The post Tenancy and vacancy rates appeared first on Infolio.

When i relay my experiences to people i start by saying that” you get what you pay for”.. .. as a start up business you often don’t have the budget or the reputation to lure the people you perceive as being ideal for your working environment but that’s when you put in place a strategy to deal with the growth stages, they will continue to happen along the way so you may as well get working on them early.    In hindsight we should have waited that bit longer, worked through the growth periods until the finances were a little fuller rather than hire someone not quite up to scratch.  I wrote a blog some time ago called “hire slow and fire fast” and that philosophy remains at Infolio.   You know in your heart of hearts if the person you have employed has what it takes, if they aren’t showing promise or the right attitude from the outset then you can’t train that.

At Infolio we have attempted so many different things to try and obtain and retain the right people; we have worked hard at creating a good environment but ultimately the people you employ create the culture so you need to get it right.  Last year we had a mix of people that wasn’t quite right and despite our best efforts it didn’t work and we could see things crumbling, when there is a bad seed no other influences will change what damage can be created… We did things like sending the property managers & admin staff to Aurora Day spa, Long lunches at fancy restaurants, giving all staff their birthday off work etc – none of this helped the culture.   The right people make the culture.

To get that right mix we have employed an interviewing strategy which is commonly used in government – its structured & measurable, we interview the preferred candidate twice and sometimes three times.   Once employed we run through a detailed induction & we set out clear goals & kpi’s so each individual understands what the expectations are, finally – we lead by example.   Work is for business but it’s even better if you like the people in your environment and you can collectively celebrate the wins along the way – it’s this simple mix that seems to be working for us.

So let’s now move to the heading of this little tale and again a trusted mentor gave me this tid bit of advice and its one of the best i have had to date.   As employers it’s our responsibility to train our staff in the manner that meets with the company satisfaction, if your employee has the right attitude then the training part should be relatively easy, if you have the systems and procedures in place your employees won’t feel lost, they will feel secure and start to learn the Infolio way of doing things… as mentioned above – you can’t train for attitude.

The post Hire for attitude and train for staff appeared first on Infolio.

What I found really interesting about this article was that of the 7 main board members of this group only 2 were licensed real estate agents; most of their backgrounds were in finance, mortgage broking, finance broking, economist or personal investor and here they were saying that basically all buyers agents amongst others, should be governed by PIPA. I found this particularly interesting because I am a buyers agents, I am a licensed agent, i am the office in effective control, I am a member of the REIV, my company is a member of the REIV and I along with all of my employees are all registered with the Business Licensing Authority – all of these bodies directly relate to the professional conduct in which we (buyers agents, estate agents & property managers) operate.

There are 2 main factors to consider here… buying property for clients and buying investment grade property for clients. When we are engaged as a buyers advocate to purchase a family home for a particular client our main job is to act as the purchasers representative, to level the playing field between the agent and the purchaser, our other aim is to help our client find property that best matches their criteria and minimise the amount of time our clients’ need to spend looking on their own. Most often when it comes to buying a home there is no element of investment of advice, we find property that matches the clients criteria then we negotiate the best deal possible on their behalf, this task fully falls under the Estate Agents act and is governed by the BLA and if you are reputable you will also be governed by the REIV.

So now we come to investment buying. We are not like many of our competitors who like to be jack of all trades… We have an investment model that we use when purchasing investment properties for our clients, this model is transparent, driven by historical data but by no means do we offer guarantees that it will be the key to financial success, what we do is stick to buying property that we feel will perform well over time we then leave the strategy of financing and financial planning up to the experts in their field and refer our valued clients onto people who specialise in that field.

What I am finding difficult to understand is why PIPA want Buyers Agents to be governed by their group when generally buyers agents don’t offer ‘investment’ advice, they offer property advice which already adheres to the strict codes developed within the industry, that’s why you need to be a sub agent or licensed agent to act as a buyer’s agent – what this looks like to me is a bunch of mortgage brokers & financial planners creating a code to try and make them “appear” to be part of the property industry when they are not – they have not sold property, they have not managed property, they have often not bought property but have decided that they now will as it creates a lucrative arm to their businesses. There may very well may be a place for a group like this to work with those in the industry that do offer financial planning property advice, however the average buyers agent is there to offer advice on buying and buying alone much like a seller offers advice on selling and as mentioned this is already well covered within the real estate industry.

If you are looking for a buyer’s agent you want someone who can negotiate harder than you, who is well connected in the property industry and as such opens up opportunities to view properties with ease or that are un-advertised. You want someone who has been around long enough that they have witnessed market trends and understands different suburbs and what they offer & who’s attracted to them, you want someone who walks the walk and understand property and the people within the industry…. You shouldn’t be selecting a buyer’s agent because they offer to show you how you can purchase 5 properties in 4 years in suburbs you have never heard of. You want a buyer’s agent who can illustrate to you their results on how they have bought property for a fair price, saving their clients personal time, and increasing the value with strong capital growth, has a great tenant or has bought you a family home which you would otherwise never have seen because it wasn’t advertised to the wider market…. That’s what you look for in a property advisor. So what i say to you is be careful as to who is spruking their wares, what is their experience in actual property & negotiation as that is where the true value will be found when you put someone on your team to offer you advice on property.

The post Property advisors or Property investment advisors – what’s the difference? appeared first on Infolio.

Basically 2.6% means there is more property than there are tenants, so landlord and property managers need to be creative and pragmatic in their approach to best to attract and retain good quality tenants.   When vacancy rates are at this level we commonly see people applying for properties then subsequently withdrawing, we often have applicants negotiating on rent or making their application for tenancy subject to some condition, i.e. instillation of an air conditioner, permission to retain a pet and so on.

What can landlords do to protect their interests?

For those with a pending vacancy I recommend the following:

• commence advertising as soon as your tenant gives notice to vacate
• obtain permission from the tenant to immediately start showing the property to prospects
• provide incentives to existing tenant to keep the property is good order for inspections
• arrive at inspections early to open blinds, turn on lights and create an inviting atmosphere
• If the property does not present well then you shouldn’t be showing it to prospects.
• use professional photos and creative, accurate property descriptions to draw interest to your property – you need to stand out amongst all the others available

If the property is vacant you should always consider the following:

• professional internal clean, including windows
• re-paint if required
• new-carpet if required
• updated window furnishings
• tidy the garden and add some colour – first impressions are fundamental to attracting the right people
• if you don’t have heating, cooling & a dishwasher you need to seriously consider one – these are common requests and all new properties now come with them!

If you have tenants in place i recommend you do the following:

• start re-negotiating new lease terms 3 months before the existing contract expires
• always look to keep the rents at market value but if you are looking at a vacancy because of a small increase in rent calculate the cost before perusing that option
• if you feel the rent should go up you could offer an incentive in lieu of this, a new dishwasher perhaps?

All properties will lease at a price but if you want to minimise vacancy you need to be aware about what the competition is offering and stand out from the crowd.

It doesn’t all need to be bad news, this is when the good property managers will stand out form the rest, this is a time when cheap service will rear its head…Strategy, listening to the market feedback and maintaining your property to a high standard are paramount, work to retain a good tenant!

The post Vacancy rates at 3%, what does this mean for landlord’s? appeared first on Infolio.

DONT – request that the leasing agent meet you after 7pm when you finish work to sign the leases because you are too busy during work hours

DO – come to your appointment on time

DONT – assume we sit in the office all day waiting for your arrival

DO – request maintenance in writing

DONT – demand immediate attention or “you will organise you own trades person” for a non urgent matter

DO – allow our tradespeople access

DONT – complain about delays when you won’t let them in

DO – give the trade’s person permission to access the property with a key

DONT – expect the tradesperson to meet you at 7pm when you have finished work & had your dinner

DO – advise us if you wish to sign a new lease

DONT – abuse us if the landlord doesn’t want to give you one

DO – replace the battery in your smoke detector

DONT – leave the battery on the kitchen bench hoping it will find its way into the device

DO – report water leaks

DONT – tell us the mould and mildew didn’t bother you but know you have a moss farm & snails on your wall that needs attention

DO – open your bathroom window when in the shower

DONT – request the landlord wipe down the condensation from your bathroom walls after you have had your shower

DO – request Foxtel if you want it

DONT – tell us that failure to connect Foxtel is our problem because “you are paying good rent”

DO – pay your rent on time

DONT – tell us you forgot

DO – report any maintenance that requires attention

DONT – report 16 globes require replacement from when you moved in 4 months ago – um, really, you lived in darkness for 4 months?

DO – water your garden

DONT – expect that it will happen by itself

The post Tenant Do’s and Don’t s! appeared first on Infolio.

So what are some methods commonly used when an acceptable offer is received:

• Highest & Best – this gives all the agents in the office who have an interested party on a property an opportunity to get their buyer to submit their highest & best offer above the acceptable price.  This is clear and fair.  Basically you submit your best offer and whoever comes in highest or with the most favourable terms will secure the sale.
• In house auction – this is where all interested parties are called into the real estate agents boardroom for a clean, transparent auction.   This is a method commonly used in the Million Plus market.
• Last right of refusal – this is where the person who submitted the acceptable offer in the first instance has last right after all other offers are submitted.
• Phone auction – this is where the agent goes back and forth between (normally 2) parties much like an auction but with anonymity, this is not transparent and not commonly used.

The key is to find out what the agents procedure is before submitting your offer because once you do the wheels are then set in motion and your offer may be entirely different, more tactical if you are aware of what’s to follow.

You should ask the following questions of your agent:

• What is your company procedure should an acceptable offer come in?
• Will i get last right of refusal

Don’t forget that the agent is employed by the vendor to obtain “the highest & best offer” each agent within the company that you are dealing with gets paid commission for a sale, and a sale only occurs if they win – there are tactic’s involved and you should be wise to them so you can put your best foot forward.

The post Tips for submitting offers & understanding the agents prior offer procedures appeared first on Infolio.

These are very good questions and we believe there are some key ingredients to purchasing a property that will continue to grow and perform well even when the economy might be tight.

Location:

select a position that has good infrastructure, trams & trains. Be within walking distance to strip shopping, parks & schools. This type of infrastructure won’t be relocating; therefore there should always be s demand for accommodation near to these things.

The Street:

ideally you want to be located in a quiet residential street, stay away from main roads, railway lines at the rear of your property or thoroughfares. Look for a cozy tree lined location where possible.

Parking:

Tenants and owner occupiers want to be able to park a car off street, it doesn’t necessarily need to be under cover, that’s a bonus but at least 1 car space should be on the list.

Outdoor space:

This is a must, a courtyard or balcony, even a Juliette balcony will do. We have found more often than not there is a difficulty in leasing properties that do not offer outdoor space, so if it’s difficult to lease it will become difficult to sell down the track. Today’s tenant or home owner wants a space to take in some fresh air, enjoy a bbq or to have a pet.

The outlook:

Where possible try to have a nice outlook, overlooking trees or roof tops is lovely but a commission housing block is not – this will detract for both a tenant and an occupier.

The floor plan: This is an interesting one because what suits one person may not suit another, what I can say is that overwhelmingly most people like to have a more spacious open feel to their living than that of separate rooms, that being said the formal dining or separate dining is coming back. The idea it so look for a property that offers some scope to improve or open up if and when time calls for it.

Sunshine:

People love natural light. If you are looking at a ground floor apartment consider where the sun rises and sets, will there be any natural light in the living areas? If you are first floor the same applies however be careful of west facing sun as it may might it unbearable throughout summer and effect the longevity of your tenancies. Of course if you are located in an area like Elwood which is full of plane trees and art deco’s – sunshine can be hard to reach your window, in particular pockets whilst sun is always welcome people will make an exception where location in kind.

Hopefully the above will prove a healthy foundation for your property search and see you profiting from your decisions down the track.

The post Plan for profit! appeared first on Infolio.

So why is property of this caliber sold so secretly?  The main reason would be to tactfully maintain the privacy of the individual stakeholders.   Often-times these people are in the media, high up on company boards, high court judges, media moguls or simply born into families with a long history of wealth.

If above $2 million constitutes the top end then what is the million dollar market?   Well I would have thought it’s the upper middle end and it’s a very, very competitive market.   This is where the double income and 1 child is moving, they want an un-renovated but liveable home in inner Melbourne, particularly along the south eastern corridor where they can rear their family, be close to an array of quality private schools but can still make it into the cbd for work within a 20 minute trip.   These families will eventually renovate but most likely move out shortly thereafter when they find out they have number 2 on the way, they will sell a renovated or partially renovated home and start looking in the $1.5-$2m mark depending on how much growth they see from their previous residence.  It’s this very scenario that has pushed the competition and moved the interest for young families into a price range that was once considered only for the super rich, if you think about this it really does change how and who we consider to be the wealthy, and it does appear to have created a gap between the wealthy and the poor.   If however the above is to be agreed with it also illustrates that regardless of the starting price these inner urban areas will always see growth, regardless of what peaks and troughs are seen in world economics, there is only so much land and so much development that will be allowed for so you either own property within the triangle or not, and if not it may come a time when you can’t, it will become financially impossible.

The post When a million dollars doesn’t get you much appeared first on Infolio.

I’ll venture a guess… You would never dream of driving without insurance, right?  And your home and its contents are covered?

I thought so.

Yet, every day as a financial planner, I encounter people who insure their homes and cars but fail to realise their biggest asset is actually their ability to generate an income.

It’s not entirely surprising because insurance has always been something people either loath or are indifferent to. It’s not as glamorous as buying that shiny red Porsche or a new Louis Vuitton handbag (not many things are!), but it’s a lifesaver if you find yourself in the unfortunate position of having these itemsstolen or damaged.

Likewise, when it comes to your income, imagine if that got “stolen” as a result of illness or injury. It’s not nice to think about, but having your income unexpectedly stop is going to cause a whirlwind of issues for you and your family.  Though the loss of a flashy car or a handbag is a disappointment, the loss of uninsured income can really be disastrous.

Once your sick leave and other leave entitlements run out, do you have enough in your savings to get by whilst recovering? How long could you continue paying your household bills? Would you be able to continue making mortgage repayments? How would you manage day-to-day household expenses like buying groceries?

Ways of Managing an Unexpected Loss of Income

There are number of options available to deal with the loss of income when sickness or injury occurs – good and bad, sensible and not so sensible. You could:

• Ignore theissue altogether. The phrase “it’s not going to happen to me” is fraught with danger. Life is inherently filled with uncertainty and no one plans to have a major accident or discover they’ve been diagnosed with a serious illness (physical or mental). The fact of the matter is that of the working population, 1 in 6 men and 1 in 4 women are expected to suffer a disability from the age of 35 to 65 that causes a loss of six months or more from work.[i]
• Rely on Centrelink or WorkCover. Would you be able to survive on a Centrelink payment of about $450pf to cover your household bills and medical expenses? Or what happens if you get injured outside the workplace? Workers Compensation only kicks in if the injury is incurred at work.
• Self-insure. You could set up a cash reserve to cater for a serious event. Unless, you’re rolling in money, most of us just don’t have this option and it becomes a little impractical.
• Rely on friends or families members. For most people, this option is not ideal either. Not only would it place significant financial strain on ourloved ones, it would leave most of usacutely feeling the loss of our independence and sense of self-determination.

Alternatively… you could:

• Take out income protection (or salary continuance). For the majority of people, this is the easiest, most reliable and most affordable option.

Income Protection Insurance

Income protection insurance does pretty much what it says it does; it ‘protects your income’. You pay your premiums and in the event you can’t work due to sickness or injury, your insurer will pay up to 75% of your regular salary.

You might also have heard the term ‘Salary Continuance’ banded about. This is essentially the same thing as income protection (it allows you to ‘continue with part of your salary’) except the policy will be held in your superannuation fund.

Things to Think about When Selecting Income Protection:

• How long do you want to wait before you receive payment?

Typically you can get waiting periods of anywhere between 14 days to 2 years. When deciding on a waiting period, consider how much of your paid leave entitlements and cash reserves you can afford to use up.

• How long will you need the payments to continue?

Payment periods will vary by the policy you select.  Some policies will cover you for 2 years.  Others will cover you until you reach the age of 65 or even 70.

• Should it be held in super or personally?

The benefit of holding a policy personally is that the premiums are 100% tax deductible.  If you choose to hold your policy in your super fund, you can use the money you won’t be able to access until retirement (i.e. your superannuation) to pay your insurance premiums and protect your income while you work.

• How much will it cost?

This depends on a number of factors, including but not limited to your age, gender, health, occupation, whether you smoke, how much income you want covered, how long you’re willing to wait before payment and how long the payment will continue.

As a general rule, income protection can cost around one week’s salary per year (approximately 2% of your annual salary).

• What’s the Value of Peace of Mind and Stability?

Having income protection in place is all about planning for the unplanned and ensuring your finances will be in order no matter what lies ahead. And, getting your income protected might just be the most important gift you ever give your loved ones. In the event that you become sick or injured,it will ensure your family’s continued stability and uphold their standard of living.

The post Insurance – income & home, what when & why. appeared first on Infolio.

At the Kearney Group, we believe there is no time like the present.  We also believe you don’t have to have a whole lot of income, assets or investment experience to benefit from a little advice.

While a long-term strategic plan will be necessary at some point, consider speaking to a financial planner who offers ‘scalable advice’.  They should be able to help you cherry pick the strategies and services that will provide you with the most immediate value and will introduce you to the world of finance, one step at a time.

So, if you’re just starting to think about your finances or have been wondering for some time whether financial planning is right for you, we’ve got a few tips and tricks that might help you get rolling…

Previous Tips

View Tip 1: “Get Your Debt Sorted”
http://www.infolio.com.au/finance-tips-for-first-timers-2.html

View Tip 2: “Build a Budget & Get a Cash Flow Management System in Place”
http://www.infolio.com.au/finance-tips-for-first-timers-3.html

View Tip 3: “Get Your Superannuation Working”
http://www.infolio.com.au/finance-tips-for-first-timers-4.html

Tip 4: Protect Yourself & Your Family

Know Your Most Important Asset:

What’s your most important asset?  Is it your house?  Or perhaps it’s your car?

Actually, it’s your ability to generate an income.  And, while most people would never think of driving without insurance and have coverage for their home and contents, many people leave themselves one illness, accident or injury away from financial ruin.

Income Protection Insurance provides coverage for lost earnings and ensures your family’s standard of living won’t be compromised by your inability to work.

If you insure nothing else, insure your income.  It might just be the most important gift you ever give your family…

Get It Young:

Lining up your insurances when you’re young provides many benefits:

• You’ll likely receive better coverage
• If you’re healthy, you may be able to avoid nasty exclusions
• Underwriting is less arduous
• You’ll be able to take advantage of Level Premiums making for lower costs over the long run

Inexpensive Insurance:

Did you know that you can use your super to pay the premiums on a wide range of personal and income insurance?  When properly structured, money you won’t need in retirement can be used to protect yourself now and while you work.

For More Information:

• Visit us online: www.kearneygroup.com.au  or speak to our team on +61 3 9428 8822.
• Explore Kearney Financial Planning’s Protection & Insurance Service.

The post ‘Finance Tips for First Timers’ – Tip 4 appeared first on Infolio.