Are you thinking of downsizing?

Buying

Are you thinking of downsizing?

There are several reasons for downsizing and many benefits for those looking to improve their lifestyle.
For empty nesters, the family home holds fond memories of raising a family however, rooms are now empty or used as storage. Although sentimental attachment has you holding on, embracing the next stage and finding the right home brings with it freedom and a new lease on life.

Selling a bigger home and buying a smaller one helps to reduce or eliminate entirely your mortgage. Smaller homes cost less to run, freeing up cash flow and giving massive savings on interest over the term of your mortgage. With the money saved on your mortgage, there’ll be more to enjoy for recreation, travel, opportunities for the family or preparing for retirement.

Downsizing will also provide you with a more manageable home base that is more easily maintained and cheaper to run with lower electricity, gas, heating and cooling expenses.
By downsizing you have more freedom and time to enjoy at your leisure and you’ll gain peace of mind. Less clutter and less or no debt will lead to a clearer state of mind and give you the opportunity to enjoy a new, simplified home and lifestyle.




REASONS TO MOVE.
Moving into a new home can be a hassle. Nobody really enjoys packing up all of their belongings and carting them off to a new place. This can lead many people to stay in their houses for a long period of time, despite their needs or the family's changing over time.

But sometimes moving house is a necessary part of life. Whether it's due to a steadily growing family, children moving out or shifting for a new job, there are many reasons why you might need to relocate.

Over time your neighbourhood can change too. The house next door might have once been occupied by a nice family, but has since become rented student accommodation. A busy shopping mall may have been erected at the end of your street. Perhaps the house next door has been demolished and new townhouses or apartments now block out the sun.

These are all good reasons why you might want to consider moving to a brand, new area, as being happy in your home is extremely important.




WHERE TO BEGIN.
Base your research on your interests, hobbies, financial situation, location of friends and family, and how you envisage living your life to the fullest.

The internet is the perfect place to start. If it’s city living you love look for a townhouse, apartment or unit. Moving from the suburbs to the city offers you increased access to museums, restaurants, shopping and theatres. A move to a smaller space in the city could also enable you to sell your car.

Age-qualified communities for those 55 years old and older are often gated and offer amenities such as a pool, fitness center, organised activities, athletic teams, sports courts, a golf course and more, so your new home could feel like a permanent holiday! Alternatively, the long-awaited dream of a lifetime sea change or tree change could be just around the corner.

Interestingly, a move like this can be even more emotional for adult children than it is for parents. Speak to your family about what you are thinking. Share your thoughts with them and find out if they have any questions or concerns.




WHAT TO KEEP, WHAT TO GIVE AWAY.
Moving homes can be emotionally difficult. You might need to sell or give away furniture, clothing, knick-knacks and artwork that you've collected over the years. Focus on what you need and use on a regular basis
•Get rid of unnecessary clothing, books, garden tools, toys and kitchen appliances you no longer use
•Go through all that old paperwork and get rid of files you no longer need – securely of course
•If you’d like to lighten the load, offer family members the items you no longer need
•Hold a garage sale. It’s amazing how much you can get rid of and how much money you can raise




DOWNSIZING TIPS.
Downsizing your home raises lots of questions so here are some tips:
•Choose a location that is central to where your children and friends live, if possible
•Check the closet and storage space in smaller residences and be sure you have enough room
•There are common access points in apartment living such as parking bays, corridors and lifts. It takes time to adjust from living in a residential house so be sure you understand the limitations of 'common property'
•Apartment blocks have body corporate rules and, often, minimum fees per month that you may wish to review before purchasing your dream downsize apartment
•Consider an extra room can that can double as a part time study, reading room or bedroom when friends, guests, children and grandchildren visit
•If downsizing for retirement, consider only properties with at least one downstairs bedroom and bathroom so stairs cannot become a problem - forcing you to move again




SELLING BEFORE YOU BUY.
If you sell before you buy, you’ll know exactly what price you’ve achieved so you can budget effectively for your next property.
If you buy first, you can move straight from your large home to your new, smaller home, so there’s no need to rent or pay removal costs twice.
There’s also no pressure to buy a new smaller house or apartment that’s not quite right, because your settlement date is looming.

However, you may find yourself in the position of making repayments on two houses at the same time. If your current home doesn’t achieve the price you expected, you may come under unnecessary financial strain. You may then feel pressured to sell your old home urgently.

Research your loan options with a financial advisor or mortgage broker. If you’ve sold your existing property, but not yet settled, a Deposit Bond could be the most cost-effective way of financing the deposit for your downsizing property.
Think also about whether you’d prefer to keep your first property, rent it, then use the income to help finance your next home.




PRESENTING THE HOME.
Presentation plays a major role when selling your home. First impressions count and encourage more buyers to take interest.
Here are 14 tips to make sure your presentation is the best it can be:
•De-clutter your house - make sure all rooms and cupboards give an impression of space
•Conduct a thorough clean of every room from top to bottom
•Make sure all fixtures and fittings are in good working order
•Repair any broken items
•Make sure bathrooms, laundry and kitchen are spotless
•Make sure all appliances included in the sale are in good working order
•Weed garden beds, mow lawns and nature strips, and trim the edges
•Any rubbish or other debris removed from the garden
•Sweep paths and driveways, and oil stains removed
•All guttering and windows cleaned
•Open curtains and blinds to let natural light to shine in
•Air the interior of the property to remove unpleasant smells or odours
•Consider a fresh coat paint in neutral tones to brighten up dark areas or rooms.




CHOOSING THE RIGHT REAL ESTATE AGENT.
One of the most important elements when choosing the real estate agent to represent you is ‘trust’.
An agent offering you the lowest commission rate and/or the highest appraisal is not necessarily the best option. To make your selection easier, take the advice of the professionals:

•Ask your colleagues, family, friends and neighbours to refer you to a proactive agent
•Search the internet for reviews from past clients of local agents
•When you interview your potential agent, ask the following questions:
- How many properties did you sell last year and last month?
- How many buyers are you working with at the moment?
- Can you provide me with an example of your marketing campaign?
- How many salespeople do you have in your team?
- What charges will I incur if the house doesn't sell?
- If I am not happy with your performance, how do I cancel our agreement?
- Can you provide me with a list of your past clients and testimonials?
- How often will I receive feedback on the progress of my sale?
- Can you provide me with 3 recent sales in the area, similar to my property, and what they sold for?
Firstly, ask them how they arrived at their opinion and what other homes, like yours, have sold nearby recently. If your agent can’t justify their estimate to you, they’ll never be able to justify it to a buyer. Do your research. Check other recent sold prices on the Internet.
- What is the average house price in my area?
- Do you have similar properties to mine currently for sale?




THE ROLE OF A REAL ESTATE AGENT.
The real estate agent has been selected by the seller to sell the property and maximise the owner’s price.
The agent organises marketing, inspections, passes on written offers received, and negotiates with multiple buyers under the instructions of the owner.
The agent receives a commission, based on a percentage of the sale price, as payment for their services.




INSURANCE.
It’s wise to insure from the moment you have signed a contract to buy your home. Risk passes from seller to purchaser, immediately upon purchase, even though you have not settled and taken possession of your new home.




PREPARING FOR AN INSPECTION.
Everybody knows first impressions are everything. When you open the doors of your home to the public for an inspection, you'll want to ensure it's looking its absolute best.

Accentuate its features
Your home might possess many great features - and now is the time to really show them off.
Depending on what the season is, you might want to showcase some features more than others. In winter, light the fireplace or turn on the heating to demonstrate how warm and cosy your home can be.
Alternatively, open all windows, blinds and doors in warmer months to let cool breezes flow into the home.

Throw out your junk
Inspections are a time to clear out your clutter. Not only will this reduce how much stuff you'll have to take with you when you move, but it will also help to make your house look tidier too.
If you really need to keep all your possessions, consider hiring some storage space for the short term.

Leave them to it
When people start arriving to look at your home, it's a good idea to pop out for a while. This will leave prospective buyers to feel more relaxed and free to roam your property.
If you have a dog, take this opportunity to go for a walk with it, as this will get both of you out of the house. Make sure you put your pet’s bowls out of sight as well.

Give your home a facelift
Have you had a good, long look at the front of your house? Does it look welcoming and attractive? If the weeds have popped up and there are nasty oil stains on your driveway, you might want to think about giving your home a quick facelift.

The front of your home is the first place a prospective buyer will look, so it pays to make this part clean and tidy. Don't forget to wash all your windows and pull back the curtains, too!




PRESENTING A SPARE ROOM.
If you're about to have private appointments, but you don't know what to do with your spare room, here are three simple ideas to help you.

Office
Show off the practicality of your home by installing a desk, swivel chair and a computer. Many people now work from home and by creating a quiet, peaceful area, you can show prospective buyers what your property has to offer.

Library
Grab a few bookshelves, a comfy chair, rug and a footrest and you can easily convert your spare room into a little library. Play around with the decor to get the feel you want - whether it's a light and airy space or warm, cosy reading nook.

Fitness room
Have you got a couple of pieces of fitness gear lying around? Convert your spare room into a small gym. Whether it's a Swiss ball, yoga mat, a treadmill or a couple of dumbbells, it's easy to show the potential the room has as a home gym.

If you happen to be short by a couple of items, ask a friend or family member to lend you a few things. Don't leave your spare room empty or filled with clutter - spruce it up in whichever way you feel to show buyers the potential and options your home has, to accommodate their lifestyle.

Ultimately, showing people how your home could perform, rather than how you currently use it, often widens its appeal. That's what you're aiming for - attracting the broadest possible range of buyers so your agent can maximise your price.




BUYING AN APARTMENT OFF THE PLAN.
Buying ‘off the plan’ provides investors with the opportunity to buy some of the best-positioned apartments within a complex. When the market is rising, it can also sometimes offer property investors a capital gain by the time construction is completed.

Here are some tips to help you make sure you make the decision that’s best for you:
•Make sure you look carefully at the displays that developers make available. These will show examples of carpets, tiles, kitchen fittings and finishes, colour schemes and general fittings.
•Ask about previous projects that the developer has completed. Arrange an inspection to make your own judgment as to the quality of construction.
•Ask residents of the developer’s previous projects how happy they are with the property they purchased.
•If you’re not confident you understand floor plans, consider asking an architect to assist you with your decision making.
•Banks generally won’t provide unconditional approval of your property loan when you buy off the plan. If the market moves downwards, between your purchase and settlement, you will need to be prepared to find additional funding.
•It is a good idea to include a finance clause in your contract and get a valuation ‘as-if-complete’ when you’re getting your initial approval. This will allow you to gauge how the property stands within the current market, as well as how the bank views the area and the property’s potential.
•Get legal advice before signing a real estate contract. Make sure you understand delivery timeframes, sunset clauses, size variation clauses and confirm that you are buying what you believe you are buying.
By conducting your due diligence and taking your time, you can take advantage of what off the plan purchasing can offer buyers; a way to secure a quality property in the future, at today’s price.




BUILDING AND PEST INSPECTIONS.
Building and pest inspections typically cost around five hundred dollars but are a vital part of the due diligence process when buying a house. When buying an apartment, a strata inspection report may be more appropriate, depending on the size and construction of the block. Remember though that almost all inspection reports reveal some form of problem, particularly with older properties.

A building and pest report will provide crucial guidance as to the condition of the property you are considering and can be useful in price negotiations, if significant problems are present. Here are some tips on understanding and responding appropriately when you receive your report:
•Don’t be shocked if your report is in the order of 30 or more pages. That’s normal.
•The presence of ‘past termite activity’ should not be viewed as a deal breaker. What is important is the extent of the damage and whether there is evidence that corrective action has been taken. Naturally, if current termite activity is present, this is potentially serious and needs to be fully assessed and dealt with.
•It is the building inspector’s job to point everything out that he/she sees to ‘cover’ themselves. It’s important you calmly read through the information and understand what it means.
•If you have a question, phone the inspector. They will often be happy to discuss their findings and explain their relevance.
•If major faults have been found, discuss these with your real estate agent. It may be possible to negotiate a suitable adjustment to the agreed property purchase price.
•Be realistic. A small range of typical faults may not be fair grounds to renegotiate price.




MARKET VALUE
"Market value" is whatever a willing buyer will pay for a property when it sells.

While this advice doesn’t help new buyers, or even experienced buyers, there are ways to work out what you should pay for a property. Here are our tips:
•Use technology. Many real estate websites provide suburb median prices and recent sales details. Remember that a median price is only indicative of the middle price in a suburb; it may not reflect the value of the property you are considering.
•Ask real estate agents.
•When buying an investment property, rental returns are the key factor in determining value. 5 per cent gross rental return is considered the ‘rule of thumb’ which essentially converts to $1 in weekly rent for every $1,000 spent buying a property.
•Obtain a valuation. Formal valuations can cost between $500 and $1,000 but a licensed valuer must support his or her indicative price with solid comparative market evidence.