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Buying & Selling Property

10 Guidelines to selling your property

1. Choose your agent
Telephone the Real Estate Institute of your state’s Membership section for a list of REI Members in your area. Ask REI Members to provide you with a marketing plan. (REI Members must abide by the REIQ Code of Ethics.)

2. Establish house price
Your selected agents can use market analysis and comparative sales techniques to guide you on realistically pricing your home. Realistic pricing helps sell quickly.

3. Choose a marketing plan
Your chosen agent can then guide you on the most effective forms of sale, which include auctions, Multilist, and exclusive and sole agencies. REI research shows newspapers and window displays play an important part in the marketing process, as can property Internet sites, such as Realnet.

4. Allocate funds for marketing
The REI recognises and supports the industry “rule of thumb” that sellers should allocate about 1 per cent of the value of the property to marketing. Agents and newspaper advertising staff can then provide you with expert advice on effective advertising.

5. Have documentation to assist listing agent
As the seller, you should have such information as a recent rates notice, title information and perhaps a photocopy of the mortgage document for your agent.

6. Complete minor repairs
Minor repairs should be carried out before the property is listed for sale.

7. Secure a building inspection report
Having a building inspection report from a reputable person assures the buyer that the property has been inspected and that any major faults have been noted.

8. Access to property
Once the property is listed for sale, the agent must have access to the property without having to find the owner and then wait for keys. Lack of access could create a missed sale opportunity.

9. Be prepared for an inspection at any time
Once the agent has access to your property, they may take potential buyers to your property at any time during work hours after telephoning you first. Keeping the house tidy means your property looks its best all the time.

10. Maintain presentation of property
Presentation is not just about keeping the inside of the property tidy, but also about keeping the lawns mown, shrubs tidy and hoses put away. A tidy property is a saleable property.

Prepared in conjunction with the Real Estate Institute of Queensland. www.reiq.com.au

Choosing a loan should not be based interest rates alone

The most affordable interest rates in decades from many financial institutions offers those with a stable income an attractive opportunity to make an investment in the housing market and in their own future.

But one of the traps for the unwary is borrowing too much.

Buyers, whether planning to buy their first home or to buy a more expensive home, must consider exactly what sort of house they can afford.

This involves more than just knowing current interest rates.

Buyers should analyse all the costs, including fixed expenses and regular costs, that may be incurred living in a new house and then decide which home they can afford.

A real estate agent who is a Member of your states the Real Estate Institute can help advise you on what costs are involved.

Even with this information, buyers shouldn’t use the maximum amount that a lender is willing to provide if there is no way to increase repayments should the interest rate increase. Also, buyers are sometimes limited in their options if they want to switch between variable, fixed, and capped loans and further fees usually apply.

There are a variety of bank charges associated with taking out a home loan. These include application fees, valuation fees, mortgage insurance, legal and account keeping fees and an overall fee.

When you are looking for a suitable home loan, be sure to compare the fees charged and services offered by different financial institutions.

When you have established the costs and you know what the monthly repayments on your loan would be, prepare a budget detailing your expenses.

Carefully compare the budget with your income and ensure you have enough disposable income to cover any unexpected expenses.

Prepared in conjunction with the Real Estate Institute of Queensland www.reiq.com.au

Choosing a real estate agent

Deciding which agent will handle the sale of your home is likely to be one of the most important decisions you will make in the selling process.

As with any other professional service, the level and style will vary from one agency to another. But one of the most important considerations when selecting an agent is their profile and knowledge of the area.

One way to establish an agent’s profile is to drive around the area in which you want to buy and look for agencies that actively promote properties.

Once you have established which agencies are active, visit the office to look at their window displays.

It's also a good idea to have a look at Saturday's newspapers and see which agency has the most properties advertised and how effective you think the advertisements are. Do they attract your attention? Are they easy to read?

Most importantly, speak to family and friends, particularly those who have sold property in the same area, and ask them to recommend an agent to you. A good agent will know that word-of-mouth referrals are a good source of business and will take care to look after every client.

Once you have selected a few likely agencies, ask them to outline the services they offer if they were chosen to sell your home. You should remember that those agents who are members of your state’s Real Estate Institute are also bound by the REI’s strict Code of Ethics.

Once you have chosen your agent, you should have them explain to you the various selling methods available.

Whichever method you choose, remember that proper marketing is essential to attract prospective buyers and a well-trained and realistic agent is likely to request vendor-paid advertising as part of their marketing proposal.

Realistic pricing is also important regardless of which selling method you choose.

Prepared in conjunction with the Real Estate Institute of Queensland. www.reiq.com.au

Housing as an investment: build or buy?

With Australians having one of the highest per capita love affairs with property of any industrial country, it is no surprise that many want to invest their money in bricks and mortar.

But the question being asked by many is whether they should build their dream home, buy an existing home, or buy a new home.

Those who buy an established home have the benefit of seeing exactly what the surrounding houses look like and how well they are maintained by the residents.

This is a definite advantage when compared to building a home on a new development, particularly in the early stages, where you may be building your home before the neighbours build theirs.

Choosing an established home also enables you to judge the home for street appeal and potential for improvement based on what you can see.

Usually, the previous owners have already done all or most of the work to establish the home. This makes it easy to judge whether your income will be enough to cover your loan repayments and leave sufficient to ensure you a reasonable standard of living. If it is an older home, you can budget for repairs, re-painting and general maintenance.

For others, the pleasures of stepping into a new home outweigh any work necessary to establish the home, such as gardens, paths and driveways. Floor coverings, curtains, light fittings, turf, fences and the driveway can be included in the buying price.

It is worth noting that those who have bought new, and have the time, can save money on the cost of establishing the home by doing as much of the work themselves.

If you want a new home and don't want to wait to move in, then one way around that is to try and buy a “spec” home: a home that a builder has already built and is offering for sale.

Prepared in conjunction with the Real Estate Institute of Queensland. www.reiq.com.au

How to present your home to best advantage

Having decided on the preliminaries of selling your home - such as which agent and the method of sale - the next most important step is ensuring your home is well-presented.

A well-presented home is often an invitation to a potential buyer that says “buy me”, and may tip the balance in the seller’s favour.

Your agent can advise you on the best ways to minimise any disadvantages and optimise the property’s major selling features. As a rule, the agent is in a better position to view the house dispassionately and recommend how to improve it so it sells quickly and at the right price.

If your home is appealing from the outside, then prospective buyers are more likely to want to see the inside. They will also be more receptive once they cross the threshold.

The outside of your home is like a shop window to your product. Keep the lawn manicured, flower beds tidy and the yard free from rubbish. Sweep leaves off paths and driveways, roll up hoses after use and, if possible, store the rubbish bin out of sight.

Don't forget to clean the windows and curtains, since a light and airy room is more appealing, particularly if outdoor areas and gardens are pleasing.

Repair any dripping taps, loose doorknobs and sticking doors and drawers.

Remember that the kitchen and bathroom are often important areas to many prospective buyers, so pay particular attention to them in any clean-up.

Throw out unwanted items that have been in cupboards, garages or under the home. This helps display the full storage facilities of the property.

If you are expecting an inspection while you are out, always make sure beds are made, open curtains and blinds and leave the home as tidy as if you were expecting guests. If the inspection is in the evening, turn on all the lights to create a bright welcoming atmosphere.

Remember, the agent knows the buyer's needs and will feel more comfortable emphasising the features of the home if you don't tag along.

Other than that, allow the agent as much access to the property for inspections as possible. Your sale may depend on it.

Prepared in conjunction with the Real Estate Institute of Queensland. www.reiq.com.au

Maximise the appeal of your home with a minimum of cash

If the home you are trying to sell needs that little something extra to entice buyers, but you’re a bit short on cash, don’t despair. There are ways of making your property look good with little monetary outlay. Here are a few tips to maximise the appeal of your home with a minimum of cash.

The first thing to remember is potential buyers will be assessing the appeal of your home as soon as they lay eyes on it. Make sure the path leading to your entrance-way is free from debris. Clear it of any weeds and trim back any overhanging branches. Make sure the grass has been recently mown, ensure garbage bins are out of sight and the letter-box is free from copious amounts of junk mail.

The entrance-way should be uncluttered and welcoming. If you Don’t have a welcoming mat, or the one you currently have is looking a bit worn - get a new one. If possible, place a nice plant near your front door. If the door itself looks a bit shabby, give it a new coat of paint. You should be able to sand it back, give it a coat of primer, an undercoat and a topcoat for around $50.00.

Inside, you can spruce the place up in a number of quick and easy ways. Search around some of the discount stores and purchase some prints that will match the rest of your décor. These shops often carry a variety of prints with either rustic wooden frames or vibrant blue frames and usually range in price in from anywhere between $5 to $30.

Plants are a good investment for inside as well as outside. They add life to any room. However, ensure they are healthy looking and are presented in attractive pots. Cheap terracotta look-a-like pots can be bought at just about any big department store or your local nursery. A small or medium size pot should probably set you back between $5 and $10.

Lamps are also a good pick me up for most rooms and are an easy way to add some colour. Another idea to introduce some colour is to purchase a couple of bright cushions to put on a chair or lounge suite.

If some of your floor covering is looking a little worse for wear consider shopping around at some of the carpet stores for remnants or throw rugs. Well travelled carpet areas can sometimes be given a lift by simply purchasing some spray on carpet cleaner from your local grocery store.

For the bathroom, make sure it is as bright and airy as possible. A couple of fluffy new towels and matching bathroom mat and hand towel can go a long way to revamping an otherwise dull bathroom. Even purchasing a new shower curtain can go a long way to enhancing a bathroom.

A simple way to brighten up your kitchen is to buy a nice bright vase and put some fresh flowers in it. Again, check around the discount stores. You should be able to pick up a flower vase for less than $10.

If your kitchen curtains aren’t what they used to be it may be a good investment to get new ones. Ready-made curtain sets for an average size kitchen window can be purchased for as little as $39.95 from your local curtain retailer and can add instant appeal to your kitchen.

For a little cash, some inspiration and a few hours work, you can transform your home to a warm and inviting place.

Prepared in conjunction with the Real Estate Institute of Queensland. www.reiq.com.au

Planning when buying pays dividends

Using a systematic approach to buying a home can save you hours of work and considerable heartache.

If you approach buying systematically, you can also optimise your chances of getting the best deal for your money.

To form a plan, you will need to talk to your lending organisation and establish the price range in which you can buy.

Once the buying range has been established, the next step is to prepare a suburb priority list based on personal preferences. Sit down and consider where you would like to live and for what reasons.

Always remember: “It is better to buy the worst house in the best street, than to buy the best house in the worst street”

You need to think about accessibility to work, such facilities as schools, hospitals and shops according to your needs.

Having drawn up a priority list, buyers should then contact their local Real Estate Institute office for a list of REI members in the suburbs they wish to buy. REI members have access to the latest statistical data and analysis from the REI and will be happy to help buyers seek the property right for them.

Be receptive to professional advice from real estate practitioners but remember that it will be your home and your decision.

By using this approach, prospective buyers can assemble and absorb market knowledge about each of the preferred suburbs or areas quickly.

One last word of advice: a house is worth what the buyer is prepared to pay for it. Naturally, sellers have an emotional attachment to their home and this can sometimes result in overpricing.

So if you like the house, but are not prepared to pay the full asking price, make a realistic offer. You may be pleasantly surprised!

Prepared in conjunction with the Real Estate Institute of Queensland. www.reiq.com.au

Reap the rewards of a well tended garden

The garden in the front of a home is not just a patch of dirt with plants and lawn, but part of the living environment of the home itself.

Too many sellers neglect this important aspect of selling a home and think that potential buyers are only interested in the house itself.

However, a well-tended garden and manicured lawn can make the difference between making a prompt sale and having trouble finding potential buyers.

The home garden is also the first aspect of the home that potential buyers see, so it is vital that the garden and lawns be as appealing as possible.

A beautiful garden can also be inexpensive to establish while other improvements may cost more without providing significant returns.

Planting a number of quickly growing trees or shrubs will give your garden a lush, established look in a relatively short time. Good nurseries can provide advice on the best types of plants for your area and soil types.

Many of the most attractive and functional gardens are designed to complement the shape, colour and design of the home they surround. So give careful thought to the height and type of the trees, shrubs and smaller plants.

If you are going to put down paths or garden edging, be sure to select a tone that will complement the house’s exterior.

When you plan a garden with the resale value of your home in mind, consider future maintenance. Some buyers may be discouraged if too many shrubs or hedges require regular trimming.

A few hours spent in the yard each week can certainly prove to be time well spent when it comes to selling.

At worst, an attractive, well-planned yard ensures your home sells faster than similar homes without one, and at best at a great garden could add considerable value. Don’t forget to fertilize!

Prepared in conjunction with the Real Estate Institute of Queensland. www.reiq.com.au

Renovation gives new opportunities

Buying and renovating an older home can be a great opportunity to own the house of your dreams and add great value to your investment.

Houses that have not been kept looking their best can often be bought and beautifully restored at comparatively little cost.

But remember the best houses to buy may not be those with immediate street appeal. For a relatively small investment, a verandah can be opened up on an older home adding thousands to the value of the property; an opportunity that would be missed had the house been renovated.

If you are thinking of buying an older home, there are a number of checks you should make to ensure the soundness of the house's basic structure.

The most important of these is to establish how well the house has resisted the weather and if there have been any significant insect infestations.

Keep possible problems like this in mind while you choose the home that you think is right for you.

If you are concerned about any potential problems with a property, ask your agent to make out the contract subject to a building inspection by someone you trust.

Select a reputable and knowledgeable tradesperson and to ask them to check the state of the house's structure and foundations.

Be equally careful when selecting the person or company that will do the alterations. Some companies even specialise in renovating older homes.

Ask for a number of quotes as a guide to the costs involved with renovations.

A reputable builder can also help you with applications to the local authority before starting renovations as it may be necessary to lodge your plans with your local council for their approval.

Prepared in conjunction with the Real Estate Institute of Queensland. www.reiq.com.au

Sellers and the improving property market

Recent leading property reports confirm improving buyer demand and sales generally throughout the property market, which should lead to better prices.

For a seller to take advantage of the increased buyer interest and the record low interest rates, remember that you risk the least if you buy and sell in the same market. In other words, don’t wait too long between buying and selling.

For first-home buyers, it is possible to wait too long and miss the opportunity to buy when prices are the most favourable.

With a little research, common sense and good advice, astute sellers can optimise their chances of making the most on their sale and achieving the best price in an upswing for what is often their largest financial asset.

You don't need a crystal ball. It is a question of gaining advice from someone who has studied trends in the real estate market and identifying the right time to make a move.

You can easily get that advice from a reliable and informed real estate agent. Remember, Real Estate Institute members agree to abide by the REI Code of Ethics in their real estate dealings with consumers and can incur penalties for business practices that don't comply with that code.

Identifying the right time to make the move is a little more complicated, but less important to sellers who plan to sell their home and buy again immediately.

Clearly, interest rates provide one of the most crucial influences on housing trends and there is a constant interaction between the real estate market and the money market.

Factors that should be considered when planning your move include the level of building activity compared with pent-up demand, population trends and movements, and interest rates.

Prepared in conjunction with the Real Estate Institute of Queensland. www.reiq.com.au

Sole agency agreements a two-way street

Sole agency agreements sometimes cause confusion among sellers about the requirements of the salesperson.

This confusion often leads to a question being asked about how a seller can get out of a sole agency agreement.

All real estate agents must act in the best interests of their sellers, so the question ideally should never have to be asked.

Owners often feel cornered when an agent “ties” a seller up in a sole agency agreement and then does not perform to expectations.

Sometimes such dissatisfaction is due to the combination of unrealistic expectations and a downturn in the marketplace. The problem is certainly less evident in a buoyant market.

However there are many instances where the complaint is valid. No communication, no feedback, poor handling of the marketing or simply no contact or enthusiasm from the lister.

Service is defined as the act of serving, helping or assisting. Many people forget the true benefits of good service. So where does that leave the sole agency agreement?

The REIQ for instance believes that the sole or exclusive agency (of which auction is one) is best for the seller for several reasons and therefore sees this style of listing as essential to good agency practice. There are obvious benefits to the owner.

One owner, one key, one person to handle marketing and any subsequent contract negotiations. There is an undoubted two-way commitment under such agreements.

What is good for the seller is, without question, good for the agency. The great sellers, the true professionals, already know this to be true.

If a salesperson over services the seller, everything else will happen. The seller’s confidence will be gained, which is absolutely critical at the time of contract negotiation; the listing will probably be held beyond the original agreement period; the property will probably be sold; and further flow-on business will doubtless result.

If an agency principal or their representative at any time considers they are not servicing an owner then it is time to evaluate the situation.

Many agencies have as a policy that they will not release a seller from a sole agency agreement under any circumstances.

Releasing a seller from a sole agency agreement is not always an open and shut case. However there appears to be no sound reason why clinging to a listing out of frustration could be beneficial.

A sole agency contract is still a legally binding contractual agreement and it is therefore in your own interests as a seller to make sure you know your rights and fully understand the terms of a contract.

 

Prepared in conjunction with the Real Estate Institute of Queensland. www.reiq.com.au

Taking advantage of interest rates

Record low interest rates are offering those with a stable income the chance to make a great investment in the housing market and in their future.

Potential buyers consider exactly what sort of house they can afford. This involves more than knowing what the current interest rates are.

With interest rates so low, it is tempting to choose the house of your dreams, which may be on the market for $150,000, and to make an offer for it because the monthly repayments will be low.

But if you are a smart buyer, you will analyse all the costs involved in buying that home. Some first-home buyers fall in love with the “honeymoon” rates of some lending institutions and forget interest rates may soon return to higher levels.

Too many potential buyers approach their banks, ask how much they can borrow, borrow that amount, and then look for a home for that price.

Smart buyers will take into account all fixed expenses and regular costs that may be incurred living in a new house and then decide what they can afford.

There is a variety of potential bank charges associated with taking out a home loan: application fees, valuation fees, mortgage insurance, legal and account-keeping fees, and a set-up charge.

These charges can be considerable. When you are looking for a suitable home loan, be sure to compare the fees charged by different financial institutions.

When you have established exactly what costs your loan involves and you know the monthly repayments, it is a good idea to draw up a budget.

Some first-home buyers buy homes in cheaper outer suburbs or nearby townships and then commute to work each day. However, you may be served better by buying closer to the city and reaping the capital gains that are sure to follow.

This way, you can take advantage of the increasing trend towards inner-and near-city living.

Prepared in conjunction with the Real Estate Institute of Queensland. www.reiq.com.au

Which home loan will suit you?

While lenders are actively competing for the hearts, minds and purse strings of home buyers, the question you as a buyer should ask is: "Which product suits our budget?"

Deciding which loan suits you is an important financial decision. To help you get a clear picture of what each organisation has to offer buyers should list questions to ask.

Finds out what are the options, the interest rates and types of interest being charged: fixed, variable or capped.

If the rate is fixed or capped, find out for how long. A capped interest rate is similar to a fixed interest rate as it will not increase beyond a certain level for a set period. Unlike a fixed interest rate, a capped rate can fall.

You should also see if you can pay out the loan early and, if so, whether there is a penalty.

Also, ask whether interest is calculated monthly or daily. If it is calculated on your minimum daily balance, you will benefit from making weekly or fortnightly repayments.

Be sure to ask about establishment fees and other costs associated with taking out a loan. Remember that these costs vary widely between lenders.

Buyers leave some margin in their loans so that they can make increased repayments should interest rates increase.

Many lending institutions now offer redundancy insurance. This insurance is usually available at reasonable rates and will take care of your loan repayments for a set period should you be made redundant.

Find out what deposit will be required on the sort of home you want to buy. This can vary markedly between lending institutions. You should also know that if you have only a relatively small deposit for your new home, your lending institution might require you to take out a mortgage insurance policy.

Some organisations also offer mortgage offset accounts that automatically use any interest generated to pay off your home loan. Alternately, some lenders allow borrowers to redraw money already paid into the loan.

Prepared in conjunction with the Real Estate Institute of Queensland www.reiq.com.au

Tridential - The Australian Finance Strategists