Aug
26

The Block’s Auction Antics

More than a decade on and the phenomenon that is Reality TV continues to roll out more and more cringe worthy spectacles.  Who said it wouldn’t last?

Ok, I have been known to immerse myself in the sparkle, silicon and veneers of The Housewives of OC or drool over some Top Chef fare, but being the Real Estate tragic that I am, I tuned in, for the first time, to The Block Auction Finale, and I was not disappointed.  My watching of TB finale was similar to observing a sports fan going through the highs and lows of watching their favourite game.

I buried my shaking head in my hands at some of the Auctioneering techniques and strategies (or lack of them).  Yelled mild obscenities at the ungrateful sister act as their property was passed in and laughed hard and knowingly as Scott Cam revealed the ‘Network paid too much for the properties’ reserves.

The reality of this whole exercise was not an accurate depiction of the Auction process.

Firstly, at no time did the Auctioneers threaten any of the bidders with ‘highest bidder gets first crack at the property if it is passed in.’  Second, the mysterious woman with jet black hair in the front row should have been shamed into opening her purse a little further after a couple of incipit $1,000 bids.  Third the portly little Auctioneer of noble Mediterranean heritage should learn to pace himself. He was out of the block that quickly that I literally thought he was going to explode.

The Block winners The Block’s Auction Antics

The Block winners

(For more info on The Block go to http://homes.ninemsn.com.au/theblock/ )

Next, and I understand the winner of TB was based on best result ‘under the hammer’, no-one took the time to explain to the television audience or the contestants for that matter, that negotiation straight after the passing in of  property still yields fantastic results.  One couple who sold in the last day or two, ‘post auction’ pulled $70,000 over their reserve!  That’s a better result than the winners on the night.

The Auction process is about unearthing buyers who are willing to pay a reasonable price in a reasonable time in a challenging market.  There is absolutely no failure if a property is passed in.  The only failure is if all those involved in the sale process don’t listen to the collective opinion of the market and maintain an over estimation of the true value of the property.

I believe all the properties are now sold and the worst result was the home renovated by the sisters who sold for bang on their reserve price straight after Auction.  Their performance, when their property was passed in, should see their papers stamped by Channel Nine – “Do not invite back to The Block Masters Series.”

Some of my Queensland Real Estate Peers have been critical of the practice in Sydney and Melbourne of Agents placing price guides on Auction properties. The ‘investigation’ by the Victorian Fair Trading Office was at best a publicity stunt to gain a larger audience.  All the quoted prices were very close to eventual sale prices. Why do you think that Sydney and Melbourne are achieving 50%-60% clearance rates at Auctions?  Because the buyers are given a general guide on price – they actually have something to aim at.  I do not condone for one second the practice of ‘Bait Pricing’ which understates the expected sale price of a property to give unsuspecting buyers false hope and pump up the number of ‘interested parties’.

Properly researched price guides are a solid indication of market activity and the prices being obtained other similar properties that have recently sold.  Ultimately it is the buyers who determine the eventual sale price of a property, especially in the evolving market we are now experiencing.

The Block Finale entertained over three million Australians.  Those who believe the Auction process is a waste of time, as one the contestants bemoaned, should not take this television spectacle as an accurate example of how a tried and proven process actually works.

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Aug
19

Nambour Real Estate’s Guide to Open Home Etiquette

Open Home.  Open For Inspection.  Buyer Viewing.  All these terms describe the same accepted (well, in most cases) Real Estate practice whereby a home seller’s agent ‘throws the doors open’ to the home, which is of course for sale, and encourages prospective buyers to look through at their leisure and without pressure for half an hour or forty-five minutes.

After conducting somewhere in the vicinity of two thousand Open For Inspections, which I now call Buyer Viewings, I am confident enough to anoint myself as the Nambour and Hinterland’s resident expert on the subject.  I have handled everything from dozens of people streaming through the one property to mind numbing boredom manning overpriced and under-promoted properties on behalf of sellers whose motivation level to sell was almost below zero.

During the thousands of viewings I have conducted I have experienced everything from refusing entry to belligerent sticky-beaks to shaking hands with prospective buyers walking through the door and within ten seconds asking, “Do you have a contract with you that I can sign?”  I’ve also had everything from sellers who refuse to leave their home during buyer viewings, literally scaring off prospective buyers, to vendors who almost leave me a three course meal and a banquet of snacks for prospective buyers.

Over the last decade here in Nambour and throughout the greater Sunshine Coast area, buyers and sellers alike have become far more accustomed to Buyer Viewings with the vast majority of buyers expecting that the home they have identified, through the various forms of promotion, to be open for viewing at some stage over the weekend.

I can say, hand on heart, that sellers who do not incorporate Buyer Viewings as part of a solid and cost effective marketing campaign should think twice about whether or not they should place their home on the market.  More than 60% of the properties I have sold in the last nearly ten years were as a result of the buyer attending a Buyer Viewing.

The sign that s sold Nambour Real Estate’s Guide to Open Home EtiquetteOk, so what about the etiquette for Buyer Viewings.  Over two thousand buyer viewings later, I am still doing my utmost to help sellers and buyers make the ‘Buyer Viewing Experience’ productive and enjoyable.

First of all, I’ll help the buyers:

  1. Be on Time: Draw up a time and travel schedule if you plan on visiting multiple properties on a given viewing day.  The average buyer spends around fifteen minutes looking a home during a Buyer Viewing, so if you have two properties with viewings starting at the same time, say 1pm, then get to the first property right on start time and aim to arrive at the second property with fifteen minutes to go for that viewing.  I know we should not have pet hates, but I do have one.  They’re called the ‘Last minute Larry’s’. I am packing up at 1.44pm after a brisk buyer viewing with two groups showing keen interest, I am excited about the good news I will pass onto my clients and a car pulls up, the occupants amble out, look at the sign, can clearly see the time has expired, but they wander in and say. “Oh, is it finished?  Can we have a quick look, sorry we just finished lunch.” “Ok,” I say, “Could I get some quick details please, but I do have to be at my next Viewing in eight minutes.” “We’re not really looking to buy we’re just seeing what’s out there.” My smile is now in need of major support and my tongue has glued itself to the top of my mouth to prevent me from saying what any other normal human being would.  Details are taken regardless using a little ex-cop persuasion, the non-buyers are ushered through, shown the door and I am on my way, now two minutes late for my next viewing.  In short; Buyers – be on time!!!!
  2. Take notes:  Once a buyer has seen more than four properties on any given day, the properties can start to meld and blur.  Write down what you like and what you don’t.  Ensure you get an information brochure from the agent.
  3. Wear slip on, slip off footwear:  Whether it is wet or dry, it is a nice courtesy is you remove your shoes before walking into a seller’s home.  Unfortunately the fellas are the worst offenders when it comes to footwear because many like to wear runners or boots, and it is a monumental pain in the ‘youknowwhat’ if you have to take your shoes on and off at five different properties.
  4. Be Discreet:  If you are inspecting a property and you don’t like it, the agent wants to hear your feedback but please don’t bellow your opinion down the hall for everyone to hear.
  5. Provide Details:  You are a stranger in someone else’s home.  They have a right to know who has been in their home.  When the agent asks for your name and contact details don’t be evasive.  A good agent will contact you at some stage for feedback.
  6. Be open to providing feedback:  A seller is very anxious to hear what the market (buyers) has to say about their home.  If the agent is unable to obtain your opinion at the open home, when he calls soon after for feedback, give it freely so he can report back to his clients.

Now, sellers, here are a few Buyer Viewing etiquette techniques for you.

  1. Let there be light:  Open all blinds, curtains and shutters to allow maximum light flow.  Dark homes are an immediate put off for buyers
  2. Tidy up:  This is the most obvious of all.  Don’t think that pile of dirty washing left by your partially brain dead teenager (I speak from experience – I have them inhabiting my home) in the corner of his room will go unnoticed by the buyers.
  3. Remove Rover from the property:  I love dogs, but some buyers just don’t.  Take Rover for a walk or a visit somewhere and pick up any of his ‘barker’s eggs’ before you leave.
  4. I would like to say this in the nicest way – Get Out!  Leave your home about 5-10 minutes before the scheduled Viewing time.  If you have any last minute instructions you need to give your agent, like switch off all the lights, lock all the doors and windows, put the cat out, turn on the roast in the oven, bring in the clothes if it looks like rain………give them to the agent earlier in the day.  There is nothing worse than having three car loads of prospective buyers waiting at the kerb whilst the owners load up the kids, the dogs and the bikes and give the important last minute instructions to the agent, “And make sure the oven is set at 200c….bye….”
  5. Do not return home until fifteen minutes after the viewing is finished:  Your agent may still be dealing with some Last Minute Larry’s or talking serious ‘Turkey’ with a buyer who has stayed the distance and has a genuine interest.  Bursting in the door and saying, “How did it go?”  While the agent is doing his thing has been termed by me ‘negotiatus interruptus’.  I clearly recall one Buyer Viewing I was conducting and there was about five minutes to go and I was deep in negotiation and fact finding with a prospective buyer.  Bold as brass, up the stairs comes the seller with a hearty, “Any action today?”  I looked at him, as did the buyer, the buyer shut up in mid sentence and said, “Thanks.” Then walked out.  By the time I did talk to the buyer between ‘negotiatus interruptus’ and the time I called him about 30 minutes later, he had gone quite cold on the idea of purchasing the property.  Oh dear!  It was back to the drawing board.
  6. Don’t invite them in:  If a buyer a turns up well after the Buyer Viewing has finished and says, “So sorry, we couldn’t get here on time,” DO NOT invite them in for an inspection.  Politely ask them to call your agent and he will arrange an inspection.  This has happened on a few occasions and I get excited sellers calling me telling me that the home is about to sell as they showed a buyer through, who was late (couldn’t read or tell the time is closer to the truth), and they love it and want to buy it.  My first question to my client is, “Did you get their name and phone number?” “No, but they said they would call you.”  Sadly the call never comes.

Without sounding blasé , I can conduct buyer viewings in my sleep, so I am very adept at quelling any fears a seller may have and love welcoming prospective buyers and allowing them to feel comfortable  during their inspection.

Even in this evolving world we live in, where all manner of purchases are made over the internet without the buyer actually seeing or touching the product in the flesh, property is most unlikely to take up this trend.  Therefore property buyers will always want to see, touch, smell and physically judge the property they have identified as there next abode.

My guide to Open Home etiquette is designed purely to help buyers and sellers enjoy the experience and optimise the anticipated results.

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Aug
02

Will higher interest rates affect the housing market?

Over the last month buyers in the Nambour/Hinterland real Estate Market have shown signs that they would like to throw off the shackles and finally get serious about making offers and purchases.  Will the latest CPI and inflation figures have buyers scuttling back under from whence they came? Hopefully not.  At worst a Rate Rise might be on the Reserve Bank’s agenda before 2011 is out, as a reaction to the slightly higher than expected inflation figures (blame the bananas!  Are you paying $14 a kilo?  Not I.)  But, they will also be looking over their shoulder at the American budget blockage, which if not resolved could have some interesting implications for Oz.  Tim Lawless, in the following article, provides his take on where we are now in the property market, Australia wide.

Will higher interest rates affect the housing market?

With another interest rate rise seemingly around the corner thanks to the high CPI reading for June, it is worthwhile looking back to see how interest rate rises over the recent past have affected the housing market. The Reserve Bank started lifting interest rates back in October 2009; prior to that, the average standard variable mortgage rate was at a recent historic low of just 5.75%. After seven rate hikes the average variable mortgage rate is now at 7.8% – unmoved since November last year and still well below the peaks seen back in July/August 2008 when the variable rate briefly hit 9.6%.

national 1024x384 Will higher interest rates affect the housing market?

Number of Houses & units sold in Australia per month

Read the rest of the article

 

 

 

 

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Jul
22

Understanding Buyer Behaviour is The Key in the Nambour & Hinterland Real Estate Market

Any market, whether it is commodities, blue chip stocks, gold, coffee or property, ebbs and flows and is influenced by almost one factor alone – human sentiment.

Excitement, greed and perceived insulation from risk will see any market rise. Fear, perceived risk exposure and lack of confidence will see any market fall.  Humans and corporations (run by humans) are the players in any market.  Someone has something to sell. Someone is looking to buy something.  A market forms when transactions start taking place.  Lots of transactions – the market is hot.  Limited or very few transactions – the market is cool.

Over the last eighteen months to two years, the local Nambour & Hinterland Property Market has cooled.  Buyer sentiment is now characterised by fear and lack of confidence.  There is definitely still a market, however less buyers are choosing to participate and those who are will not pay prices that exceed true market value.

Over this period of change, mid 2009 to the present, I have studied, very closely, buyer behaviour and two words best describe it – fascinating and frustrating.  As time has gone by and the market has settled into itself and the prevailing conditions, frustration (on my part) is starting to dissipate because current buyer  behaviour is now the norm and has changed the market or did the market change buyer behaviour – chicken or the egg first?  This is another subject all together.

The thrust of my article is a specific behaviour that strikes at the one factor that so many vendors are unaware of or actually ignore and it revolves around the competitiveness of any given property.  Simply put, with less buyers and more property on the market, buyers have a choice. Buyers are very much like kids being let loose in lolly shop.  So, if a property listed for sale does not represent value compared to all the similar properties on the market in that particular genre or price range, then quite simply, buyers will ignore it and move onto the next flavour (house).

IMG 2851 Understanding Buyer Behaviour is The Key in the  Nambour & Hinterland Real Estate Market

Like a kid at a lolly shop

Now, in this type of market it gets even trickier and here is my point, and this observation is based on watching and talking to nearly every buyer swimming around in the property pond in this part of the world – Location is now secondary to value!

Buyers are no longer confining their search to one suburb or precinct.  They are widening their search and are prepared to settle in any number of areas.  Their total focus is on cutting the best deal, for them, on a property, and location and travel distances are taking a back seat to the Big ‘V’ – Value!!!!

This behavioural change was highlighted best in a conversation I had with a buyer recently as he inspected a home I was marketing.  After my usual ‘friendly interrogation’ I got a very good picture of what this buyer was looking for in a home.  The next two questions and answers bolted in how the buying public were behaving.  It rolled out this way.

“John, which area or suburb have you identified that will best suit you for work travel and amenities?”

“Well we’ve looked at similar homes to this from Tewantin to Beerwah.”

For those of you who may not be geographically inclined that is about a 60km Sunshine Coast Hinterland strip – North to South.

“Wow John, that’s a wide area you have covered.  How many homes have you seen in your search?”

“This one makes it 47.”

Forty Seven!  And he had seen that many in just four weeks or even less. The home we were talking in and inspecting was at Woombye – smack in the middle of his search strip.  He eventually bought at Beerwah because a home there, in his opinion, represented the best bang for his buck.

What can sellers learn from this now established buyer behaviour trend?  Your home no longer just competes with others in your suburb.  Be aware that buyers are identifying multiple areas and then digging into each suburb to find the best value homes then comparing them against the homes they have seen in the other suburbs.

Very recently I had a buyer who presented with me her ‘short-list’ of twelve properties of interest – in four different suburbs!  Fortunately for my seller he understood that giving the buyer any hint of reluctance to negotiate would have sent her off to any one of the other eleven homes.  The buyer stuck to my client’s home and now everyone is happy.

Sellers – Be competitive. Be aware.  Understanding  buyer behaviour, in this very interesting market, is the key to moving on.

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Jul
15

Get Out The Net……We Have An Offer

Recent personally experienced events have shed a huge spotlight on what is going on in the minds of home sellers and buyers in the current Nambour /Hinterland and Sunshine Coast Real Estate Market.

Slowly but surely buyers are waking up to the fact that Stamp Duties in Queensland are about to change, and for one particular segment of buyers it won’t be pretty.  Buyers who are NOT first home buyers; in other words who currently own a home or have owned a home previously, and want to buy another existing dwelling, will see their Stamp Duty contribution increase by around 250%.  On a $350,000 purchase, instead of paying $3,500 in Stamp Duty – relocating, non-first home buyers, buying an existing dwelling will have to ante up around $10,000 after the 1st of August, 2011.  This increase has been introduced by the State Government to fund their initiative to stimulate new residential home construction.  First home buyers and investors are being tempted with grants to build new homes, yet have been slugged by the new Stamp Duties. This has led to a slight increase in buyer activity and enquiry.

We are seeing buyers, who may have been sitting on the side line watching the property game for many months, lacing up their boots and running on the field of play brandishing what can only be described as cheeky offers, knowing full well that this initial offer is unlikely to be accepted by the vendor of the subject property.  This highlights somewhat of a pent up demand for property, however continued sensationalised reporting from the media on major economic factors has kept buyers warming the bench – must be a few splinters in quite a few behinds at the moment.

People in general are motivated by the carrot or the stick.  The majority will act when confronted with the latter.  It is a psychological fact that humans will act to avoid pain(getting hit with the stick) rather than taking perceived risks to move toward pleasure or a goal (eating the carrot).  The Stamp Duty stick seems to be working – albeit temporarily.

On the vendor’s (seller’s) side of the equation, equally interesting, predictable behaviours are being displayed.

Some vendors are breaking out the flame thrower and burning potential deals on their properties before the offer has even landed on the table.  Others are chiselling unrealistic price responses to offers in the concrete and basically killing off any chance of negotiating their only solid deal.

catching barramundi Get Out The Net......We Have An Offer

Barramundi - The BIG one that should never get away

One recent negotiation I conducted saw the buyer jack-hammer a price line into the concrete only to see the vendor do the same – with the vendor accompanying his response to the offer with, “This is only our first offer.”  Problem is the vendor had been on the market, in total, for nearly six months, without a single offer!  Suffice to say, I filled in the original ‘permanent’ line drawn by the buyer and helped the vendor to draw his lines in the sand and the deal was done.  Everybody was very happy – a buyer who had been on the hunt for months and vendor who wanted to be hunted were brought together in property bliss.

What this and other similar recent events have highlighted is a couple of less than helpful psychological barriers which have created the market we are experiencing currently.

For buyers it is the fear of making a decision to act and moving forward driven by a less than healthy bag full of “What if’s?”  For sellers it is the fear of meeting the market, “The next buyer might offer more.” Which next buyer might that be? Uncertainty meets denial, the two show stoppers.

The remedy is simple.  Buyers, never be afraid to make an offer, it is impossible to buy a property without making one and it is the quickest way to find out how much the seller is willing to take.  Sellers, when an offer is presented, hug your agent and don’t allow negative emotions to cloud your good judgement – the first offer is rarely where it all ends. An offer is where it all begins. You have one on the hook in a sparsely populated buyer pool, so never cut them loose on the first tug of the line.  There could be juicier bait for the buyer just around the corner.

excitedman Get Out The Net......We Have An Offer

Craig from Victor Realty, on his way with an offer.

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Jul
12

It’s Good News Week in the Nambour Real Estate Market

GOOD NEWS WEEK

As the Nambour and Hinterland Real Estate Market emerges from the perfect economic storm; buffeted by Carbon Tax, blown around by threats of Interest Rate rises, knocked over by standard pre June 30 (Tax Time) consumer inhibition – it is somewhat comforting, if you can call it that, to see the Reserve Bank may have just cottoned on that all the roads are not paved in gold, iron ore and coal.  Whilst mining and related service sectors are investing and growing, the remainder of the economy remains sluggish.  With this realisation, Mr Stevens and his board left rates on hold last Tuesday and it appears they may stay that way for the short to mid- term.  That has to be good news.  The summary of the RBA decision follows -

Reserve Bank of Australia Its Good News Week in the Nambour Real Estate Market

The Reserve Bank of Australia

Statement by Glenn Stevens, Governor: Monetary Policy Decision
At its meeting today, the Board decided to leave the cash rate unchanged at 4.75 per cent.
The global economy is continuing its expansion, but the pace of growth slowed in the June quarter. The supply-chain disruptions from the Japanese earthquake and the dampening effects of high commodity prices on income and spending in major countries have both contributed to the slowing. The banking and sovereign debt problems in Europe have also added to uncertainty and volatility in financial markets over recent months.
A key question is whether this more moderate pace of growth will continue. Commodity prices have generally softened of late, though they remain at very high levels. Despite the challenging international environment, the central scenario for the world economy envisaged by most forecasters remains one of growth at, or above, average over the next couple of years. A number of countries have tightened monetary policy but, overall, global financial conditions remain accommodative and underlying rates of inflation have tended to move higher.
Australia’s terms of trade are now at very high levels and national income has been growing strongly, though conditions vary significantly across industries. Investment in the resources sector is picking up strongly in response to high levels of commodity prices and the outlook remains very positive.  A number of service sectors are also expanding at a solid pace. In other areas, cautious behaviour by households and the high level of the exchange rate are having a noticeable dampening effect. The impetus from earlier Australian Government spending programs is now also abating, as had been intended.
A gradual recovery from the floods and cyclones over the summer is taking place, though the resumption of coal production in flooded mines continues to proceed more slowly than initially expected. The recovery will boost output over the months ahead, and there will also be a mild boost to demand from the broader rebuilding efforts as they get under way, but growth through 2011 is now unlikely to be as strong as earlier forecast. Over the medium term, overall growth is still likely to be at trend or higher, if the world economy grows as expected.
Growth in employment has moderated over recent months and the unemployment rate has been little changed, near 5 per cent. Most leading indicators suggest that this slower pace of employment growth is likely to continue in the near term. Reports of skills shortages remain confined, at this point, to the resources and related sectors. After the significant decline in 2009, growth in wages has returned to rates seen prior to the downturn.
Credit growth remains modest. Signs have continued to emerge of some greater willingness to lend and business credit has expanded this year after a period of contraction. Growth in credit to households, on the other hand, has slowed. Most asset prices, including housing prices, have also softened over recent months.
Year-ended CPI inflation is likely to remain elevated in the near term due to the extreme weather events earlier in the year. However, as the temporary price shocks dissipate, CPI inflation is expected to be close to target over the next 12 months. In underlying terms, inflation has been in the bottom half of the target range, though a gradual increase is expected over time.
At today’s meeting, the Board judged that the current mildly restrictive stance of monetary policy remained appropriate. In future meetings, the Board will continue to assess carefully the evolving outlook for growth and inflation.

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Jun
28

Australian property market to avoid crash, but price growth moderate to 2014

Following on from my last offering from Robert Gottleibson, which covered the potential damage another or more interest rates rises could wreak upon the economy, the following summarises a report researched and written by Angie Zigomanis – a Senior Manager from BIS Shrapnel – that is a specific look at the Property Market.

Zigomanis’ research has led him to believe that we will not see a housing market slump, but moderate growth through to 2014 seems to be on the agenda.  East Coast Capital Cities should fare well and more specifically the Sunshine Coast, including the Nambour Real Estate Market, should see a levelling out of prices with a slight rise in the vicinity of 3-4% up to 2014.

This information comes as a welcome relief, if true, to those who continue to worry about when the local market is likely to ‘bottom out’.  Sooner than later I would like to think.

Enjoy, Craig Heppell -

Australian property market to avoid crash, but price growth moderate to 2014: BIS Shrapnel

The Australian property market is not set to crash any time soon, a new report from BIS Shrapnel has found, with prices expected to remain steady in 2011 and grow moderately over the next two years.

The report pins Sydney, Perth and Brisbane as the cities likely to record the fastest residential property growth in the next three years. Melbourne is only forecast to record a 6% increase to 2014.

And despite recent fears over the rising number of delinquencies – in particular, arrears among first-home buyers – BIS senior manager and study author Angie Zigomanis says current default rates are not yet worrying.

“Obviously the figures show they are rising. As to whether they are worrying or not, I think they are still very low compared to other countries. And it depends on how much they rise further to see if they are worrying,” he says.

“Our view is they may not rise by a huge amount given we’re expecting economic conditions to accelerate, growth will rise, unemployment is set to drop even further.”

Zigomanis also says while prices will remain flat for the rest of the year, growth will be moderately higher over the next two years due in part to the ongoing chronic undersupply of dwellings.

To read the rest of the article click link

http://www.smartcompany.com.au/property/20110627-australian-property-market-to-avoid-crash-but-price-growth-moderate-to-2014-bis-shrapnel.html

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Jun
24

Will the RBA repeat its mistake and whack households again?

The Nambour/Sunshine Coast Real Estate market has been particularly sensitive to movements in interest rates (cash rate or the cost of money) as determined by the Reserve Bank of Australia.  Over the last ten years, and more noticeably over the last 18 months, any lift in official interest rates has led to prices softening in the Nambour and Hinterland area by around 2% per rate rise.  The only tool at the disposal of the Reserve Bank to control inflation, which in their view is our biggest enemy, is the adjustment of interest rates and unfortunately there are only three speeds: Reverse, Neutral and the RBA’s current favourite, Forward.  Thankfully recent economic data is finally hitting home to the RBA Board that the Nation has a definite two speed economy and there is no longer a one for all medicine – the upward movement of interest rates.

The following blog was recently penned by economic expert Robert Gottliebsen on this subject

Will the RBA repeat its mistake and whack households again?

As the mountain of unsold houses on the Australian east coast rises each week, so the array of suggested solutions starts to increase. Given the rises in dwelling prices that we have seen in recent years, the current fall of around 10% in many areas is probably a good thing, although a big surprise to the community.

The danger arises if those 10% falls become 15 or 20% or – most unlikely – the 40% slump we have seen in Noosa. There are three groups that may have solutions – the government, the big banks and the Reserve Bank.

It is clear that first home buyers are now pulling back from the market, sensing that there is no hurry…… to read the rest of this excellent article go to

http://www.smartcompany.com.au/property/20110620-will-the-rba-repeat-its-mistake-and-whack-households-again-gottliebsen.html

 

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Jun
17

Ready, Fire, Aim. Missed again!

Over the course of a week, I would have twenty or more industry and economic reports land in front of me, predominantly by way of email and some by way of industry and economic magazine subscriptions.

The sheer volume of articles, opinions, observations and predictions is huge, however, and thankfully, I am a sponge and can’t get enough. Actually I am a prolific reader and currently I have two books on the go as I speak to you.  Generally my choice of reading depends on my moods and immediate needs for improvement or entertainment.  Much of this information I filter and put to good use for my clients, colleagues and business.  In nearly ten years as a Property Professional this pursuit of self development has brought me the success and career satisfaction that for many can be a rare commodity in today’s ‘turn up, work (and hate it), go home’ environment.

I have digressed a little. Yes, I absorb a lot of information and one piece I read last week came from one of Australia’s largest Property Information providers, RP Data.  It appears that in the last three years or so, the nation’s population of Estate Agents has diminished from around 75,000 to 50,000, with 10,000 leaving the industry in the last 6 months.  Now dry those tears folks.  I know your heart bleeds for these poor souls but spare a thought for those who have now gone from sipping coffee with an iphone bolted their ear to selling shoes at Myer or paint at Bunnings.  You may want to re-acquaint yourself with my blog ‘Are you the next real estate superstar?’ for a better understanding of what it takes to make it in this business.

Three years ago there was around one Agent to every three hundred head of population, now there is one to every four hundred.  Did you notice?  Did you care?  Maybe not but the reason for this tectonic shift actually had an effect on home owners as well as the number Agents mixing with the human race.

Many of the Agents who have handed in their name stickers and open home signs, entered the industry when the market was hot or at worst, even.  Many homes came to the market, many homes sold.  The skill levels required to make a good Agent were to be able to read, write and speak English, and stand upright.  There was an industry full of ‘order takers’ making promises which, through good fortune rather than good efforts, could actually be kept.  The basic strategy employed by the majority of order takers was – ready, fire aim!

ready fire aim2 Ready, Fire, Aim. Missed again!

Ready Fire Aim - Oops not the outcome they expected

With the large number of active buyers around (2001- 2009) our intrepid ‘hot market performers’ could not miss.  From January, 2010 these Agents with a limited skill set began missing, and often!  And when they began missing en masse, the dollars entering their wallets began to miss as well.There are two major reasons these agents, and possibly a few more to come, had to leave this exciting, cut and thrust industry.

The first.  In a softening market when prices are falling, these former Agents could not bring themselves to show their clients (home sellers) that the price on their home was wrong.  I will elaborate on this phenomenon in the near future, titled, ‘The Conversation Everyone Must Have.’

The second is not quite as obvious, but equally important.  Many agents do not market homes to attract buyers.  A good proportion of Agents market homes to please their clients, the sellers.  That would be a great tactic if the seller planned on buying their own home!  Always remember this – everyday a property is on the market, the seller is writing himself a cheque for the list price but can’t cash it!  The whole idea is to get someone else to write a cheque for the property.

Several of my past clients have said, “Oh, I don’t like that photo.”  Knowing that the photo is a definite buyer attractant I would reply politely, “Are you buying the home?”  Or one of my favourites is the client who wants ‘War and Peace’ written about his or her home. “Craig, you didn’t mention the 11th tap we have up near the vege patch and you didn’t mention the avocado tree next to the chook pen.”  Trust me, buyers are lazy readers and want to know a handful of things; where it is, how much, how many bedrooms, baths and cars – and do the photos or virtual tour give an accurate representation of the home.

Ready Aim fire Ready, Fire, Aim. Missed again!

Ready Aim Fire - bullseye Right Message to the Right People

The key to ‘ready, aim, fire!’ buyer attraction marketing is first of all identifying who is the likely buying group for the property – empty nesters, first home buyers (now on the endangered species list), investors or several other categories of buyer.

Professional photos, stand out headlines and a less is more philosophy for the narrative are extremely important buyer attraction ingredients.

The intrepid souls who have moved on to work with Ms. Hawkins unfortunately got either or both of these two vital success ingredients wrong.  Many home owners, as the market quickly softened, were protected by their (now ex) agents and not given the facts about their price or their marketing strategy overhauled.

The property market now looks this way; more homes for sale, less buyers and less agents to choose from. Be sure that the agent you choose is an expert at buyer attraction.  Is your agent willing to do what it takes, the right way, to get you a good, early result?  If not I strongly suggest you find one that does.

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Jun
10

RP Data Market Wrap 10 June

Regional cities the weakest housing markets

Over the last 12 months house values in those areas outside of the capital cities have fallen by -1.8% however, in many of the major regional centres the falls have been much greater.

Property values across the combined capital cities fell by -0.2% during the three months to April 2011 and were down by -1.4% over the year in raw terms. Capital city houses have actually fared worse than units, with house values down -2.0% for the year compared to 0.2% growth in unit values.

Quartley Change RP Data Market Wrap 10 June

Over the last 12 months house values in those areas outside of the capital cities have fallen

Read the full article…

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