How To Avoid Buying In The Wrong Location.

We spend most of our time talking about finding the right property, but what about the steps you can take the avoid buying the wrong property? Buying in the wrong location can set you back in a big way. Over the years, we've seen many people make the mistake and get tricked into buying into strange areas. These ill-informed purchases, more often than not, are the result of a compelling story attached to it. We're a firm believer in letting data to the talking and let emotion take a back seat. There are many reasons we've seen relatively switched on investors make poor real estate buying decisions. In most cases, however, the reason comes down to skilled property "spruiker" that targets investors who, for one reason or another, are too busy to do the correct level of due diligence.  In most cases it's not until a proper level of due diligence is undertaken that particular properties become a poor investment. We've found that once we go out and visit these specific sites, the initial appeal conveyed by the salesman quickly begins to unravel. In most occasions, these supposed "fantastic locations" can be: Flood proneFeature eyesores like power lines or substationsBe close to major road noiseHave large industrial zones nearbyHave high rental vacancy rates In years past, we've seen many locations touted as the next "booming market." These areas usually go hand in hand with vacancy rates as high as 6-7%, meaning your rental yield will be in serious jeopardy (and any chances of significant capital gain). So, how do we help find out clients property in the RIGHT location? The answer is surprisingly simple. To begin with, we look for high demand markets with vacancy rates under the 2% mark. From there, we take a look at a diverse range of key market indicators to give us an insight into the overall economic health of the particular region we're targeting. Another good sign is finding areas with a high percentage of "owner-occupiers." In our time, we've seen plenty of large-scale developments where it looks like nearly 80% of the people living there are renters, this is never a good sign. At Logica Property, we go above and beyond to understand the ins and outs of every location we put forward to our clients. We do the due diligence to understand all the unique factors that a particular location exhibits. We listen for road noise, examine the community, meet the people and most importantly, put ourselves in the shoes of potential tenants in the area to get insights into the areas long-term investment prospects.​

How The 2017 Federal Budget Affects Buyers

Budget night is always a time of great excitement for us at Logica Property. 2017's budget brought on a host of fairly wild measures that will have noticeable impact for both home buyers and property investors

Advice On Selecting A Selling Agent.

In the course of our lives, we partake in a huge number of transactions. Few are higher stakes than that of selling a property.

Regardless of what stage of life you’re at, selling your property can be a tremendously huge decision to make. Finding and choosing the perfect selling agent for such an occasion is often the difference between selling at an average price and an extraordinary price.

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Buyers Agents:

Sydney & Adelaide

How the 2017 Federal Budget Affects buyers

Budget night is always a time of great excitement for us at Logica Property. 2017's budget brought on a host of fairly wild measures that will have noticeable impact for both home buyers and property investors

 

Here's a quick overview on the 2017 budget from the view of a home buyer or property investor:

 

1. First home buyers will now have the ability to use their super as a low tax savings vehicle for a deposit on a home from 1st July. Individuals will now be able to make voluntary contributions to their super of up to $15,000 a year over and above their employers contributions. There is however a limit of $30,000 per person. These contributions will be taxed at 15% and can be drawn down on for first home purchases. Withdrawals of eligible voluntary contributions will be permitted from July 2018 onwards. This will replace the First Home Savers Account scheme which was vastly underused.

 

2. Downsizers and the over 65's will be able to contribute up to $300,000 to super from the sale of their principle home, if they've owned the home for at least 10 years. This will be teated as a non-concessional contribution outside the existing caps. There will be a limit per person, couples will be able to contribute $600,000 to benefit from this measure for the same home. This measure even applies if they have reached the $1.6 million cap in a private pension. Any amounts over and above $1.6m will be placed in an accumulation account where earnings are taxed at 15%

 

3. Depreciation of Plant and Equipment. From the 1st of July 2017, depreciation deductions from residential plant and equipment assets (washing machines and ceiling fans etc) will be limited to investors who incur the outlay - not subsequent owners. Also from that date, investors will be unable to deduct travel expenses related to inspecting, maintaining or collecting rent for a residential investment property. So those trips to Noosa to "check on your investment" are no longer deductible.

 

4, Social Housing Incentive. For investors that choose to invest in affordable housing, a 10% saving in capital gains tax is up for grabs. Unfortunately, to get the tax discounts, you must hold the property as an affordable rental for a minimum period of 10 years. The solid CGT discount is being pitched as a way to offset the lower yield that an investor will receive for investing in social housing.

 

6. Foreign and temporary tax residents will be denied any CGT discounts from 9th may, however any purchases made prior to this date will have them offered until 30th June 2019. The CGT withholding tax rate for foreign tax residents is also being raised to 12.5% and the CGT withholding threshold for foreign tax residents is being dropped from $2m to $750k. 

 

7. Property developers are now going to be prohibited from selling more than 50% of new developments to foreigners. This rule will only apply to developments which have at least 50 units on offer. This is a revert back to the original policy. This may actually result in reducing market supply as some developers will no longer find it viable to just sell 50% to the local market. One of the reasons apartment supply has lifted substantially is the fact that developers can sell the majority to overseas buyers.

 

We're confident that successive Governments will keep fiddling with the rules around home buying and investment. The biggest obstacle with any budget is figuring out how the economy can keep seeing growth. 

 

At Logica Property, we specialise in helping home buyers and investors find the right property. If you would like any assistance navigating the tricky waters of real estate, talk to us today.

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