Insights into investing: Right Property Group
On Saturday, Right Property Group visited Melbourne's Convention Centre to give an intensive workshop for local investors. Property Observer went along to get some of the highlights.
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State of the markets
Tasmania: Not on the radar for either of Right Property Group's directors, Steve Waters and Victor Kumar, due to the distance from the mainland and sketchy growth potential.
Sydney: Still at around 9/10 on the property clock. Getting in months earlier than the masses can have an effect of 10%. Has another two years of capital growth to go. Falling yield a result of rising property prices, rather than a result of falling rents.
Brisbane: On the 'property clock' where Sydney was two years ago and presents some of the best buying opportunities now.
Melbourne: Heading towards the bottom of the clock, but it's still not the right time to buy. To get a sense of the city and the sentiment around property, count the number of cranes in the sky and keep an eye out for this over time.
Hotspots you've missed out on
Mount Druitt: While both Kumar and Waters were bullish on this area for several years, they are no longer buying much stock here.
Hunter Valley/Newcastle: The Hunter Valley was at its peak six months ago.
A quick sign of whether an area is becoming too hot to purchase into is if the real estate agents are becoming slow at returning your calls and are not as willing to negotiate with you.
Strategy
Investors should look towards new property prices in an area to understand the "new norm" that owner occupiers are willing to pay. If you can buy decent established properties at a much lower price point, there are opportunities here. For instance, in Ambarvale, NSW, house and land packages are selling for $450,000. Established stock on bigger blocks of land can be bought for $370,000.
You must consider reverse-engineering your portfolio. Decide where you want to end up and work the steps backwards.
Loans
Consider fixing soon. If you're looking to re-value your property for refinancing after a renovation the best idea is to have a variable rate, undertake the renovation and then refinance into a fixed loan.
Subscribe to RP Data, and wait for favourable comparables to sell and then appear on the database. This is what many valuers use, and so you want to wait for the records to pop up onto the site.
If you want to read more tips from the day, head to #propertyobserving where we live tweeted the event.
