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What the heck!

What the heck?

Here at Madeleine Hicks HQ we have a problem. The good news is that it may not be unique to us. The bad news is that it’s nation-wide: There are more buyers than sellers, especially in the entry-to-mid-range property market.

With housing affordability the best it has been in over a decade, what the heck is going on, you might ask? Why are there not enough houses for sale to meet the continuing strong demand?

Well. Here’s four factors influencing the market at present:

  1. The season
  2. The budget and rattled consumer confidence
  3. Interest rates
  4. The economy

 

The first one – the season – is a much documented pattern: sellers typically hesitate to list properties with the approach of Winter and burst forth come Spring.

The second factor – the budget and consumer confidence – is more complex and destabilising and who knows just what the end result will be, but, given the budget impacts those already most marginalised, it’s sadly possible that many of these folk have more pressing concerns than securing their next property deal.

As for interest rates, they are the lowest they’ve been for ten years, so affordability is still a green light. And thanks to this post-budget nervousness, the longer consumers remain rattled; the longer interest rates will remain stable.

And finally, the economy: depending on whom you listen to, we’re either on the verge of a national-debt-induced-crisis, or things aren’t all that bad if you compare our debt levels to many other nations, but refer again to point two (the budget) and cue nervousness…

Yet, whatever your political views are, the problem comes down to a basic economic principle of ‘supply and demand’. And when (housing) supply is short, demand goes unmet. Or to put it into more human terms; for every home listed for sale, there are buyers competing. And there are buyers missing out…

So, if you’re one of those unlucky enough to have missed out on the home you’d set your sights on (or even a few properties) then, it’s not all bad news. Contact us and we’ll add you to our ‘Sneak Peek’ list where you’ll be emailed properties as they get listed with us, and most importantly, before the wider-market gets notified.

And for those of you thinking of selling, now might just be a good time: demand is strong and that’s a good indicator to getting the price you’re aiming for.

Thinking of selling? For an in-depth discussion of what you could expect in the current climate and a free Comparative Market Analysis of properties similar to yours contact our office and talk to one of our great (not just good), but great agents.

The Silent Thief

The Silent Thief

Be alert, not alarmed. There may be a thief in your home. And it’s called, ‘clutter’. It moves in slowly. And sometimes quietly, until – like a swarm of ants – you’re inundated and you don’t know where to start.

Seriously. Clutter in the home can be a thief to your health, sanity and hip pocket.

Consider this. Clutter encourages the build-up of dust, which impacts air quality. Clutter hinders our ability to think clearly (think tidy home, tidy mind). And finally, if you’re considering selling, then clutter to potential buyers is like hot salty, chips at the end of the salad bar: At best a total, unnecessary distraction.

But there’s always a place to start, when it comes to getting rid of clutter. And here’s six of the best tips ever:

TIP 1 Find the problem areas

You’ll know them when you start to look for them. The piles of newspapers or magazines, the bench tops that attract little bits of disparate nothing, all the dust-covered heaps of household orphans: get rid of them. Join me in this mantra: If in doubt, chuck it out…

The Silent Thief

TIP 2 Do the thing you loathe most first

What job are you avoiding? By tackling clutter that usually stumps you, you free up energy for the rest of your cleaning efforts. Don’t underestimate the satisfaction of de-cluttering even a small area that makes you feel annoyed, guilty or overwhelmed.

TIP 3 Implement systems for dealing with incoming clutter

Consider for instance, the one paper method. Basically, any paper that comes into your house gets looked at once and dealt with straight away: in most cases filed, turned around, or binned.

TIP 4 A place for everything and everything in its place

Put into practice, this mantra is one of the best ways to beat clutter. Designate proper homes for any flotsam and jetsam clutter that drifts endlessly around your home. Or better still – if you’re de-cluttering to sell – start packing and store anything you won’t need over the coming months and be ruthless.

TIP 5 Become a basket-case

When you’re cleaning and tidying, carry a basket around with you in which to put all clutter. These items can be sorted and restored to their rightful locations later, one room at a time, rather than making multiple trips to each room. This will speed your cleaning process and make it easier to keep up momentum.

TIP 6 Reward yourself for dealing with clutter

Decide on something you can treat yourself with after you’ve done battle with the clinging claws of clutter and use it as motivation to push on. Even if it’s just a cup of tea on the couch with a good book, reward yourself so that you feel inspired to keep dealing with the clutter.

So, whether you’re de-cluttering to sell, or simply wish to bring some calm, organised space to your life, start today. A drawer a day, if necessary.

But tackle the clutter thief before it gets to you.

Success is about showing up

Success is about showing up

Simply getting started and giving something a go is so much more likely to yield results than if you did nothing at all. And so it goes for financial independence…

Really, you have two choices. One – accept that you are not built for the world of investing and be content with paying the bills and maybe preparing a budget. Or, two – acknowledge that your financial life is up to you (and no one else), then get smart, get prepared and take action.

Success is about showing up

Are you doing what you need to do, right now, today to ensure your personal financial success?

We’re not talking about saving here; we’re talking about investing and there’s a difference between saving and investing and it’s important to understand the difference and do both. More about that here.

Many of us manage to save a little money but never quite get to the investing bit. The sad fact is many people put it off because they think it’s too hard.

So here’s a plan to tackle the ‘too hard’ barrier to investing and get you started. Educate yourself.

The exact starting point will be different for everyone when it comes to learning the jargon, but pick an investment type that interests you, for example, stocks or real estate and get going.

Your next steps are to: read books; listen to podcasts; invest in educational seminars, workshops and conferences; read financial newspapers and magazines; talk with your local real estate agents and stock brokers; and talk with other investors. Get the picture?

A word about financial planners. It’s true, there are a lot of good ones out there, but the reality is there are also a lot of not-so-good ones too. Ultimately your money and financial freedom is up to you. Perhaps investing in your own financial education is a better investment than trusting a stranger with your money.

Remembering to make the priorities in your life a priority can often get clouded by the daily grind. Yet if financial independence is a priority for you, then you cannot expect someone else to be the driver of your financial bus to get you there.

Decide on your next step today and do one thing every day that gets you a little closer to financial independence. You’ve probably got more to lose by doing nothing…

Investing and saving

Investing and saving

There is a huge difference between investing and saving and getting clear on this is vital to building long-term wealth.

‘Investing’ means putting money away to generate wealth for the long-term. It is invested in growth assets and never cashed in and spent. If you do sell an investment asset, the money should be put back into other investment assets.

‘Saving’ means putting money away to pay for specific items in the future. Saving is just deferred spending. Once you buy the item you’re saved up for, the money’s gone and you have to start saving all over again for the next item.

Both investing and saving are very important parts of your financial plan, but realising you are never going to build wealth if you spend first, save next and invest last is key. Investing for the future should be your first priority, not your last.

Investing and saving

It’s easy to change the order of your actions so they happen like clockwork each time:

  1. Invest first – have part of your salary paid directly into your investments
  2. Save next – have the balance of your salary paid into a high interest rate account
  3. Spend last – when you need cash to pay expenses, transfer it into your transaction account

By getting clear on what your expenses are, you can set up a regular automatic transfer from your high interest rate account to your transaction account to cover your expenses.

The great benefit of this set up is that you can’t be tempted to spend the money allocated for ‘investment’ it because it’s not readily available.

Make a list of the specific items you want to save for over the next couple of years – such as a home deposit, or overseas holiday – and establish accounts specifically for these items.

Remember, small amounts spent here and there can really add up over time and the same principle applies to investing money to build wealth. Small amounts put away regularly and invested wisely can turn into big amounts.

Do you have a system for prioritising your investment goals?

Sellers, get set, go

Sellers, get set, go

Want some really good news? Local agents say there’s a shortage of properties for sale out there, and plenty of keen buyers. And this means that for those considering selling soon, then sooner may be even better.

In selling your property, have you considered a key force in you getting the listing price, or better? One word: competition. Put another way, if more than one party is interested in your property, then chances are, they may just have to ‘outbid’ each other.

List your property before the Spring rush of properties hit the market – and those waiting for an election to be called – and you may just have more buyer interest. It’s a simple equation. Less properties for sale, equals a greater chance of more interested buyers.

It’s the sellers that typically come out in Spring, but the buyers are always out there.

Popular thought says that many planning to sell their home do so in Spring, when the flowers are blooming, and buyers are brave enough to leave their cave after the long Winter hibernation.

But the reality is actually different. It’s true that many people do wait till Spring to sell their property, but buyers are always ready to pounce for the right property.

With local agents talking about property shortages, this means that if you act now, your leap may just pay off handsomely.

And with the NAB tipping an interest rate cut for August, what better conditions would a seller need to list their property now?

Be prepared to walk that line

Be prepared to walk that line

With more than 100,000 property investors receiving letters from the Australian Tax Office for possible incorrect property deductions this year, it’s crucial you have a plan for effectively managing your tax situation.

Although it may seem tempting to exaggerate a claim, it isn’t worth the risk. Heavy penalties apply to those caught claiming excessive deductions or failing to declare rent.

Astute property investors can adopt a range of strategies to legitimately minimise tax liabilities, while maximising their tax breaks. And the first step should be to arm yourself with trusted experts.

While it may cost upfront, paying for expert advice and services, will pay dividends for years to come. Because, getting your system right – for effectively managing your tax situation –can help clarify and manage the following areas, which can often trip investors:

Be prepared to walk that line

Be aware of what you can claim. Sounds simple, but, are you sure you’ve got it all covered.

Research your tax obligations and claimable expenses. Remember too, that expenses are only claimable when the property has been available for rent. When performing repairs or maintenance, anything completed prior to the property being available for rent will not be tax deductible.

Is it a repair or an improvement? Not all work performed on your property is deductible. If the work involves fixing damage caused by wear and tear, it is likely to be a repair and therefore tax deductible. But when you are replacing old materials with new and enhancing your property, the work is more likely to be considered an improvement and will instead be added to the cost of your property, representing a depreciable asset.

So, if you’re ever in doubt when it comes to walking that fine line of optimising your tax position, seek professional advice early, or even contact the ATO directly for a ruling.

Can the auction highs continue

Can the auction highs continue?

Will the Queen’s Birthday weekend signal a turnaround in auction fortunes?

Last weekend auction clearance rates were strong around much of the country.

Sydney finished up at 78 per cent, Melbourne 71.8 per cent (against 56 per cent on the equivalent weekend last year) and even sleepy old Adelaide managed 70 per cent. Brisbane didn’t fare so well with 45 per cent, although it is generally higher than the sunshine state’s capital has managed in recent months.

Andrew Wilson, senior economist for the Fairfax Media-owned Australian Property Monitors, doesn’t think this coming weekend – traditionally a turning point in the market as buyers head indoors for winter – will bring the cooling effect it normally does.

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The Passive House

The Passive House

A home with almost no energy bills?

From the outside, Passive House homes look like any other. This apartment building is built to Passive House standards and is part of the Vauban community, on the outskirts of Freiburg in south-west Germany.

It might seem impossible to some but clever house design that virtually eliminates ongoing energy bills is possible and happening in some parts of the world. The concept has been most vigorously developed in Germany and is known as passivhaus or in English, Passive House. The first demonstration model was built in Germany in 1991. Homes of this type look like any other; the features that make a home a Passive House generally are not that visible either inside or out.

A Passive House includes passive solar design to optimise the sun and many other clever features that all work together to keep the internal temperature as constant as possible:

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What is a Home Energy Rating

What is a Home Energy Rating?

A home energy rating is the measurement of a home’s energy efficiency.  A home energy rating of an existing home allows a homeowner to understand the strong and weak points of their home with regards to efficiency. It gives people an understanding of the ongoing costs of running a home.

Just in the same way as knowing the fuel consumption of a car or seeing the energy rating on a clothes dryer can help consumers make a purchasing decision, a robust home energy rating can enable a home buyer and homeowner to have all the information they need at their disposal to reduce their running costs.

The report outlines where changes can be made to increase the home’s efficiency and therefore lower energy and water bills. Homeowners can then use the report to determine the most effective ways in which to upgrade the home’s energy efficiency.

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Tips for the Kitchen

Tips for the Kitchen

Don’t open the fridge door too often

In most households the fridge uses more power than any other appliance. To cut energy use, try to limit the number of times you open the fridge door, and never leave it open.

Don’t place hot items in the fridge

Wait until a dish has cooled down before placing it in the fridge. Put cold items back into the fridge after use rather than letting them warm to room temperature.

Get the temperature right

The recommended operating temperature for a fridge is 3°C to 5°C. For freezers, the recommended range is –15 to –18°C.

Switch off the second fridge

If you have a second fridge, consider how often your “drinks fridge” is really used. Turn it on only when you need it, such as for parties or when you have guests staying, and put the drinks you use on a daily basis in the main fridge. A second fridge can cost up to three cartons of beer a year to run.

Keep the fridge well ventilated

Ensure you leave at least 50mm of space at the top, back and sides to improve ventilation and let your fridge work at its best.

Place the fridge in a cool spot

Locate fridges and freezers in cool spots, away from direct sun and other heat sources such as stoves.

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