Negotiating 101

Hopefully you’ve done your research and chosen a top quality agent, so you’ll be going into the negotiation phase of selling your home with an expert. Your agent will use his or her excellent negotiating skills and detailed knowledge of the current market, local area and particular features of your home to drive up your sale price and get you the best result. Given you may have never sold a property before, or only ever do this once every 10 years, it’s great to have that negotiating expert in your corner. Image result for NEGOTIATING IMAGES

AUCTION NEGOTIATIONS

If you’re going to auction, your agent may bring pre-auction offers to you. Of course, you can accept pre-auction offers anytime before auction day, but as your agent will most likely advise, an early offer really has to be outstanding to convince you to accept. Otherwise, you may as well see what open market competition will do for your sale price at auction. If your home does not reach your reserve price at market, then your agent will then negotiate with the top bidders, and any other interested buyers in the same way as private sale negotiations below.

PRIVATE SALE NEGOTIATIONS

If you’re selling your property privately with a fixed price, your agent will bring all buyer offers to you for consideration. Here are 5 top negotiating tips and strategies to help you sift through the offers, and get to the price you really want!

Get it in writing…Buyers may give your agent a verbal offer, but as they say, it’s not worth the paper it’s written on. So if a buyer is serious, get them to commit to their offer in writing, and sign some form of agreement with a deposit. That way you can separate the talk from the walk.

First in, best considered…It may be tempting to dismiss the first offer you get out of hand, because it’s not exactly the price you’re looking for. But this could be the most interested buyer in your home, as they’ve already been shopping around and know your home is “the one”. Good offers usually do come early when your property is fresh on the market, so be sure to consider these first offers carefully with your agent and negotiate seriously, because you may not get that price again.

Everything’s negotiable…It’s not just about the sale price either. You may be able to get closer to the price you want by being flexible on other terms. Does the buyer desperately neeImage result for NEGOTIATING IMAGESd a longer settlement, prefer 5% deposit, or want your fabulous outdoor furniture thrown in as part of the sale? A bit of give and take on your side may get you the price  you want, with terms that suit both parties.

Meet in the middle…The simplest negotiating strategy of all, but often it works. Being prepared to compromise on the price and/or terms and meet somewhere in between could be a win-win for both you and the buyer. It’s easy to get caught up in the emotion of it and refuse to budge, but by giving a little on your side, you could encourage the buyer to move closer to your dream price, instead of walking away.

Know when to move onIf a sale does fall through and a buyer walks away for whatever reason, it can be tough to let go of that price as a seller. Perhaps they couldn’t get a loan, sell their own home, or they saw something they liked better? Whatever the reason, it was not meant to be, so discuss the options with your agent, move on and focus on the sale that will go through this time.

 

 

 

                                                                                      

 

 

 

 

Opening Your Home

Now you’re ready to open the door to a fantastic price for your home – literally! Yes, open inspections are annoying (cleaning every Saturday morning!) but essential, because let’s face it, no prospective buyer is going to offer you hundreds of thousands of dollars for your home without giving it a thorough once over first.

Make a clean sweep… Before inspection day, make sure you’ve done everything you possibly can in the “Preparing your property for sale” section previously. Then give your place one last clean and de-clutter, removing everyday mess like shoes in the hall, the mail piling up, and pet bowls, etc.  It’s also a good idea to put away any small valuables or trinkets, not only to de-personalise the space, but also to avoid tempting light-fingered guests.

Do a walk through… It is always a good idea to walk through your property for a final inspection first, and try to look at it through a buyer’s eyes. Remove anything that makes it look cluttered, but also take care not to make it look empty and unwelcoming. Do you think your buyers will be impressed by what they see? Are you showing off your home’s best features?

Take your temperature… Experience shows buyers are turned off by properties that are too hot or too cool. So, it’s important to air out your house, then get your temperature right, depending on the season and time of day, etc. Buyers should walk in and feel fresh and cool (not cold) if it’s hot outside, or warm and toasty – not sweaty – if it’s cooler.

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Get out of the house… As tempted as you are to hang around and see how the open home goes, it’s best to get lost and leave prospective buyers to it. That way, they can tour your place at their leisure, and talk honestly to their partners and to your agent about what they really think. Don’t forget to take your pets with you too, to avoid that doggy or moggy smell, and also in case any prospective buyers are allergic.

Be flexible with open times…People have busy lives, kids to pick up, meetings that run late, and other properties to view, so it’s important to be flexible with open times so prospective buyers get to see your home too. While your agent will usually schedule a weekend and a weeknight viewing, unexpected inspections can pop up so make sure you keep the place tidy and be ready to duck out for an hour sometimes at short notice.

Welcome the feedback… After the inspection, you’ll no doubt be very keen to hear what your agent and the prospective buyers have to say about your property. Whether it’s face to face, a phone call or a detailed email and report, it’s important to get your agent’s feedback and really listen to what they have to say – even if it’s not always glowing. If you do get some negative responses, try not to get upset or defensive. Instead, talk through it together with your agent and plan how you can address any issues, whether it’s adjusting your price range, changing your marketing tactics, or maybe making a few simple cosmetic changes to improve your property’s chance of selling for a great price.

  • Sourced from REIQ

Marketing Your Property

So you’ve signed up with a great agent, given your place a makeover, and now you’re ready to put it on the market. You and your agent have already agreed on a marketing plan. Here’s how the different marketing tools in the mix can work to make your property stand out to prospective buyers.

Professional Photography

Happy snaps are just not going to cut it when you are selling your most important financial asset. So professional photography is a must, for both online and other media. On photo day, make sure your home is spic and span, the garden is perfectly manicured, all the mess is hidden away, and there are fresh flowers in the vases.  Also try to schedule your agent’s photography on a bright sunny day, and at a time when you know the natural light in your home is at its best.

Signage

Your agent will arrange for a professional sign on your property to let people know it’s on the market. The sign, depending on the size you’ve chosen, will show buyers interior photos, basic features such as how many bedrooms and bathrooms, when it’s open for inspection, and your agent’s contact details.

Online Advertising

Before buyers ever set foot in your home, they’ll see it on their phone, tablet or computer first. Real estate sites such as realestate.com.au are where nearly all buyers start their property search these days, and your agent will no doubt be making the most of these to drive interested people to your door.

These portals allow you to upload video tours, showcase a whole range of photos, features and floorplans, and also track how many people have viewed your property – making them a powerful and essential marketing tool.

Your agent will probably also have their own website where they can show off your home in greater detail, with links back to the major sites.

Social media is also becoming a popular way to market properties more informally and get the word out to a mass audience.

Other Advertising

Printed flyers and floorplans can also capture the attention of local renters looking to buy, or homeowners looking to purchase. Interested buyers still stop to check out real estate agency windows whenever they’re in the neighbourhood.

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  • Sourced from REIQ

Buying While Selling

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Out with the old, in with the new. But which comes first? It’s never an easy call.  Here’s what to weigh up when deciding if you put up the sign, or put up your hand at auction first.

Sell First

  • You can wait until you get the price you’re really happy with for your existing home with no pressure.
  • You can go shopping for your new home knowing exactly how much you’ve got to spend.
  • You’ve got time to shop around and possibly negotiate better deals.
  • You can avoid the hassle and expense of bridging finance – which you’ll need if you end up owning two properties at the same time.
  • BUT if your old home sells faster than you planned, you could face the stress of having no place to live while you look for a new home.

Buy First

  • You can spend as much time as you like shopping around for your ideal next home, instead of feeling pressured to take anything just so you’ll have somewhere to live.
  • You don’t know exactly how much your old home will sell for, so you can’t lock in a budget for your new place.
  • If your existing home doesn’t sell fast enough, you may have to get bridging finance to fund both properties while you’re changing over.
  • You may feel pressured to accept a lower offer as your new home settlement gets closer.
  • You may not get as much as you hoped for your existing property, and have to make up the difference with your savings or a larger loan.

*Sourced from REIQ

 

 

NEW TAX RULES FOR ALL PROPERTIES WITH A SALE VALUE $750,000 AND ABOVE

From 1 July 2017, new tax rules will apply on any property transaction where the market value of the property is $750,000 and above. Although the new laws are aimed at foreign residents, real estate agents must be aware that these new laws also impact Australian residents selling properties above this value.

Australian resident seller/s, if you are looking to sell your property and you consider its market value to be $750,000 or more then you should apply for a clearance certificate from the ATO as soon as practicable to avoid 12.5 per cent of the purchase price being withheld at settlement.

If you are unsure about the ultimate purchase price but there is some prospect that it may sell for $750,000 or above (for example, it is being sold at auction and the purchase price is unknown or it is being sold by expression of interest) you should apply for a clearance certificate from the ATO as soon as practicable to avoid 12.5 per cent of the purchase price being withheld at settlement

How do Australian residents obtain a clearance certificate…A seller who is an Australian resident can obtain a clearance certificate by making an application on ato.gov.au/FRCGW (hyper link). If the seller is automatically assessed as an Australian resident, a clearance certificate will be issued within days of the application however, the process may take longer for more complex applications.

When does the clearance certificate have to be given?…Australian resident sellers must give the clearance certificate to the purchaser on or before settlement occurs to avoid the buyers’ solicitor withholding 12.5 per cent of the purchase price.

What if the seller is a foreign person?…Where the seller is a ‘foreign person’, the purchaser must retain 12.5 per cent of the purchase price and pay that to the ATO at settlement, unless the seller provides a valid “Variation Notice’ in which case the purchaser must remit the amount stated in the notice.

When will the new laws apply?…The new laws will apply to sale contracts (for $750,000 and above) entered into on or after 1 July 2017.

What types of properties do these rules apply to?…All property including, vacant land, residential property, commercial property, strata title and community titles schemes.

Foreign resident sellers…If the purchase price is $750,000 or above and the seller is a foreign resident, you should advise them that 12.5 per cent of the purchase price will be withheld at settlement by the purchaser and provided to the ATO.

Will the REIQ amend its contracts?…Yes, all REIQ property sales contracts (residential and commercial) will be amended to include provisions which reflect the above new tax rules.

**sourced from the REIQ

 

Housing Affordability & Investment Properties…WHAT’S COMING 2017 – 2018

Access to Super for First Home Deposits Individuals will be able to make voluntary contributions to superannuation of up to $15,000 per year and $30,000 in total, to be withdrawn subsequently for a first home deposit. The contributions can be made from 1 July 2017 and must be made within an individual’s existing contribution caps. From 1 July 2018, an individual will be able to withdraw these contributions and their associated deemed earnings for a first home deposit. The withdrawals will be taxed at an individual’s marginal tax rate, less a 30% tax offset. Couples saving for a first-home deposit can access this measure and double the benefit.

Super Contributions from Downsizing – Individuals aged 65 or over can contribute up to $300,000 from the proceeds of the sale of their home as a non-concessional contribution into superannuation, from 1 July 2018.

Travel Deductions Limited – Deductions for travel expenses related to inspecting, maintaining or collecting rent for a residential rental property will be disallowed from 1 July 2017.

Plant and Equipment Deductions Limited – Plant and equipment depreciation deductions will be limited to outlays actually incurred by investors in residential real estate properties from 1 July 2017.

CGT Discount Increased – Subject to various conditions, the Capital Gains Tax discount for Australian resident individuals investing in qualifying affordable housing will be increased from 50% to 60% from 1 January 2018.

Negative Gearing Despite pre-Budget speculation, the negative gearing rules remain unchanged.

** Information provided by: Australian Taxation Reporter **

 

Finance Health Check for Investors

Have you noticed of late significant increases in the interest rates you are paying on your loans?

focus-interest-ratesIf you have, it is due to the governing body for the banks (APRA) directing them to build their cash reserves. It may be time to look at one of the non major lenders.

With increases in investment interest rates and new restrictions on interest only loans, it is becoming tougher to borrow for investment.

In today’s climate of rate rises and banks lower borrowing tolerances it is now even more important to engage the services of a professional mortgage broker and not rely on any one bank for a solution.

Competition among banks has never been greater with large variations in home loan products, interest rates and lending policies.

Some banks will not lend at all to purchase investment properties.

Releasing the equity in your current property or finding the benefits you may be entitled to with different banks could be found by exploring your options with a professional broker. They could find opportunities to help advance your portfolio or streamline your current lending you may not even be aware of.

With the lending markets constantly changing it makes sense to re-evaluate your loans from time to time.

A discussion with a professional mortgage broker who could assist you with all important loan structuring, product selection and interest rates may enhance the performance of your property investment.

If you would like a free no obligation appointment to discuss your circumstances please don’t hesitate to call Tim Hansen from Your Property Finance (YPF Group) on 0413 305 900.

**Written by Tim Hansen, Senior Finance Broker for YPF Group**