It is an exciting time for Australian property thanks to a modest to strong growth in many locations around the country – including Brisbane. While other sources might be singing songs to a different tune, it is a really hard pill to swallow when the facts show growth and point to nothing but a positive future for Australian property as a whole.

Sure there will always be good and bad points to discuss, but when it comes to the Australian property market (and economy for that matter), there are many people out there making a living off selling the ‘doom and gloom’. And many of us take the bait.

 But a fact is a fact. To set the story straight, we thought we would shed a few home truths about the current global, Australian and local economic situation – and what it means for property investors in the scheme of things.

ON A GLOBAL SCALE

US jobless claims are at near all-time lows

The US workforce is dramatically bigger than it was, however out-of-work assistance is at record lows. The data speaks for itself – and it does not get much better than that!

Non-manufacturing PMI (Purchasing Managers' index) jumped to 54.4

This number right here is economic ‘boom’ territory. The biggest sector of the economy, the services sector, accelerated sharply, while the manufacturing sector also improved. The big sample official PMI edged up from 49.6 to 49.7; this is a small increase, but a rise nonetheless.

China is anything but slowing down

New orders for manufactured goods are up by a healthy amount. Additionally, the Fixed Direct Investment results for 2015 indicate a very strong 6.4% growth. There was also a 9.5% jump in investment in high-tech manufacturing. All positive news here.

Lower global energy costs 

Sure this might have come from the fact that oil has crashed (only due to traditional oil producers deliberately driving prices lower to force new fracking producers out of business) driving lower oil prices, thus lower energy prices in general. However, lower energy costs is still a fantastic outcome for the world’s consumers and businesses alike.

Germany posted its strongest growth of 1.7% in four years

It might not be a lot but it is still a growth, and their strongest one at that, so it is all positive and that is what we want to hear. Nothing negative about that.

ON THE HOME FRONT

Un-employment rate steady at 5.8%

The latest unemployment data on our home soil suggests steady growth in employment is underway, further indicating that there is certainly light at the end of the tunnel.

Australian dollar remains low

Our low Australian dollar means Australian property looks like a total bargain in the eyes of foreign investors, who will have an ever-increasing influence on the Australian property market for decades to come.

LOCALLY HERE IN BRISBANE

Queensland's infrastructure spend is 75% higher than the national state average

From 2000 to 2010 Queensland’s infrastructure spend was 75% higher than the average of other states and territories, combined at $1021 per capita (Source: Queensland Infrastructure Plan, 2011). Not bad really in the eyes of an investor. 

Future plans have recently been announced by Lord Mayor Graham Quirk, for a $1.54 billion "Brisbane Metro" subway system, a first of its kind in Australia and great news for Brisbane investors. 

Several new CBD developments  

With a strong vision for the future, the Brisbane City Council and Queensland Government’s long-term commitment to invest in critical infrastructure (such as the Queen’s Wharf) continues to transform the city and the state, with the ongoing delivery of new road, tunnel and rail links to support the competitiveness of industry and business.

Brisbane booming thanks to lower AUD

Key tourist destinations (such as Brisbane) are benefiting from the lower AUD thanks to strong interstate visitor arrivals! More and more Australians are expected to holiday right here in their own backyard as opposed to venturing off overseas. Thankfully Queensland is one of the top tourism destinations in the country, proving that while things might be looking somewhat differently for other states, right here in Brisbane, the future is very bright.

So let us be clear, when we say “opportune times”, we mean exactly that. Amidst all the media negativity and scare tactics, fundamentally our economic situation is actually very strong, and prices are holding up – as you can clearly see.

Perhaps potential property buyers have been holding back? But just you wait. Once Australian’s start to catch wind of how good things actually are in the current economy, things are expected to shift quick smart. Very quickly indeed.

Thus pointing towards another price acceleration phase, especially here in Brisbane where things are already on the up.

 With so much to get excited about with the economy (globally and locally), now is an opportune time to get in on the front foot. Are you ready?

 If you are considering investing here in Brisbane, or growing your property portfolio, now is a great time to book a consultation with Hannah and the team. Call 0419 782 133 to make an appointment. 

Do holiday rentals really bring in the big bucks or could it just be a bad case of mixing business and pleasure? Here, we explore three reasons why it might be a good idea to leave holiday homes off the investment portfolio.

When you think of the ‘Australian dream’ it conjures up all sorts of lovely ideals – including owning your very own holiday home. For many of us this is just a pipedream, but for some investors, the option to purchase a holiday house as an investment property is very much a reality.

 But, is buying a holiday house as an investment really a wise move? Or, as the good old saying goes, is it best not to mix business with pleasure?

 A beach house or secluded country cottage might be appealing for a weekend getaway but, when it comes to an investment decision, going down this path could end up causing more trouble than it is worth. Here are three possible reasons why:

 1.  Limited to certain ‘holiday’ areas

Finding the best areas to invest requires a lot of thorough research and industry know-how. Why limit opportunities by only looking for an investment property that is situated in a holiday hotspot?

Having too narrow a focus when it comes to searching for the best investment property is a crucial error and could cost dearly in the long run. Remember not to get caught up in the ‘idea’ of owning a holiday house; be realistic and invest in a property because it is a smart investment decision – not because it is a great vacation spot for two weeks of the year.

 2. Increased financial risk

No investor wants to hear the words ‘increased financial risk’ but when it comes to holiday homes purchased as an investment then investors need to be aware of the increased financial risk that they carry. This comes from rental returns varying with the seasons. Plus, if it not rented it out during the peak periods this will significantly alter the income return you can expect from the property.

In addition, from a capital growth perspective, properties in holiday spots are actually more exposed to price volatility because factors that support suburban housing markets, like infrastructure spend and employment growth, will seldom apply to these markets.

 3. Higher maintenance expenses

Holiday homes can often come with costs that aren’t typically associated with other investment properties. For example, in an ordinary lease you are likely to have the same tenant for a minimum of one year, possibly longer. Whereas, in a holiday house you could have as many 50 tenants in one year.

Higher turnover means greater repairs and ultimately more outgoings over that same period of time. Cleaning and maintenance bills are also likely to be infinitely higher – as are the headaches that potentially accompany them.

What about the furniture and fittings? How often do these need to be upgraded? Do you need to provide internet connectivity and cable television? These are just some of the extra ongoing costs that come with a holiday house – all of which can significantly influence your overall budget.

While they might seem like three very feasible reasons to rethink investing in a holiday house, another underlining factor is ‘inconsistency of income’. But do not take our word for it. The Queensland Office of Fair Trading (OFT) recently issued a reminder about the difficulties that holiday homes pose due to this very reason.

“One of the biggest issues potential owners face is not understanding the level of ongoing income and cost involved,” OFT executive director Brian Bauer said.

Hannah Schuhmann, Principal of HS Brisbane Property, agrees with the OFT, saying that she often sees investors fall victim to some of the more basic investment mistakes after buying a holiday house as an investment.

 “Not wanting to keep repeating the same mistakes over and over, we are now seeing a shift whereby more and more investors are turning their backs on ‘holiday investment properties’ for smarter investment opportunities right here in the Brisbane CBD,” says Schuhmann. 

“Nowadays investors are smarter, business-minded entrepreneurs who are more focused on the bottom line and less concerned about the bells and whistles. As such, they are looking to buy in areas that provide solid growth, modern infrastructure and increasing demand. They want a better return on investment. After all, that is what it all comes down to at the end of the day,” she says.

If you are thinking of selling your holiday house for a more reliable CBD investment contact Hannah on 0419 782 133.

Whether a first-time property investor or someone with an extensive property portfolio, it is no surprise that apartments will make up the core of any acquisition strategy. One of the reasons for this is because apartments are often considered a safe bet (in comparison to detached houses) when it comes to public/tenant liability.

 That is not to say apartments aren’t without their own risks. That in mind, to help avoid any possible pitfalls when it comes to investing in apartments, here are five potential safety points to keep an eye out for:

 1. CURTAINS AND BLINDS 

According to the Australian Competition and Consumer Commission one to two children die every year after being strangled by blind or curtain cords, with 15 deaths reported in Australia since 2001. Many of which are a result of children becoming entangled in the cords that are used to raise, lower, open or close the blind or curtain.

 Recently, in an effort to lower these statistics, several states made several important changes pertaining to the regulations surrounding curtains and vertical blinds.

 New laws include an update to the pulley system, as well as installation regulations, such as: (1) ensuring any cleat used to secure a cord must be installed at least 1,600mm above floor level and (2) no part of a cord guide may be installed lower than 1,600mm above floor level unless the cord guide remains firmly attached to a wall or other structure or the cord is sufficiently secured or tensioned to prevent the formation of a loop 200mm or longer.

 For more information on the new 2014 regulations, click here.

 2. WINDOWS 

When it comes to apartments, another child-safety issue is windows. Stipulations on how far a window is able to open were introduced in order to prevent children falling out of high windows – these vary from state to state. For instance, in some states there are rules that require windows can open to no more than just 12 centimetres width.

 In addition to regulations differing between states, sometimes they even change within apartment complexes as well. For example, while windows above a certain height from the ground may have a tight restriction, some ground floor units may be exempt. With so many variables that come into play, the safest way to really ensure your apartment’s windows are fully compliant with state regulations is to seek professional legal advice. 

 3. BALCONY BALUSTRADE 

Again, like window and curtain regulations, balcony balustrade height requirements vary from state to state. If you are thinking of buying an investment property with a balcony balustrade and it appears to be low, it is certainly worth making an enquiry into this with the selling agent. It is also worth investigating into compliancy issues that may result from a child (or adult!) balcony fall or accident as a result of a low-built balustrade. 

4. STAIRWELL BALUSTRADE

Be conscious of balustrades on stairwells - both inside and out – with an exception of ‘common property’ stairwells, whereby any accidents or deaths (pertaining to incidents) are handled by the strata plan liability insurances, not the individual unit or apartment owners. 

3. FIRE ALARMS 

With a large number of property fires around Australia every year, it is no surprise why we have such tight regulations surrounding fire and smoke alarms. This one should be relatively easy to regulate, given that most professional managers check smoke alarms and safety switches as part of routine property inspections. However, that does not mean you should get complacent. A simple follow up from time to time to ensure the agent is signing off on the inspection report is worth it, to ensure alarms are in working order. Again, while this is a good habit to get into it, it still is not an iron-clad guarantee that the devices are functional or have even been checked for that matter.

 It is important to reinforce that many of these regulations change per-state/territory. Thus, knowing the state rules in which a property resides is key.

For more information on property safety or to ensure your apartment is up-to-date with the latest laws and protocols, it is best to speak with a legal advisor who can inform you of your responsibilities and duty-of-care as a landlord.

 Here at HSBP we pride ourselves on working with some of Brisbane’s best Property Managers and Legal Advisors in an effort to bring you apartments that offer safety and a solid return on investment. For more information or to schedule an appointment with one of our professional agents, contact Hannah on 0419 782 133.

While there are a lot of benefits that come with having a property or building manager, it is not for everyone. There are many investors who much prefer to stay in control by flying solo without any property manager in toe. Sounds like you?

 If you have an existing investment or thinking of buying property, and are entertaining the thought of going DIY when it comes to the everyday management of your investment property, here are 10 questions you will need to ask yourself before taking the plunge and managing your own portfolio:

1. Are you assertive enough to chase up late rent?
2. Do you have the confidence to negotiate regular rent increases?
3. Do you have access to quality, reliable tradesmen?
4. Will landlords insurance cover you if you self-manage – if so, will the premium rise?
5. Do you feel comfortable with the tenant being able to contact you 24-7?
6. If you go on a holiday or overseas how will you manage the tenancy?
7. How will you verify that tenants are who they say they are?
8. How will you know if tenants have been evicted or have a poor rental history?
9. Could you evict a family, or person who has fallen on hard times?
10. Are you familiar with tenancy legislation? Do you have the time, expertise and confidence to go to a tribunal and publicly argue your case, if necessary?

While these points are all valid and definitely need to be considered, when going it alone, it all comes down to the million-dollar question – How much money will it save you, after tax? After all, it is an investment property and the entire point is to make money. Is it not?

So with all things considered, you really need to crunch the numbers and work out what you time is worth? Have you got the resources and freedom to devote to your investments? Or would that time (and stress) be better spent on other priorities?

The reality is that not everyone has the skills, time and temperament to successfully manage their own investment, particularly one of the size and scale required for real estate.

Whether you opt to manage your own investment or you outsource a professional, you will always need the backing of a reliable and trustworthy real estate agent to help you source and secure those valuable investment deals. You know, those ‘too good to be true ones’ that allow you to continuously build on your portfolio.

Thankfully that is where we come into the picture. Here at HSBP we source some of the best investment properties that Brisbane has to offer, which is why we work with some of Australia’s biggest property investors. For more information or to secure a private appointment, contact us on 0419 782 133. 

There has been a lot reported on the mining investment downturn of late, which appears to be having a dramatic impact across many segments of the economy. As a result, conditions in mining states have become more challenging as commodity prices have fallen further. But, it is not all doom and gloom. Let us shift our focus for a minute and explore some of the positives about Australia’s current economic situation. Yes, the positives.

Such as how, to a varied degree, further depreciation of the AUD is expected to improve the competitiveness of our exporting and importing firms. Other areas seemingly on the up include solid employment growth and lower petrol prices – both of which will sufficiently support household incomes and consumption.

 While these are all great, one of the most interesting examples (especially for Brisbane investors) is how the depreciating dollar (which is now AUD to USD66c) is expected to have a positive effect here on our home soil. This will become most apparent amongst the services sectors, such as hospitality, retail and education, especially those benefiting from tourism and international student arrivals.  

It seems, the states that will be particularly supported are (yes, you guessed it), sunny Queensland and the Northern Territory – the two Australian states in which tourism-related activity makes up a large proportion of the economy. Both of these states are expected to outperform all other Australian states in terms of overall gross state product in coming years.

The question is how? How are key tourist destinations benefiting from the lower AUD? The answer is strong interstate visitor arrivals! More and more Australians are expected to holiday right here in their own backyard as opposed to venturing off overseas. Thankfully Queensland is one of the top tourism destinations in the country, proving that while things might be looking somewhat differently for other states, right here in Brisbane, the future is very bright.

However, it is important to know that we are not saying that Queensland won’t be effected at all by the decline in mining investment. All we are saying is that fortunately for Queensland this decline will be offset by exports and a very strong tourism market.

This is great news for any Brisbane investor, just ask Alan Oster from the NAB.

In a recent article, Alan Oster wrote that he believes key tourist destinations are benefiting from the lower AUD (with interstate visitor arrivals particularly strong). Alan also said that domestic demand growth is slowly improving.

“More attractive rental yields and housing affordability than in NSW and Victoria are driving dwelling investment in Brisbane,” said Oster.

Once again proving that the future of the sunshine state shines very bright indeed and demonstrating, yet again, just another reason why now is the perfect time to purchase an investment property in Brisbane, or even look to expand your existing Brisbane portfolio.

For a complete list of available investment opportunities contact Hannah on 0419 782 133.