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There is a lot of commentary at the moment about the ‘housing crisis’ – particularly how it is affecting the rental market. One area of property that is not being widely discussed by the public though, is the State government’s proposed changes to the Residential Tenancies Act. It is not in the current media cycle, though the proposed changes will likely impact further on the rental stock shortage and have potential to make the current situation tougher again.
So let’s look at a few of the proposed changes. Please note the changes below are not yet legislated but given that the current government holds the upper hand, I am confident the government will be pushing to get them through sooner rather than later.
Some of the proposed changes that may affect investment property owners are:
As you can see, these are quite significant changes to the status quo. As I meet with landlords and investors around town, many I have spoken to are either unaware of these proposed changes or in dismay when they learn more about it. The idea that a tenant can make changes to someone else’s investment, or bring pets into the house without any notice to the owners brings with it many questions. How does this affect insurance? Who is then liable should modifications be unsafe? What happens if a dog damages the property and the pet bond (Which is only $260), is insufficient to cover repairs? At the moment, I don’t have answers to those questions.
And I am not alone, nor are the owners I speak with. In January this year the Real Estate Institute of Western Australia (REIWA) sent a survey to investment property owners on this issue. In only two weeks they had received more than 10,000 responses from landlords!! 10,000. Think about surveys that you receive; how many do you reply to? A response like this in such a short timeframe surely indicates the level of concern landlords hold over these changes. Overwhelmingly, landlords were opposed to changes which further shift the balance of the laws in favour of tenants.
81.7% of respondents had not heard the residential tenancies laws were being reviewed;
85.7% of respondents believe the proposed changes increase the riskiness of investing in property;
62.1% of respondents said they would be likely to sell because of the changes, with a further 23.5% undecided;
80% of respondents said they would be unlikely to buy another property because of the changes, and a further 16% were undecided. (Source REIWA, Jan 2022)
The majority of local rental investment properties are owned by small, ‘Mum and Dad’ investors. 80% is the number of mum and dad investors that own 1 property across Australia This perceived increase in the riskiness is not good, even if the risk can be mitigated, as many will simply look to put their investment savings elsewhere. The figures stated above showing the planned mass exit from the investment market could have an enormous impact on rentals locally. When investors leave the market, the houses are most often bought by owner-occupiers – that is, they are no longer available to lease.
We are already in a situation where we are facing a large undersupply of housing available. If these results play out to be true (or even close to accurate) it will lead to less properties being available. In turn this leads to rents increasing further for tenants due to both increased costs to owners, and a further undersupply than present.
In my opinion, a proper conversation needs to be held with all parties, to address these concerns. Pushing through changes as proposed is ill-timed given the current housing situation that we are all experiencing. I encourage further debate and holding off on any changes until everyone is better informed of impacts this will potentially have.
By Jeremy Stewart – Director
The current rental market is insanely busy. We are seeing many more prospective tenants in the market and this increased demand for properties outstrips what is available across the board. Searching for a new home is always stressful and the shortage of rentals at the moment is making a bad situation worse.
Here at Merrifield Real Estate we want to ease this stress. We hope this information helps you understand the rental process – and by helping you, it helps us match you to a home as quickly as we possibly can.
One of the biggest challenges in the rental market is the application process. It is extensive, requires a lot of information, and can be confusing. Worst though, is the time it takes, and we know it’s time that many of you simply don’t have to spare! So let us share with you our five Hot Tips on how you can put your best foot forward when applying for a rental property.
#1 Hot Tip: Presentation – First Impressions count!
When attending a property viewing be mindful of how you present and handle yourself. Most agents and property owners will be assessing you from this first interaction, including how you act, and what you say and do. Later they will consider how well your application is completed. Be mindful of these things and make sure the impression you give to others is memorable for the right reasons!
#2 Hot Tip: The Application – Get the perfect form in!
Ensure you have fully read the application, including any additional requirements. If your application is not fully complete when you submit it, but we receive 10 others that are, yours won’t be prioritized. Ensuring you provide all the required information means we can start processing the application straight away rather than needing more time to follow you up. The same goes for the ID and income requirements; these are presented to the owner to help them decide if you are the right tenant for their property. Taking the time to do the application well helps save time in the process, for everyone involved.
#3 Hot Tip: References – Choose wisely!
Too often, our time is spent chasing applicant’s referees because they will not answer, or return our calls. Making sure your nominated referees are aware that their details will be provided is critical in the response time. Provide them with our details, and make sure they know to expect a call. We know, ignoring calls from an unknown number is tempting – but this is important. The faster your application is processed, the faster we can present it to the owner. If they miss our call, a quick return call is appreciated.
Employment contact is the same, we need to confirm the information you have supplied is correct and current and that your employment is ongoing. This confirms your ability to afford the property. Ensure your employment references are aware we will be contacting them.
When applying with others (including partners) please ensure you have each listed different personal references. These provide a character reference for you, so the referees need to know you on a personal level: think work colleagues, supervisors, neighbours or friends for example.
#4 Hot Tip: Honesty – it is always the best policy!
When checking through your application we look at everything. We are engaged by the property owner to match them to the best suitable tenant, which means we must scrutinize every piece of information you provide to ensure you are the right tenant for them. If you are not honest when listing information, it will be uncovered. If there is something you think we should know about you, then let us know! If you need to, feel free to add extra information to assist in the processing of your application.
#5 Hot Tip: Speed – delays cost!
Due to the current demand, you simply must work quickly. This means attending the first possible viewing as soon as you can. If you’ve secured a time and cannot attend yourself; don’t cancel! See if a friend can view the rental for you, so that you don’t miss out. We recommend submitting your application no later than 24 hours after viewing the property. Some people wait a week before they submit their application, and after that much time the property is already leased.
We aim to get a response to you within five business days so please be patient with us. We do not make the final decision, that comes down to the property owner who makes it. Some owners like to take a little longer to decide when it comes to their investment but we will always provide you with a response as soon as practicable. Please note though, that due to confidentiality laws we are not able to provide reasons as to why your application has been declined.
Ultimately, the rental market at the moment is extremely tough. Everyone is in need and there is only so many properties available. We understand it’s a stressful situation but with your help, we hope to make this process a little less stressful because lets face it, we all need less stress in our lives!
Written by Lisa Dunham & Liz Duncan
I was recently sitting with a group of people and one of them said “I don’t think I am ever going to be able to afford to buy a property”. This got me thinking about what it takes to be in a position to own your own home, or at least qualify for a mortgage to purchase a property. I am fortunate enough to own my home outright, and I am happy to share how I got to this point in the hope it may inspire or educate.
I certainly haven’t had any money fall in my lap in my lifetime, such as being the beneficiary of a financial gift from a family member, or received any kind of inheritance. However, what my family has provided me with is a different kind of a gift – they have instilled in me the value of money and a strong work ethic that has always helped me to achieve my goals, be it monetary or otherwise.
I’ve you’ve ever checked me out on platforms such as LinkedIn or searched for my name in scholarly publications you may already know that I have other qualifications outside of real estate that I gained in my time before entering the real estate industry. If we wind the clock back a little, straight after finishing my secondary education at good old Albany Senior High School I moved to Perth to study at University. I’m proud to say that I’m the first person on both my mum and dad’s side of the family to gain a University degree. In fact I loved studying so much that I successfully completed three degrees in a relatively short space of time, being in the fields of Biochemistry, Physiology and Nutrition & Food Science, if you are curious to know. Anyone who has ever been a student will tell you that studying does not pay the bills, and so throughout that time of my life I got by mainly by working part time and receiving some assistance from the Government (think Austudy). After gaining my tertiary qualifications, my future was looking bright, and I was anticipating being able to establish a career and become financially independent. Home ownership was certainly on the list of achievements I was hoping to be able to tick off in time. However, things for me came crashing down in my mid-late 20s when I became critically unwell. At that stage I returned home to family support in Albany to fight my illness and thankfully I won the battle after a number of years, but not, unfortunately, without a cost to my future well being.
When I was considered healthy enough to re-enter the workforce I was very keen to get back on my feet financially and regain my independence so applied for all sorts of different jobs in Albany. However, I was continually knocked back and told it was because I was over qualified and the employers didn’t think I would stick around. Out of the blue one day I saw an advert in the local newspaper (there were no job seeker websites around in those days) published by a local real estate office looking for a rookie salesperson – someone without prior experience in the industry was preferred. I was certainly a rookie alright! I knew nothing about buying or selling a property and hadn’t ever had a loan. I was also very shy, far from being a social person, and hadn’t made a lot of connections in the community as I was practically new to town after living away from the area since becoming an adult. But I thought I would give it a go, submitted an application, and that was the beginning of a now nearly 18 year stint in the industry.
I have worked very hard in that time and gone through many ups and downs, both personally and professionally. However, after many long days and nights and weekends of commitment to my job, I have managed to earn and save enough money to purchase a few properties, including one for my now ex-partner (!), and am very close to being completely debt free with a healthy superannuation fund before reaching the age of 50. I also supported my current partner financially for many years until his new career became established and worked continuously throughout my pregnancies. After my son was born I didn’t receive any maternity leave entitlements so I kept working to pay the bills for my family (except for about a 6 week period when I thought I’d try to be a stay-at-home mum but that nearly drove me up the wall so I knew I couldn’t continue with that).
I look back now and I think that anyone could have been that person 18 years ago who applied for the rookie salesperson position that I did. That was without a doubt the turning point for me which enabled me to create the wealth I now have, as before then I really hadn’t had a chance to spend much time in the workforce. I don’t consider myself to be ‘rich’ like the high flyers around town but I am able to live a comfortable life and I’ve set myself up so I don’t have to worry about what age I can retire. Now that I am at this point in my life I have set some new goals that involve me being able to give back to the community that I live in and I’m excited at the prospect of being able to turn those ideas in to a reality.
In reflecting about what it took for me to be able to afford my own home, it’s quite funny that the answer was getting a job in the real estate industry. However, this is just my story and there are many other different paths people can take to achieve their home ownership goals. I hope, though, that you can appreciate that with some smart, sometimes bold choices, an intrinsic fight inside you that keeps you pushing on even when the going gets tough, a commitment to self improvement and many hours of hard work and sacrifice, what seems the impossible can become possible.
By Lee Stonell – Sales Consultant
It’s time to make a confession. I had worked in Property Management or related assistant roles – for over a decade when I applied for my role at Merrifield Real Estate – and I didn’t really understand what I was applying for in their Strata Management department. In fact, even after landing the role and spending a full 12 months shadowing their Strata Manager learning the ropes, it was still another year or so before I truly felt comfortable in explaining what Strata Management actually is!
It is a theme that I notice a lot as a Strata Manager. When I’m with my friends and family, meeting new people at a BBQ, or sitting with other parents as I watch my boys play sport, I am often met with a fearful look when I answer what I do for work. “Strata? Isn’t that really complicated?” often it’s “I have heard that’s always dealing with petty disputes over driveways!” or “We looked at a unit once but it was the strata costs that made us back away.” And yes, it can be complicated, it is sometimes dealing with disputes and there are costs involved, but it is a lot more than that too.
The word ‘strata’ comes from the Latin stratum, which means something that is laid down, or spread out. So, if you think about a block of apartments (which stack in layers) you can see how strata came to be used in language around buildings, and then into property law. Basically though, if there is a group of buildings containing common property then they fall into the strata category.
Now, there isn’t tons of high-rise buildings in Albany with apartments stacked in layers, I know. But if you take a look as you drive around town, you will start to see how many multi-unit sites there are in residential areas. And it’s not just residential. Lots of our town’s commercial spaces are also strata lots, and these buildings require different management to a stand-alone house or business.
In a strata complex, the Strata Company collects levies from each individual owner to cover the shared costs relating to the building complex. This includes insurance for all buildings, and maintenance expenses for shared items like plumbing, roofing, driveways and so on – considered each year in the company budget, from which levies are calculated. These companies can be small, and able to be managed without appointing a manager like myself. Others though, can contain dozens of units and dozens of individual owners, and this is where we come in.
Appointing a Strata Manager takes the stress out of ownership. We are here to help owners manage their buildings. Often it is simply acting as a go-between for owners, working hard to keep multiple owners as happy as we can. Ok, so I make that sound simple but believe me – it is a developed skill to be able to communicate and negotiate with up to 50 owners in one strata company!
I now understand why it is a stand-alone department within Merrifield’s! There is definitely a lot of work to be done.
What I love the most though, is that the main aims from my Property Management years have transferred across. I am here to help owners maintain value in their home, or to help them protect their investment property. I enjoy this – I have a great support team in the office and in our sub-contractors – and I love knowing that I’m removing the stress of strata ownership for my clients.
So, there it is. Strata does not need to be as difficult, or scary as it first seems. There are actually so many positives to this type of property, especially when it is managed well!
By Selena Taylor – Strata Manager
A common question I regularly get asked is what I think will happen in the next 12 months with the property market. While I’m not in the habit of making big bold predictions here’s some food for thought. So, here’s my top 5 predictions for 2022.
Migration Trends – Covid-19 has highlighted to people that they have the ability to work remotely. It has also allowed people to re-evaluate their priorities and where they most feel safe and secure. This has led to a huge net migration out of metropolitan cities and into regional areas right across Australia. And Albany is no different where approximately 60% plus of buyers I’m selling property too are outside of the Great Southern and mainly from Perth. With a wonderful lifestyle, moderate climate, huge amount of job prospects and many more reasons to live here, expect this trend to continue and Albany’s population increase quickly. We may well hit the 50,000 target by 2030 that our Mayor talks about.
Interest rates – While we’ve had the lowest interest rates on records, it’s going to start heading upwards earlier than people think so it might be worth going hard to pay down debt while rates are low. Inflation figures just released are at 3.5% in Australia and across the world in most countries it’s high or heading that direction. Banks have already been for some time lifting fixed rates for the last 18 months and while the reserve bank have backed themselves into a corner by publicly stating they won’t adjust rates till 2024, they may well have humble egg on their face and have to lift them sooner. The USA has inflation at 6.9% and you can sure bet when the Fed meet over the next month or so the rate will increase. Being Australia generally follows other trends, I expect this to happen. Don’t be surprised if banks lift variable rates out of cycle and certainly by mid-year. You only need to go to the supermarket, look at the cost of materials and building, cost of fuel as examples of rising costs which all lead to higher inflation which isn’t under control no matter how much spin some media outlets put on it.
Building and Construction Pressures – Shortage of trades, labour and materials will have a knock-on effect. Some builders I have spoken with have seen 70% rises in these items since the start of 2021. And of course, the end consumer is lumped with having to absorb the costs. These items will continue to increase and I’m not expecting that to change this year as the delays to build continue to blow out expectations for people building. Many people I have spoken too that are building have confirmed this.
Rental crisis – With vacancy rates at record lows not only in Albany but across the nation this will continue. There simply aren’t enough houses for the demand. Air BnB has taken up some stock, landlords have sold properties as part of succession planning, reducing debt and because tenancy laws don’t reflect a neutral position for all parties. If proposed changes to the Residential Tenancy Act go through, then based on a recent REIWA survey 62.1% of landlords said they would sell up. Over 10,000 people completed this survey in a 2-week period. If that’s not a clear message, nothing is. If the changes happen then that’s only going to lead to higher rents and lower stock. So, Albany and the Great Southern will be significantly affected. With currently over 430 people on government housing waiting lists let alone the private sector waiting lists, this problem isn’t going away soon and will take some time to sort out. Our region is no exception.
Covid-19 – This is the real wildcard. It’s a moving beast and the reality is no one knows what will happen, when and if borders come down and what affects that will have. Remember all the economists are predicting property prices to drop up to 30% – 40% in April 2020? ( Maybe we should list them who got this so wrong to stir the pot ). Well the opposite has happened right across the country and also in a lot of overseas markets as well where double digit rises have happened. While we are somewhat isolated, and with strong demand here in Albany, I expect to see property prices to continue in a growth pattern for this year. That could well change quickly because covid-19 is something no one has experienced before and with different variants all the time, it’s anyone’s guess.
So hopefully I’ve given you something to ponder about as your flick through your social media channels or while you’re having a chat with your partner. Please note the above is the opinion of the author only and should not be deemed to be advice. We advise to seek independent advice when making property decisions.
By Jeremy Stewart – Director
As we approach the end of another year, I hear you say to yourself where did the last 12 months go! And what a crazy 12 months we’ve had in real estate and across the world. The thing about the end of the year is that it gives you a chance to clear your head, review the year just gone and then plan your goals for the next 12 months. Part of that planning maybe around your lifestyle, job, location, kids and current living arrangements. With property a key element in all of that, what’s your priority? Are you considering upgrading or downsizing your home, taking on a renovation, buying an investment property or buying some land and building? Or are you looking to sell & capitalise on the strong real estate market? If so, what do you do with the funds after you’ve sold and hopefully paid out debts? Are you a tenant and worried about long term longevity of leasing, especially in the current rental market, or do you save up for a deposit to buy a property? Can you afford a property in a rising market?
There are a million questions from every angle you take no matter what position you’re in or stage of life you’re at. And while it might seem overwhelming, what you need to do is actually start writing things down. “So where do I start?” you say because quite often the first step is the hardest. First thing to remember is there is no right way or wrong way to go about it nor does anyone have a crystal ball (i.e. remember all the economists predicting 30 – 40% declined property values in April/May 2020 and now look what’s happened? The complete opposite as the market has gone the other way with everything going up). So start by sitting down and grabbing a pen and paper and writing it all down. It’s proven that people who have written goals have a lot higher chance for them to materialise than not, so what’s the harm in doing this. And if you’re struggling with this concept, then there’s plenty of material online that you can google that helps or you can seek further professional advice if you really want to get into the nitty gritty.
Work out what’s important to you and those around you. Only you know the answer to this. It may also help talking to a close confidante if you’re particularly stuck on some aspect. Everyone has different priorities but only you know the direction you want to take. You don’t just wake up one day and think I’ll sell up and move up north or to Perth or over east. It takes time & planning for things to come to fruition and the new year is a great time to put some thought into this. With these Covid times having a plan or contingency is a wise move. Someone I follow that has some great thoughts and wisdom in this space is The Barefoot Investor ( p.s. his books are fantastic Christmas Gifts in case you need to find a last minute gift for someone!) You may like to have a read because there are some real practical common sense approaches that he suggests, and it’s an easy read for all ages.
I’ll admit this approach isn’t for everyone, however many people I speak with that are doing well have good solid plans in place to flourish. And to finish with a great quote that I see “ Failing to plan is planning to fail “. Something to ponder over the new year. Good luck in 2022 and may your year be prosperous.
By Jeremy Stewart – Director
It is that time of year again! Kiddies, get your pencils ready, and start colouring!
What you need to know:
I read a short story a while ago that has really stuck with me because it resonates with situations I come across in my work. There are various versions of this tale in existence but please take a moment to read this one:
A giant ship engine failed. The ship’s owners spoke to several engineers but none of them could figure out how to fix the engine. Someone recommended they get in an old man who was known to have been fixing engines since he was young. The old man agreed to help and arrived with a large bag of tools. He immediately went to work and first inspected the engine very carefully from top to bottom. Two of the ship’s owners were there, watching this man, hoping he would know what to do. After looking things over, the man reached in to his bag and pulled out a small hammer. He gently tapped something. Instantly, the engine sprung back into life. He then carefully put his hammer away. The engine was fixed!
A week later, the owners received a bill from the old man for $10,000. “What?!” the owners exclaimed, “he hardly did anything!” So they wrote a note to the old man asking for an itemised bill.
This is the breakdown of the bill they received back from the old man:
Tapping with a hammer………. $2.00
Knowing where to tap…………. $9,998.00
This story teaches us that there is value in someone truly knowing how to do a job and being an expert in their field. It also tells us that while effort is important, having the experience to know where to apply the effort makes all the difference.
Next time you use the services of a professional, be it a doctor, lawyer, consultant or even real estate agent, it is worth considering the years of training and ‘practice’ they have under their belt and how refined their skills are to be able to give you best result you could hope for. It may appear as though they haven’t had to do much for the fee they charge but a specialist in their field will always make a job look easy because they know precisely how to respond to and efficiently deal with situations that present in their workplace environment.
Next time you are choosing a service provider in any industry my advice is to make sure you do your “homework” first. Don’t just focus on what they charge, but also give serious consideration as to how well they perform their role. If someone can’t prove the value they bring to what they do then you are probably not talking to the best person for the job.
By Lee Stonell
It’s well documented in just about every media publication that property prices have increased both state wide and nationally in 2021, with predictions of further increases for 2022. It does however present a number of challenges for the consumer. With stock levels low there are still people that would like to sell, however the issue those sellers face is the majority need to go into another property and they too are confronted with very little selection. And for those sellers to buy as a subject sale, they don’t stand a chance especially with the amount of pre-approved finance buyers and cash buyers currently in the market. So those potential sellers are staying put, but caught in a difficult situation around the process of selling. So that’s obstacle one.
Another challenge for sellers is around pricing. There can be some wild ranges of pricing from agents to the point where I’ve heard first hand of agents just pricing any old figure, just to secure the listing because they have no stock. This is not in anyone’s best interest as they are not taking into account comparative sales because either there isn’t any or that the sales range is expansive. It’s also confusing for some sellers as well because agents have access to the same sales information & data.
We’re also seeing a number of landlords sell properties being they either purchased in a softer market and are trying to recoup some of the value of the property or are in the process of moving to retirement or succession planning and want to offload their asset. With landlords selling, there are generally tenants involved which can cause high emotions because if the buyer isn’t an investor then the buyer may want vacant possession. And for that to be achieved the tenants have to find another property (making sure they are given the correct notices in accordance with the Residential Tenancies Act) which isn’t an easy task when there are very limited properties available to rent (only 15 houses available for lease in Albany at the time of writing this article) and when there are massive amounts of people viewing property and putting in rental applications.
You’ve then got those clients that are wanting to build. With majority of the suburban blocks sold and being built on due to the government grants in 2020 there are massive wait times to secure builders. In Albany, for example, we’ve gone from under 150 residential approvals for the 2018/19 financial year to over 350 approvals for the 2019/20 year. Also, if the building timelines aren’t enough of a stumbling block, then the severe increases in costs of materials and the cost of building is providing a lot of frustrations. It’s not uncommon to hear that builders won’t allow fixed priced contracts, and to pass on cost increases on short notice that are out of their control. That is also not taking into account the shipping delays and slow processing at ports.
Buyers, of course, are having their own difficulties in securing a property. And apart from the lack of available listings for consideration they are competing with multiple offers, and in most cases not even getting a look at it before it hits online.
A tip for buyers reading this article. If you want to know what’s coming onto the market before it goes online, register your details with your requirements with an agent so you are on their radar.
So while the property market is strong, it’s also worth remembering that sellers, buyers, landlords & tenants have a lot of the above challenges plus a lot more not mentioned on a variety of levels, and that some of those aren’t going to go away anytime soon. Lots of patience & understanding is required for everyone involved which isn’t always easy, but is necessary in the current environment. And that’s all industries, not just real estate.
By Jeremy Stewart
Merrifield is a long standing proud supporter of the Albany Community Foundation.
This year, we are hosting a Quiz Night on Saturday 6th November, at the North Albany Football Club. It will be a fun filled night, with trivia, prizes, raffles, and a silent auction!
Tickets for a table of 8 are $150, and you have the option to purchase a grazing platter with your ticket for an additional cost. Please note that it is a licensed venue so No BYO Alcohol.
Tickets can be purchased here:
If you would like to make a donation to be used as a prize, raffle or auction item, please contact Shantell Anderton on 9841 4022, or email@example.com
A DAY IN THE LIFE OF A SALES ADMINISTRATOR
Have you ever wondered what a day in the real estate industry might look like? Have you been pondering a career change and thought that real estate might be what you want to do?
After a long career in medical administration, joining the real estate industry has been a change of pace that I have thoroughly enjoyed. Each day is different, and you can never plan what the day is going to hold. Are we going to sell 3 properties today? Maybe we will have some new listings come to market! Perhaps a timber pest report comes back with significant findings, and we need to come up with some solutions to get the deal across the line.
Some days you are at your desk for the day, others we might get to spend the day out and about drawing floor plans, seeing new properties, and other odd jobs. We liaise with settlement agents, banks, buyers, sellers, other agents, and so many more wonderful people. Some people are local, some interstate, and the odd ones are even international!
It is incredibly satisfying to assist someone buy or sell their home, usually the biggest investment of their lives! Any way that we can help to make this process easier, we are always looking for ways to help our clients achieve the best outcomes with the least amount of stress and worry.
No matter what the day brings, the best part of working in real estate, and especially at Merrifield, is the bond and friendships formed within the team. It doesn’t matter what department, whether it be commercial, strata, rentals, sales – everyone pitches in and helps out to get things done. The cohesiveness of the team here is amazing, and it makes it a pleasure to come to work each day.
If you have been thinking about a career change, I would not hesitate to recommend looking further into the real estate industry!
By Shantell Anderton – Sales Administrator
In a market that’s extremely busy, one of the constant questions I get asked is what does under contract mean when displayed online on internet sites such as realestate.com.au. Is the property still available or has it sold? I can’t speak for all agencies and their procedures because some of them continue to display properties for sale even though they are sold, however when we mark properties under contract it means that there has been an accepted offer on the property. Now this may mean that conditions are still to be met (i.e. awaiting finance, building inspection or timberpest report) or it could also be that the property is unconditional (this means all conditions have been satisfied and the transaction is progressing to settlement).
Sometimes properties are displayed under offer for a long period of time and buyers may wonder why. This is generally due to long finance periods, extensions for finance or even delayed or longer settlements which is more common now that sellers need longer to find somewhere to go, settlement agents require a good amount of time to settle (especially when banks are involved) and that broker and bank application processes have blown out considerably.
Now sometimes properties are displayed under contract as soon as they hit online. I hear you say, how can this happen when it’s only just gone online? Well the answer to that question is that the buyer has been introduced to the property between when the listing documentation was signed, and when all the marketing was completed and displayed online. Of course the next question to follow is, why didn’t I get an opportunity as this can cause frustrations to buyers looking in the market especially when it’s a busy as it is currently. Agents work for the seller so it comes back to the owners instructions. Some sellers will get an offer too good to refuse, others may want to try and attract even more buyers. It really depends on the sellers motivation and what their plans are.
So what do you need to do so you don’t miss out and that you’re informed ahead of the game? It’s my advice to get yourself onto a registered database. A good agent will have this and be able to advise of possible opportunities that may fit your needs. Provide them with a list of your requirements and budget and make sure you have everything in order to be able to act. It’s not uncommon in the current marketplace for buyers to make an offer on the property sight unseen especially from east coast buyers which is becoming more and more so this is another important reason to have all your ducks in a row so you can act quickly.
Happy house hunting and know, with a bit more knowledge about what under offer/under contract means it should assist your searching and time efficiency.
By Jeremy Stewart – Director
As I sit pondering this question and the answer to it, I find myself thinking about the good experiences I have had. I also flip my thinking to the other side of the equation and the not so great ones. Either way experiences could be real estate orientated, going to a restaurant for dinner, taking a trip or holiday somewhere, going to the shops or attending a sporting event. It’s interesting that in general terms your experience is shaped by something much more than price and money. Yes that plays some part, however there is something bigger and it’s the people and how they engage and treat you. Behavioural experts will tell you there are different personalities types. Some are more outgoing and vocal, some are quiet and reserved, some are driven differently but personality traits aside, I question as a society are we getting better with delivering the customer experience, are we settling for less, are people expecting a lot more or is it that people’s values have changed and that is the reason not everyone has a great customer experience?
In the last 12 months we as a business have focused hard on values, where the staff have had a great amount of input into defining what Merrifield Real Estate is all about. I’m not in the habit of making big statements and putting them on office buildings or billboards. Those that really know us, know what matters the most. What I am really proud of is the time we have put in and the investment in our staff which empowers us to provide a positive customer experience. Yes everyone is busy and most businesses don’t have time to take a lot of time out of their day but a great mentor of mine reminds me all the time, that if you don’t have time to train then how can people learn and get better. I’ve been lucky to have blessed to have a brilliant facilitator to help formulate these values and an external consultant that’s added huge value in helping deliver what we’re aiming to achieve.
While training to get better is the best way to improve, the truth is we don’t always get it right. No one is prefect and sometimes there are things outside of our control. In real estate all kind of things happen that can be last minute. For example you could have a removalist booked on the day of settlement and have a delayed settlement ( some advice don’t book a removalist for settlement day ) , it could be a bank losing a title, a delay in obtaining finance by the due date, not being able to inspect a property when you want because of a tenant. The list goes on and generally we are the middle person involved. Some things are in our control, others aren’t.
While I don’t pretend to understand some people’s thinking and logic, I will say that by showing understanding, patience & respect for our fellow human being might actually go a long way to getting what you require and having a good customer experience along the way. And isn’t that all we want! To have a great experience and be treated kindly.
By Jeremy Stewart – Director
A job title that carries a huge amount of responsibility and weight, but more often than not under appreciated.
Property Management laws in Western Australia are the strictest within Australia (With potentially more proposed); the Residential Tenancies Act of WA is so involved we are constantly learning each and every day because we simply cannot know it all and need to keep up. On a day to day basis Property Managers are subjected to different scenarios and/or issues which require a high level of concentration, knowledge and dedication to the job at hand to ensure everything is correctly handled in accordance with the guidelines set out before us. And from time to time we come under fire for following the rules and can sometimes be seen as being heartless simply for doing our job.
The scary world of property management is certainly not for everyone, which can be witnessed by the high level of burnout within our industry and the large amount of new property managers entering the industry then leaving within their first 12 months, as they realise it is not the career path for them. Tenants and Owners see this as an inconvenience and become irritated at having to deal with different people all the time, not realizing that it is because of the jobs requirements that there is such high turnover of staff. It can be a thankless job at times.
You need a thick skin in this challenging role when we are dealing with peoples most primary need “a home” as well as peoples secondary need “money”, both of which can bring out the best and the worst in people.
We joke in this industry that we wear a number of different hats in our day job from property managers to relationship counsellors, advisors, maintenance people, plumbers, electricians, roofers, building inspectors (obviously not doing the work but trying to explain and prove issues need to be repaired), cleaners, pet handlers and a huge array of other roles. When in fact we are simply a bunch of somewhat crazy people coming to work each day to help provide our community with a roof over their head and hopefully money in the pockets of the investors providing the homes to lease. We push to be the best, offer the best service and do everything we can to keep everyone happy and the wheel turning.
Why then, do property managers receive so much criticism from those we serve?
Admittedly we can’t keep everyone happy 100% of the time. Some Landlords don’t want to complete those repairs or refuse to respond to our calls and emails to get that heater working before winter. Tenants don’t always do the right thing and may be late in rent payments, damage the property or not be ready for that inspection which results in a follow up inspection needing to be done. We are the mediator between the Tenant and the Owner and the enforcer of the rules, and for this, we are often the ones caught in the middle. For some this becomes too much and they leave the industry, or they just brush it off for someone else to deal with. For others such as myself, it pushes us to strive for a better world in which we work and to try and change peoples perspective of the infamous Property Manager. Being in real estate for the past 18 years I have seen so much change within our industry however our treatment has stayed consistent the whole way through.
While landlords get extremely good value for us to do this task no one else wants, we certainly don’t get to go on a Christmas holiday with tenant’s bond funds contrary to everyone’s beliefs. We go home and cry somedays because one of our favourite tenants has been diagnosed with cancer or we’ve stumbled across a death in one of our rentals. We clean properties ourselves because it isn’t up to our own standard and can’t bear to allow a tenant to move into a filthy property. We sympathize with our landlords that can’t afford for the property to be vacant but also need to sell and their tenant isn’t happy. We push our trades to give the best and cheapest service possible so the Owner isn’t out of pocket before their mortgage payment is due. We are required to terminate a tenancy on a family who can’t afford to pay the rent because they’ve lost their job and have no where else to go. We are often seen as the cause of the problem when we are merely the message giver.
When a job requires us to deal with such massive degrees of difficulty, we should be given the utmost respect for doing what we do however this sadly isn’t the case.
It is certainly not all bad though; we have massive highs of winning new business and beating our competitors to that awesome new property to manage, we create amazing relationships with our Tenants and Owners which often continue well on past their stay with our agency. We manage properties for years for some clients, meaning we become a part of their lives and they a part of ours. We have a huge level of appreciation to our trades people who quite regularly give up their weekends and nights to fix those hot water systems not working and always greet us with a smile even at 4.55pm on a Friday when all they want is that ice cold beer. Not to mention the amazing and equally crazy team that do this by our side each and every day and keep us all coming back for more. And sometimes and I mean sometimes we receive a heart felt gift of thanks for helping a tenant or managing a property for an Owner.
So the next time you are speaking with your Property Manager, just remember that we are only doing our job. We are not trying to make your life difficult, we don’t revel in the so called power trip of advising what needs to be done after you’ve vacated or that your water bill or rent needs to be paid. We aren’t trying to force you to use all your money and completely renovate your property. We are simply coming to work each day to manage the relationship between two people to reach a happy and mutual outcome. A smile and a thank you goes a long way in our world and costs nothing.
Written by Lisa Dunham
Senior Property Manager
All the media and talk at the moment is centred around the housing crisis in particular the massive shortage of rentals. While all the talk is fine and most certainly needed, action is what’s required and action is what has been lacking for some time. As a result of this we are in a situation where we are being reactive rather than proactive and therefore there is no quick solution because everyone is so busy scrambling with all the chaos. Being that I work in the industry this has been coming for some time but the relevant authorities have fallen asleep at the wheel and are madly trying to conduct reports for solutions as we speak.
Some of these solutions have been right under their nose for years, others need more work and will take time. The reality is we need more houses. With over 450 people on social housing waiting lists in The Great Southern and over 16,000 state wide this is an issue that will not being going away anytime soon. For more social houses you either need to purchase established in a hot market ( is this the best use of tax payers money? ) or buy land and build. Builders I talk with have advised me there is a 2 year wait to build a house. This is due mainly to the government grants program in mid-2020 where the market got flooded with buyers wanting to purchase land and build. The WA Housing Strategy for 2020 – 2030 report only factors in to build houses in WA that’s not going to make a dent into providing enough. That’s not going to cut the mustard by any stretch of the imagination. So tell those people looking for a house that there is nowhere to go for a few years! And as I write this blog there are only 44 properties for lease in Albany, 10 in Broome, 2 in Esperance and 23 in Busselton. This is a WA issue that’s not going away any time soon.
If you want investors to provide more housing then you need to encourage that. Amendments to the Residential Tenancy Act (RTA) continue to discourage them from buying and with more proposed changes that give landlords less rights, why would they want to buy and supply housing. I’d hate to be a landlord in Victoria with the tenancy law changes there recently. Without investors you don’t have a supply of housing in the first place. It will do tenant advocates to remember this when pushing for changes to the RTA because we need more supply not less of housing. Over 80% of Australian investors are mums and dads owning only 1 investment property. And government want to make it harder for them with more proposed changes to the RTA! It’s the majority of mum and dad investors who are generally borrowing and taking all the risk. While I do agree that there are some landlords that take the mickey, in my experience this is few and far between. Yes come down on them if they do the wrong thing but you need to encourage investors to provide more houses.
Another barrier for investors is stamp duty. This is a rip off and change is required. Real Estate Institute of WA (REIWA) has been lobbying the state government for ages now that at least a 75% reduction is required. We have one of the highest stamp duty rates in the country. I guess there must be a build-up of wax in the ears of these people that are meant to be listening, because the message simply isn’t getting through. At least NSW is trying something different with a different kind of property tax that at least allows some flexibility. It still may not be prefect but at least it’s something different. WA on the other hand is in la la land. If it’s serious about providing more housing it will do something now not wait for a budget, half year review or whatever other excuse they come up with.
An impressive read if you want to find more solutions is the Unlocking Housing Report. It’s a 50 page report that tackles all the important housing issues. More importantly it provides solutions which can be acted upon. Some I agree with and others I don’t. Take a read for yourself – the link is below. One thing is for sure, less talk more action is required before it gets even worse.
By Jeremy Stewart -Director of Merrifield Real Estate