The three property descriptions that first time investors want "outlawed"

The three property descriptions that first time investors want
The three property descriptions that first time investors want "outlawed"

Searching for an investment property or a home loan was not stressful for 76.3% of those surveyed in RAMS’ latest First Time Investor Survey 2014.

However a quarter of respondents said that they still don’t know where to start. There were also a number of pet peeves listed by new buyers.

In particular, the RAMS survey found three common property descriptions that first time buyers detested so much, that they would apparently seek legislative action to never see again.

The top three property descriptions that those surveyed wanted “outlawed”:

  • "Hot Property"
  • "Water Glimpses"
  • "Renovator’s Dream"

Source: RAMS.

According to the survey results, first time investors initially turn to real estate websites (38%) before trying a friend, family member or colleague (24%) and then looking to a real estate agent (23%) for assistance in finding their first investment.

The survey uncovered a majority of first time investors (51%) said that they would prefer researching their first investment property to having dinner with the in-laws (15.4%) or completing a tax return (11.2%).

A majority noted that they were looking for somewhere in a quiet neighbourhood, new appliances and fittings and close to public transport. The main purposes of the investment was potential capital group, followed by current low interest rates and tax benefits.

RAMS CEO Martine Jager said that first time investors are becoming savvier and increasingly using the resources available. However, she noted that face to face expert advice is still one of the most valuable tools.

Despite the lack of stress in searching for a property, 43% noted that rising interest rates are a concern and their long-term ability to pay for the property, as well as bad property management, were areas of worry.

“Despite first time investors being wary of rising interest rates, they do not appear to be overly sensitive to such increases, with their intention to invest only deterred by larger rate rises,” Jager said.

“The survey results showed that interest rates would have to rise by 2% before first time investors would start to rethink their strategy – which means, given recent fixed interest rate cuts by some lenders, even if the rate direction changes suddenly, there could still be at least a year of strong demand left in the Australian property market,” she explained.

“The survey results show that while investing in property is not a taxing exercise, there are still aspects of the search and buying process that are unappealing to buyers.

“It’s not surprising to find that most first time investors cite exaggerations with property descriptions as their biggest pet peeve when trying the find the right property to invest in. After all, buying a property is not just a financial commitment it is also a big investment of your time, and misleading listings can be discouraging and frustrating.”

Jager noted that first timers were mainly looking for cheaper entry points into the market.

“For many, this means buying a modest property in more affordable suburban areas which have good capital growth potential.” 

Jennifer Duke

Jennifer Duke

Jennifer Duke was a property writer at Property Observer

First Home Buyers

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