Housing Affordability Worries Remain in 2020

According to CoreLogic’s national home value index, home values rise through December 2019, cap-ping off a solid ending to the real estate market for the calendar year. This minimal rebound in dwelling prices indicates home owners are becoming richer, which may also assist in paying for household expenses.

On the other hand, housing affordability is forecast to worsen even further as house prices surpass growth in household incomes, indicating an impediment for people who are saving for a deposit.

The deteriorating housing affordability is likely to slow down the activity across price-sensitive sectors of the market. This particularly true for Sydney, where housing prices are already pegged at 8.2 times greater than gross annual household incomes midway through 2019.

Regardless, an increase in investors who are drawn in by opportunities for capital gains and a positive spread between mortgage rates and rental yields should help counteract a decline in active from more price-sensitive buyers. 

In addition, minor cities where housing prices are more reasonable and economic conditions appear recovering may provide certain protections for investors who will see advertised stock levels increase.

Jobs and population growth is weakening in NSW and Victoria, while the situation is picking up in Queensland, Western Australia and, to a lesser extent, South Australia.

Relatively low dwelling prices, combined with increased migration rates and recovering jobs growth, could prove beneficial for the capital cities in these regions.

With household values tipped to increase through 2020 across most regions, the year may result in a change in the growth dynamic, with bigger cities forecast to experience a slowdown in the fast pace of progress seen through the second half of 2019.

In contrast, minor capital cities like Perth and Brisbane, as well as major regional hubs and lifestyle markets like Newcastle are expected to enjoy improved conditions as buyers are drawn in by affordable prices combined with job opportunities and lifestyle factors.

 

 

Pantone’s 2020 Colour of the Year is…?

For all the interior lovers out there, the Pantone Colour Institute has announced its 2020 colour of the year. And it is: Classic Blue!

According to Pantone, the leading forecaster of worldwide colour trends, the classic blue colour will be everywhere in 2020. This is what the global authority for colour and communication and inspiration has to say ahead of the beginning of a new decade:

“Instilling calm, confidence, and connection, this enduring blue hue highlights our desire for a dependable and stable foundation on which to build as we cross the threshold into a new era.”

On the company’s website, it also posted a short video to describe the feel of the colour, showing a night sky, faint mountain ranges, and a soothing soundtrack.

The Classic Blue colour underscores “dependability, trustworthiness, credibility, and constancy, all characteristics that are important in today’s fast-paced, high-stress world.

In addition, deep blue goes with the shade of the sky at dusk, which is a perfect example that shows why this colour resonate with a lot of people.

For over two decades, Pantone’s colour of the year has strongly influenced many aspects of life, including home design.

So how did Pantone come up with Classic Blue as the colour of the year?

Pantone says, experts from various fields, including in the entertainment industry and films in production, travelling art collections and new artists, fashion, interior design and lifestyles, “comb the world looking for new colour influences.”

By using Classic Blue, Pantone wish to promote a feeling of peace and tranquility, and foster interaction.

Technology is developing at a pace that humans have difficulty processing at the same speed, so it’s not difficult to understand why people are drawn towards colours that are authentic and give the promise of security. The trusted PANTONE 19-4052, non-aggressive and easily relatable, inspires a relaxed interaction. Linked to the return of another day, this beloved shade is easily adopted.

If you are planning a new home, a makeover or interior design project in 2020, don’t just ignore the colour of the year. You’ll see a barrage of mood boards and Pinterest sites in no time.

 

 

 

5 Home Features that Seldom Add Value When You Sell

A rule of thumb that you should aim to achieve when renovating is to add three dollars back from every dollar you spend.

This three-dollar-for-one rule instantly manifests if the money and time you had invested was worth it. So if you want to add dollars to your home’s final sale price, you need to know which items not to spend your money on.

So, what are the home features that add little or no value to most properties. Here is the answer according to avid investors and renovators.

  1. Swimming pools

You have probably heard this before but it is worth repeating: a swimming pool is a major investment, and it will not give you the return you are hoping for.

You may like this feature, but others may see it as a hassle, danger, or expensive to maintain. If you are in a suburb teeming with young families, you may see them reject perfectly nice homes because of a swimming pool, so if your home already doesn’t have one, don’t build one in hopes of making a good sale.

Swimming pools may look like a good idea, but it is an expensive addition. If you are selling, it can turn off a prospective group of buyers, like families, the elderly, and potentially property investors. A pool will not attract these types of tenants because of maintenance, public liability, insurance and local government regulations relating to fencing and safety barriers.

  1. Excessive fittings and fixtures

With so many renovation shows on TV showing contestants being provided with ridiculous amounts of money for renovations, high-end products of all sorts have been introduced to try to win points.

But while the latest stove may be what your heart desires, with a customised backsplash made of cow hide and gold trims, this may not fit the taste of your buyers. Unless your target buyers belong to the rich, the fixtures and fittings, no matter how expensive and extravagant they are, will not give you a high return on investment.

  1. Things you cannot see

Something you can’t see is not likely to increase your return. This comprises wall and ceiling insulation, double glazing, new air-con systems and stumps.

These things are good to add to your long-term home. But don’t put them in as a selling feature because most people assume they are already installed and are in good working condition. However, it is fine too if they are not there.

Air-conditioners don’t add value to a home for sale. In Australia’s sub-tropical regions, air-conditioning is a must. But, installing a nifty split-system priced at say, $1,000, does not boost the price of your home by $5,000 as many home sellers think. This type of features only boosts a home’s marketability, not the value.

  1. Lavish landscaping or no landscaping

You have to find a balance when it comes to your garden.  A lack of a garden is a major turn off, much like a very fancy garden.

Experts advise a basic makeover is definitely the way to get a return on your outdoors expenses. Some lawn and a simple, easy to maintain garden design should suffice. Don’t go crazy with water features, cladding, secret gardens, paving, etc.

And your rare and/or edible botanicals will not boost your sale price either. You may be able to make delicious marmalade from your fruit trees, but you don’t automatically get money for the jam.

Some sellers believe that trees will be a big seller and add significant value to their property. But unless your property is a working orchard, the average buyer will be lukewarm to a guided tour of fruit trees as they’d rather hear and see the benefits and amenities the property actually offers.

  1. Sub-par DIY work

It’s not so hard to get a false sense of what an average person with a hammer and paint can do. What person wouldn’t get excited at the thought of saving lots of money? But this doesn’t mean homeowners can’t DIY minor cosmetic improvements and do a good job of it.

But it can cost you a lot to do a below-than-average job. Defective tiling and painting is easy to see at open homes. The value of a house decrease with half-finished jobs.

Even if you don’t hire a professional in order to save money, if you don’t have the confidence in doing the job it can end up taking you longer to achieve the desired results. That delay will mean a delay in getting your property to market.

Electricity and plumbing will also require the sign-off sheets from tradespeople for the works completed, so before you start determine what jobs you can do competently.

Bridesmaid Suburb: Your Alternative When Priced Out of your Dream Suburb

Is your heart set on living in a specific suburb? Maybe it’s a short distance from your work, you grew up in the area, you want access to a particular school there, or you really like the homes there.

Home prices increase due to buyer demand in popular suburb pockets. It means the hope of residing in a particular area is isn’t attainable for many, especially first home buyers.

But sometimes, checking out the suburbs near your dream one, frequently referred to as “brides-maid” suburbs, can open up homes in a buyer’s price range.

Look a bit further afar, particularly if you know nothing of the area. It can give you a wider base to begin your search on. Switching suburbs can gain you access to another bedroom, it can give you a backyard, it can move you from townhouse into house territory. There are many advantages.

When helping buyers in search of their new home, there are four things that a good agent will ask them to compromise on: raising their price range, lowering their expectations of size, purchasing an older home, and remodeling, or expanding their search further afield.

Of course, you will also need to compromise some things if you decide to live in a bridesmaid suburb.

These suburbs are less costly because you need to make concessions. They are inexpensive for a rea-son. However, if you list down a wish list and agree to compromise on certain things, you’ll be amazed how your dream suburb matches the so-called bridesmaid suburb.

Assessing sacrifices like commute time, or additional walking distance to stores and cafes, often doesn’t measure up with considerably lower mortgage repayments. And there are many of these throughout the capital cities.

For example, a family home in Williamstown has a median price of $1.3 million, but in Altona (an inner southwestern suburb in Melbourne), which is just one suburb away, can save you $500,000 on mort-gages.

In Brisbane, Ascot is an established blue ribbon suburb, well-known for its verdant streets and time-less Queenslander homes. But one kilometre away to adjacent Hendra, the median home value is down by $300,000. 

In Sydney, a perfect example is Mosman, with a median home price of $3.7 million. But in Naremburn, which is just a 10-minute drive away, has a median home price that is $1.8 million lower than “bride” suburb Mosman. Aside from cheaper, this bridesmaid suburb has a café culture, that highly regarded lower north postcode, or similar distance to the city.

It is a long term play if you buy in a bridesmaid suburb play. Being located adjacent to a more favoured suburb means there is a high probability that the neighbourhood will be gentrified over the years, which can only support your outcome if you decide to sell.

You benefit from the drag up effect, particularly if it is an adjacent postcode and it has not yet become popular like the original suburb you are looking at.

Expect to get an overflow from other similar-minded buyers as well, so gentrification is a major deal when you are considering the neighbouring suburb.