Page 1

A P R I L

M A R K E T

2 0 1 8

P U L S E

C21


PUBLISHER Century 21 Australia Pty Ltd

M A R K E T

Charles Tarbey Eliot Hastie Chris Gray

Bradley Beer

EDITORIAL ENQUIRIES P U L S E

C21

CONTRIBUTORS

Century 21 Australia (02) 8295 0600

ADVERTISING ENQUIRIES Century 21 Australia (02) 8295 0600

WELCOME TO

THE APRIL 2018 ISSUE OF

C21 MARKET PULSE

DISCLAIMER We have in preparing this information used our best endeavours to ensure that the information contained therein is true and accurate, but accept no responsibility and disclaim all

liability in respect of any errors, inaccuracies

or misstatements contained herein. Prospective buyers and sellers should make their own

enquiries to verify the information contained herein. All information contained in the

CENTURY 21 Australia Pty Ltd website is

provided as a convenience to clients. All links

to property prices displayed on the website are current at the time of issue, but may change at any time and are subject to availability.

For more information on our Privacy Policy please refer to:

www.century21.com.au/privacy


C

O A

N P

CHAIRMAN STATEMENT

R

T I

E

L

02-03

N 2

0

T 1

S 8

FINDING THE RIGHT QUANTITY SURVEYOR

Will first home buyers create a soft landing for

Five questions you should ask your quantity

Century 21 Chairman, Charles Tarbey.

BMT Tax Depreciation, Bradley Beer.

surveyor.

the property market?

AS WE GROW, SO DOES OUR TEAM

08-09

04-05

TECH TO END RENTAL CASH BONDS

New staff to lead Century 21 through period of

World-first technology to end rental cash

Eliot Hastie, Journalist of Real Estate Business

Terri Scheer Landlord Insurance.

10-11

bonds.

growth.

(REB) Magazine.

UP YOUR HOME’S ‘WOW’ FACTOR RENOVATING YOUR PROPERTY

06-07

Inexpensive ways to up your home’s ‘wow’ factor.

Renovating your investment property. Your Empire CEO, Chris Gray.

C21 MARKET PULSE

01

CENTURY 21

12


CHAIRMAN STATEMENT

WILL FIRST HOME BUYERS CREATE A SOFT LANDING FOR THE MARKET?

BY CHARLES TARBEY CHAIRMAN CENTURY 21 AUSTRALASIA

Trends across the March quarter showed that capital city home values were 0.9% lower over the quarter, while values across the regional markets tracked 1.1% higher. Interestingly, regional markets are now consistently outperforming the combined capitals, according to CoreLogic. Six of the eight capital cities

Leaving regional markets to the side

deposit under normal property

first quarter of 2018, ranging from

rising stock levels, falling property

and stagnant wage growth made

recorded a fall in values over the

a 1.8% drop in Sydney values to a 0.1% fall in Darwin.

At Century 21, we are noticing

substantial increases in stock levels compared to the same periods last

for a moment, the combination of

prices and tight lending conditions has many asking whether the

property market – after many years

of incredible growth – is in for a soft or hard landing.

year. Increasing stock levels can

To get a clue as to what the outcome

and that is what we are seeing across

to examine and watch the activity of

often equate to decreasing prices most capital cities.

may be, I believe it may be prudent the first home buyer segment.

market conditions, rising prices

the situation even more difficult for many hopeful market entrants. This issue created a dangerous

situation where some first home

buyers were using credit cards or

personal loans for deposits. Notably, the bank of ‘Mum and Dad’ became

the fifth largest home loan lender in Australia last year.

Increasing prices in regional areas is

In June last year, first home buyer

Recognising this issue, some

time and was a logical next step

many Australian states.

regulations to make it easier for

something we have forecast for some from the property boom that started in many major capital cities. The

new equity that is created around

capital cities often flows outwards in a wave like effect.

levels were at almost record lows in Despite low interest rates, sky high property prices in many markets were making it difficult for this

group to enter the property market. While it is difficult to save for a

C21 MARKET PULSE

02

CENTURY 21

governments introduced new

this group to buy first homes. As

an example, from 1 July last year,

first home buyers in Australia’s two

most populous states no longer have to pay stamp duty when buying


properties below $650,000 in NSW and below $600,000 in Victoria.

These types of changes are likely having a dramatic impact on the activity and participation of this

group in the market; and at a time

when the market may need them the most.

ABS Data shows that the number of loans to first home buyers rose to a

housing market moving forward? So long as first home buyer interest continues to build, interest rates remain low and Governments

continue to incentivise this group

to buy property, first home buyers could play a key role in ensuring that property price growth only moderates or that the market experiences a ‘soft landing’.

five-year high in November, 2017,

I think it remains important for

owner-occupied home borrowings.

the challenges this group faces and

to account for 18 per cent of total Incredibly, in the last quarter of

2017, NAB analysis suggested that first home buyers accounted for

governments to continue to realise

look to do everything in their power to help first home buyers enter the property market.

almost two in five sales in new

Dropping the ball here could be

three in established markets.

the property market and even the

housing markets and around one in What does this all mean for the

detrimental to this group of people, wider economy.

C21 MARKET PULSE

03

CENTURY 21

At the same time, I believe it

remains important for first home buyers to recognise that heat is

coming out of many markets and they should look to be savvy, not

emotional, buyers. This means doing their research, defining a clear

purchasing budget and ensuring that they take into account the potential for rising interest rates.

In the end, all market participants want a stable, sustainable and

strong market. First home buyers are starting to get busy and will play a major role in making this happen.


AS WE GROW, SO DOES OUR TEAM

NEW STAFF TO LEAD CENTURY 21 THROUGH PERIOD OF GROWTH Seven new staff members are joining the Century 21 corporate office to steer it through its next strategic growth cycle. The new staff members will join the Australasian corporate office and will not only manage growth but

also support new franchise owners. Real estate veteran David Baliviera

has been appointed the new regional director of service and training for Australia and New Zealand.

Mr Baliviera brings with him 35 years of experience in a varied

career where he has been an agent, auctioneer, trainer and member of

the Real Estate Institute of Victoria. Amie Stickler, who has extensive management experience, joins

CENTURY 21 as the operations

manager where she will be working in the national network.

Lara Kilborn has been appointed

to a national business and training support role, after over 20 years’

BY ELIOT HASTIE, JOURNALIST, REAL ESTATE BUSINESS

Ms Kilborn has been operating

Chairman and owner of CENTURY

business for over 14 years and has

said of the new appointments: “It

her own training and consulting

previously worked in the franchise sector.

Returning to CENTURY 21 is

21 Australasia Charles Tarbey

is wonderful to have new team members of such calibre and

experience join our network.

Whitney Sutton, who started

“We believe these strategic

Queensland and who will be in

service offering in several ways and

her career with the network in

a national business training and support role.

Isaac Goodland, who brings 18 years of experience to the network, will be taking on a national network development role.

Gabriella Finelli joins the real estate sector for the first time in a national business training and support role.

appointments will enhance our

during a period where the network has attracted some incredible

talented and credentialed sales staff and new franchise owners.”

CENTURY 21, which boasts over

100,000 staff in 78 countries, has

opened new offices in New Zealand,

Queensland, Victoria and New South Wales over the past six months.

Ms Finelli has previously been

the national educator for a global brand, from which she developed

and implemented training programs nationwide.

Internally, Amanda Hall will move from her current position of New South Wales area manager to a national orientation position.

experience as a trainer and marketer.

C21 MARKET PULSE

04

CENTURY 21

The story Several new hires to lead CENTURY 21 through period of growth first appeared on Real Estate Business (REB). Article Link: https://www.realestatebusiness.com.au/ breaking-news/17028-several-new-hires-to-leadcentury-21-through-period-of-growth


Pictured above: David Baliviera Regional Director Service/Training

Pictured above: Amie Stickler National Operations Manager

Pictured above: Lara Kilborn National Business/Training Support

Pictured above: Whitney Sutton National Business/Training Support

Pictured above: Isaac Goodland National Network Development

Pictured above: Gabriella Finelli National Business/Training Support

Pictured above: Amanda Hall National Orientations Manager

C21 MARKET PULSE

05

CENTURY 21


RENOVATING YOUR PROPERTY

RENOVATING YOUR INVESTMENT PROPERTY Renovating can be an extremely successful way to instantly maximise the value of any second-hand investment property. Not only can renovating contribute to a property’s capital growth, but the instant additional equity that

comes from renovating can be used

BY CHRIS GRAY, YOUR EMPIRE CEO

a property’s overall value requires

and with the right advice, you can

if the tiler you’ve chosen has quoted

equity in the first year alone. It can

expert knowledge. How do you know the right price? Will your bathroom

and kitchen really take two weeks as promised – or will it drag out to two months, losing you potential rent

for weeks that you haven’t planned

for? Should you always go with the cheapest quote?

make tens of thousands of dollars in be as simple as new paint and new

carpet, or it can be as complex as a complete refurbishment.

HIRE A PROJECT MANAGER Hiring a project manager to

to help fund any negative cash

oversee larger-scale renovations

a concerted effort to upgrade

think you can save thousands by

can be very worthwhile. You might

flow. Even in a flat market, making your property will also prevent

maintenance for years to come,

giving you a passive, trouble-free investment.

However, there is one glitch – very few property owners know how to achieve these results without any stress. Here’s my advice:

“Very few property owners know how to achieve these results without any stress. ”

managing the project yourself, but this comes with risks. A project

manager can prevent arguments when there are several parties

doing different pieces of the same

job. Not only can a good project

manager take responsibility for

costings and timings, but they can mediate between contractors and

tradespeople, pushing them into gear if they appear to be lagging. They

DO YOUR RESEARCH

can also take care of drawing plans,

It’s easy enough to sand the

P L A N C A R E F U L LY

negotiate with councils for approval,

and call yourself a renovator, but

Renovations require careful

the renovation to ensure the final

floorboards, paint some bedrooms knowing exactly what you need to

do to improve a space and increase

planning and execution. If the

renovations are carried out correctly

C21 MARKET PULSE

06

CENTURY 21

as well as manage all aspects of

product is complete to perfection. While the project manager can


be anyone from an architect,

much a decent clean can increase

professional property investor or

simple re-carpeting job can cost

interior designer or builder, to a

renovator, ultimately they need to be experienced, trustworthy and have

a team of reliable tradespeople they can call on.

KNOW HOW TO ADD VALUE WITH LITTLE OUTLAY If you’re looking to boost the price of your property but don’t want to

the appeal of a home. Likewise, a

as little as $5000 while adding as

much as $10–$20,000 to a property’s value. Finally, instead of adding a

whole new kitchen, why not consider changing the kitchen cupboard

doors and replacing old light fittings, switches and sockets. The aspect of

any home is important and, if a room is well-lit, it can instantly lift the feeling of a dated room.

ABOUT THE CONTRIBUTOR Chris Gray is CEO of Your Empire, a buyer’s agency which builds property portfolios for time-poor people – searching, negotiating,

take on a large renovation project,

renovating and managing property on their behalf. Chris’s team buys 1-2 properties a week

there are several small-scale

and often spends $5m+ a year renovating

improvements you can do yourself to

on others’ behalf, providing a unique insight

instantly lift the value of your home.

into market conditions and buyer and seller

The main thing to remember when

sentiment. Chris hosts “Your Property Empire’

renovating, however, is to know

each Friday on Sky News Business channel, where he interviews various heads of property

what can add value to your property

research companies and major industry figures.

without overcapitalising. Why

Chris is a qualified accountant, buyer’s agent

not try cleaning and painting the

and mortgage broker. For more information visit

inside and outside of your home, for

www.yourempire.com.au, www.chrisgray.com.

instance. A fresh coat of paint can

au and follow Chris on Twitter:

out interiors, and it’s impressive how

https://www.yourempire.com.au/

@ChrisGrayEmpire.

make a world of difference to worn-

C21 MARKET PULSE

07

CENTURY 21


FINDING THE RIGHT QUANTITY SURVEYOR

FIVE QUESTIONS YOU SHOULD ASK YOUR QUANTITY SURVEYOR Are you an investor who’s heard about the benefits of depreciation and have decided to start claiming? That’s great news for your investment Claiming depreciation will help you

maximise the cash return from your investment property. As a non-cash deduction, depreciation is a quick win for investors and requires

minimal effort on the owner’s end. But before organising a quantity surveyor to prepare your tax

depreciation schedule, it’s important to note that not all quantity

surveyors are created equal, and some due diligence is usually

required before forging ahead.

BY BRADLEY BEER, BMT TAX DEPRECIATION

WHAT INDUSTRY QUALIFICATIONS DO YOU HAVE? AND ARE YOU A REGISTERED QUANTITY SURVEYOR?

DO YOU SPECIALISE IN TAX DEPRECIATION?

When choosing a quantity surveyor,

on to maintain detailed knowledge

members of the Australian Institute

Office (ATO) Tax Rulings relating to

AIQS is an industry body that assists

This difference is reflected in a

depreciation specialist can be relied of all current Australian Taxation

of Quantity Surveyors (AIQS). The

depreciation.

its members to maintain compliance with industry regulations and

Australian Standards ensuring a high quality of service.

property investors’ bottom line.

Because of their in-depth industry knowledge, a specialist quantity surveyor can help their clients

In addition to being accredited by

claim more deductions, pay less tax

check that the firm are registered

investment.

Board (TPB). The TPB is the

IS MY PROPERTY TOO OLD?

the AIQS, it is also important to

tax agents with the Tax Practitioners national body responsible for the

registration and regulation of tax

investment property, you should do

the Tax Agents Services Act 2009

with a quantity surveyor.

be registered tax agents to complete

property manager to manage your

agents ensuring compliance with

the same when choosing to work

(TASA). Quantity surveyors need to

deductions, here are five questions

in tax depreciation. Only a tax

it is important to check that they are

Just like you would seek the best

To help ensure you get maximum

Not all quantity surveyors specialise

tax depreciation schedules for investment properties.

and see a greater return on their

Legislation from the ATO states that Since changes to claiming depreciation on second-hand residential properties were

introduced following the 2017

federal budget*, many investors now wonder if they’re still able to claim depreciation for their investment properties.

you should be asking your potential quantity surveyor.

C21 MARKET PULSE

08

CENTURY 21


The bottom line is that it is

year projection of all available

what depreciation deductions are

for easy understanding.

always worth enquiring about available.

Even if your property was purchased second-hand after this date, it

is likely there will still be some

deductions available, whether it’s in

the form of capital works deductions, previous renovations or newly

deductions, and a glossary of terms The quantity surveyor should also be able to provide Excel and CSV

schedule files for accountants and owners for easy importing into

compatible accounting software.

*Under new legislation outlined in the Treasury Laws Amendment (Housing Tax Integrity) Bill 2017 passed by

Furthermore, if your property is

Parliament on 15th November 2017,

your quantity surveyor should be

a second-hand residential property

report, as this often results in higher

longer be able to claim depreciation

owned by more than one party,

investors who exchange contracts on

able to provide you with a split

after 7:30pm on 9th May 2017 will no

deductions earlier.

on previously used plant and

WHAT’S INCLUDED IN YOUR TAX DEPRECIATION SCHEDULES?

DO YOU OUTSOURCE ANY OF YOUR WORK?

deductions on plant and equipment

Some tax depreciation companies

purchased prior to this date and those

Your tax depreciation schedule

will outsource parts of the process of

who purchase a brand new property

needs to be comprehensive and ATO

preparing a schedule to contractors

will still be able to claim depreciation

compliant. This helps you claim

or external quantity surveyors and

as they were previously. To learn more

maximum deductions and also

site inspectors. While not technically

visit www.bmtqs.com.au/budget-2017

covers you in the event of an audit

incorrect or bad practice, this can

or read BMT’s comprehensive White

from the ATO.

be an inconvenience service wise

Paper document at www.bmtqs.com.

and may lead to a greater chance of

au/2017-budget-whitepaper

are working on the one schedule.

To obtain a free estimate of the

installed plant and equipment assets. Now more than ever it’s important

to maximise the deductions you are legally entitled to.

As an example of what should be

included in a schedule, a BMT Tax Depreciation Schedule contains a one page overview of total

deductions, the prime cost and

equipment assets. Investors can claim assets they purchase and directly

incur the expense for. Investors who

errors occurring, if several parties Please note that BMT do not

outsource any of their operations.

deductions available for any

investment property, contact the expert team at BMT Tax

diminishing value methods for

Depreciation on 1300 728 726.

plant and equipment assets, a forty

ABOUT THE CONTRIBUTOR Article provided by BMT Tax Depreciation. Bradley Beer is the CEO of BMT Tax Depreciation. Please contact 1300 728 726 for an Australia-wide service. https://www.bmtqs.com.au/

C21 MARKET PULSE

09

CENTURY 21


TECH TO END RENTAL CASH BONDS

WORLD-FIRST TECHNOLOGY TO END RENTAL CASH BONDS A world-first technology will make renting more accessible to trustworthy Australians. Fintech company Traity has launched Trustbond, powered by leading

landlord insurance specialist Terri Scheer.

Trustbond helps tenants to rent a

home and provide security to their landlord without freezing their savings in a rental bond.

It helps landlords to determine a

person’s suitability as a tenant whilst providing landlords with the same

BY TERRI SCHEER INSURANCE

For example, a traditional cash bond

“Trustbond recognises a person’s

With Trustbond, the tenant might

money back in tenants’ pockets to

might require a tenant to pay $2000. pay a much smaller fee of around

$250 for the term of the lease that

still covers their landlord for $2000, freeing up $1750 for the tenant.

The inspiration for Trustbond came from Traity CEO Juan Cartagena

and his own experience of renting property.

As a new resident of the United States with no local rental or

employment history, landlords were

requesting rental cash bonds of up to $14,000.

level of protection as a traditional cash bond.

Traity measures trustworthiness using online data including

networks, ratings and reviews from

Facebook, Twitter, LinkedIn, Airbnb, eBay and Uber to determine a tenant’s TrustScore.

Once eligibility has been established, the tenant pays an upfront fee that is a percentage of what a conventional rental bond would cost.

C21 MARKET PULSE

10

CENTURY 21

digital profile as an asset, putting

spend on the things that matter to

them,” Traity Country Manager, Will Soutar, said.

“It allows people who may have an unconventional working life, such as freelancing, or who have no

rental history, greater access to the property rental market.

“A traditional bond is a large sum

that is tied up for the duration of the lease. Trustbond allows tenants to

pay a relatively small fee upfront to


cover the protection their landlord

a high TrustScore are eligible,” Ms

“In addition to the financial

“Trustbond gives landlords and

for tenants to show who they really

and review tenants. This encourages

requires.

incentives, Trustbond is a better way are. It’s a way to build stronger relationships between tenants,

landlords and property managers based on trust.”

Terri Scheer Insurance Executive Manager, Ms Carolyn Parrella,

said there were key incentives for

landlords to choose tenants who are eligible for Trustbond.

“Trustbond is based on the premise that good online citizens will also

be good tenants. Only tenants with

Parrella said.

property managers the ability to rate tenants to be responsible and

motivates them to take care of their

landlord’s property, in order to keep their TrustScore high.

“These benefits can be achieved with the same level of protection as a conventional cash bond.

“Trustbond covers the same breaches of a tenancy agreement including

unpaid rent, damage, broken leases

“Owning a rental property is a

significant investment. We want to take the stress out of investing for landlords, support tenants to feel

trusted and remove barriers to entry for renting. Trustbond will do just that.”

Trustbond is being launched in South Australia and will roll out to other states in the coming months.

In time, Traity plans to donate

one in 30 products to people who

have experienced domestic abuse, to help them move into safer accommodation.

and associated costs, without the need to go to a tribunal.

HOW TO START A TRUSTBOND Go to www.trustbond.com: • Prove you are a trustworthy tenant by building your reputation profile

• Replace the cash bond with a Trustbond • Share the Trustbond with your real estate agent or landlord for their agreement

• Use your cash for when you need it most. Visit www.trustbond.com to check your TrustScore and Trustbond eligibility.

ABOUT THE CONTRIBUTOR The information contained in this article is intended to be of a general nature only. Terri Scheer does not accept any legal responsibility for any loss incurred as a result of reliance upon it. Insurance issued by Vero Insurance. Read the Product Disclosure Statement before buying this insurance and consider whether it is right for you. Contact Terri Scheer on 1800 804 016 or visit our website at www.terrischeer.com.au for a copy. https://www.terrischeer.com.au/

C21 MARKET PULSE

11

CENTURY 21


UP YOUR HOME’S ‘WOW’ FACTOR

INEXPENSIVE WAYS TO UP YOUR HOME’S ‘WOW’ FACTOR When selling a home, it is important to remember that not everybody sees your property the way you do. The reality is that some buyers need to be shown the possibilities that exist within a home, inspiring them to imagine themselves living there. In many cases, all it takes is a few simple changes that may position

your home as a place where many

different prospective buyers could be happy.

THE USE OF COLOUR Firstly, the use of the colour white

has the potential to make a marked

painting outrageously bright feature

trick that may work well is to choose

colour throughout your house

to the main function of the room, a

walls, but rather adding pops of

to brighten up living spaces and create an aesthetically pleasing

environment. Things such as flowers, cushions and candles in bright

colours can be inexpensively used to make your home feel up-to-date and modern.

“Minor changes can make such big differences and they don’t have to cost you a fortune”

This helps buyers to see the room in

its primary role, while also allowing them to visualise how their own furniture could be arranged.

also be nice to keep a few touches of ‘home’ as well. Such touches could

include things like plush towels in the bathrooms, fresh hand towels in the kitchen, fluffed up pillows

on beds and even fresh flowers on

the main dining table. The aim

here is to make your house feel like

a home, without actually looking too Relatively minor changes can make such big differences and they don’t

AVOID OVERCROWDING

have to cost you a fortune. These

It may be wise to avoid crowding

In addition to white, a few splashes

rooms with furniture. In the

go astray either. This doesn’t mean

more spacious a room will look. A

of colour here and there may not

with minimal ancillary furniture.

‘lived in’.

using white can create a feeling of

a blank canvas.

arrange this piece as the area’s focus

excessive personal clutter, it can

If your walls need to be painted,

showing off a room as somewhat of

bed in a bedroom for example, and

Whilst it is advisable to remove

difference in any room of the house.

space and freshness, whilst also

one piece of furniture that relates

majority of cases, the less clutter, the

C21 MARKET PULSE

12

CENTURY 21

techniques and many others can be used to enhance your home’s

appeal to prospective buyers, thus

enhancing the prospect of achieving a desirable price for your home.


LOOKING FOR STANDOUT SERVICE? WE HAVE YOU COVERED. Century 21 may be the world’s largest real estate franchise, but our focus is on being the very best. With state-of-the-art technologies and leading industry resources at our fingertips, we have you covered this Autumn. Call us today: 1300 24 21 21

CENTURY21.COM.AU

C21 Market Pulse | April 2018  
C21 Market Pulse | April 2018