Which Mistakes Sellers Need to Avoid When Picking a Real Estate Agent?

Most of you will need a real estate agent when it’s time to sell your home.

There is definitely no problem in finding a real estate agent near you as their signs are everywhere. However, identifying which real estate agent is the right one is not quite easy. You have to ask yourself: Will this person be successful in selling my property for the best possible price, in the fastest time possible, and the least amount of hassle for you?

For most of us, dealing with real estate matters is not a normal occurrence. Hence, deciding which real estate agent to choose is not quite a straightforward process.

If you choose the wrong real estate agent, you are in for some financial and emotional woes.  So, when choosing a real estate agent, remember to avoid making these mistakes:

 

1. Hiring an agent with the lowest commission rate

Many agents will try to win over their competition by offering the lowest possible commission.  You’re probably thinking “I am saving. Why is that a bad thing?” Well, here are some other ways of looking at it.

Bargain commissions means the agent is skimping in other areas.  They simply are not offering  a full service.

If the listing agents decides to heavily discount the commission rate, buyer agents are likely to be turned off by how small a commission they would be getting. Therefore, it would be in the buyer agent’s best interest to take his client elsewhere and get the standard commission rate.

You have to question how come the agent is willing to cut his commission to get your business? If he can easily give up a huge portion of his commission thereby hurting him financially, you have to doubt his ability to negotiate a good price on your behalf!

Before choosing a real estate agent who is offering lowest commission, read the reasons above again. Try to compare his listing presentation with what other agents are offering to market your property.

 

2. Hiring an agent who gives you the highest listing price

When you have decided to put your property up for sale (and it’s carrying a hefty price tag), chances are that in the end you will sell at a price below the market average.

It is again important to reiterate to begin your marketing process with the right asking price. The first three weeks of marketing are critical and if your home has a high asking price, prospective buyers could simply skip over the property. Why? Because it’s a waste of their time to look at a property that is out of their price range.

Even worse, many real estate agents might use your overpriced home to steer their educated home buyers towards correctly priced properties.

What will happen is that your property will sit on the market for a long time and you will eventually be forced to sell at a much lower price than you would have received had you put the correct price on your home from the start.

 

3. Picking the real estate agent with the highest number of properties sold

You might be tempted to use the total of homes sold by an agent as the No.1 criteria when choosing a real estate agent.

While the agent who was only able to sell two properties in a month may not be your immediate pick, the agent selling three times as many properties in a given year should not be your first pick either.

Why?  Because of this thing called “sales-to-listing ratio.”

Picture this: the real estate agent who gives the highest listing price is likely to secure more listings. However, those overpriced properties will probably remain unsold for quite some time adding to the ‘days on market’. This means the number of homes that agent finally sells compared with the properties that remain on his books will be quite low.

Who is the better agent now?  The one who sells 10 out of 12 listings (80%) or the one who sells 30 out of 60 listings (50%)?  Remembering too that the length of time that your home is on the market for will also likely reduce the sale price as well…!!!

Instead of looking at agents who sold the most number of properties, look at how well the agent priced the home, what were the number of days on market, what the contents are of his marketing presentation, what his reactions were when you tried to cut his commission (to test his bargaining skills), how his general presentation and communication report went and if the final sale price was within or above the original appraisal price.

You will find these skills very helpful when it comes to negotiation time.

 

4. Interviewing only one real estate agent

It is recommended that you interview real estate agents from various agencies, as each agency offers unique strengths in marketing and servicing. The individual agents will have their own tools and talents to offer when presenting their marketing strategy for your property. If you interview only one agent, you will miss the chance of finding out what others have to offer.

Just like in other business, the 80/20 rule is also applicable in real estate. (Truth be told, the numbers is close to 90/10 in certain real estate markets.)

This means the rest of the 80-90% of agents will do what is necessary to secure those quite a few remaining listings, even going to the lengths of inflating “a little bit” the listing price. This is not uncommon in real estate.

So, if you’re only interviewing one listing agent, you should remember that there is an 80-90% chance that you will get one of the latter ones.

Do you want to hire an agent who will tell you whatever you want to hear in order to get your business?

 

5. Not checking references

Many people will spend more time reading the latest reviews on the internet before making a purchase than researching the background of a real estate agent before hiring him.  This, despite the fact, that the financial impact is 100 times bigger and will affect you for the next 20 years.

When choosing a real estate agent, spend time not only on looking at his listings, but also researching his information and looking him up on social media like LinkedIn or Facebook.

And you should expect each real estate agent you interview to provide you with references. However, bypass the references that were handpicked and put on the list, for obvious reasons.  Instead, ask for information on the current listings on his book and ask for permission to email or call a few of his current clients.  These latest clients can tell you how the agent rates in terms of professionalism and services during the home selling process.

 

For more tips on how to choose your next real estate agent in Newcastle, call Annette Pinkerton directly on 0418447856.

Tips to Avoid Mortgage Stress

There are many Australians with mortgages that fail to arrange for contingencies in case of interest rate increases or changes in their financial situation, both of which can hinder the ability to fulfil their mortgage duties.

There are many ways to avoid mortgage stress, including knowing your true financial circumstance, making extra payments, opening an offset account, or fixing interest.

Income information and estimated expenses are used by lenders and mortgage brokers to make sure applicants can pay the loan their applying for.  However, knowing your own financial position is vital in case there are changes, and some mortgage brokers provide their clients a family budget spreadsheet that they can use to understand their current financial position and allow them to better manage the future.

When there is trouble, you can relieve stress through changes in the loan or lifestyle with the help of a budget.  Especially important at this time of year as all those credit card bills from Christmas are beginning to come in.

Another way to avoid mortgage stress is by making extra repayments. It will move you ahead of regular repayments and reduce your interest as well.

There are also the offset accounts, though they can be quite accessible at times.

There are some lenders that allow clients to take a repayment holiday if the situation is ideal, like a new baby or major illness. However, even this is on a case by case basis.

A fixed rate is another way to ensure repayments, especially with interest rates at record lows at the moment.

Best advise is to get educated about your own circumstances and use the services of a professional to help you!

 

 

5 Major Wardrobe Fails and How to Correct Them

How do you know you have a messy issue in your wardrobe? You can’t get dress every morning without feeling like you have just been in a fight.  Let’s face it, if any mess started in your closet, it is inevitable that more mess will happen.

We ask the experts to help you identify and fix the mistakes you have been making in your closet.

  1. Mistake: Using a wardrobe that doesn’t fit your needs
    Remedy: Know all the things you own

The experts say that the first thing you need to do to have an organised wardrobe is to remove everything from it.

To determine the wardrobe that best fits your needs, go over all your clothes and group the items together so you get an idea of how much space you need to allocate for long clothing, and for tops and pants.

  1. Folding too many clothing
    Remedy: Reduce air space and “categorise” your clothes

Experts recommend that if you have adjustable shelves in your wardrobe modify the shelves to move them closer together. Doing this will prevent your clothes from piling up and cause needless mess. You can even create extra shelving or new hanging space, depending on how much space is left.

You can also use containers or cubes. For clothes that you use quite often, you can use transparent, acrylic-style storage in order to store similar items together and use it like a drawer.

“File” your clothes instead of piling them up on top of each other. By doing this, you can get what you need without taking everything out. For example, place in one container similar items like sleeveless tops, T-shirts, cardigans and jumpers.

  1. Mistake: Showing off the clothes you don’t need at the moment
    Solution: Store them in an upper storage space with labelled inserts

There is a storage space built into the top of most wardrobes. Use this space to keep items that you rarely wear, like clothes for special occasions and seasonal clothing. Once again, use labelled storage containers to keep your items organised and easily accessible.

  1. Mistake: Improper organising of hanging space
    Solution: Just think that you’re shopping for your clothes

Experts say that people that go inside a retail store are likely to be drawn to clothes on hangers because they can see the whole thing.

So, it is recommended that you organise your wardrobe as a store would. What this involves is using hangers that are similar and sorting clothes based on type. Those who are extra organised can even arrange their clothes based on type and colour.

You should also factor in the style of hanging space when you’re figuring out how to show off your clothes and what type of hanger to use. For example, a double handing section is best utilised by folding your long pants over the hanger to cut their length, and clip hangers for shorts or skirts.

  1. Mistake: Shoes that are out of your sight
    Remedy: Utilise tilted racks or shelves

The best way to store your shoes is on a higher shelf from the bottom, depending on the design of your wardrobe.

For example, if you have shelving that you want to use as a shoe rack, place the back peg of the shelf higher up than the front to create a tilt. The other option is use the bottom of your long hanging section as a room for an expandable shoe rack.

You know the old saying, right???  “Out of sight; out of mind”.  The end goal is to make sure all of your things are placed where you can see them. 

 

 

What Renters Really Want From a Home

Investors could be making a mistake purchasing a house on the best location. They probably believe that a renter’s dream house is a four-bedroom with great water views, but the reality is that renters are only concerned about the basics.

This is basically what new research found: investors are not likely to see a return on their investment if they rent out properties in affluent suburbs like New Lambton Heights or Coal Point.

So what do tenants really want?   Options!!!

Here is a list that may help you focus on the location of your next investment:

  • Houses within 500 metres of a train station, bus route or close to Newcastle University are the best locations for investors. Renters, in general, belong to the low income group and are less likely to own a private vehicle and would much prefer public transportation.
  • These renters would generally be younger, or in their 20’s rather than in their 70’s, as they would find it easier to use public transport.
  • Also good targets for investors are houses around Callaghan, Waratah West, Warabrook, Shortland and even apartment units in Jesmond.
  • New Lambton Heights and Coal Point are richer suburbs, and therefore, offer amenities that mostly appeal to a homeowner rather than a renter.
  • Homeowners generally preferred to be in districts near schools.
  • Investors aiming for high gains should stay away from suburbs out by the lake and areas that are affluent.
  • People who invested in apartments were receiving better returns than those with houses most likely because they are located in more convenient areas.

According to this recent research, investors should consider what renters want, not what they want, like proximity to public transport, education, etc.

Try thinking like the ideal renter instead of what appeals to you and find an investment property that will always be occupied!

 

 

Could Rentvesting be your 2019 Goal?

What is rentvesting? Could you make it a New Year Goal to become a rentvestor? 

Rentvesting is a strategy where a person rents a home in an area they desire and purchase in another area. It’s probably not the first time you’ve heard of this term, but if you’re new to the real estate market there is probably a few facts that you don’t know about this buying strategy.

Here are five unknown facts about rentvesting:

  1. You can maintain your desired lifestyle with rentventing

Are you living at home or renting in a trendy inner-city suburb?

You may feel like living the dream life in a good neighbourhood, until it dawns on you that you’re still living with your parents or you’re living in the city with all the amenities and attractions, but you’re always short on cash. 

Through rentvesting, you’re on the pathways towards property ownership while living your present lifestyle in the neighbourhood you like.

One of the major factors to consider when purchasing a home is location, and being without the means to obtain property in the area you desire is typically an enormous obstacle to people wanting to enter the market. It’s also a tempting option for people who always travel for work or like a more flexible lifestyle.

By giving you easy access, rentvesting allows you to boost your capital wealth with property, without sacrificing your lifestyle choices.

  1. You expand your options… to across Australia with rentvesting

Another of rentvesting’s draw is you can basically buy in any popular property market in Australia – because you will not be residing in the home you’re not confined to a local area.

There are sections of suburbs across Australia that are enjoying fast growth and astronomical rental income, but remain more affordable compared with major cities such as Melbourne, Sydney or even Newcastle’s inner city.

There is no risk of loss from buying property without seeing it, in a market where you’re not familiar.

What you need to do is conduct research and go to the location before you purchase in order to become familiar and make sure the property meets your standards.

It is also recommended that you keep up to speed with any taxes, fees and other expenses imposed by the specific state where you’re buying to avoid being caught unaware by unforeseen expenses.

  1. You can enter the market sooner with rentvesting

One of the major challenges for first-home buyers is saving for a deposit. It’s a fact that it can take you years to save for your forever home.

But because rentvesting lets you invest in another region, or in an outer suburb that is more within your reach, you will need to save just a smaller amount of deposit. This mean you can jump into the market sooner.

  1. Rentvestors could benefit from high rental yield areas

Minimising costs and increasing income is the key to boosting your cash flow in the investment property market.

Taking note of that, don’t be too focused on capital growth. Instead, focus on high rental yields. This income will help keep you afloat while you juggle paying cash for your investment property and paying rent in your desired location.

  1. You could further offset your own rent with practical measures

How can you further increase your income through rentvesting?

  • A rentvestor is an investor, and there are several simple and practicals approaches to boost your cash flow as a landlord.
  • Permitting pets
  • Raising rent, in accordance with market performance; and Renting out add-ons in your property, like storage spaces and parking spaces.

These are easy ways to boost your rental income, in effect your cash flow, through your investment property all while you are living in a beautiful property in a suburb you like.