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Upcoming Property Talk

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Home Buyers Information Evening

Wednesday June 1st 2011

Finding it difficult understanding the property market??

Ian James, Director JPP Buyer Advocates will give his view on the Current Melbourne Property Market.

Discussions on:

-Finding the perfect home / Investment.
-Preparing to bid at Auction.
-Negotiating for Private Sale.

Come along to an informal evening with property buying experts.
Have a cuppa while you listen, then feel free to ask our team any questions you may have.

We look forward to seeing you...

Location - JPP Buyer Advocates - Caulfield South
Time 6:30pm
RSVP - enquiry@jpp.com.au or 03 9523 1054
Limited numbers.

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Market News

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If anyone in the market place believes that First Home Owners will again be a market force because of stamp duty savings the Victorian State Government is offering, they are seriously deluding themselves.

Firstly, the stamp duty savings will count for anyone that has already purchased and settles after 1st July this year. Therefore there would have been a rush now! Average settlement is 60 days putting us past 1st July.

Secondly, the savings on a $565k (median house price in Melbourne) home will be just over $5700. As this is a reduction in Stamp Duty and not money that would be seen as a deposit, the banks will most likely not leverage this money which they did with the First Home Owners Grants. When $30,000 was being given to First Home Buyers, the banks looked at this as the equivalent of a deposit and lent accordingly. If you were borrowing 90% loan to value ratio, then with an extra $30k, if you could afford the repayments, the bank would lend you up to an extra $300k. This would not be the same with a reduction to a fee.

As far as waiting for further cuts through for the next 3 years in order to reach the full savings of nearly $14,500, the market will have most likely moved further than this. The best time for first home buyers, or anyone else for that matter, is as soon as they can reasonably afford to. Buying property is long term: 5 – 10 years.

As a first home buyer, if you cannot afford to purchase where you want to live, consider renting where you want to live and buy an investment property where the tenant will assist you to pay off the mortgage. Or, and this is the scary line for all you mums and dads, stay at home longer, and buy an investment property. Why don’t you join forces with your parents and buy a property together.

The sooner you get into the property market and the longer you are in the property market, the more money you will make.

If you are considering a purchase why don’t you drop in for a no obligation chat.

Regards,
Ian James

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Recent Articles Of Interest

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Medium-term returns by distance from CBD


When house sales are compared over a five-year time frame by geographic location, houses returning the highest capital growth are generally found in the middle suburbs of Melbourne that is those between 10 and 20km radius from the CBD.

The most expensive houses are found, not surprisingly in the inner suburbs, those within 10km radius of the CBD. The median price for a house in this category is $882,500, an increase of 77 per cent over five years compared to 57 per cent for the Melbourne Median. Unit and apartment sales also recorded in the same area increased 48 per cent over five years to $505,000.

Read the rest of the article here (source:REIV).






First home buyers can benefit from stamp duty cut this weekend


A factor of the recently announced 20 per cent discount on stamp duty for first home buyers that could easily be overlooked is that it may apply to homes purchased now, even though it does not come into effect until 1 July, 2011

REIV CEO Enzo Raimondo said this may not be appreciated by first home buyers because they pay stamp duty when settlement of their purchase occurs, not when they sign a contract.

“Settlement occurs on the day the balance of the purchase price is paid and the property’s title document is handed over to the buyer.

Read the rest of the article here (source:REIV).


Sam James

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The Consequences Of A Big Australia

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The stream of extreme bullish and bearish views regarding the real estate market tirelessly adopts the guise of a political contest. Those of us working in the industry are constantly accused of talking up the market for our own 'greedy' ends. On the other end of the spectrum are the 'bubble' doomsday pundits, who are so determined to see our market take on the form of an American style crash and shoot down the drain, they hang onto any bit of negative data they can lay their hands on. However the real truth is neither bearish nor bullish, but in many respects overwhelmingly predictable.

Most people residing in Australia recognise the beauty and quality of life style we're privileged to experience in comparison with many other countries. It's the reason our major cities top the list of the world's most liveable destinations. However, debate is rife concerning the rapidly increasing population simply because our infrastructure in the major metropolitan areas is woefully over capacitated. We don't have enough accommodation in the areas people want to live to accommodate growing numbers of people, so is it any wonder we continue to see inner city property cycles of unsustainable booms, followed by flat periods of pain and grief, for potential buyers who can’t afford a foot through the door??

Real estate has always seemed unaffordable and overpriced to first home buyers - a simple search back through newspaper archives will teach you this much. However as the metropolitan belt tightens, it's fast becoming a split between 'those who can' and 'those who can't'. In short, any single person on an average wage fighting to save a deposit will find they're limited to properties in 'regional' locations with sparse amenities, or high rise inner city rabbit hutches for which banks are not all that keen to lend on - (and understandably so!) Is it any wonder reducing numbers of first home buyers are entering the market? The incentive to scrimp and save for a deposit is only there when the reward is achievable.

Julia Gillard, and Sustainable Population Minister Tony Burke, recently made comments that Australia's most densely populated cities (Sydney and Melbourne) have reached their "carrying capacity". This could have been a political ploy to gain kudos in the polls - after all there's huge consensus to reduce (or at least 'cap') Australia's population, but it would be interesting to debate further how we intend to achieve this? Australia is one of the least densely populated countries in the world! It's not good enough to protest that much of the land isn't arable when we've already proved our ability to adapt to different terrains and climates. Although we may be able to slow our growth, we can't single handedly stop it any more than we can single handedly stop climate change! People are going to keep coming, and a consistent fertility rate alone will see 29 Million by 2050.

Therefore unless we look outside the square and find 'real' feasible options for an increasing number of buyers who can no longer afford to purchase - we'll see tremendous pressure on rental accommodation and our market will become an 'investor's domain'. Increasing stock supply is not the 'simple' answer to this equation if it's located where commuting time will outweigh any savings made. Increasing inner city density is all well and good, however as any first home buyer knows - banks place strict criteria on the type and size of property they'll lend against. Many of the Manhattan style high rise developments ('supposedly' built to ease home buyer pain) don't come close to ticking the necessary criteria.

At around $290,000 (the average loan for a first home buyer) it's all but impossible to purchase something in a metro location that will provide a decent stepping stone for future advancement. Anyone experienced in property investing knows the number one consideration for home buyers is proximity to public transport. In recent study by Oliver Hume - profiling buyer's 'must have' criteria - public transport topped the list followed closely by schools. We have to face the stark reality that our population cannot be 'capped', but neither should we be feeling like factory farmed chickens squashed into metropolitan areas where housing is reserved for 'those who can'! By 2013 Australia will be the only continent without any high speed rail! A high speed network linking regional locations would see commuting times to the nearest CBDs from as little as 20 minutes and open a wide range of affordable options for home buyers. Unless we start understanding extra roof space is not the answer to 'sustaining' population without serious commitment to improve transport systems, we can expect the house hunting pain of 'those who can't' to get progressively worst.

Catherine Cashmore

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Spotlight On Melbourne Suburbs

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In our regular spotlight section we examine a selection of Melbourne suburbs, highlighting what's happening in these areas right now


Albert Park


Municipality: City of Port Phillip
Population: 5827 (2006 census)
Postcode: 3206
Location: 3km from Melbourne CBD

Located 3 km south of Melbourne's CBD with a population of 5827 (2006 Census). Albert Park is possibly one of the most picturesque suburbs in Melbourne. With a village like atmosphere, wide tree lined streets, and an abundance of heritage listed houses, the suburb plays host to possibly the most famous park in Melbourne - Albert Park and lake.

Named after Price Albert - the consort of Queen Victoria, after his death in the mid 19th Century, the park is made up of over 225-hectares of land and features a beautiful lake, a network of walking tracks, a golf course, picnic areas, and numerous other facilities attracting visitors both near and far. Over 100 bird species make their home in the park - most commonly seen are the black swans which are a major feature of the lake. The park plays host to Melbourne's Grand Prix once a year which attracts international attention, and many complaints about the noise from locals in the area! Without doubt it is the park which makes Albert Park the wonderful residential location it is today.

Defying the grid like system in other areas of Melbourne, the most prestigious residential locality in Albert Park are the curved streets surrounding St Vincent Gardens. The gardens are Georgian in design and retain great significance with the Victorian Heritage register. The streets circling the gardens are tightly held by a small residential community and feature richly detailed Victorian terrace houses. It's the largest design of this type in Melbourne and therefore understandable that property for sale in this locality attracts sky high prices for their rarity. The gardens have an exclusive tennis and lawn bowls club which was established mid 19 century.

Located just a stones throw from the city, Albert Park is easily accessible with St Kilda light rail service running along Ferrars St, and a tram service on Victoria Ave. Bridport Street and Victoria Avenue are Albert Parks main shopping strips. They are renown for their stylish cafes, delicatessens, restaurants, clothing boutiques and vintage furniture and homeware stores.

To top it off Albert Park has a beautiful long beach lined with historic buildings such as the Victoria Hotel. Although house prices are high and land sizes small, the suburb still manges to retain a family friendly feel largely due to the excellent facilities on offer. Off street parking is a rarity and houses offering the luxury come with a premium attached. However thankfully the streets are wide and street parking is well catered for. Albert Park is truly one of Melbourne's best loved suburbs and it's hard to see how you can go wrong if purchasing in this location.



Amenities

Albert Park’s main schools are:

  • Albert Park Primary School

Transport - Two tram lines service Albert Park - number 1 and number 96

Shopping - The major shopping strips are located along Bridport St and Victoria Ave - the shops are well catered for the exclusive residential clientele with boutique retail clothing stores, book shops, cafes, delicatessens and restaurants.

House Styles

Albert Park's streets are generally lined with Victorian and Edwardian terrace houses. High rise apartment blocks ranging from the 1970's to present can be found closer towards the shopping strips and along the beach front. Quite a high proportion of residents rent in Albert Park, however the housing market is fuelled by owner occupiers and there is a wide discrepancy between house price which is often based on emotion rather than land and house value alone. Therefore the market can prove quite volatile and is tightly held, in recessive economic conditions.



Maribyrnong River

Image from Wikipedia


Catherine Cashmore

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"THE BLOCK" 2011
Will It Struggle To Break Even?

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The new series of 'The Block' about to go to air on Channel 9 will have their work cut out based on its previous endeavours in Sydney.

This time around they have taken a different approach not only by moving to Melbourne but also to houses.

Channel 9 has managed to purchase four single fronted homes in Richmond, all of which were owned by one vendor, Works have been underway for a number of weeks transforming these four run-down houses into a workable shell for the show to commence.

With an initial purchase price of $3,600,000.00 plus stamp duty ($198,000) Channel 9 has well and truly jumped into the deep end.

All four are currently undergoing the initial structural repairs and a second story extension to allow the contestants a clean workable space for the interior flair.

These four single fronted homes are situated in Cameron Street across the road from the entrance to a Safeway car park and under the shadow of the commission flats. The resulting T-intersection restricts parking and increasing traffic in the immediate area.

The publicity that the TV show generates may be the only way to see these properties break even.

I think this season's contestants are going to need a lot of luck!!

The Block auction results: 2010
Neisha and John Mark and Duncan
Reserve: $900,000 Reserve: $860,000
Sold: $1,105,000 Sold: $907,000
Takeaway: $205,000 +
$100,000 Prize Money
 
Won: $305,000 Won: $47,000

Erin and Jake Brenton and Chez
Reserve: $910,000 Reserve: $880,000
Sold: $997,500 Passed in at auction
  Post auction sale: $970,000
Won: $87,500 Won: $90,000

Source: Channel Nine

Justin Lilburne

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Technology Monthly

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Nintendo trys 3D....again.


Some may not know this, but the 3DS console is not Nintendo's first attempt at a 3D game system. Although they don't like to admit it, in 1995 they released the Virtual boy...thought of by some as Nintendo's biggest failure.

The Virtual Boy is essentially a pair of glasses on a tripod that uses oscillating mirrors (one for each eye) that vibrate at high speed to create the 3D effect. The problem with this (an the fact that it used only a monochrome red and black display) was that it gave users everything from headaches and eye strain to seizures...meaning that breaks had to be taken every 10-15 mins.

Nintendo also marketed the device as a portable gaming machine, the problem with this was that it weighed almost a kilo, took 6 AA batteries (which only lasted 4 hours) and was too big to fit anywhere except a suitcase...and as Nintendo saw fit to not make a headstrap for the device, you needed a completely flay surface, or to lay on your back to play it (using it in the car was impossible).

The Virtual Boy was phased out in less than 6 months from launch, meaning that: there were only 22 games released for the system, the cable for the expansion port (to link 2 units together) was never released, and that it now goes for ridiculous prices on eBay as there were only 770,000 units sold world wide. Because I am a collector (or an idiot), I happen to have a Virtual Boy, and I can say from experience that it definitly hurts your eyes and gives you headaches. I haven't had a chance to play with a 3DS yet, but I hope it is not the Virtual Boy v.2.

Below is a picture of the unit:


Virtual Boy



*Image from Wikipedia

Chris Thursfield

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Recipe: Goulash Soup

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Ingredients: (serves 4)

  • 1 tablespoon olive oil
  • 400g beef chuck steak, trimmed, cubed
  • 1 medium brown onion, chopped
  • 1 medium carrot, peeled, chopped
  • 2 garlic cloves, crushed
  • 1 teaspoon sweet paprika
  • 3 1/2 cups beef stock
  • 400g can diced tomatoes
  • 450g sebago potatoes, peeled, cubed
  • Sour cream and fresh chives, to serve

Method:

1. Heat oil in a saucepan over medium-high heat. Cook steak, stirring, in 2 batches, for 2 to 3 minutes or until browned. Transfer to a bowl.

2. Add onion and carrot to pan. Cook, stirring, for 5 minutes or until softened. Add garlic and paprika. Cook, stirring, for 30 seconds or until fragrant. Add stock and tomato. Stir to combine. Add steak. Bring to the boil. Reduce heat to low. Simmer, covered, for 1 hour or until steak is tender. Add potato. Cook, partially covered, for 30 minutes or until slightly thickened and potato tender.

3. Season with pepper. Ladle into bowls. Dollop with sour cream. Sprinkle with chives. Serve.


*Recipe From taste.com.au

Chris Thursfield

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Kind regards from the team at JPP.
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