Local Real Estate Comments from Peter Cooke and the Team at Richardson & Wrench.

> Reducing Property Investment Risks

Owners of investment properties can cut risks and maximise profits by paying careful attention to common mistakes made by novice investors. Sustaining returns can mean charging fair rents. As demand for the need to rent decreases any increases imposed can be important. Many novice investors fail to charge fairly and find themselves faced with vacancies, quick turnovers and lease terminations, all of which are major expenses. Impediments to income need to be avoided. This is why I suggest that owners of rental properties avoid the temptation to manage properties on their own.

Professional managers are aware of local changes to rents being charged and can see that the rent your property achieves is competitive with others. Charging the correct rent keeps tenants happy and sees the premises cared for. This in turn helps ensure that the value of the investment grows over time, year after year. In most areas, the rental market remains tight. Yet vacancy rates can vary greatly from region to region and suburb to suburb.

If you are currently attempting to manage a property without professional assistance, it can pay to enquire about the low cost of professional property management. Self-management can lead to a failure to keep business records and tax matters properly aligned, as few private owners have access to the detailed accounting systems used by professional property management departments.

> Rush on First Home Concessions is Tapering Off

The response to date has been enormous, but with the cut-off point nearing, the rush to qualify for the financial concessions available under the First Home Buyers Scheme is beginning to taper off. The scheme expires on June 30, and while 12,664 buyers took up the opportunity to save in February, this sum is down 500 from the month before.

Buyers have been quick to take advantage of three factors working in their favour. These are (1) lowered interest rates (2) the enhanced first home owner’s grant and (3) lower property prices. The influx began after the Federal Government announced the First Home Owners Boost back in October. This increased the grant from $7,000 to $14,000 for established homes and from $7,000 to $21,000 for newly constructed homes.

Affordability was further enhanced with the NSW Government’s contribution of a $7,000 First Home Owner Grant and a $3,000 New Home Buyers Supplement. Reports from the Housing Industry Association claim that buying a home in Australia has not been this easy in years.