From the worst market to one of the best: Why house prices in Darwin have skyrocketed

From the worst market to one of the best: Why house prices in Darwin have skyrocketed

https://www.domain.com.au/news/from-the-worst-market-to-the-best-why-house-prices-in-darwin-have-skyrocketed-1003364/

This is the sort of reporting you must read and digest. The median price in Darwin has increased by more than 6% year-on-year, mainly due to Victorians’ contribution. The Darwinians must be annoyed by the Victorians, just like Sydney siders and Victorians who got shixxy with the Chinese migrants who pushed up the house prices in their respective states.

The slight increase or no increase in some cities are mainly due to lockdown, and the small sample size used in the calculation.

Queensland experienced a big surge when early baby boomers turned grey nomads and moved to the sunny state, only to find that they couldn’t just enjoy the sunshine without their long time mates and relatives near them.

It takes time to adjust and establish oneself in a new environment. Many moved back to Melbourne, the place they call home.

There is financial benefit to invest interstate because land tax is a state tax, and more Victorian properties one owns in the state, the higher the marginal land tax rate.

The real estate market as I have predicted will continue to rise in Victoria after the lockdown probably until early next year, when the real impact of unemployment kicks in, and government assistance is withdrawn.

Once the Ring of Steel is removed, potential investors should consider taKing a drive to some regional towns for a exploratory tour, and in the meantime help the local businesses. Make sure you have a chat on the phone with some local agents before you go roaming without any purpose.

Thank you for reading.

From the worst market to one of the best: Why house prices in Darwin have skyrocketed

Find out your property value with just your address

Find out in under a minute
https://www.realestate.com.au/property/value-my-property

If you can’t see the attachment, it means realestate.com.au has removed their post. The following is how I comment to the post:

It is very irresponsible for realestate.com.au to post such a message. This is misleading because the address does not show the condition of the house - whether it has been wrecked by tenants from hell, uncaring owners, pets, etc, or it has been meticulously renovated.

I would like to see this post modified or removed!

Thank you for reading.

Find out in a minute

Cathay Pacific job cuts will hit Hong Kong housing market axed pilots, cabin crew move away or downsize

Cathay Pacific job cuts will hit Hong Kong housing market axed pilots, cabin crew move away or downsize
https://www.scmp.com/business/article/3106631/cathay-pacific-job-cuts-will-hit-hong-kong-housing-market-axed-pilots

Qantas on Thursday 25 June 2020 announced at least 6,000 employees will be laid off and another 15,000 will remain on furlough, due to economic conditions linked to the COVID-19 crisis.

Many of the skilled workers are not easy to find another similar employment, especially in the aviation imdustry. Their skills may be traferrable, but the post pandemic economy will also have to accommodate those previously retrenched workers of the same industries, and likely preference is given to those with prior experience first.

Loss of employment is going to be a trigger for the future downturn in the rental market.

Thank you for reading.

Cathay Pacific job cuts will hit Hong Kong housing market axed pilots, cabin crew move away or downsize

Local family snaps up $2m Kensington house after it passes in

Local family snaps up $2m Kensington house after it passes in
https://www.domain.com.au/news/melbourne-auctions-local-family-snaps-up-2m-kensington-house-after-it-passed-in-999086/

Would you pay that much after the property was passed in?

Many people do not move out of their suburbs, or return to the suburbs they once lived in.

It is important for real estate agents to letter box drop not just to get more listing from the neighbourhood, but also let the neighbours know of the property in the market should they want to upsize or downsize. These neighbours may also let their friends or relatives know of the property is available so that can move close to them.

Most sellers treat their houses as castles, and therefore it is not advisable to ask the opinion of people in the neighbourhood to estimate the price of the property close by. The price is likely to be inflated.

Thank you for reading.

Local family snaps up $2m Kensington house after it passes in

Our empty CBD apartment blocks and what it’s like to live there

Our empty CBD apartment blocks and what it’s like to live there

I have issued warnings again and again to be careful about over commitment, especially those brain-washed negative gearing followers. I have met people who only believe in owning high end investment properties because of higher rental income, but not necessarily higher return.

This pandemic is a reality check for the reckless investors who have been deafened by just hearsay and convinced by snake oil salespeople.

High rise and high density living dwellers are likely to experience depression more than many suburban counterpart.

I predict the new post COVID-19 normal life at the suburbs will not suffer as much as Melbourne and Sydney CBD where many high rise apartments dominate the skyline. Without the presence of tens of thousands international students, demand of accommodation will not recover, neither will the traders who rely on their business.

I am glad I chose to live in the suburb long time ago, even though I had to rely on public transport. Later, I also tried to find employment near home or workplaces that were against the general traffic flow to-and-fro.

If you have a choice, think of fresh air, ale=nd your own space to move about out side your home.

Thank you for reading.

Our empty CBD apartment blocks and what it’s like to live there

No negotiations: How Simon scored an investment property at the right price

No negotiations: How Simon scored an investment property at the right price
https://www.domain.com.au/advice/no-negotiations-how-simon-scored-an-investment-property-at-the-right-price-987400/

It may not be the buyer was good in negotiating, but the the agent could have done a better job in getting the price for the owner. There is another possibility that the asking price was unreasonably high.

During my active days as a vendor advocate, I worked with agents to market properties, and achieved final sale price thousands of dollars above the appraised values by other agents.

A client’s property was appraised by three agents, and I chose the one that appraised it $100,000 above the lowest one. It was not the high price that I based my decision on to engage agent, but his positive attitude and his confidence.

Quite a number of years ago, my brother-in-law engaged me to sell his investment property. It was appraised by another two other agents at about $350,000 then. I chose an agent who got a tick after my usual 30 to 45 minutes interview. She sold it for close to $412,000.

I never disclosed the price I had in mind, but I worked those agents very hard, or shall I say I worked along side with them, keeping tab of OFI and adjusting the marketing strategies if necessary.

One of my approach is never let my client meet the marketing agent, and I took over all the communication and negotiation. The owners were “transparent” and unknown to the agent.

When I sold my block of land, I interviewed three agents to appraise it. I finally came out with rather unrealistic price, and asked the agents how they would market it to achieve my price. I chose a young an enthusiastic agent representative to do the honour.

The rep worked very hard on the listing, but for some unknown reasons he left the company before he sold it. A new comer filled his position. She was working with another agency which was unsuccessful to get my listing. She followed up the lead and finally close pd the deal, another $5k about the asking price, or $55k above what was appraised by all the agents.

Marketing properties needs a lot of skill, especially during difficult time like now or normal downturn.

Remember, marketing technique means selling what people want to buy, not what the owner wants to sell.

Thank you for reading.

No negotiations: How Simon scored an investment property at the right price

Melbourne and Sydney house values tumble through September

Melbourne and Sydney house values tumble through September
https://www.theage.com.au/politics/federal/melbourne-and-sydney-house-values-tumble-through-september-20201001-p560w2.html

Data don’t lie, but those misinterpret or use for own special interest do. With so few houses in the market for sale and purchase, the sample size is too small to make any sense.

Why should anyone want to take the trouble to sell or sell at a lower price? Very likely these owners are either in need of money, or their investment property is NOT generating income.

Mortgage stress is very real, and therefore be very careful if your own a property, especially your first home. Make sure you have enough backup income to keep you afloat in case you or your family bread winner become unemployed.

Thank you for reading.

Melbourne and Sydney house values tumble through September

Do not buy without a proper inspection

Do not buy without a proper inspection

During the week, I had two long conversations with my industry peers - a property manager who works with a family owned agency, and an owner of a licensed estate agency.

I have known the property manager’s boss for more than 30 years, and the other has been my industry "buddy" for about 10 years.

I chatted with each of them for over an hour. With the property manager, she discussed her background, her own property investment portfolio, how she achieved it, and the market trend around the surrounding area.

I have not met her before, and that was the first time I had verbal communication with. She has a very cheerful voice, which is an important asset for anyone who works in a service industry.

One of the secrets of success in real estate investment is to start young. It must be a coincidence that my previous blog with an attachment was about a young lady at the age of 19 managed to buy / build her her first home.

The property manager married and started her family not long after. She could return to the workforce when she was still very energetic. Her daughter is in her final high school year, and she works two part time jobs.

As you may heard me saying many times, save, save and save, and both she and her husband did the same in their early days.

They are in their early 40's now, live on an acre block in an outer suburb, worth about $1.5 mil, and also have other investment properties. As I am not a "qualified" financial adviser, I could only give her a general friendly advice - DO NOT put all the eggs in one basket.

In order to minimise land tax, it is better to invest in interstate properties, preferably in regions with employment growth potential.

Some members who had attended my video meeting a few months ago, would have heard my explanation the importance in investing in multiple lower price properties than just a single very high price property.

I prefer to adopt a risk minimisation strategy.

With the other agent, we went more in depth about the demand and supply of the property of past months, and the coming months.

We also talked about some of my former "students" that we both know mutually. One has already retired, another in LA, and the rest still in Australia. The two I mentioned earlier were brilliant real estate agents professionals.

My buddy is a very friendly guy. Unlike many real estate representatives or agents, he has the right attitude in marketing properties. In a way he strikes a right chord with me, because he "markets" positives rather then negatives of a property.

The first time I worked with him, I spent almost an hour interviewing him at a client's kitchen. He appraised the property close to $100,000 more than the lowest figure quoted by another agent.

We worked together to map out a marketing strategy, and the property was sold at the price as he quoted.

The difficulty in prediction the trend is due to the changing government policy on JobKeeper, and my assessment is that there will be initial surge but the decline will follow as reality sets in. I shall have a better assessment after restriction is relaxed.

The latest national and by state employment rates are too rubbery to make any sense, because the definition of someone being employed is completely nonsensical. One is considered employed if he/she is engaged in an hour of paid job during the survey period.

Hang in there, do not buy without a proper inspection.

Thank you for reading.

Australian teen buys her first human at 19 working at McDonald's

Australian teen buys her first home at 19 working at McDonal's
https://www.dailymail.co.uk/news/article-8743659/Australian-teenager-buys-home-aged-just-19-working-hard-McDonalds.html

If this young lady could do it, so can you. It is a matter of hard work and determination. It’s about mindset and seizing the opportunity.

A group member contacted me during the last few days asking whether this is the right time to buy her first home.

There is a big difference between a home and a house just for rental investment. If it is a first home, there are government first home grant and building grant. The building grant applies home-and-land package or building a new home.

Buying an existing property, in the present context implies house, townhouse and apartment, has advantages and disadvantages. A buyer knows that the property is there, and hopefully with building inspection and pest inspection, the risks of buying a lemon is minimised.

Of course, the first thing for one with a sharp mind is these inspections cost money.

A flipped property may look very clean and nice and one can move in without any renovation to worry about, but this can be short term. Do keep in mind many of these properties were purchased and then undergo renovations, some are extensive while others are just superficial. It is difficult to know how good the conditions of the wall and floor are behind the new coat of paint or tiles.

Many excited buyers love the fresh pine barks or gum chips around the flower beds, or new artificial and real lawn laid over the “garden”. Not well prepared ”groundwork” can lead to backbreaking chores to remove the weeds.

If you have been reading my blogs, you would have understood my sentiment about buying off-the-plan, or new construction. Especially during this difficult time, many businesses are facing financial difficulties, compounded with possible material supply problem.

Property owners selling their properties at this unprecedented time are likely experiencing financial difficulty or with health issues. Are the properties kept to acceptable standard? Without physical inspection, it is extremely difficult to know whether the real condition is as good as the digital images depict.

I do a lot of editing with my travel photos; I can brighten, make more contrast, increase or decrease the colour intensity, etc to enhance the originals. Furthermore, a photographer may use different types of lenses to enlarge or elongate a room or living area giving a more impressive view.

By the way, the approach used to distort the real object is challengeable, because it is deceiving and misleading.

Many renters do not realise owning a property incurs more than just rent. Besides their missing out paying council rates and park charges, fire levy, and water rates, some councils also charge annual garbage bins fee. On top of that, living in a multi-townhouse or unit compound or apartment, also incurs owners corporation fee.

Replacement of fence is another cost. On an average the long side of the property incurs a share cost of over $1,000, and the short side is about $900 to $1,000. Normally, the property photos never show the run down fence. Even with physical inspection, many excited buyers never bother to check out the fences around the property.

On top of and electricity usages, the utility companies add supply charges to the bills.

Saving enough plus the government’s generous grants to raise a loan to purchase a property is only the first step. If you are on hands-to-mouth, make sure you are going to look for another income source to pay for the extras, and leave some money in the piggy bank.

Thank you for reading.

Australian teen buys her first human at 19 working at McDonald's

An apology from Domain

An apology from Domain

It is important to use commonsense and be aware of what some “interpretation” really mean. If something sounds too good to be true, then it is more than likely so.

Real estate investment is a long term investment, and more than likely your investment will grow in years to come. The simple logic is that once a block of land is occupied or owned, total remaining area of land available is reduced.

Can a property depreciate in value? Yes it can, especially properties purchased at peak time. Due to all the hype and Fear of Missing Out or FOMO, property prices are pushed up artificially. the margin of over-valuation not only have to incur all extra rates and charges, but also land tax if it is in Victoria, the value is added to the rest of the properties in Victoria.

A property depreciates in value because the building and the contents within are badly run down. However, it will reach a point that these factors can no longer affect the true value of the land it is built on.

Why am I not confident in buying a property without inspecting it? Not knowing where it is situated, I have no idea about the surround, and its growth potential. Furthermore, it is important to ask the agent point blank whether the property is on reclaimed rubbish dump. Under some of the negative physical factors, property value can fall and may never increase at all. The out-of-pocket costs can be enormous and the sooner to cut the losses, the better.

The Capital Improved Value CIV stated in the council rate and valuation is a reasonably guide of the property value. In recent years, there are a lot of Apps and fly-by-nighters promised to give you a ‘valuation” within minutes, and even in seconds. Indeed they do, but how accurate are they? Why do these Apps and free “valuation” exist?

The reliability of the “guess” based on just the address only without taking into all the physical, environmental and emotional factors into account is as good as believing a pig can fly. Similarly, many gurus give free seminars must be as saintly as mother Theresa. It is not cheap to hire a conference hall, free “lunch” and surrounded by a team of staff or contractors, some of them may have to travel long distance.

Surely, there is no free lunch, and if they are making so much money, why don’t they use the same method or strategy to make more instead of creating competition?

If you have doubt or unsure about what I have blogged to date, please ask for clarification.

Thank you for reading.

An apology from Domain

Designing the interior layout of a house or apartment

Posted to Facebook on 3/8/2020 at 9:22 AM
Designing the interior layout of a house or apartment

Last week, I managed to find time to call a FB member who required advice on his proposed project.

I went through the floor plans, did some estimation and worked out suggested sale prices. However, the main points I advised him to keep in mind is product differentiation. This topic will be discussed in my SFC Marketing Blogs & Lessons group.

The current pandemic has revealed many short comings of house designs, and the short-sightedness of home owners. Many ignore the future needs of the family members, and changing lifestyle at different stages of life cycles

It is important when buying a house to live in, you must not be blinded by the new coat of paint, fresh bark in the garden bed, brand new kitchen, fashionable blinds and curtains, attractive hired furniture, or some cosmetic changes within.

Have you seen study tables, baby cot or any clutter in a display home? Many new buildings may be bigger in area in the least use places, but small in the private rooms. Can you keep as clean and tidy as a spanking new display home?

Where the windows are in a bedroom affects where you place your bed, and study table. The natural lighting can affect the mood of the occupier. I always like to let the sun shine in. However, be mindful if the bedroom windows are west facing. You can expect sleepless night because west summer sun heats up the room very quickly, and you may have to resort to sleeping with the air conditioner going most part of the evening and night.

The old measurement 1 square is 100 sq feet. Many older properties have bedrooms measured 10 ft by 10 ft, giving 100 sq ft, or 1 square. The new measurement is about 300 cm x 300 cm. Is that size good enough with modern day living?

When you go shopping for a house, do make up a list of needs and wants, a topic I have discussed in my SFC Marketing Blogs & Lessons. The list can help you choose that optimal house for you and the family.

Thank you for reading.

Sydney and Melbourne house prices tumble through July

Posted to Facebook on 3/8/2020 at 1:31 PM
Posted to The Age (3/8/2020) on 3/8/2020 (not published by the newspaper)
Commenting on “Sydney and Melbourne house prices tumble through July
https://www.theage.com.au/politics/federal/sydney-and-melbourne-house-prices-tumble-through-july-20200803-p55hxd.html

Tumble? Not quite yet. Interested parties disclose or present the data in a manner that suit their purpose.

Many house owners are still hanging in there hoping the bad wind will blow past. Shortage of listings keeps prices relatively stable if not slightly higher.

The real tumble is round the corner, because the mortgage repayment deferral honeymoon period will terminate, along with the reduction in JobKeeper and JobSeek payments.

Another disastrous scenario is that some withdraw superannuation money prematurely and put down as a deposit for a new home. These are the vulnerable group, who may lose their jobs after the pandemic is over

Middle managerial positions are just as shaky as the lower level employees. If the latter lose their jobs, there is no need to have the extra personnel in the managerial and supervisory roles.

All these unfavourable conditions will mean house owners have to cave in and let go of their castles after September.

For the agents representatives and agents, this is time to call whoever in your contact list and keep them talking.

Thank you for reading.

Sydney and Melbourne house prices tumble through July

Curiouser and curiouser: Alice’s new house comes complete with its own looking glass

Post to Facebook on 26/7/2020 9:32 AM
Commenting on “Curiouser and curiouser: Alice’s new house comes complete with its own looking glass”
https://www.domain.com.au/living/curiouser-and-curiouser-alices-new-house-comes-complete-with-its-own-looking-glass-971505/

There may not be stones or hail stones that will damage the beautiful, full length picturesque glass windows costing an arm and a leg to repair, but what about keeping the glass clean to have crystal clear views all the time?

I suppose with an expensive house like this, the owners can afford some petty cash to get window the roof cleaner to do the chores regularly.

Thank you fore reading.

Curiouser and curiouser: Alice’s new house comes complete with its own looking glass

HomeBuilder grants: Buyer hopes dashed by rising prices

Post to Facebook on 18/7/2020 12:51 PM
Commenting on “Curiouser and curiouser: Alice’s new house comes complete with its own looking glass”
https://www.domain.com.au/living/curiouser-and-curiouser-alices-new-house-comes-complete-with-its-own-looking-glass-971505/

As I have mentioned at least in one of my previous posts when the announcement was made on HomeBuilder grants that the house prices would rise by what the government is to top up. Well it is proven correct.

This is also true for First Home Buyer Grant, and for the tax dodging tradespeople and restaurants that offer discount if their customers pay by cash, and not issuing receipts or receipts from a different cash register not used for daily taking.

A lesson buyers must learn is never show too much enthusiasm even they are dying to buy the items. Indifference in negotiation really "kills" the seller, because every seller has a target to meet, or else even the JobKeeper scheme can't keep them in their job for long.

A number of members have asked me whether there will be a drop in house prices and when. The answers are there all over the news. The latest report shows that housing loan has dropped by 30%, and almost 51% of mortgage holders are in mortgage stress, honeymoon period for loan deferral will soon be over, JobKeeper scheme is very likely to terminate by the end of September. You do not need a PhD in real estate to figure out the answers.

But you must remember what I have said so many times - buy within your budget, with backup savings for rainy days, and not to invest in air but land.

One more thing to reminder - be careful of newly renovated house sold by people who just make money by flipping. You are likely buying a lemon.

Thank you for reading.

HomeBuilder grants: Buyer hopes dashed by rising prices

My Story - Part 4

Post to Facebook on 13/7/2020 2:02 AM
“My Story - Paert 3”

Episode 4
Bring home the bacon sooner!

After two interviews with Barry Plant, Glen Waverley, with a different director on each occasion, I still did not receive a reply whether the company would employ me after I finished my real estate agent's representative course.

The night before, or rather the early morning of the last day of my course at RMIT, I was getting anxious or somewhat impatient. That was not very good manners of the directors or the company not to give me an answer whether I was successful in getting a job there

I was still providing support to my software clients in Hong Kong then, and my home office was equipped with many state-of-the-art equipment of that time like hand-held scanner, bed scanner, fax machine, desk top and laptop computers, and good quality colour printers. Internet was only used by the undergraduates in the US universities then, and the mobile phone was more like a brick.

It was after mid-night, I decided to write a letter and faxed it to the directors. I had to put on my marketing thinking hat and using my marketing skill to give it a shot. I had to write something that the directors who were the employer, wanted to read and "buy" my service.

I outlined my key points as llows

1. It had to contain a touch of humour to get attention
2. I had to be direct about my enthusiasm and ambition
3. Created an urgency for them to "buy" my service, or else they would miss out a great opportunity

I did not have that many hours of sleep, because I went to bed at 2:30 am after I had finished and faxed the letter over. I took the train from Glen Waverley to RMIT in the Melbourne at 7:00 am. The course work finally ended, but I could not get the piece of paper to show that I could practise real estate until I was employed by an agency.

It did not take long to walk from the Glen Waverley Station to Barry Plant situated along Springvale Road. I requested the receptionist to see one of the directors. Not long after, I saw one of the directors DT walked along the corridor with a smile on his face and extended his hand to greet me.

Before I had a chance to open my mouth to ask whether he had receive my fax, he said, "You are the one I want to see. I like your fax."

To cut the story short, I scored an interview with both directors, and understood their hesitation and reservation in employing me. They had their hands burnt by a former employee who was from Malaysia. I started my real estate career after that interview.

What was in the fax that amused DT?

1. I needed the job so that I could qualify to become an agent's representative to market real estate
2. I was enthusiastic and wanted work with one of the best agencies in Melbourne
3. I wanted to be a top agent's representative in the near future
4. The sooner Barry Plant employed me, the sooner I could bring home the bacon for the Company

How could the Company walk away from such a good opportunity - to have a hard-working, enthusiastic employee who was also ambitious to reach the top in the industry, bring home lots of bacon to the Company?

Thank you for reading.

My Story - Part 3

Post to Facebook on 1811/7/2020 2:40 AM
“My Story - Paert 3”

Episode 3

I realised many teachers knew very little about computer hardware or software, and yet they were assigned to teach the subjects. I felt rotten to my core, but I decided to do my utmost to change it, and I believe I did improve the quality.

I kept my qualification and background a secret, but not for long. My fellow teachers soon discovered that I was more than just a programmer. Since then, my teaching hours grew, and the number of subjects broadened.

When the state government amalgamated the technical colleges and adult education into Tafe, and upgraded some colleges to merge with universities, great opportunity just knocked on my door.

The Tafe I started with, Eastern Tafe, became Swinburne Tafe, and had campus in Wantirna, Croydon, Lilydale, Hawthorn and Prahran. I was teaching in all the campuses, and during one term, I taught in 4 campuses in a day.

At this point in time, I was only teaching Microsoft Office software, and MYOB accounting software. No one knew that I was a Licensed Estate Agent yet.

I had a bad reputation being very strict, and some students reported me to the coordinators. However, that infamous reputation also landed me to spread my wings to teach in Chisholm Tafe as well as in Swinburne University. Some colleagues recommended me to their friends in those institutions.

One day when I was walking to my class at Lilydale campus, I met someone familiar at the corridor. He was my former teacher when I was studying my real estate licence course at Prahran. He recognised me.

In fact he should because of two unforgettable incidents. One evening, he was stuck in getting the Rental Management software working, and I helped him overcome the problem so that the class could continue. I was the first student granted an exemption for the subject.

The second incident was that I failed my favourite subject, Property Valuation. It was one of the easy subjects which involved mainly simple mathematical calculations. I paid $50 to have the paper re-marked. Whoever marked the paper marked it halfway, and therefore I failed. However, I finally I got back the High Distinction I worked so hard for, and the money was refunded.

This former teacher just resigned from Swinburne Tafe because he found a new full-time job. After wishing him good luck and bidding him farewell, I quickly rushed to the Real Estate course coordinator office and booked an appointment to discuss that vacancy after my class.

That's it. I was in.

REIV did not have the facility to conduct training licence course, and contracted Swinburn Tafe to run it. I was at the right place at the right time, and I became a trainer for potential licensed estate agents

Moving forward a couple more years, I was also teaching at Chisholm Tafe, I was offered an off-campus assessor position for the real estate representative course. That was really lowly paid job, of my own doing, because I spent enormous amount of time providing a lot of feedback to the students in writing! I did not want to do things by halves.

Every few years, I return to the industry and work hands-on with my industry peers for a year or so, in order to keep my marketing skills and knowledge of the legislation up-to-date..

Thank you for reading.

PS. I shall write more about my Teaching experience in my other group, SFC Education, Teaching, Learning.

I enjoy sharing my story with you, especially the younger readers. Life is full of challenges, but you must be prepared before you take them on, or else you will fail. You must also learn to seize the moment, because opportunity does not wait for you or may not come knocking on your door the second time.

My Story - Part 2

Post to Facebook on 10/7/2020 2:07 AM
“My Story - Part 2”

Episode 2

I converted the balcony at the rear of the house into home office. From the office I could see sun rise, and hear bird chirping in the morning. With the sliding windows open, the cool fresh morning air charged up my brain battery every morning to last the whole day.

It was just amazing that I could switch between computer software development and real estate marketing without any problem.

One afternoon, my brain seemed to go on strike. It went blank, and I had to take a break. During this time, I queried myself what I should do with all the knowledge in my brain and my interesting life experience; I had no children to pass on and it would be a waste to bury the valuable assets locked in my head six-foot under when I kicked the bucket.

There was one career I could undertake, that is to become a teacher. I retrieved The Age from the previous weekend and checked through the classified advertisements. Lo and behold, there was a small advertisement from a Tafe in Warntina looking for a sessional teacher proficient in Microsoftffice.

I removed large sections of my resume, except the part that I was a programmer. I started with only 2 hours teaching Access in the evening. Many people were unfamiliar with Access, let alone taught the subject.

Thank you for reading.

My Story - Part 1

Post to Facebook on 10/7/2020 2:07 AM
“My Story - Part 2”

Episode 1

In my previous career before I joined a real estate agency in Glen Waverley, I travelled to almost every suburb in Melbourne Metropolitan marketing decorated cakes each week. That was how I knew so much about Melbourne.

How I managed to get my foot in the agency was very interesting, and I did post my story some time ago in my SFC Marketing Blogs and Lessons group.

When I started in the industry, the market was on the downward slide. Despite that, I had a distinct advantage over my peers, the reason being I could speak fluent Cantonese (Guangdong Hua) and Mandarin (Potong Hua) in addition to English. There were not many Chinese migrants from mainland China then. Those who managed to migrate over were mainly from Shanghai and Beijing. Hardly any agents or agents representatives could speak a word of Mandarin, and that was an opportunity too good to be true.

A few years before 1997, the year when the British handed Hong Kong back to China, many Hong Kongers sought to migrate overseas, including Australia. They could not speak English well, and once again I could use my language skill to service them. In fact, my Cantonese was so fluent without a trace of Malaysian Chinese accent that almost all Hong Kongers thought that I came from Hong Kong.

I was always a keen learner and knowledge seeker then, and still am now. I studied the concepts of Feng Shui, and superstitious beliefs and practices of Southeast Asian and Hong Kong Chinese. Most importantly, I also brushed up my knowledge about Hong Kong history. Oh yes, I worked as fast as the Hong Hongers. Not long after, I completed my full real estate licence, while I was still working as an agents representative. My final project / thesis for my course work was about setting up a real estate agency. It was not easy to get information on market shares and other statistics, because Internet was not available yet. I did SWOT analysis of different agencies, and tried to make sense of the historical rise and fall of real estate cycles.

I was like walking "Google". Oops, Google was not around yet. I knew a lot the about the schools, bus routes, churches and the demographics of Glen Waverley and surrounding suburbs including Rowville. When the keys of a new listing landed in the office, and before it was announced and advertised, I would be the first one to jump into my car to inspect it before other fellow colleagues in the office.

During slack time, I developed my own Customer Relation Management (CRM) software, and also did a lot of analysis on movements of real estate buyers and sellers in the region

I was at a crossroad after obtaining my qualification as a Licensed Estate Agent (LEA). I found too many cowboys in the industry, and the industry was very much of a dog-eat-dog world. Owning and operating an agency was not my preference, because I held very strong principles.

At that time, I was approached to design a bilingual Accounting system for a Hong Kong printing company and subsequently to develop an application system for Food Service Management for a big contracting company.

So I decided to quit my full time real estate job, and became a freelance Vendor Advocate, helping vendors to sell the property. While I was not meeting clients and real estate agents, I spent my time on software development and programming.

I slowed down my Vendor Advocate business close to zero when I decided to spend more time on international travel. Due to the coronavirus pandemic, I doubt I shall jump onto another plane or cruise ship for a long, long time to come. I may reconsider to be a Trainer or Advocate again in order to fill in time, and keep my brain working. Thank you for reading

One in 10 off-the-plan apartment sales collapse

Post to Facebook on 5/7/2020 1:31 PM
Commenting on “Inside a rush pre-auction-day auction prompted by COVID-19”
https://www.afr.com/property/residential/one-in-10-off-the-plan-apartment-sales-collapse-20200630-p557iw/

A member in another group put a link of the following article on off-the-plan apartment having lower valuation during settlement than when the contract is signed.

He commented "Caveat Emptor". This is a term I learned when I was studying my real estate course. What it basically means "Buyers Beware - you're responsible for checking the quality of goods before a purchase is made". Doesn't it sound a bit posh or rich when someone like an agent trying to impress you?

I know many members of this group understand why off-the-plan purchase carries a lot more risks than an existing building. In the latter case, the purchaser can send in professionals to check the foundation and structure, any terminate attack, etc. in an agreed time frame before the sale can proceed.

It is a cold comfort to find out during settlement other tall buildings are around blocking the views that one pays that premium price for, and let sunlight in during the broad daylight.

The coronavirus pandemic reveals what I have saying again and again - space to roam and neighbourhood. I am not in favour of apartment living. Nevertheless , one cannot be certain about the future, and it is wise not to deny "never say never".

Now why does the valuation become lower than the contract price? It is all about the supply and demand. Besides, value of the property depends on land. I am not going to elaborate more, because I have written too many times about land, land, and land.

Just be careful with your money. Feel it, touch it, and talk about it when you want to invest in real estate property. You spend so much much time to find out the car, laptop, and restaurants before you purchase the product or service, make sure you are doing likewise when investing you hard earned hundreds of thousands or even millions. .

If you want to learn more about marketing, including selling and buying real estate property, do read my free education blogs in SFC Marketing Blogs & Lessons.

Thank you for reading.

One in 10 off-the-plan apartment sales collapse

Inside a rush pre-auction-day auction prompted by COVID-19

Post to Facebook on 4/7/2020 8:20 PM
Commenting on “Inside a rush pre-auction-day auction prompted by COVID-19”
https://www.domain.com.au/news/melbourne-auctions-rush-to-bring-kensington-sale-forward-as-pandemic-escalates-967009/

If I was a serious buyer or bidder at the auction of 25 Neville Street, Keilor East, I would report the real agent to Consumer Victoria for underquoting.

The price guide was $800,000 to $880,000, but after the failed auction, which only attracted only one bidder who gave his final offer of $790,000, the property is now listed at $890,000. What it means, the seller / owner would not let go of the property for $880,000 at the auction.

Underquoting is an illegal oractice, and agents who do not comply with underquoting laws risk a penalty of more than $31,000 (200 penalty units).

Thank you for reading.

Inside a rush pre-auction-day auction prompted by COVID-19

How coronavirus has snapped Australia's fragile rental system

Post to Facebook on 29/6/2020 11:22 PM
Commenting on “How coronavirus has snapped Australia's fragile rental system”
https://www.domain.com.au/news/how-coronavirus-has-snapped-australias-fragile-rental-system-965317/

Once again, my advice is proven correct. I always go against investing in property banking on negative gearing. No sensible business operators want to make a loss in order to offset tax reduction, unless the benefit is so much greater than what one can earn in opportunity loss.

Most properties these days cost too much to give any good rental return. If property value does not appreciate more than the overall loss during the life of the mortgage, then it is time and effort wasted to invest in that property. As I put it bluntly, one might as well pack up and go home for a good rest.

There are far too many property investment gurus running get rich quick seminars, whose intention is to sell you courses costing thousands of dollars. If the return on investment is so good, why don’t they raise money to do exactly what they have been preaching and make millions of extra dollars?

I work on 75% to 80% of the expected annual rent as an average of the gross income after management fees. The reason is that I expect certain maintenance and contingencies need to be accounted for. From the balance, I deduct other expenses. I only expect the two to two and a half years that the property not breaking even in the worst case.

Another word of caution, “do not go crazy investing in additional properties if you have not paid off your own home”! Your own home is your security blanket, and it is so comforting when the bank manager hand you the house title after you have discharged your lmortgage.

Thank you for reading.

How coronavirus has snapped Australia's fragile rental system

Multiple $4 million sales but auction results still weak in Sydney and Melbourne

Post to Facebook on 22/6/2020 1:23 PM
Commenting on “Multiple $4 million sales but auction results still weak in Sydney and Melbourne”
https://www.domain.com.au/news/multiple-4-million-sales-but-the-auction-results-are-still-weak-in-sydney-and-melbourne-963856/

Read the linked article very carefully before you continue reading this blog. Can you tell me why you should not buy a property the same way like one of the buyers mentioned?

You should never jump in to buy another property, just because you sold yours just a day or week before, unless you have extra money lying around.

Even if a property is sold at auction, which is an unconditional sale, anything can still happen before the title is exchanged and settlement money is received in your bank account. The buyer of your property could become bankrupt, die or for other reason that the final settlement is deferred. The buyer could have owed money to ATO or asset frozen.

This report, like many other real estate reports published recently, reinforces what I have been writing about the downturn and possible doom in October.

Thank you for reading.

Unlivable unit sells for nearly $70,000 above reserve

Post to Facebook on 20/6/2020 6:31 PM
Commenting on “Melbourne auctions: Unlivable unit sells for nearly $70,000 above reserve”
https://www.domain.com.au/news/melbourne-auctions-unlivable-unit-sells-for-nearly-70000-more-than-reserve-963768//

There are people claiming to have made a killing by buying a run down property, doing some cosmetic renovation on it, and then putting it back in the market. This kind of quick turn around renovation for profit is known as flipping.

Like many gamblers or regular Tatts buyers, they normally don’t tell others how much they have lost before they finally win some money.

Unless you are a handy person, and prepared to breakeven or make a loss for your first couple of projects, just to gain some experience, I do not advise you to venture into this.

Those renovation programs on television in a way are just make-believe programs. There are teams of qualified and experienced tradespeople on hand to carry out the major work, while the contestants seem to handle the less dangerous and less laborious tasks. Any disasters are likely to be fixed up. by some technical experts behind the scene.

I am very concerned that readers of newspaper real estate articles may not have weighed up all the pros and cons before they dive in to undertake such a major project. They may incur financial loss, as well as suffer physical injury. If you are unemployed, and financially unstable, please DO NOT lure by such hype, thinking that you can do better than someone else.

It is advisable to do some small home renovation projects first before attempting something big like flipping.

You must be mindful that there are many other associated costs involved, eg. agents commission, marketing fees, stamp duty, capital gains tax, bank interest on borrowing, and opportunity loss on your holding cost, etc.

Thank you for reading.

Options for first-home buyers narrow as listings below $700,000 drop

Post to Facebook on 17/6/2020 10:23 AM
Commenting on “Options for first-home buyers narrow as listings below $700,000 drop”
https://www.domain.com.au/news/options-for-first-home-buyers-narrow-as-listings-below-700000-drop-data-962161/

As long as the community is not completely free to move around, and there remains great uncertainly about employment prospect, potential sellers will continue to hold on to their properties.

The question is why sell unless one has a reason to do so. When one sells his property, he needs another one to live in, whether you call it downsizing, upsizing or right sizing.

The prices will not drop, as I mentioned in several blogs. Unfortunately, due to scarcity, the price may even climb a bit higher.

The critical time is around the end of August and September, when the mortgage repayment deferral and Jobkeeper payment will discontinue, unless the government changes its heart.

Many landlords are facing financial trouble too, with tenants not paying rent during this period.

All these unfavourable conditions can lead to only one conclusion, that is, many property owners may have to put their properties in the market reluctantly, not by choice.

In recent weeks, a lot of activities have been going on with many mortgage holders looking for brokers to refinance their mortgage, in order to lower their repayment burden.

Thank you for reading.

Home Loan Pre-Approval: How To Apply

Post to Facebook on 5/6/2020 12:19 AM
Commenting on “Home Loan Pre-Approval: How To Apply”
https://www.canstar.com.au/home-loans/get-home-loan-pre-approval/

During the pandemic lockdown, the real estate market went belly up. Many property owners held back their properties, because most potential buyers were not game enough to buy a property by taking a virtual tour inspection.

Although some real estate agents tried hard to adopt new technology and conducted online auctions, potential sellers were not that keen, and withdrew their properties from auction, or changed to private sale instead.

Now that the lockdown is relaxed, more and more properties are coming onto the market. I cannot foresee many sellers are prepared to lower their prices yet, and agents are not prepared to advise their clients to be realistic, or else the agents will miss getting the listing on their books.

The real estate market is a bit erratic in the next few weeks on the upward climb, but the trend is likely to reverse after September when Jobseeker scheme stops, and reprieve on mortgage repayments discontinues.

With that in mind, if you have saved enough deposit for a target property and are ready to buy, then it is time for you to contact a lender, be it a bank or mortgage broker to get an idea how much you are eligible to borrow.

The following is a very good article on what pre-approval is about and how t get one.

Thank you for reading.

Government to hand out $25k grants for housing construction, renovations to bolster industry

Post to Facebook on 4/6/2020 3:33 PM
Commenting on “Government to hand out $25k grants for housing construction, renovations to bolster industry”
https://www.abc.net.au/news/2020-06-03/government-coronavirus-construction-stimulus-renovations-25k/12317786

I anticipate new home prices will rise by $25k, and more bunnies will commit themselves to even greater unsustainable debt.

This is an opportunity for smart handy people to flip properties, further pushing up prices for the end product.

So far I know two highly paid ”personal friends” and several other in middle management have been retrenched. It is important to know your financial situation and job security in this uncertain time before you commit on taking up a big loan, even if you have offered one.

Thank you for reading.

Home values fall slightly in May amid COVID-19 crisis

Post to Facebook on 1/6/2020 3:30 PM
Commenting on “Home values fall slightly in May amid COVID-19 crisis”
https://www.domain.com.au/news/home-values-fall-in-may-amid-covid-19-new-figures-show-959558/

As predicted, the coronavirus pandemic has definitely a serious negative impact on the real estate industry. A lot more property owners are still hanging in there hoping for that light at the end of the tunnel.

Unfortunately, miracles do not happen, and that is why I am such a pessimistic optimist, advising against negative gearing and encourage saving, especially at early stage in working life. I experience losses too, but that does not cut into my life that much that I can't sleep at night.

Many parents are too afraid to "advise" their children about their life experience because their children do not want to listen to hardship, and just want to live for today, as the words "old age" and "retirement" are not in their vocabulary.

Advice is NOT nagging, and being a bit conservative is NOT unwise. It is important to remember if "it's too good to be true, it is".

Is my free advice too good to be true? Well, you'll be the judge. If I start asking you to invest in some scheme or donation, then you better get out of this group and don't have anything to do with me. Otherwise, stay tuned.

Do you think the fall will continue?
When will the fall pause and the climb resume?
When will it fall again after the rise?

I have blogged about this before, and these questions serve to test your memory? I shall discuss this later.

Thank you for reading.

Victorian residents left in limbo after builder Archiblox goes bust

Posted to Facebook on 1/6/2010 at 1:24 AM
Commenting on “Victorian residents left in limbo after builder Archiblox goes bust”
https://www.9news.com.au/national/melbourne-news-archiblox-collapse-residents-left-out-of-pocket-thousands/a70dc623-77fd-4fcc-a82d-d33a05d82a8c

I have been warning about buying off-the-plan investments. Unless you're a brave gambler, investing such big sum of money without knowing or touching the finished product, or recommendation from reliable satisfied customers is definitely risky.

I hope you do think carefully before you put your bet on. As some of you have noticed, this a Private group, and I do not share my posts in other groups as often as before because some members complained that I spammed their groups. If your friends are interested to know more about real estate, ask them to check out this group before they make that big investment decision.

Thank you for reading.

Buyers fail to pay up in glittering South Yarra mega development

Posted to The Age (14/5/2020) on 17/5/2020
Post to Facebook on 17/5/2020 10:53 AM
Commenting on “Buyers fail to pay up in glittering South Yarra mega development”
https://www.theage.com.au/national/victoria/buyers-fail-to-pay-up-in-glittering-south-yarra-mega-development-20200514-p54sze.html

On a clear sunny day, it is great to look out horizontally of the full length glass windows to enjoy the view, but not to look down to the street level to see the ugly roof tops and untidy backyards of many dwellings.

In fact, it is quite horrifying when the sky is grey, with a storm approaching.

Many people buying off-the-plan are lured by the glossy magazines and promotional videos without any idea what the finished product will look end up with, or how they will feel living in one.

The best and inexpensive way to try out a high rise living is to pay more attention when you book into a high rise luxurious hotel. As for the view, get up to the roof top and check out the view.

Even if the apartment owners do not use the available the facilities, they still have to pay for the owners corporation fees to subsidise the maintenance.

Thank you for reading.

Which Capital City Could Boom Next?

Commenting on “Which Capital City Could Boom Next?”
https://www.yourinvestmentpropertymag.com.au/strategy/which-capital-city-could-boom-next-258086.aspx

This news article was published in January 2020 before the coronavirus pandemic. I wonder how this deadly virus can change the the real estate prediction.

Please note that this prediction should be taken with a grain of salt!

Thank you for reading.

Global economic shock caused by coronavirus pandemic

Post to Facebook on 22/4/2020 5:11 PM
Commenting on “Global economic shock caused by coronavirus pandemic”

A few months ago, Australians were more concerned about declining in housing financing and weak income growth, but now the coronavirus pandemic bring forth two gigantic nightmare, namely unemployment and population decline.

The pandemic kicks start a depression, and this could trigger loan defaults and foreclosures. This would exacerbate price declines.

This is the first time Australia is facing the biggest population decline in history. More than 300,00 tourists, temporary workers, and students have already departed Australia this year. It is expected another 300,000 people could leave the country to return home by year’s end.

In 2018-2019, international education contributed $37.6b to the Australian economy.

The decline in international students coming to study has a negative impact on the survival of the higher education sector, as well as on accommodation demand, especially in the CBD areas and near the institutions.

Due to loss of employment or reduction in income, many young people move back to stay with their parents instead of living out in rental properties.

This is a global economic shock, and the recovery will take quite some time. However, for the cash rich, the opportunity has arrived!

Thank you for reading.

Why negatively geared landlords are going to struggle the most with reducing rents for tenants

Post to Facebook on 18/4/2020 9:44 AM
Commenting on “Why negatively geared landlords are going to struggle the most with reducing rents for tenants”
https://www.domain.com.au/news/why-negatively-geared-landlords-are-going-to-struggle-the-most-with-reducing-rents-for-tenants-948993/

From what I have been tracking, out of all the members reading my blog, less than 20% actually read my blogs in detail, or believe in what I said. The rest probably take my words with a grain of salt, or just being nosy.

At the primary school I volunteer in, the teachers and school children call me a mathematician, but I advise them I am not a mathematician, but I love mathematics.

Since the days I set my eyes on property investment, I rely heavily on mathematics to work out my potential risk of not being able to sleep soundly at night, worrying whether I could repay my loan.

During the early days when credit was freely available, I was asked why I did not borrow to buy properties and shares. I did not follow the norm, because good times never last forever, and if the trend reversed, I could be in deep financial strive. If everyone was to rush in to invest, how could I get the best value for my money?

We need to learn about breakeven and worst case scenario, the latter was discussed in my earlier blog. I do not invest unless I know I can afford to ride out a financial storm, at least for 6 months. Now that I am not in employment, it is more critical to have an watchful eye over my bank balance.

During my online chat, I explained one of my conservative investment strategies - if I had a million dollars to invest in property, and also what I would invest in with a bucket of money.

I am not in agreement with those gurus who have been advising that a successful strategy that an investor adopts in negative gearing should be replicated in the future investment. What these gurus fail to understand and advise accordingly is that the strategy may be conceptually valid, but the financial commitments and dynamics of the investor would have changed after the initial investment.

Circumstances could not be replicated easily by some artificial or mathematical means. In most cases, the mathematics does not stack up that people invest in a business should make a loss in order to get tax benefits.

In my earlier blogs, I talked about a number of property owners would have to let go of their properties after the coronavirus pandemic. Among these will be those involve in negative gearing. I sincerely hope the reason of their selling the properties is not due to their loss of their high income.

Thank you for reading.

A brief report on the first online real estate chat

Post to Facebook on 12/4/2020 5:58 PM
Commenting on “A brief report on the first online real estate chat”

A big thank you to those members who participated in the first online video chat session with me for more than 2 hours.

Questions were raised related to the coronavirus crisis from whether to lock in mortgage loan at fixed interest rate, to when in the foreseeable future the industry will recover.

I also explained why many people misunderstood Return on Investment ROI for real estate investment, and what I would do for a given sum of money.

There are other topics about buying a new home versus an older house, and whether to demolish an existing home and build two units for sale.

I hope I have satisfactory answered the questions, and their time was well spent.

Thank you for reading.

Victoria’s property market tipped to slow in wake of new government restrictions

Commenting on “Victoria’s property market tipped to slow in wake of new government restrictions”
https://www.domain.com.au/news/coronavirus-victorias-property-market-tipped-to-slow-in-wake-of-new-government-restrictions-948204/

Post to Facebook on 11/4/2020 8:20 PM
I saw banning of auction and open-for-inspection as early as January 2020, but somehow the state government was just pussyfooting.

When I was teaching problem solving, I always taught to consider and evaluate the worst case scenario. If one can get out of the worst case with minimum damage, then one is ready to deal with any situation.

Looking for loophole is not the way to tackle a problem. For example, arranging private inspection. The fact is social distancing laws clearly say that social visitation is not allowed, and inspecting a property is not an essential purchase like buying food.

This is the most testing time in human history, and everyone including the real estate agents are not different from others in the community.

The government keeps saying Victoria is in Stage-3 restrictions, and possibly Stage-4 is forthcoming. A better educated person like me don’t even know what these jargons mean. It is better to clear cut that makes no exceptions than the rules - just call it a lockdown!

The sooner everyone gets into the act of staying home, non-food and emergency “trade” businesses stay shut, the sooner the spread can be stopped, and Victoria will be back on the road of recovery.

I went through slack time before, but not a disaster like this pandemic. I spent my time designing my own real estate software, working on new design brochures, reading books and articles of successful professionals, and working on my garden - an essential component of real estate.

It is easier said than done, many will remark. How about consider this slack period as non-pay leave and hang in there until government assistance kick in?

Thank you for reading.

Up to one third of mortgage holders don't have a buffer

Post to Facebook on 10/4/2020 9:54 AM
Commenting on “Up to one third of mortgage holders don't have a buffer”
https://www.theage.com.au/politics/federal/up-to-a-third-of-mortgage-holders-don-t-have-a-buffer-for-virus-downturn-20200409-p54io2.html

I suggested repeatedly that you must have enough buffer money reserved for at least two months of mortgage repayment for rainy days. The rainy days are here to stay for quite some time.

A member commented that six months is recommended by advisers. While this may seem like a better safeguard, this is unlikely possible for those work with tight budget. The unfortunate thing is that many will use the “spare” cash to pay for the deposit, just to reduce the loan amount.

I have stressed many times that young people who rely on Mum-and-Dad bank are likely to suffer in tough time, just like this now. If they do not have the ability to save for the deposit, it is doubtful they can afford the cope with repayment and other related household expenses.

What if the mortgage holders continue to fall behind their repayment? The banks are not charity organisations, and they will have to default, and more properties will end up in the market.

Someone’s loss is others opportunity. Unfortunately, this is just a sad story penned by the coronavirus pandemic.

Stay Home, Stay Safe.

Thank you for reading.

Property prices to plunge as auction clearance rates fall off a cliff

Post to Facebook on 8/4/2020 10:57 AM
Commenting on “'Property prices to plunge as auction clearance rates fall off a cliff”
https://www.theage.com.au/money/investing/property-prices-to-plunge-as-auction-clearance-rates-fall-off-a-cliff-20200403-p54gt1.html

You have to keep up-to-date with my blogs. What I advised yesterday may be out-of-date today.

When I advise readers to hold, I do mean hold. Some people ask me whether a property is worth a certain amount, my answer is always vague and non-committal. The reason is simple; I am not the one that buys the property.

Beauty is in the eyes of the beholder. I do not know how much they like that property, and for what reason. The worth of that property in my eyes is different from theirs.

By now, you probably have read many of my blogs, and some of you have taken my advice and hold back that purchase. If during this period you are still accumulating your money more than you expense, you will have a much larger deposit when the time comes.

Even some people I know well or related to me thought that I was pessimistic and talked crap, until they got themselves burnt, and burnt badly. Even recently, one just bought a property which I believe is at least $150k too much.

Some people have bought and sold a few properties, and they become very confident or even over confident. No one can be an expert unless his ears are on the ground and eyes on the market trend. Each property has its own objective value, and the same property value fluctuates with economic situation.

My first boss at Barry Plant once said, “if you think you are an expert in real estate, it is time to get out of the game”.

There is some truth in it. Some real estate representatives and agents do get arrogant and with a click his fingers quote a price of a property without looking at it. Just a word of warning; these are not the agents you want to sell your property or sell you one, because they take things for granted and very likely they are a smart Alec.

A few days ago a member messaged me and asked “SFC what’s your outlook both economy and hounding market for 3, 6, 9 months?”

As I have said on 26 January, “the coronavirus will have a negative impact on the real estate market”, and I have said the fall at best will be no less than 20%, that translates to a property sold at $1,500,000 can go down to $1,200,000 or lower.

For some reason I think the economy will see some daylight in August or September. However, this Coronavirus pandemic will have left a trail of disaster.

Please remember NOT to bank on negative gearing. This pandemic will serve as a bad lesson that gives them financial nightmare.

Thank you for reading.

Australia's suicide rate to rise 40% if emerging risks such as debt not tackled

Post to Facebook on 7/4/2020 9:42 AM
Commenting on “'Australia's suicide rate to rise 40% if emerging risks such as debt not tackled”
https://www.theguardian.com/australia-news/2019/sep/10/australias-suicide-rate-to-rise-40-if-emerging-risks-such-as-debt-not-tackled

Do not become a statistics directly due to coronavirus infection, or indirectly due to depression caused by loss of income.

Seek help if you can’t find ways out. Remember, taking your life leaves the trouble to your loved ones to deal with, not only the financial burden, but also the grief and the lack of a shoulder to lean on.

I keep warning readers NOT to overstretch their financial commitments, and all need to save up for rainy days such as foreseen disaster like now. If you can’t afford that extra luxury, sacrifice it until you have accumulated that extra wealth.

The adage that “Short term pain, long term gain” should always be kept your mind if you need a happy ending.

Please be wise, and do not do such silly things.

Thank you for reading.

Housing market 'not immune' to coronavirus crisis as cracks show in Sydney and Melbourne

Post to Facebook on 2/4/2020 1:26 AM
Commenting on “Housing market 'not immune' to coronavirus crisis as cracks show in Sydney and Melbourne”
https://www.theage.com.au/politics/federal/housing-market-not-immune-to-coronavirus-crisis-as-cracks-show-in-sydney-and-melbourne-markets-20200401-p54fut.html

One of the members from this group called me via Messenger about 2 weeks ago asking for my opinion / advice on a property he was to bid the following Saturday. I checked the advertisement posted by the agency, and did some calculations based on the information provided in the Section 32, I reckoned it was worth no more than $625K.

We exchanged messages and when he asked me whether the property prices would fall, I replied that "The virus situation can only get worse. ... Too much uncertainty about employment and there will be a shortage of buyers, and therefore the price will come down."

After my quick analysis of the property, I had a long conversation with him, and emphasised that he must keep to the budget and not to get too hyped up. I reminded him that the coronavirus outbreak would result in banning on-site auctions, and falling house prices.

I did not attend the auction, but he provided me the feedback. There were not many interested parties, and it came down to a 2-horse race. He continued to push the price up, beyond what he budgeted for. The final killer bid was $686k, $1,000 more than his.

He was really keen to buy the apartment, but I believe even $625k was generous.

I was pleased that he did not win the final bid.

Thank you for reading.