While it may all come down to who has the deepest pockets on the day, sometimes how you bid will influence just how high the other bidders are prepared to go.
However, the most important factor at auction is to decide what is your realistic limit in advance. Be prepared to be a little flexible, but don’t allow yourself to get carried away with emotion. Here are our best tips:
Obtain pre-approval for your loan before the auction. This provides you with confidence that the bank will support your highest bid.
Some people like to enter the bidding early and then keep bidding strongly in the hope that other buyers will find their tenacity off putting
Some buyers like to open the bidding with a very high bid but this can risk paying too much for the property
Others prefer to wait until the bidding appears to be exhausted, before starting to compete
If two bidders keep upping their bids by similar amounts, some buyers believe it is advantageous to suddenly bid with a stronger, larger increase than has been generally taking place throughout the auction. This is thought to convince competitors that you are determined to succeed and will just keep bidding
If the auctioneer indicates that the property is to be ‘passed in’, make sure that you are the highest bidder if you wish to have the ‘first right of refusal’ following the auction. This means you will be first to have the opportunity to negotiate with the vendor
Whatever your style, the one thing that rarely works to anybody’s benefit is being loud and obnoxious.
Renting a holiday home
Consumer facts for travellers
By renting private houses and units, holiday-makers can enjoy the comforts of home while staying at their favourite holiday destination. But short-term renters in NSW don't have the same rights or responsibilities as regular, long term tenants. So it ?s a good idea to find out precisely what your rights are before renting a holiday house or unit.
Online booking services
Online booking services operate websites (such as Airbnb, Stayz and Wotif) allowing home owners to advertise and rent out their homes, or rooms in their homes, for holiday accommodation.
Your holiday experience renting such private accommodation through an online booking service may be very unlike traditional hotel accommodation. In many cases, it involves you entering a private contract with the home owner. The online booking service may not be a party to the contract, and not obliged to assist either you or the home owner if there is a dispute.
Some tips for renters using an online booking service are:
? Check the agreement ?s terms and conditions, especially the refund and cancellation policies. Ask about anything that you are unsure of when you make a booking. A short conversation may prevent unpleasant `surprises ? later on!
? Check if you have to pay a form of 'bond' for damages and how it will be released when you check-out.
? Clarify what you are renting and be aware that you could be in someone ?s home (or bedroom). If you have booked a room, you may want to confirm that the landlord has the permission of rest of the household.
? Understand what the booking includes. Landlords may have policies about whether they supply linen, internet, cleaning or certain household items (like cutlery or toilet paper).
? Ask about any special conditions or 'house- rules' that the landlord has (eg. noise, pets and shower times). These may be based on Council restrictions.
? Consider how amenities may differ in shared accommodation. Compared with staying in a hotel, it may have a different standard of amenities and level of privacy.
Home owners and agents can find out more on online booking services, including tips for landlords, on our Holiday and short stay rentals page.
Who should I rent from?
Individuals are quite at liberty to rent out their holiday properties. However, if they use an agent or broker to carry out this task then those people must be licensed with NSW Fair Trading as a real estate agent. Dealing with an unlicensed agent or broker exposes you to unnecessary risks. Find out if the person you are dealing with is licensed by doing a licence check on the Fair Trading website or by calling 13 32 20.
Whether renting directly from the property owner or through a licensed agent, make certain you sign a written agreement that clearly sets out the rights and responsibilities of both parties.
What services are provided?
Before signing a written agreement, talk to the owner or agent about anything you are unsure of. For example:
? does the owner have the right to enter the property while you are living there? If so, in what circumstances?
? is the accommodation rated according to an accommodation classifications system (a star rating) and how does it work?
IMPORTANT: Make sure that an agent is licensed by calling 13 32 20 or do a licence check online by visiting www.fairtrading.nsw.gov.au
? is the accommodation serviced and if so, how often?
? is there anything in the property which you cannot
use (eg. garage, cupboards) or are any of the
facilities (eg. bathrooms) shared?
? is the accommodation fully furnished, including
cutlery, bedding and towels?
? how close are the premises to points of interest and
? how will disputes be settled? Does any formal
dispute resolution system exist?
? who do you call in the event of an emergency?
? Where possible, it is a good idea to deal with people you know or who have been recommended to you.
? Don't be hesitant about reporting fraud or other misconduct to the appropriate authorities. Ask questions. It ?s your money.
A real estate agent is required to give you a trust account receipt for any money you have paid. If a dispute arises, you will need this receipt as proof of payment for the services you have paid for. Receipt details should include the date of payment, amount paid, period covered by the payment, what the payment was for, the owner ?s or agent's name, contact details and a licence number if the receipt was issued by an agent.
Together with the owner or agent, you should conduct an inspection of the property before moving in. During the inspection you should note any existing damage, what is contained in the property and any missing or faulty appliances. It's important that your comments are noted in writing and that you, and the owner or agent, keep a copy of the report. This will help you avoid disputes when you move out.
Remember, you will be responsible for damage to the property or its equipment, fixtures or fittings if it was caused through your negligence. You are not responsible for any damage to items that is regarded as 'fair wear and tear'.
You will probably be asked to provide a security deposit (or bond). It's important to get a receipt for the security deposit, as well as written information on where it will be held, who it will be paid to, how to claim it back and the responsibilities of you and the owner or agent.
Security deposits for short term holiday accommodation not covered by the Residential Tenancies Act 2010 do not have to be paid to NSW Fair Trading.
IMPORTANT: Make certain any agreement or contract is in writing and you get a copy. By law, a real estate agent must deposit any money paid by you - including deposits - into their trust account. Make sure the agreement sets out when this money can be paid from the agent's trust account to the owner or to the agent. Some agreements may require deposits to be paid to the owner before you take up the accommodation.
Before making a booking
Frequently, people who are going on holidays make telephone bookings for accommodation at locations they have never visited before. When this happens, it's important to keep the following points in mind.
? When speaking to a person, ask for their name and who they represent.
? Take notes of all important points of your conversation, including dates, times and names.
? Make sure you understand all the terms and conditions. If you don't understand something, don't be afraid to ask questions.
? Ensure you receive written confirmation of everything you request. That way you can be certain you will get what you are paying for.
? Read all correspondence carefully.
? Check that the business you are dealing with is
licensed. Contact NSW Fair Trading for this information on 13 32 20 or do a licence check online by visiting www.fairtrading.nsw.gov.au
If you have a dispute with an accommodation provider, try to contact the owner or manager. If you cannot settle the problem by mutual agreement, contact NSW Fair Trading on 13 32 20, or lodge your enquiry or complaint through the Fair Trading website.
www.fairtrading.nsw.gov.au Fair Trading enquiries 13 32 20 TTY 1300 723 404
Language assistance 13 14 50
This fact sheet must not be relied on as legal advice. For more information about this topic, refer to the appropriate legislation.
© State of New South Wales through NSW Fair Trading
You may freely copy, distribute, display or download this information with some important restrictions. See NSW Fair Trading's copyright policy at www.fairtrading.nsw.gov.au or email firstname.lastname@example.org
Building and pest inspections can help safeguard property buyers against investing in fault-ridden properties, as the reports reveal any hidden problems a property may have.
Picture of building and pest inspection
The results can give investors peace of mind, with the knowledge that what they’re buying isn’t going to collapse around them.
According to Ian Pepper, CEO of Property Penguin, if the property has termite damage, for example, you could be up for tens of thousands of dollars in repairs. “Major structural issues can be very costly to fix, so it’s really worthwhile finding out those sort of things upfront.”
The other benefit of a property inspection is that if no major issues are identified, but several minor problems are noted, the report can become a powerful negotiating tool in regards to purchase price.
Commercial properties are great for those who have some business knowledge. If you understand a potential tenant’s financial history and goals, it will give you a better idea of what your potential earnings could be. Commercial properties can also offer great returns. These properties tend to have a larger annual profit than residential investments. Also, leases are usually for longer terms and there are options for renewal. Compared to residential properties, commercial tenants tend to stay longer, which can give a greater sense of stability for you as the owner.
However, a commercial property investment is not for someone on a tight budget. It can be harder to find a tenant as it is a lot of work for businesses to change locations. Businesses do not usually move as regularly as families. In some markets, incentives may need to be offered in order to attract a company. An example of this is one month’s free rent. This is just one thing that can put you out of pocket right at the beginning.
Residential properties are a great option as there is a huge demand for it. If a person is unable to buy a house, they have very few options other than to rent. This means you will have a large group of potential tenants at your doorstep. However, rental terms are often shorter, compared to commercial properties. Some tenants consider renting a short term alternative as they themselves are building a home or saving to buy their own home. Therefore, the rental term can often be 6 months to a year.
In summary, it is probably fair to say that commercial property investment is a riskier proposition that can offer bigger rewards, whilst residential property is a safer, slightly less rewarding alternative.
While the national market moderates, demand among Sydney investors remains strong. A report from the Real Estate Institute of Australia showed that in December 2016, finance for investors went up by 1.5 per cent.
Clearly, investing in residential property remains popular – but how long should I hold my investment for? The temptation to sell after a few years of capital gains is often strong, but will there be greater profits in the long-term?
The long and short of investing in residential real estate
CoreLogic RP Data's Pain and Gain report highlights where the biggest profits and losses were made in real estate each quarter, as well as how long people held onto their properties for. Using this information, we can glean a rough idea of how long investment properties should be held.
This suggests the longer you hold real estate, the more growth you will see.
The nationwide average time a buyer held real estate before making a loss was 6.1 years for a detached house, and 6.5 years for units and apartments. Those that made a profit when selling had house and unit hold times of 9.1 and 7.6 years respectively.
This suggests the longer you hold real estate, the more growth you will see. Even though the real estate market has ups and downs, in the long term it generally increases in value.
One of the most important elements when choosing the real estate agent to represent you is ‘trust’.
An agent offering you the lowest commission rate and/or the highest appraisal is not necessarily the best option. To make your selection easier, take the advice of the professionals:
Ask your colleagues, family, friends and neighbours if they are able to refer you to a proactive agent
If you are unable to receive referrals, search the internet for reviews from past clients of local agents
When you interview your potential agent, ask the following questions:
- How many properties did you sell last year and last month?
- How many buyers are you working with at the moment?
- Can you provide me with an example of your marketing campaign?
- How many salespeople do you have in your team?
- What charges will I incur if the house doesn't sell?
- If I am not happy with your performance, how do I cancel our agreement?
- Can you provide me with a list of your past clients and testimonials?
- How often will I receive feedback on the progress of my sale?
- Can you provide me with 3 recent sales in the area, similar to my property, and what they sold for?
- What is the average house price in my area?
- Do you have similar properties to mine currently for sale?
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