Reality Bites

PPG_Aug_Blog_image 3_reality TV showsReality TV shows about DIY renovating are BIG at the moment! The Block, Top Designs and The Renovators are all ratings winners. These programs have an uncanny ability to draw us in night after night until we feel just as fretful and exhausted as the quirky contestants themselves. But we just can’t get enough!

So how authentic are these shows and what impact are they having on real Australian home owners? Well, most professionals and experienced DIY enthusiasts would agree that if you take off the rose-coloured glasses and look behind the scenes, the renovating picture is somewhat different. Whilst the shows have a positive impact on getting people thinking about style and design, they don’t necessarily reflect the reality of a renovation. In the real world home owners are faced with designing a renovation well beforehand, getting planning and building approvals (which can take months) and mapping out the construction course. These shows are obviously more driven by entertainment needs and time constraints where the contestants and renovation activity are packaged into a prime time production.

Renovating programs can, however, provide excellent ideas and invaluable information to viewers who are thinking of undertaking a major overhaul. Things like sticking to a budget, using good trades people and only tackling one room at a time, are all important renovation principles. Marketing tips such as creating street appeal and a good first impression are also uncovered, which adds to the overall value of these shows. But if nothing else The Block and its rivals provide an interesting insight into how we as mere mortals cope with extreme sleep deprivation and intense pressure – and don’t we just love the fights, the tantrums and the major dummy spits!

Invest with the best!

PPG_Blog_July_IMage 6July can be a busy time for property investors as they sort through end-of-financial-year deductions and paperwork. Around this time many investors are looking for opportunities and talking with their real estate agents about prospects in the market.

Quality advice starts with encouraging investors to do their research. This gives them the confidence to make an educated purchase.
When researching the market, investors should be mindful of the key characteristics of successful residential property investment.

The better investments are generally in places where there is consistent population growth – which, at the moment, is a Melbourne-wide phenomenon. Currently, vacancy rates are at an all time low, and have been for more than three years.

Tenants like convenience. The better investment properties tend to be those which are easy to maintain, have space for cars, access to main roads and public transport and are located close to shops, schools, tertiary institutions and other community infrastructure.

The ideal investment location is where demand for rental properties exceeds supply. In the current tight market this is almost everywhere, but it won’t always be the case. Do your homework to gain a long term view of local conditions. The Australian Bureau of Statistics has census results illustrating areas of high tenancy rates.

Ordinarily, a good measure of the supply of rental properties is the proportion that is vacant. Suburban or town vacancy rates are not always readily available, but there is no question that metropolitan vacancy rates are currently low at around 1.5 – 2.5 per cent. Another measure is the number of new housing developments and this information is available from the local council.

Look for properties that are affordable, generally at or around the median price, and which have reasonable prospects of good growth in values.

Historical median house price information for suburbs and major regional areas is available from Real Estate Institute of Victoria. This information is useful to discover patterns in values.

Choosing a property with redevelopment potential can also be worthwhile. An investment property that can be subdivided into smaller lots for home units will be popular with some developers and can bring long-term rewards.

How do we house our growing population?

PPG_image5_JUne 2011Accommodating our growing population is one of our community’s most pressing concerns.

This was highlighted in a recent report by the Productivity Commission, in which Australians were surveyed about attitudes to population growth and the increased density required to house it.

The report found that the majority of Australians indicated that they would not like increased population. In Melbourne, 52 per cent said they would not like it, while a mere 11 per cent said they would.

The reasons behind the resistance to higher population were not surprising: 86 per cent said increased traffic congestion was the main reason, followed by increased noise and loss of street appeal. Shadows from higher buildings and decreased property values were also cited as a problem.

Conversely, those who were in favour of increased population cited increased property values, improved services and more vibrant suburbs as positive factors.

It’s fascinating that on both sides of the debate, property values are an issue.

While not included in the survey, the message is clear that most people do not want to see housing affordability further reduced.

Those surveyed were also asked to rate different types of development, indicating which of five different variants they most favoured. The least popular form was ‘multiple dwellings replacing single dwellings’ (basically infill development), which 53 per cent of those surveyed opposed; compare this to the much more favourable rating given to ‘residential development in a new area’, which was only opposed by 29 per cent.

Opposition to infill development is in part why the cost of infill development is higher and the preference given to ‘greenfields’ development results in higher costs for government in the form of more roads and public transport.

Given that the inability to provide enough homes is the main cause of reduced affordability, solving this issue will also provide the keys to improved housing affordability.

Information courtesy of the REIV

Safety in embers

PPG_image 6_June 2011Nothing negates the winter chill quite like an open fireplace. Not only are they practical and provide warmth on cool winter nights, but open fires also act as a centerpiece in a living area. In particular, many older, period-style homes often have an open fire in each room complete with iron surrounds and pretty, decorative tiles.

Regardless of your open fire’s style, homeowners with a yen for fireside thawing are being urged not to put safety on the backburner. According to industry body Archicentre, many of Australia’s 11,000 yearly house fires are preventable – and protecting your bricks, mortar and loved ones starts with changing your smoke detector.

The safest detectors are those electrically wired into mains power. Home owners annoyed by false alarms and flat battery beep warnings often disconnect the battery operated alarms or simply do not replace the batteries, warns Archicentre. Smoke detectors also need to be located to suit the design and layout of your home and, ideally, be fitted by an expert.

Similarly, all chimneys and flues require maintenance and if purchasing a period home, it pays to have a professional chimney sweep clean your chimney before lighting a fire. A build up of creosote can not only hinder the efficiency of your open fire, but also create a fire hazard. Old bird’s nests and other animal activity in your chimney can also cause problems – the least of which is a room full of smoke!

Regular maintenance of your chimney or flue will increase the safety and efficiency of your unit.

Getting a deposit together

clip_image002Building a deposit for a home takes discipline and hard work. Every little bit helps though, and with some short term sacrifices and effective lifestyle changes, building a deposit is achievable for most working Australians.

Tips for growing an adequate deposit include:

  • Existing Debt – before saving can begin, and to increase borrowing power, it’s important to minimise or completely do away with credit facilities like credit cards or personal loans. These kinds of debt can inhibit any serious savings plan
  • Goal – Set a budget goal. The size of a deposit required depends on the value of the price range of the property being sort. Being realistic at this initial stage is imperative.
  • Budget – working out a budget can start by looking at monthly bank statements, they show where the money is going and where spending could be pruned.
  • Bank Account – open a high interest savings account or term deposit (put a withdrawal restriction on that account in case of temptation)
  • Government Assistance – research eligibility for any grants and bonuses available.

The deposit is only one piece of the purchasing puzzle. Other costs to consider include inspection costs, solicitors/conveyance fees, stamp duty, government charges and bank fees. Saving a sufficient deposit can seem out of reach to many. However, with a realistic plan and some discipline it is not out of reach for most.

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