How to Cash-in and Cash-out
On The Property Boom in Melbourne
Sell, sell, sell is all we hear day in day out. It’s the perfect time, it’s the right time..this is it? But who is buying property in Melbourne?
YOU? Your friends? Your neighbours? Your kids? I don’t think so…do you!
But someone is raising the prices of our homes to the point..well I am no Nostradamus – but soon to the point of no return for most. Meaning – most people will be so far behind the eight-ball, they cannot catch a bus back to the pool table, let alone play the game. If you know what I mean- financialy. Beyond their purchasing capabilities. Leaving many and our children on the rental rat-wheel forever.
What got me thinking about this subject was only this morning I got a phone call from a local real Estate Agent.
She was pleasant enough, although not sure how she got my private number, so I listened. The pnone call went something like this: “ Hi this is Jay from your local ACME real estate . We have an overflow of buyers in your area and was wondering, if you knew of your friends, relatives or next door neighboiurs that wanted to sell!? You see, we have so many buyers wishing to purchase a home like yours, but do not have enough stock.”
Even Being Great Is No Longer Good Enough
She represented a good and well known Real Estate franchise in Melbourne, yet she still had to pick up the phone and cold call to list my property. Because the compettition for listings is so great, agents have to re-invent themselves in order to snare that listing.
Some offer nibblies at open for house inspections. Others offer champagne for all those attending. Others willing to get your garden spruced up – a myriad of inventive marketing ideas.
That’s all fine –it seems – for those that have a few investment properties to sell or those thast are debt free. But what about those that got taken in by the by the ‘sell, sell, sell’ bug and have fanciful illusions of becoming millionaires. Mu answer is – be careful. Believe only half of what you hear and nothing of what you see – there are magicians everywhere.And you do not want to catch yourself short when having to shelve out more money when upgrading to a new home.
Three Secrets about Real Estate Wealth I Discovered 40 Years AGO
I was lucky, if there is such a euphemis for luck – that I bought my first home some 40 years ago. Staright out of Uni, first job – I saved like crazy for a deposit. With a bit of help from the Government (First homr buyer scheme ) and a small loan from mum and dad – I was starting to feel like a home owner.
Sure, I worked hard, saved, I even had it leased to help me pay the mortgage – but I got the property bug. Now mind you, I was not on a huge salary, but I knew how to save and invest.
Two yeqars later we had a mimi boom in Melbourne. I sold my house for a 50% profit and used the money to purchase another home in a better location. I was debt free and had a few thousand left over. So I invested in a vacant block of land.
The moral of that story wqs, I wish I waas a bit more financially savvy ( I did teach myself in the process though) I would have bought 2- 3 more properties instead of buying a delapidated business.
Then I met a real Estate Gury who taught me these 3 secrets I am about to share with you.
He said: “My boy, forget position, position, position. You will be paying top dollar for that. What you need to know is to buy in a market that is riddled with the 3 D’s:
- Divorce and
Wow ! Think about where most fortunes are made. When you buy high and sell high, or when you buy low and sell high? If someone has already applied the profit margin to the property by adding renovations and extras – there is the profit. Gone !
It took me ages to understand it.- but from then on – I looked for opportunities to buy property where 3 D’s reigned surpreme.
Brighton-ism—Is it Becoming Hot
If you are buying today, there are hot areas and suburbs. Most properties are so done up that they make lady GAGA look bare. Houses with massive bedrooms, even bigger open living spaces. The Master Chef designed modern kitchens, the outdoor verandahs, patios, awnings Melbourne stle, the swimming pools and on it goes on. You see, someone paid for all those upgardes and renovations and now you are going to.
The moral of that story is -don’t pay for someone elses handiwork unless you really must. Reap the profuts yourself.
If you are purchasing a house for yourself to live in – then that’s something different and another stategy has to be employed here. But if you have an investment to sell , this could be a good time to sell inmelbourne. Everyone is telling us to. There are heaps of bidding customers who are virtually knocking themselves out to get yopur place. So listen up.
How Not to Get Zapped Like a Mozzie
Few things to pay attention to if you are selling your investment property:
- How much did you originally spend on purchase
- Did you use it as tax leverage
- Did yo complete any of the improvements or just did the basics ( lick of paint and a steam clean)
- If you did any renovations did perform the minimum or went all aout
- Did you have renters that helepd you pay for the mortgage
- How much did you pay of the mortgage
- How much did you – actually dig into your finances to pay for this investment
- If you did any renovations, do you have all the certificates and compliances.
- Are there any external chattels including awnings Melbourne style that will increase the price
- Is the peoperty good enough to sell or is it in pristinne condition.
All terrific questions. But if you are flipping propeties to make quick profit then you only need to know this:
Spend as little as possible of your money on upgrades and repairs. The rest – including the price will take care of itself. At least that what the Finance Guru’s and Real Estate Agents Tell Us !!