Ideal time to assess portfolio
WITH the end of the financial year approaching, it is the perfect time to conduct an audit of your property investments. Perhaps it’s time to look at selling your current property and replacing it with something that offers better growth, quality or be more tax effective. Maybe it’s time to look at growing your portfolio? How long has it been since you evaluated things? Does your rent level need adjusting? Is your property in urgent need of maintenance and should this be done before the end of the financial year or later? How long has it been since you evaluated your property manager and their role in your financial growth – perhaps it’s time for a change. You will already be meeting with your accountant – make it a longer meeting and determine if your investment is truly working for you and you are claiming all the deductions you can. A great many properties were never intended to be suitable as investments and perhaps your circumstances have changed. It is worth considering that if you were to purchase a new property each year for 10 years you would be looking at a very comfortable retirement. It can be done. Greg Clyde-Smith, director, Elite Cairns Rentals, Edge Hill and Whitfield A POTENTIAL future oversupply of units may have prompted banks to shift their lending criteria in “risky” postcodes, but astute investors are still looking to Cairns to nab a city- based bargain.
According to a Cairns real estate direc tor, Kaine Rowe, apartments are also looking attractive to empty- nesters wanting to downsize.
“The majority of units I am selling are going to owner-occupiers,” Mr Rowe said.
“At the higher end of the market, it is downsizers wanting to move from the house in the suburbs and at the lower end it is more first-home buyers wanting to enter the market.”
While some banks are calling for a 30 per cent upfront deposit for units in some capital cities, lenders are still largely willing to sign up buyers in Cairns.
“I have encountered issues with buyers being unable to get finance as they have not chosen the right lender for the type of apartment they are buying,” Mr Rowe admitted.
“It is important buyers get the right advice when they are looking to get finance for an apartment. Every bank has different criteria when it comes to lending on apartments.
“Although a buyer may have banked with someone for years, they may have much stricter rules than someone else, so it is very important to speak to a broker when looking to purchase an apartment.”
He said the number of apartments in a complex and the zoning of a block could affect how much a bank was willing to lend.
“Another thing which often becomes an issue is furniture,” he said.
“If furniture is included in a contract, the valuer will take off what they perceive the value of this to be from the price, which will mean the buyer may have to put more funds to make up this difference.”
Mr Rowe recently listed a seventh-floor, three-bedroom apartment in the heart of Cairns city for $599,000.
The Axis complex apartment on McLeod St was suited to an owner- occupier and boasts sweeping views and modern living, Mr Rowe said.
“Units can offer great value for owner-occupiers and investors alike,” he said.
“For owner-occupiers, considering rents are continuing to climb and interest rates are so low, getting out of a rental and owning their own property units are very affordable and offer great value.
“With southern markets becoming overheated and returns being so low due to high sale prices, the return on our units is becoming more attractive.”