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Sandstone masterpiece Bomera sells for $12.5 million

March 22, 2013

bomera Bomera, the Italianate sandstone mansion at Potts Point has sold for $12.5 million, says Jonathan Chancellor while writing for the Property Observer. With a clear view of the Woolloomooloo Bay, this powerful piece of architecture encompasses 2150 square meters. Jorge Fernandez, an expatriate real estate developer has fetched a reasonable price for the deal. Having undergone an intensive revamping in 2003 (Graham Brooks & Associates), the property was listed with very high hopes in the year 2011. It aimed to fetch about $25 million but has procured only half of the expected price.

Bomera is the more illustrious half of the Bomera-Tarana combo. While it is spread over 2150 square meters, Tarana takes up 1550 square meters of space.

Don’t underestimate the risks in off-the-plan buying

March 21, 2013

sales contract Buyers are at no risk if the projects they invest in do not start off at all, observes Michael Laurence in an article for the Property Observer. The 10% security deposit made by a buyer is completely refundable. This is if the project fails to take off owing to some constraint from the developer’s end.

Subdividing vs Renovating – Which Is More Profitable?

March 19, 2013

homes Mark Armstrong busts a real estate myth while reporting for Property Observer. In his article, he discusses how Subdividing may not be the most profitable way to go. Property owners hold two opposite ideas equally dear when they are looking to sell their properties. One such idea is Home Staging wherein they revamp their existing homes, upscale it a little, give a few finishing touches and seek better prices for their appraised properties.

Property owners sometimes take a diametrically opposite route and demolish their properties to create two separate units on the site. If you stick to traditional notions, you may feel that two units can be sold for a higher price than one- right? So is there a catch? Well! Plenty to be precise!

To begin, there is a cost involved in demolishing the existing home and leveling the site. There is a price tag attached to council permits. Add to this the fee of the architect or the draftsman who prepares the blueprint for the new units. You cannot overlook the cost of labor and raw materials (it may include an exigency or a sudden surcharge). One has to duly consider the amount of interest on loan (required for reconstruction) and rental fee (for the time you do not have a place to live in).

Next in line is the cost involved in marketing your property, appraisal fee, agent’s cut and the capital gains tax. If you now look at it, subdividing might not seem to be a viable option anymore. Well! It still can be but it is your duty to make an informed decision.

Which one between the two would you typically choose? I invite your opinion.

Australian housing nowhere close to a bust

March 18, 2013

Sydney Property - Buyers Agent Sydney The Australian housing bubble is not bursting anytime soon. The prices may be high but they are so only because the cost of living is high says Gary Thomas, President of US National Realtors association. Larry Schlesinger while reporting for the Property Observer writes an interesting article that sheds light on how the US real Estate is looking to come through after the Sub Prime crisis years. Property legend like Gary Thomas feels that the difference in pricing is only because of differences in average income, liquidity and subsequent purchasing power.

Gary Thomas does not speak through his hat. With over 35 years of experience in US Realty and managing a pan-Southern California firm called Evergreen Realty; he certainly knows a thing or two about the statements he makes. The prices of homes in US (inclusive of Foreclosure and Short Sales) have come up by 9.7% in the last one year. There are clear indications of property resurgence in California, Florida and Arizona. In fact, the states that had suffered most are coming up most strongly (says something about the US resilience- is it not their style since Lincoln’s time?)

While prices are increasing steadily, they are not exactly skyrocketing- this is especially because mortgage loans are not too easily available (Sub Prime days have resulted in extremely strict lending policies). Gary Thomas uses a beautiful satire when he says that lenders in US sometimes treat borrowers as those under trial for ‘inquisition”. All said, there is enough reason feels Thomas for Australia to take a keen interest in its near-boom property days without fearing a bust.

Does the Australian housing market remind you of days that led to the US mortgage crisis?

Mortgage commitments for first home buyers at a nine-year low

March 17, 2013

Buyers Advocate - Sydney Federation House Mortgage commitments made by first home buyers are not sending too many happy signals. Larry Schlesinger confirms in his article how owner occupied financial commitments have fallen by about 1.5% in January 2013. Over this same period, first home seekers stood at 14.9% of the total number of people seeking home loans. ABS puts it in close proximity to March 2004, the month which had recorded lowest first home buyer count.

First home buyers are showing some improvement when it comes to the average size of the loan. Between December 2012 and January 2013, size of their home loans has increased by $2800. Buyers on the whole have stunted their budgets by $1200 between Dec ‘12’ and Jan ‘13’. After having risen 1.6% in the month of December, mortgage commitments for home constructions have come down by 0.2% in January. This figure is a little difficult to chew for the construction sector. Having said this, sale of already established houses remained flat (point to note: it did not go down) for most of January.

Commitments towards purchase of new homes have increased in the month of December. The percentage of hike is similar to that in December (2.3%). This is definitely a trend that will pick momentum in coming days.

There won’t be an Australian property crash anytime soon

March 16, 2013

Bubbles do not wait for a decade to burst. Thus any suggestion about Australian Real Estate being close to a bubble phase is a myth. In an article written for Property Observer, Terry Ryder illustrates (and effectively) why there isn’t going to be an Australian property crash. While doing so, he speaks in line with what Glenn Stevens suggested about the Realty scene here.

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