Reverse Mortgages

A 'Reverse Mortgage' (equity release plan) is a loan where home equity is converted into cash and specifically designed for people over the age of 63. Essentially the traditional mortgage is flipped and the lender pays the borrower funds via either a lump sum, a regular income or a combination of both. The amount of cash the borrower receives is based on the age and the value of the property, and the borrower retains full ownership of the property and can stay in the property as long the borrower chooses.

The debt, including all interest owed, is repaid to the lender when: 

• The borrower sells the property of their own accord, OR
• The borrower moves into aged care (not required with some lenders), OR
• The last surviving borrower dies

After the Lease is Signed, Make Tenants Feel Welcome.

When you have new tenants moving in to your rental property how do you make them feel welcome? Little things really do go a long way in making a good impression on tenants. It goes without saying that after they have signed the lease the basic need for every tenant is that their landlord is responsive to maintenance calls. But it takes time to build that trust, so what can you do initially to make a good impression? 

Starting off on the right foot, will create goodwill on both sides, tenants are very aware that this is a business for you, so they want to feel that they, as customers, are appreciated. When they feel appreciated they will care for your property like it was their own. So what are some things that you can do?

Property and the Gen Y Crowd

If you are not a Gen Yer yourself, you may think that they are a 'funny' bunch, hard to understand and demanding. It's not that at all, like every generation before them, they have been born at a particular time with particular influences. The influence that drives Gen Y is technology and that determines how they view the world and how they also do business. So their 'needs' in a residence are somewhat different to Baby Boomers. 

Much of the housing industry has been focused on what Baby Boomers like - formal living rooms, dependence on cars and soaker tubs. But Gen Y (Millennials) are not interested in any of that. They want something different, and with an estimated 4.7 million people in the Gen Y group in Australia, it's time to start listening and catering to their needs if you want their business.

Mistakes when Renting out your property.

This was  a great article with good reminders for those who like to self-manage their properties. I found it over at www.zillow.com I thought you might enjoy it. It is an American based article but it still have great information.

Investing in a rental property is a great way to generate income, but it’s not always easy. Renting out your property also involves managing it — and mistakes along the way can end up costing you more money. Although there’s no guaranteed way to weed out bad tenants in your screening process, you can definitely safeguard against future headaches by avoiding these common mistakes owners make when they rent out their homes.

June Article Round Up

We are pretty close to the end of June and the tax deadline is pretty much here, so I hope all that stress is off the table. So now you have a few minutes to spare, you can re-read some of these interesting article I came across in June.

The Economic History of the Last 2,000 Years in 1 Little Graph:

Property Management Scam: Reminder

I very much doubt it's a large problem, but it is always good to be aware. When you deal with a great property management company, it's hard to believe that there are those out there without integrity. We like to consider ourselves one of the great ones, but here's a few key things to look out for if you think you might be involved in a scam.

Now a scam is different to being a bad property manager. A bad property manager will not return calls, will leave maintenance issues lingering and will have poor people skills. A scam artist on the other hand, aren't property managers at all, and see the opportunity to fleece the unwise. The scammer will try and rent a property to potential tenants (sometimes to multiple tenants), collect the first and last months rent, plus maybe some other fees (e.g. pet deposits) then disappear along with your money.

Rating Tenants.

I recently came across a service called ratetenant.com  It is only applicable in the US and Canada, but I thought it was an interesting concept.

What it allows you to do is to search information about potential tenants (both commercial and residential). It allows property management companies and landlords to type in the person's name and find out if they have a good, bad or ugly rental history.  Following on from this, you would update this tenant's history with your own feedback during and after their tenancy. The service is not designed to replace credit history or background searches, but to capitalise on technology to verify information.

3 Key Mistakes when Buying Property

When you invested in property, was it smooth sailing? Did you have any regrets or concerns, or did you make a major mistake? This is aimed mainly at buying your primary residence, but you need to keep them all in mind when you are looking at purchasing investment properties.

It's not uncommon to make mistakes when buying a property, especially when it's your first time out, but a few common mistakes that you can avoid with some forethought are:

Renovate or Move?

There are many reasons to renovate and there are many reasons to move. In general, the goal for most people is to upgrade to a better residence, so that later on you can sell it and make some money. In times of a down market, financial experts tell us to upgrade into a different house when prices are low, but it appears that advice is not always heeded.

When the market looks bleak, potential sellers look at all the costs that are involved - agents costs, marketing and legal fees and the big one- taking a loss on the property. So rather than dive in and sell, or rent it out and buy a new primary residence, more and more people are thinking along the lines of:  'Well this place is not so bad, we can renovate and add that bathroom and bedroom and in the future it will be worth more.'

Article Round-Up

During May I came across some interesting articles and blogposts, here are a few that I wanted to revisit.

Where Students go Real Estate Follows:

 

"According to a recent Jones Lang LaSalle report entitled “International student destinations redefining the world of real estate investment”, the nine top destinations in the world for international students are also tops in terms of being real estate investment destinations for both residential and commercial properties."

Australia had 2 cities in the list - Sydney and Melbourne.