PROPERTY NEWS FROM BUYERS ADVOCATE

Welcome to Buyer’s Advocate monthly newsletter for May 2011

We will catch up each month to talk about the most common property and market issues that we are being asked about, relevant and current facts and figures, report to you our professional and real observations of the market, and we’ll take you out into the action with a few live auction stories.

Please click on any of the following articles you would like to read, or simply scroll down the email to read all.

Our view on the ground
Suburb profile of the month – South Melbourne 
Recent purchases
Tip of the month – Making an offer!

If you want to discuss anything property related please call our office to chat with one of our advocates. Or make an appointment to meet us for an hour of personal and tailored property advice.

OUR VIEW ON THE GROUND

The clearance rate for the weekend ending the 8th May was 60 per cent from the 577 results reported. Of those a total of 348 sold and 229 were passed in, 134 of those on a vendors bid.

The same weekend last year saw a total of 887 auctions and a clearance rate of 76 per cent.
The REIV expects around 600 auctions next weekend and then 800 on the following weekend.

The last two weekend’s auction activity has allowed for some great buying opportunities for buyers out there willing to make their purchasing dreams a reality.

Of the 480 auctions reported for the weekend ending 1st May, 276 sold and 204 passed in, 116 of those on what is typically known as a vendors bid. Everything really isn’t all doom and gloom though, as there were also 511 private sales over the last week. Total result for the week was just shy of 1000 sales, again typically, a good result. back to see what happens, others are in for quality buying.

The current residential market has no doubt slowed down but this is not a representation of a property bubble at all about to burst. Melbourne’s current issue with a housing shortage is the main driver of our property prices, along with the population intake into Melbourne. In saying that, the current market is demonstrating good buying conditions with some excellent opportunities available for the opportunistic purchaser. Most good quality properties are still selling well, and any buyer thinking about purchasing, should ensure they purchase a property that will sell well in almost any type of market.

Should you be thinking about purchasing a property in the coming months please call us to discuss how the market is performing then and how we can best help you.

Free Consultation
Call Buyers Advocate or visit www.buyersadvocate.com.au to book a free consultation with one of our advocates

THE BUYERS ADVOCATE TEAM

South Melbourne is a quiet achiever and a suburb that often pails into insignificance alongside the higher profile suburbs of Port Melbourne and Albert Park, though offers a fantastic lifestyle.

South Melbourne, located a convenient 2 kilometres south of the CDB, was previously known as Emerald Hill in the gold rush days when the area was first occupied.  This suburb now has a mixture of land uses, combining industrial, commercial, retail and residential.  With a rich historical past and contemporary urban character, South Melbourne enjoys diversity along with architectural grandeur.

The population of approximately 10,502 people is predominately young, aged between 20 – 39, 50% are single, identified as well educated, with a high proportion of professionals employed in finance, property and business services sector.

The variety of wonderful shopping options from a traditional retail strip down Clarendon Street, to the famous South Melbourne market and many exclusive and unique food suppliers, attracts visitors from everywhere. South Melbourne market was built in 1867 and with warm personality offers a range of farm fresh produce, home and hard ware to pet supplies, open Wednesday, Friday and Saturday and Sunday.  It includes a variety of eateries of various culinary experiences including traditional Italian, Asian through to your local Fish n Chips. 

South Melbourne is contained within the boundaries of Kingsway, Ferrars Street and City Road.  For getting around the suburb and to and from the CBD, both trams and light rail are public transport options. The location of this suburb allows for easy access to the city, local beaches and walking distance to Albert Park and Port Melbourne eateries and shopping.  With approximately 12 hotels in the area, South Melbourne is a fine example of “a pub on every corner”!

South Melbourne is home to more than 1532 terrace/semi detached houses that make up the majority of homes within the suburb.  These early Victorian cottages are now in popular demand with young professionals and couples starting out who are looking to renovate and extend.  The medium house price for South Melbourne as of January 2011 is $980,000, and unit price $555,000.  Houses have experienced a 55% increase in the past five years, and apartments 60% increase.  The clearance rate is 67.8% for houses and 81.6% for apartments which is above the average for Melbourne. This trend is sure to continue due to an increasing demand for urban lifestyle, and ease of living in close proximity to CBD and beach.

Cate Dundon
Buyer’s Advocate
Licensed Agents
Representative

Paul Borovac
Buyers Advocate
Licensed Agents Representative

June Hall
Executive Assistant

15/44 Murphy Street South Yarra

This property was purchased prior to auction for $706,000. Our client had very specific requirements and after searching for herself over many years, came to Buyer’s Advocate with hope that we could find exactly what she was looking for.

After locating the property we were among the first few to inspect. So without the potential for the competition to push the price outside of our client’s budget we successfully negotiated with the agent for the purchase of this iconic property.

This is a wonderful example of the importance to find the right property to match your vision, your goals, and of course your budget.

3/16 Westbrook Street Kew East  

We quite often look at properties that do not sell on the day to see whether they are worthwhile pursuing. After passing in at auction the weekend before this property gained our interest, one of 3, positioned at the back of the block, providing maximum privacy. What really interested us though was the size of the accommodation with 3 good size bedrooms and a 4th that could easily accommodate a double bed.

The living areas face North and open up to an expansive, private deck. Not only will this provide a great rental opportunity for an investor, this also offers future upside potential with further modernisation (& rendering).

Other considerations that drew us to this property were that Kew East has experienced over 80% growth over the last 5 years and has seen a lot of development both residentially and commercially.

The reserve on the day was $760k which we thought was very reasonable and likely to sell within days. Our clients were very pleased that we were able to secure this for $740k. As an added benefit we also negotiated an additional car space from the body corporate on a 99 year lease.

1/116 Broughman Street

This property was purchased at auction for our client. Considering that a number of 2 bedroom apartments in Kew sell well into the $600’s and beyond, it was quoted low so we started the auction at $650k, knowing full well that the property was worth more. This knocked out some early competition but there were still a few parties involved. Most %%drop%%ped out at the 700k mark, with a round number once again being a barrier for a lot of people. At this level there was only one other party, who when they saw our aggressive bidding gave up quickly.

We successful secured the property for our client for $706,000. This was a great buy when you consider this property has its own title. It also has a private driveway and fully lined roof storage. There is also an opportunity for future extension up which would create a great family home in a very exclusive and expensive neighbourhood.

TIP OF THE MONTH - MAKING AN OFFER

Before becoming a successful member of our Buyer’s Advocate team, Sam Lally was a Real Estate Agent for many years.

One of the most frequent questions he was asked by clients was “How do I make an offer to buy a property in a private sale”? Back then his response came from the interests and purpose of a Real Estate Agent. Now when Sam is asked this question as a Buyer Advocate his considerations and answer is very different.

Here Sam talks about what the buyer should know when making an offer and negotiating with a Real Estate Agent and explains some of the differences of interest that we help our clients to understand every day.

It is important to remember when making an offer:

• The seller may wait to see what other offers and different terms for settlement are made
• There may be no other parties interested in the property
• The seller does not have to accept your offer
• The Agent has complete control of the process, no emotional involvement and is a very experienced negotiator.

Be mindful that the Agent acts on behalf of the seller and not you, the buyer. Negotiation of an offer will probably be directly with a Real Estate Agent, generally, a trained, highly skilled property negotiator.

As a Buyer’s Advocate, our role is to act on your behalf; to balance the negotiation process with the required knowledge, experience and skills to negotiate with an Agent. We make offers and negotiate the purchase of property on a daily basis so we are familiar with the complexities, prepare and direct for each stage of the process.

When making an offer, ensure that your offer is in writing, in the form of a contract and signed by you.  An offer should be submitted with the Vendors Statement, also known as the Section 32 statement and forms part of Section 32 of the Sale of Land Act.  This should be signed by both you and seller of the property.

Ensure that your offer has a fixed acceptance date and time.

You can make the offer subject to specific conditions.
A building and pest inspection; or a finance clause can be included, for example finance subject to the sale of an existing property.

Remember though, if a property has a lot of interest in it then including irregular special conditions in a contract of offer may inhibit your chances of securing the property at the price you offer to the Vendor. Another party’s offer may not be subject to any of these things and the Vendor can enter an unconditional contract and have their property sold.

A legally binding contract is achieved when the seller accepts your offer and countersigns the contract.  This contract sets out the terms of the sale and must include:

• Names of the buyer
• Names of the seller
• Names of the Real Estate Agent
• The Title details
• Total purchase price
• Deposit amount
• Balance of purchase price payment
• Date of settlement
• Time you can take possession of the property.

A cooling off period applies to residential property for three clear business days, from the date and time you sign the contract. Note this does not apply to the date and time of the Vendor signing the document.

The exception to this is if you buy the property:

• within three business days of a publicly advertised Auction
• On the day of the Auction
• or three business days after the Auction.
• Note the cooling off does not apply, if you have sought independent legal advice prior to signing the Contract of Sale.

Residential real estate is complex and for the buyer intimidating to negotiate and manage. At worst, mistakes and uninformed decisions can lead to disaster. There are significant differences of interest and purpose, for the buyer, their Buyer Advocate, and the seller and their Real Estate Agent.

Our responsibility as the Buyer Advocate is to negotiate the best result purely for the buyer. As Sam says “evening up the playing field”. A Buyer’s Advocate represents and protects your interests when making an offer on a property and negotiating with the Real Estate Agent and seller.  We understand that the purchase of a property for a new home or investment is a major decision and life event for our clients.  How much money do you want to save?

Warm regards from the Buyer’s Advocate team at Hawthorn

Suggestions – If you have any suggestions on what information you would like Buyers Advocate to include in future newsletters, please let us know by emailing admin@buyersadvocate.com.au