REINSW Awards For Excellence
Henry Wilkinson of Homesearch Solutions has been judged as a finalist for the 2010 NSW REINSW Awards for Excellence, in the Buyers Agent Category. The winner will be announced in October 2010.
Henry Wilkinson of Homesearch Solutions has been judged as a finalist for the 2010 NSW REINSW Awards for Excellence, in the Buyers Agent Category. The winner will be announced in October 2010.
The start of 2009 was characterised by buyer reluctance and extreme caution in the midst of the global financial recession.
However from around February the lower end of the market ($400,000 to $700,000) was kicked along by the Government’s increased first home owner’s grant and record low interest rates.
Around May/June confidence reappeared in the mid market ($700,000 to $1.5M) and a couple of months after that, the higher end of the market started to show some signs of improvement. As economic conditions in Australia improved and confidence strengthened in financial markets, gains were made across all areas of the market.
Price growth across Sydney was recorded at over 10% across the board in 2009, with higher rises at the lower end of the market and more modest gains in the premium market.
The 2010 real estate year has started strongly, with auction clearance rates across Sydney high – between 70 and 83 %.
As buyer’s agents, we are seeing large numbers of people attending open for inspections for both houses and units. Often there are lengthy queues at the front doors on Saturdays. The number of registered bidders at auctions is also very high, and the bidding is generally very competitive.
The market appears to us to be as strong as the boom of 2002/2003 when price rises were 29% and 15% respectively. Whether the overall gains for 2010 will be at these levels remains to be seen.
Some of the main reasons we are seeing the current boom and increased prices are :
Therefore in our opinion, provided the international economy continues to stabilise, the Sydney residential property market is set for continued strong growth throughout 2010 in all sectors.
Source : Yahoo 7 On the House
Thursday 11th March 2010
Sydney’s house prices have defied even bullish forecasts to post strong gains at the start of 2010, led by the Eastern Suburbs, Inner West and Lower North Shore, with many predicting the momentum will flow through to the rest of the year and into 2011. Buyers are being urged to enter the market now before prices move further away from them.
“What were considered bullish forecasts of ours six months ago have turned out to be on the light side,” said Harley Dale, chief economist at the Housing Industry Association (HIA). “Things are going even more strongly than we have forecast. On both fronts (activity and prices) it’s clear that, yes, we are in the midst of a housing recovery in Sydney.”
According to REX data, Sydney’s median house price rose 5.63 per cent to $525,000 in the past rolling quarter, while the Property Price Index, which factors in repeat sales, rose 3.92 per cent to $523,496 . It has outstripped gains in other NSW cities, including Wollongong where median prices were up 3.7 per cent to $362,950 and Newcastle where prices gained 1.54 per cent to $330,000. Sydney has also outperformed other capitals such as Brisbane where median prices rose 1.32 per cent.
Sydney’s housing recovery follows years of underperformance – the median Sydney price fell as low as $440,000 in March 2009 – after the market was affected by a sluggish local economy and the global financial crisis. But a stabilization of the economy and stock market has restored confidence in the Sydney market.
Henry Wilkinson, principal of Sydney-based buyers agent and property consultant Homesearch Solutions, says people should buy now, rather than wait. “We’re advising our clients to buy early this year rather than later,” he said. “We’re just seeing no sign of any change – unless there’s some world economic difficulty that comes from left of field. If fundamentals stay the way they are we’re expecting a very strong year in growth of greater than 10 per cent.”
Wilkinson said the main factor driving the market is relatively low interest rates. “The official cash rate is at 4 per cent – two years ago it was at 7.25 per cent,” he said. “That’s the main driving factor. Even with interest rates potentially going up a bit, they’re still going to be well below where they were two years ago.” He said there was also a shortage of quality stock in the market. “That seems to be a common problem around Sydney,” he said.
Wilkinson said Sydney’s Inner West has been strong. According to REX, median prices in the Inner West suburb of Birchgrove rose 34 per cent to $1.2 million, while Drummoyne was up 50 per cent to $1.13 million. But Wilkinson says the Eastern Suburbs are recording particularly strong price gains. “It’s the strongest of the market we have seen,” he said, adding the East was rebounding strongly after the GFC and is attracting people because of its access to the CBD and lifestyle including cafes, restaurants and beaches. According to REX data, median prices in Bondi Beach rose 42 per cent to $925,000, while the PPI for Bondi and Bondi Beach rose 8.96 per cent to $772,321.
Nathan Mainhoff of Century21 Ascot Homes in Bellevue Hill in Sydney’s East said there has been an upsurge in activity since Christmas, particularly in the sub-$5 million, with lots of activity in the $1 million to $3 million range. “The Eastern Suburbs is the first to go in and the first out in any cycle,” he said. “The market had a major correction last year and the one before courtesy of the GFC. It fell 18 to 20 per cent and is now finding its way back to what it was prior to the GFC in 2007.” He said there’s still scope for improvement – with the market still to get back to the peak it reached in 2005/06.
John McGrath, chief executive of McGrath Estate Agents, in his recently released Autumn 2010 market review said the bounce back in Sydney’s upper prestige end is continuing. “The recovery will likely be complete by mid-year so this is the last chance to upgrade into homes worth $3 million-plus at a discount to 2007 prices,” he said. “In 2010, the middle and upper brackets should increase as the economy strengthens and executive bonuses re-appear. I suspect we will see the $1.5m to $3m range start to increase strongly.” Mainhoff agrees there is still value at the top end. He says high-net-worth individuals are telling him they believe there is still good buying in suburbs such as Bellevue Hill and Point Piper. According to REX, median prices in Bellevue Hill surged 76 per cent to $1.43 million. Media heir Lachlan Murdoch’s $23 million purchase of the former French consulate, Le Manoir, at 93 Victoria Road, Bellevue Hill, helped boost overall prices.
Homesearch Solution’s Wilkinson said the lower to mid North Shore is also strong, and stronger than the upper North Shore. Mary Curran, sales consultant at Ray White Lower North Shore, says she is seeing increasing numbers of inspections, while there is generally a lack of stock. “A lot of the properties are having offers on them prior to auction,” she said. “Properties on the market last year that weren’t sold have now sold. There are also high investor enquiries. The market has been very flat for a while. We don’t think it’s going to boom, but we think it will be a steady increase.”
Curran said there is a return to confidence in the general economy, which is underpinning the market. “The fact the stock markets have stopped falling means that people are now transacting again – they’re moving; they’re thinking about doing things,” she said. “Before they were just too nervous. There’s also confidence in the rental market from a landlord and investor perspective.” She said many were looking to diversify their portfolio out of the share market and into smaller units around the $500,000 mark.
Curran said anywhere close to the water, transport – including train lines and ferries – is particularly in high demand on the Lower North Shore. “The demographic is primarily a lot of single people. Therefore it’s good for rentals of studios and one and two-bedroom units.” According to REX, median prices in Kirribilli surged 53 per cent to $1.35 million, prices in Lane Cove North were up 27 per cent to $621,000 and McMahons Point rose 50 per cent to $935,000.
The HIA’s Harley Dale says the question is now whether Sydney’s price gains are sustainable. “Will we be talking about this kind of recovery in 2011? I think we’re at the crossroads at the moment,” he said. “There’s enough momentum that 2010 will be a better year than 2009 was. The next two to three to four months of information on housing will give us an idea of whether we will see a sustained recovery. It’s touch and go at the moment.”
But Dale is optimistic that prices can keep rising. “Momentum and confidence are very important to the Sydney market – two things Sydney has been lacking since around 2003/2004,” he said. “There’s more confidence on the ground from the building community than there has been for some time. There certainly seems to be a recovery underway in home values which is very good for household confidence. What I sense from talking to people on the ground is that sentiment’s improved and that’s a vital first ingredient.”
Source: Press Release 25 June 2009, REINSW
Sydney’s rental vacancy rate is at its lowest level in 12 months, according to the latest data released today by the REINSW.
In May 2009, the percentage of available rental properties across Sydney slumped by half a percent to 1.0%.
“This is the lowest result recorded since May last year and is extremely disappointing,” said REINSW President Steve Martin.
In May 2009, the percentage of available properties in suburbs more than 25 kilometres from the CBD fell 0.4% to 1.0%.
In Sydney’s ‘middle’ suburbs, between 10 and 25 kilometres from the CBD, rental vacancies fell 0.2% to 1.5%.
The only parts of Sydney not to record a fall in available rental properties were suburbs within 10 kilometres of the CBD, which recorded a vacancy rate of 1.4% – unchanged compared to the previous month.
“These results are a double-edged sword: great news for landlords but grim news for tenants,” said Mr Martin.
Those living in fear of world financial doom may be in for the surprise of their life — their home could actually be defying the crunch.
Australian Financial Review’s Smart Investor Magazine has assembled the house price bible, identifying 700 of Australia’s best-performing suburbs.
Victoria’s hottest suburb is Lyndhurst, which has risen 75 percent — raising the average home’s worth to over $300,000.
And defying the doubters in Queensland is Agnes Water, which has shot upstream by almost 70 percent — making an average unit worth about $515,000.
Is your suburb set to skyrocket?
Property Hot Spots – by state:
For example, a home in Sapphire Beach, NSW has gone up by an average of 79 percent in just 12 months — meaning some people have earned almost a thousand dollars a day in the past year.
A number of important changes to strata laws in New South Wales came into effect on 1 August 2008.
The changes were introduced by the Strata Management Legislation Amendment Act 2008, and their purpose is to enhance the operation and management of strata schemes.
The five areas of change are summarised below.
This amendment makes it clear that all on-site caretakers are covered by the Strata Schemes Management Act, even if they use a different job title such as ‘building manager’.
The changes to the caretaker laws make it clear that anyone carrying out the role of an on-site caretaker is subject to the those laws, regardless of whether they are called a caretaker or use a different title, such as building manager or resident manager.
This change is important, because the Strata Schemes Management Act sets out strong protections for strata owners in relation to caretaker contracts. The amendment will ensure that a caretaker cannot avoid the requirements of the Act simply by using a different job title.
Caretakers may be employed to assist the owners corporation in carrying out its functions. They do not have the same delegated functions as a licensed strata managing agent.
Caretakers may assist the owners corporation in:
Caretakers may not enforce by-laws or carry out other similar functions of the owners corporation. A person is not a caretaker if they exercise their functions on a voluntary or casual basis or as a member of the executive committee.
By-laws about parking vehicles on common property
This amendment prevents by-laws giving a right to park on common property being made during the initial period of a strata scheme.
An owners corporation in a strata scheme may make by-laws giving rights to an owner for the exclusive use of, or special privileges in relation to, an area of the common property. However, these types of by-laws cannot generally be made during the ‘initial period’ of the scheme, that is, the period from the commencement of the scheme up until one third of the unit entitlements have been sold.
The Strata Schemes Management Act contains an exemption allowing by-laws to be made in the initial period authorising an owner to park a vehicle on the common property. This has led to disputes when buyers later move in and find that the developer has given themselves or someone else the right to permanently park in visitor parking spaces. This exception has been removed by the amendments so that such by-laws can only be made after the expiry of the initial period when other owners besides the developer are able to vote on the proposal.
Proxies and power of attorney
These amendments will protect strata buyers from terms in sale contracts which require them to give proxy voting rights or power of attorney to the developer of the strata scheme.
Under the legislation, owners in a strata scheme who are entitled to vote in an owners corporation meeting can appoint a person as proxy to vote on their behalf. Proxy appointments enable owners who are unable to attend meetings to have a say on issues under consideration.
A proxy appointment must be made on a prescribed form and remains in effect for 12 months or two consecutive annual general meetings. The owner making the appointment can, if they wish, specify how their proxy is to vote on any matter. Alternatively, an owner may allow the proxy full discretion in the use of their voting entitlements. An owner can revoke or replace the proxy appointment at any time or may attend a meeting and vote in person, thus overriding any proxy they have issued.
However, some developers seek to avoid these requirements by making it a condition of the sale of a strata lot for the buyer to give the developer unconditional proxy voting rights or a power of attorney. Owners who have signed such contracts could risk having action taken against them for breach of contract if they attempt to exercise their right to vote at an owners corporation meeting or make a change to their proxy.
To provide greater safeguards for owners’ voting rights, the legislation has been amended so a developer or a person connected with the developer cannot make use of a proxy voting appointment or power of attorney that was obtained by a condition in a contract for the sale of a strata lot, or another related contract or arrangement.
In the case of proxy voting appointments or powers of attorney in place before 1 August 2008, these remain in effect. However, if the proxy appointment or power of attorney was obtained by a condition in the sale contract and is renewed or extended on or after 1 August 2008, that appointment or power is invalid.
The amendment does not stop an owner from giving proxy voting rights to anyone they choose – including the developer or caretaker if that is what they wish. However, the provisions of the Act apply and the owner can cancel their proxy at any time or override it by attending a meeting to vote in person without fear of legal action or penalties.
Executive committee members – disclosure requirements
Executive committee members will need to disclose any personal, business or financial connection they have with the developer or caretaker.
The executive committee of the owners corporation is a group which represents owners or owners’ nominees. It administers the day-to-day running of the strata scheme and is elected at each Annual General Meeting (AGM). The owners corporation may limit the matters that the executive committee may decide and the Act contains various matters that must be decided by the owners corporation in a general meeting.
The owners corporation has the authority to dismiss some or all of its executive committee. An owners corporation may also employ a strata managing agent and/or caretaker to carry out some or all of the functions of the executive committee. If a vacancy occurs during the term of the executive committee, the owners corporation must appoint a person to fill the vacancy until the next AGM.
In response to complaints about executive committees being ‘stacked’ by friends or associates of the developer, the Act has been amended so that a person nominated for election to an executive committee must disclose any financial, business or family connections they have with the developer or caretaker. The disclosure will need to be made at the meeting at which the executive committee is to be elected before the election is conducted and the disclosure must be recorded in the meeting minutes.
Once elected, members of executive committees will also have to disclose any connection they subsequently develop. The disclosure must be made in writing to the secretary of the executive committee and placed on the agenda for the next general meeting. If the person is the secretary, the disclosure is to be made to the chairperson of the committee. A person being appointed to act in the place of an executive committee member must also disclose any connections they have with the developer or caretaker. This disclosure is to be made in writing to the executive committee before the appointment.
However, the disclosure of a connection with the developer or caretaker does not prevent an executive committee member from continuing to hold their position on the committee. Equally, the disclosure of a connection between an executive committee candidate and a developer does not prohibit or prevent the candidate from being elected to the committee.
This measure will enhance the transparency of executive committee elections, and will enable the other owners to take candidates’ association with the developer into account when voting on membership of the executive committee or when voting to remove a member of the committee.
Source : NSW Office of Fair Trading www.fairtrading.nsw.gov.au
The alternative to Private Treaty is sale by Auction. This is where a property is offered for sale to the highest bidder on Auction Day. The property will usually be open for inspection for around 3-4 weeks before auction day. It is important that all due diligence (ie. Checking the contract, building and pest inspections, strata reports etc) be carried out before the auction day, as unlike Private Treaty, once the hammer falls, the property is sold and there is no cooling off period. A deposit, usually 10% is payable after the auction at the time of signing the Contract of Sale.
If a property passes in at auction and you are the highest bidder, you normally have the first right of negotiation with the vendor (or agent).
It is also possible to buy a property prior to auction, simply by getting “Offer & Acceptance” and following the due diligence procedures as shown above in Purchasing by Private Treaty. After successful exchange the property auction will then be cancelled. Remember also that there is no cooling off period if you buy pre-auction.
There were substantial changes brought about in relation to dummy bidding & auction bidding registers by the reformed Property Stock & Business Agents Act (2002).
These New South Wales laws now allow for only one dummy (vendor) bid at a property auction, which must be announced when made, and in practice is usually done by the auctioneer. When introduced there were fears that instead of the selling agent’s past practice of employing professional dummy bidders to go from auction to auction, vendors would continue to have family, friends & associates to do the dummy bidding for them, as they also have in the past. However the Australian Competition & Consumer Commission (ACCC) has since stepped in and added weight to banning the practice of dummy bidding across Australia, by promising fines of up to $1.2 Million for real estate companies, and up to $220,000 for vendors and individuals. The combination of these laws appear to have made a marked difference to the performance of auctions.
A major concern from buyers about the new Bidding Register is that of confidentiality. Regardless of the Privacy Act regulations prohibiting selling agents from using the register information for future marketing, they will have records in their office of the auctions that a buyer has attended, and therefore a clear idea of their budget and other information.
One way around having your name disclosed on the bidding register is to employ a Homesearch Solutions to do the bidding on your behalf, by giving us a strictly limited Power of Attorney. Under these circumstances we will only have to put our name on the register and not the actual buyer’s, which will maintain confidentiality.
The terms of the Power of Attorney can be as specific and limited as the buyer wants, such as keeping it to a particular property on a set date, and also be subject to a separate letter which states the bidding limit.
People that may be inclined to use this system are: buyers who have made rejected pre-auction offers and who want to remain anonymous to the selling agent at the auction, high profile community members, those intimidated by the auction room, and also people concerned about selling agents having access to the register.
A Private Treaty sale is where a property is listed with a purchase price and is not subject to an auction. It is up to the purchaser to negotiate a mutually acceptable price with the selling agent or vendor (owner of the property). When a price & the sale terms are agreed you are said to have “offer & acceptance” to buy the property. The purchaser is then usually given a short period of time in which to conduct “due diligence” (unless done prior to the offer), which includes checking of the Contract of Sale by a solicitor or conveyancer, conducting building and pest reports, and undertaking strata inspections (for apartment purchases). When the purchaser is satisfied it is time to sign a copy of the Contract of Sale and pay a deposit (usually 10%, but can be negotiated) for the property. The vendor also signs a copy of the Contract of Sale after which “exchange” occurs. This basically means forwarding the purchasers signed Contract of Sale to the vendor’s solicitor or conveyancer and the vendors signed Contract of Sale to the purchaser’s solicitor or conveyancer. Once this has occurred the property has been officially sold, and until this has occurred there is always a risk of gazumping taking place (where another purchaser offers a higher price for the property which is accepted by the selling agent or vendor).
There will usually be a cooling off period during which time the purchaser can effectively terminate the Contract of Sale. This is usually 5 days after contract exchange, but the purchaser must pay the vendor 0.25% of the agreed purchase price as a penalty. If the cooling off period is agreed to be waived at exchange then the solicitor/conveyancer must sign the 66W Certificate and attach it to the contract.
Settlement will usually occur 42 days (6 weeks) after exchange, but this is negotiable between the vendor and the purchaser. At settlement all remaining monies are required (ie, purchase price less deposit & other adjustments).It is important to take into account other “hidden” costs of purchasing a property which may be required prior to settlement, at settlement, or shortly afterwards.
You will not be able to bid at an auction of residential and rural property in NSW unless you give the selling agent your name and address and show proof of your identity. Your details will be recorded by the agent in the Bidders Record and at the auction you will be given a bidder’s number. Registering for an auction does not mean you must bid. Registering simply gives you the right to bid.
If you are bidding to buy the property jointly with another person, for example, a spouse or partner, only one of you needs to register.
You need to register if you are bidding for another person or a company, and you need to show the agent a letter of authority from them, authorising you to bid on their behalf. This also applies if you are bidding on behalf of someone on the telephone.
If you are bidding for another person the letter of authority must include the person’s name, address and the number on their proof of identity (eg. driver’s licence).
If you are bidding for a company the letter of authority must be on the company letterhead and the ABN will be recorded in the Bidders Record as the company’s proof of identity.
To register, you must present a card or document issued by government or a financial institution, that shows your name and address, for example:
If you do not have this kind of proof of identity, you can use two documents that together show your name and address.
One must show your name and be issued by a government or financial institution, for example:
The other must show your address, for example:
You can register with the selling agent at any time prior to the auction, such as when you inspect the property, or on the day itself.
If you pre-register, you will still need to show the agent your proof of identity on auction day. The agent will then give you your bidder’s number.
The agent will write your name, address and the number of your proof of identity in the Bidders Record and, if you are bidding for someone else or a company, their name, address and proof of identity details. The agent will then give you your bidder’s number, which must be displayed when you bid.
If you arrive after the auction has started and wish to bid, you will need to quickly find the agent and register or present your proof of identity, if you have pre-registered.
If you need to make a bid immediately, hold up your hand to let the auctioneer know you are going to make a bid after you have registered.
As soon as you have a bidder’s number, the auctioneer can accept your bids. Return your bidder’s number to the agent after the auction.
The agent is not permitted to show the Bidders Record to anyone, including the property owner. Only an authorised person from the Office of Fair Trading is permitted to see the Bidders Record.
The agent must store the Bidders Record securely and cannot use it for any purpose.
This auction is being conducted under certain conditions that are set by law.
The auctioneer will have these conditions on display before the auction so that you can read them. The auction conditions include:
If you are the successful bidder, you must sign the sale contract and pay a deposit on the spot, usually ten per cent of the purchase price. There is no cooling-off period when you buy at auction.
After the exchange of contracts, your solicitor or conveyancer will carry out various searches on the property. Your solicitor and the seller’s legal representative will then arrange for settlement at which time you must pay the balance of the purchase price.
It is illegal to make dummy bids at an auction.
The seller of the property is entitled to have one bid made on their behalf by the auctioneer. When the seller’s bid is made the auctioneer must announce it as a vendor bid.
If you make dummy bids for the seller, you may be prosecuted and fined up to $55,000. The property seller who asked you to bid can also be fined up to $55,000, as can the agent and the auctioneer if they were involved in the arrangement.
It is an offence to collude with someone to interfere with free and open competition at the auction. This offence carries a maximum fine of $55,000.
A co-owner, executor or administrator or someone bidding on their behalf, may make more than one bid to purchase the property as long as:
From NSW Office of Fair Trading Website www.fairtrading.nsw.gov.au
If you want to buy a home, land or investment property you’ll have to sign a sale contract. The legal work involved in preparing the sale contract, mortgage and other related documents, is called conveyancing. It’s possible to do your own conveyancing, however, most people get a licensed conveyancer or solicitor to do the work for them.
Exchanging sale contracts is the legal part of buying a home. Before exchange, the agreement is usually just verbal and not binding. Up until you exchange contracts either you or the vendor have the right to change your minds.
After you have discussed the contract with your solicitor or licensed conveyancer and all the proper inquiries have been made, you will be ready to exchange contracts. There will be two copies of the sale contract: one for you and one for the vendor. You each sign one copy before they are swapped or ‘exchanged’. This can be done by hand or post and is usually arranged by your solicitor, conveyancer or the agent. If the agent is handling the exchange, you must expressly authorise them to do so.
At the time of the exchange you will be required to pay a deposit, usually 10% of the purchase price. Following exchange, you have a financial interest in the property so it’s wise to get it insured.
Note: A contract has not been made and is not legally binding before the exchange of contracts and the payment of a 10% deposit.
When you buy a property in NSW there is a five business-day cooling-off period after you exchange contracts. During this period you have the option to get out of the contract as long as you give written notice. The cooling-off period starts as soon as you exchange and ends at 5pm on the fifth business day.
A cooling-off period does not apply if you buy a property at auction or exchange contracts on the same day as the auction after it is passed in.
You can waive the cooling-off period by giving the seller a ‘66W certificate’. This is a certificate that complies with Section 66W of the Conveyancing Act 1919. The certificate needs to be signed by your solicitor or conveyancer.
If you use your cooling-off rights and withdraw from the contract during the five business-day period, you will have to pay the seller 0.25% of the purchase price. This works out to be $250 for every $100,000.
Sometimes, there are more buyers looking for homes than there are properties on the market. This is called a sellers’ market. In this case, you may want to organise a quick contract exchange. This way you can reduce the possibility of someone beating your offer and get your building and pest inspections done during the cooling-off period. You will still be able to back out if there is a problem. However, it is important to have the contract checked by your solicitor or conveyancer before you sign it.
It is possible to waive, reduce or extend the cooling-off period with the consent of the seller. If your solicitor or conveyancer has examined certificates from the appropriate authorities, a pest and building inspection has been done and your finance has been approved, then deciding to waive the cooling-off period could make your offer more attractive to the seller.
Settlement usually takes place about six weeks after contracts are exchanged. This is when you become the legal owner of the property. The balance of the purchase price and other adjustments are paid on this date.
From NSW Office of Fair Trading website www.fairtrading.nsw.gov.au
Homesearch Solutions is owned by
Homesearch Property Group Pty Ltd – Licence No. 1721053
Office address : 119 Willoughby Rd Crows Nest NSW 2065 Australia
Phone : (61 2) 9958 4815
Mobile : 0409 105015
Mobile from outside Australia : (61) 409 105015
Email : email@example.com
Skype : henrywilkinson1