government Support for property investors

Housing Minister announced a second round of the scheme that will pay investors a subsidy for renting property for 20% less than the market rate. Meanwhile the Government will slash the social housing component of the economic stimulus.

The market is moving!

Two properties listed by Ray White Beecroft sold very quickly recently, one for $30K above the asking price, and the other before auction. Market experts are increasingly sounding confident that the market is beginning to move. "Buyers are coming out of the woodwork", was one nice quotation.