1 00:00:05,480 --> 00:00:08,240 Speaker 1: Welcome to the Property Pendulum, brought to you by Domain 2 00:00:08,440 --> 00:00:11,000 Speaker 1: and Fear and Greed, the podcast that tells you which 3 00:00:11,039 --> 00:00:13,520 Speaker 1: way the property market is going to swing and how 4 00:00:13,560 --> 00:00:15,880 Speaker 1: to make the most of it. I'm Michael Thompson and 5 00:00:15,960 --> 00:00:19,200 Speaker 1: I'm joined by Alice Staltz, national property editor at Domain 6 00:00:19,640 --> 00:00:22,600 Speaker 1: and one of Australia's foremost experts on all things real 7 00:00:22,760 --> 00:00:25,479 Speaker 1: estate known to audience is right around the country for 8 00:00:25,800 --> 00:00:29,840 Speaker 1: her work on nine including the Block. Hello Alice, Hello Michael. 9 00:00:30,280 --> 00:00:33,760 Speaker 1: This is very exciting and a quick little introductory question. 10 00:00:33,880 --> 00:00:38,120 Speaker 1: I suppose before we get started, why the property pendulum? 11 00:00:38,720 --> 00:00:40,760 Speaker 2: Well, you know what, Michael, I reckon the question I 12 00:00:40,760 --> 00:00:44,080 Speaker 2: get asked most is is good for buyers, sellers, renters 13 00:00:44,120 --> 00:00:47,000 Speaker 2: And I always think of that pendulum swinging where is 14 00:00:47,040 --> 00:00:49,400 Speaker 2: it going? So I guess what we're hopefully going to 15 00:00:49,440 --> 00:00:52,280 Speaker 2: do is give people information so they can work out 16 00:00:52,560 --> 00:00:55,360 Speaker 2: where that market is sitting at any given point in time. 17 00:00:55,640 --> 00:00:59,000 Speaker 1: Yeah. Absolutely, and really the tips and the strategies to 18 00:00:59,080 --> 00:01:00,880 Speaker 1: kind of make the most of it wherever it is, 19 00:01:00,960 --> 00:01:03,720 Speaker 1: wherever the market is sitting, how you can get the 20 00:01:03,720 --> 00:01:06,240 Speaker 1: best result in that market. And that's really what today's 21 00:01:06,280 --> 00:01:09,880 Speaker 1: episode is all about, because we are putting together a list, 22 00:01:09,880 --> 00:01:12,280 Speaker 1: and I love lists. I love any kind of podcast, 23 00:01:12,360 --> 00:01:16,360 Speaker 1: any magazine article, anything that has a list, I am there. 24 00:01:16,920 --> 00:01:19,319 Speaker 1: So today we are putting together a list of the 25 00:01:19,440 --> 00:01:23,160 Speaker 1: four things that every home buyer needs to know before 26 00:01:23,240 --> 00:01:25,920 Speaker 1: making an office. So really, to kind of set the scene, 27 00:01:25,920 --> 00:01:30,039 Speaker 1: I suppose we are assuming that we've found the dream home. 28 00:01:30,480 --> 00:01:33,960 Speaker 1: Maybe it's kind of a couple of extra bedrooms, it's upsizing, 29 00:01:34,040 --> 00:01:37,840 Speaker 1: it's moving to a new city, something something big, something spectacular. 30 00:01:38,640 --> 00:01:40,200 Speaker 1: You've got your eye on it, you've got your heart 31 00:01:40,280 --> 00:01:44,440 Speaker 1: set on it. What do you do? What's step one? 32 00:01:44,959 --> 00:01:47,560 Speaker 2: The most important step is to ensure your finances are 33 00:01:47,560 --> 00:01:50,440 Speaker 2: in order. So we know that, particularly people who are 34 00:01:50,520 --> 00:01:53,600 Speaker 2: upgrading or making that sideways move, it's really important to 35 00:01:53,680 --> 00:01:56,640 Speaker 2: understand what your borrowing capacity is going to be. So 36 00:01:56,760 --> 00:01:59,200 Speaker 2: basically that is getting in touch with a broker or 37 00:01:59,240 --> 00:02:03,240 Speaker 2: a bank, understanding what your options are because things have 38 00:02:03,280 --> 00:02:05,840 Speaker 2: probably changed quite a bit, particularly if you are in 39 00:02:05,840 --> 00:02:08,239 Speaker 2: an upgrading category, or you're moving on to a second 40 00:02:08,320 --> 00:02:10,600 Speaker 2: or third property from what they were when you bought 41 00:02:10,600 --> 00:02:14,720 Speaker 2: your first property, perhaps some years ago. So it's ensuring 42 00:02:14,800 --> 00:02:18,320 Speaker 2: to understand the minimum deposit is basically will be ten percent, 43 00:02:18,600 --> 00:02:21,560 Speaker 2: but people should be aiming for twenty percent. Now, if 44 00:02:21,600 --> 00:02:23,680 Speaker 2: you are borrowing more than eighty percent of the property 45 00:02:23,760 --> 00:02:25,600 Speaker 2: value that you're going to you're going to have to 46 00:02:25,639 --> 00:02:29,160 Speaker 2: take out lender's mortgage insurance, so being really mindful about 47 00:02:29,200 --> 00:02:32,919 Speaker 2: how that will impact all the charges associated with what 48 00:02:32,960 --> 00:02:33,720 Speaker 2: you're paying for. 49 00:02:34,040 --> 00:02:36,440 Speaker 1: And a broker can talk you through all of this, 50 00:02:36,840 --> 00:02:39,840 Speaker 1: can't they. And so it's really the first step is 51 00:02:39,840 --> 00:02:41,480 Speaker 1: to go and talk to someone and you can do 52 00:02:41,480 --> 00:02:44,400 Speaker 1: that almost before you've found the house completely. 53 00:02:44,440 --> 00:02:47,079 Speaker 2: And I mean really, anyone who is really after good 54 00:02:47,080 --> 00:02:49,600 Speaker 2: financial health should be doing that's almost once a year, 55 00:02:49,919 --> 00:02:52,200 Speaker 2: just to check in with someone quite neutral in the 56 00:02:52,280 --> 00:02:54,800 Speaker 2: agnostic I suppose. And it's amazing the rise of brokers 57 00:02:54,800 --> 00:02:57,000 Speaker 2: in Australia compared to where banks way ten years ago, 58 00:02:57,040 --> 00:02:59,480 Speaker 2: that people are really using them a lot more as 59 00:02:59,480 --> 00:03:01,800 Speaker 2: that touch points to ensure they've got the best interest 60 00:03:01,840 --> 00:03:04,919 Speaker 2: rate possible and that their borrowing options are always sort 61 00:03:04,919 --> 00:03:06,880 Speaker 2: of ready to go should they find something. 62 00:03:07,440 --> 00:03:09,880 Speaker 1: And so say they have then found something, is it 63 00:03:09,880 --> 00:03:12,360 Speaker 1: I suppose having pre approval in place so that you 64 00:03:12,400 --> 00:03:15,359 Speaker 1: can move quite quickly, because I suppose times are the 65 00:03:15,480 --> 00:03:17,799 Speaker 1: essence in this scenario, isn't it if you found something 66 00:03:17,840 --> 00:03:19,520 Speaker 1: you don't want to just leave it for weeks and 67 00:03:19,560 --> 00:03:21,480 Speaker 1: weeks and weeks while you get your ducks in. 68 00:03:21,480 --> 00:03:24,200 Speaker 2: A row exactly, And in my mind, there's no harm 69 00:03:24,240 --> 00:03:26,120 Speaker 2: done in having that pre approval ready to go. It 70 00:03:26,200 --> 00:03:28,520 Speaker 2: just gives you flexibility. It allows you to pounce when 71 00:03:28,520 --> 00:03:31,239 Speaker 2: you're ready, and also just gives you that confidence that 72 00:03:31,240 --> 00:03:33,840 Speaker 2: you're sort of not wasting time or just kicking tires. 73 00:03:33,919 --> 00:03:35,960 Speaker 2: So I think it also means that you're not going 74 00:03:36,000 --> 00:03:37,680 Speaker 2: to look at properties that are out of your budget 75 00:03:37,800 --> 00:03:39,880 Speaker 2: or well below your budget or whatnot. So I think 76 00:03:39,920 --> 00:03:42,960 Speaker 2: it just gives you certainty and clarity about what you 77 00:03:43,000 --> 00:03:44,000 Speaker 2: can actually purchase. 78 00:03:44,240 --> 00:03:46,640 Speaker 1: The temptation is there, though, isn't it. Like I know 79 00:03:46,720 --> 00:03:51,240 Speaker 1: that when we were looking to upgrade, we constantly went 80 00:03:51,720 --> 00:03:55,600 Speaker 1: to open homes for properties that we knew we couldn't afford. 81 00:03:55,720 --> 00:03:59,320 Speaker 1: It was slightly above what we'd been preapproved for a 82 00:03:59,360 --> 00:04:02,760 Speaker 1: waste of time, maybe, but god, it's fun always. 83 00:04:02,480 --> 00:04:04,480 Speaker 2: Looking for the top shelf, sort of that idea of 84 00:04:04,560 --> 00:04:07,040 Speaker 2: just stretching slightly up. Look, you know what, I think 85 00:04:07,040 --> 00:04:09,160 Speaker 2: it's quite harmless in the sense that maybe it's giving 86 00:04:09,160 --> 00:04:10,800 Speaker 2: you ideas about what you might want to do on 87 00:04:10,800 --> 00:04:12,600 Speaker 2: a net on your next property. It might give you 88 00:04:12,680 --> 00:04:15,120 Speaker 2: ideas about what the property after this one will be. 89 00:04:15,440 --> 00:04:17,240 Speaker 2: I think there's no harm in it, and I think 90 00:04:17,320 --> 00:04:20,440 Speaker 2: the more you can understand different levels of the market 91 00:04:20,920 --> 00:04:22,839 Speaker 2: and what you're getting for your money and the difference 92 00:04:22,839 --> 00:04:24,839 Speaker 2: in price in each category, the better. 93 00:04:25,200 --> 00:04:27,640 Speaker 1: Thank you for making me feel better. And it wasn't 94 00:04:27,680 --> 00:04:30,000 Speaker 1: wasted time at all, It was just future research. I 95 00:04:30,040 --> 00:04:32,640 Speaker 1: love that. I suppose that's kind of leading us into 96 00:04:32,760 --> 00:04:35,240 Speaker 1: step two. Then, So stage one is kind of knowing 97 00:04:35,920 --> 00:04:40,320 Speaker 1: what you can afford. Step two is then knowing what 98 00:04:40,360 --> 00:04:43,360 Speaker 1: the property you are looking at is actually worth. And 99 00:04:43,400 --> 00:04:46,200 Speaker 1: to me, this feels like a very hard thing to 100 00:04:46,240 --> 00:04:49,800 Speaker 1: do because there are so many different forces that can 101 00:04:49,839 --> 00:04:52,599 Speaker 1: impact on it. How on earth do you figure out 102 00:04:52,600 --> 00:04:54,560 Speaker 1: what this is going to be worth and therefore how 103 00:04:54,640 --> 00:04:55,599 Speaker 1: much you should be offering. 104 00:04:56,080 --> 00:04:58,440 Speaker 2: Yeah, there's a saying in property that a property is 105 00:04:58,480 --> 00:05:01,479 Speaker 2: only worth what a buyer is willing to pay. And 106 00:05:02,240 --> 00:05:04,880 Speaker 2: ask any vendor or house on what they think their 107 00:05:04,880 --> 00:05:06,960 Speaker 2: property is worth, and it probably is quite different than 108 00:05:06,960 --> 00:05:10,159 Speaker 2: what the average buyer will pay for it. I think 109 00:05:10,160 --> 00:05:12,720 Speaker 2: it's also really important to remember how quickly a market 110 00:05:12,760 --> 00:05:15,760 Speaker 2: can move, particularly in this current cycle we're in at 111 00:05:15,800 --> 00:05:18,360 Speaker 2: the moment. You know, we're moving into a buyer's market, 112 00:05:19,000 --> 00:05:21,400 Speaker 2: and the market is changing quite a bit in different 113 00:05:21,440 --> 00:05:25,200 Speaker 2: cities and in different suburbs and regions. So basically you 114 00:05:25,200 --> 00:05:27,360 Speaker 2: should check what the estimated value is of the property 115 00:05:27,360 --> 00:05:30,240 Speaker 2: that you're looking at, and you should also be really 116 00:05:30,320 --> 00:05:33,839 Speaker 2: forensically looking at auction results in the area that you're buying. 117 00:05:33,960 --> 00:05:37,520 Speaker 2: I think that's probably the most salient and transparent way 118 00:05:37,560 --> 00:05:40,640 Speaker 2: to actually see what's going on. Go to auctions, see 119 00:05:40,680 --> 00:05:43,440 Speaker 2: the level of bidding, or there might be no bidding, 120 00:05:43,440 --> 00:05:45,240 Speaker 2: and that will give you a very firm indication of 121 00:05:45,279 --> 00:05:48,040 Speaker 2: what's going on in that little patch. But see what's 122 00:05:48,040 --> 00:05:50,720 Speaker 2: going on and see sort of the emotion the energy 123 00:05:50,839 --> 00:05:52,840 Speaker 2: these actions and if they're getting passed in and then 124 00:05:52,880 --> 00:05:53,839 Speaker 2: selling afterwards. 125 00:05:54,080 --> 00:05:56,720 Speaker 1: Okay, so it's not just the price that it sells for, 126 00:05:56,839 --> 00:06:00,520 Speaker 1: it's actually the environment. And really you can do that 127 00:06:00,600 --> 00:06:04,360 Speaker 1: by reading the auction values that the sold prices on 128 00:06:04,400 --> 00:06:06,800 Speaker 1: a page. It's a bit of legwork involved. He you've 129 00:06:06,800 --> 00:06:08,600 Speaker 1: actually got a head out on a Saturday morning or 130 00:06:08,640 --> 00:06:10,640 Speaker 1: on a Thursday night or whenever the auction is held 131 00:06:10,640 --> 00:06:13,840 Speaker 1: and actually be there and feel, God, I don't want 132 00:06:13,839 --> 00:06:16,320 Speaker 1: to say this makes me sound You've got to feel 133 00:06:16,320 --> 00:06:19,039 Speaker 1: the vibe in the room, don't you, Alice, You really do. 134 00:06:19,160 --> 00:06:21,240 Speaker 2: And I think Michael, what it's doing is giving you 135 00:06:21,279 --> 00:06:23,320 Speaker 2: the context of the situation. If you just look at 136 00:06:23,320 --> 00:06:25,840 Speaker 2: a price on something and see one point two million, 137 00:06:26,400 --> 00:06:29,120 Speaker 2: it doesn't necessarily give you And if you're not at 138 00:06:29,120 --> 00:06:32,599 Speaker 2: that auction, you're not understanding how hotly contested it was, 139 00:06:32,720 --> 00:06:35,280 Speaker 2: or did it actually pass in and sell one week later. 140 00:06:35,600 --> 00:06:37,360 Speaker 2: We're just looking at the raw number, and I think 141 00:06:37,360 --> 00:06:39,120 Speaker 2: there's so much more to know about it, and also 142 00:06:39,200 --> 00:06:41,920 Speaker 2: also looking at whose wine these properties? Was it that 143 00:06:41,960 --> 00:06:44,360 Speaker 2: person you saw the weekend before that auction that they 144 00:06:44,400 --> 00:06:47,560 Speaker 2: also lost out to It just gives more clarity and 145 00:06:47,640 --> 00:06:50,920 Speaker 2: more layers, I suppose, and understanding where it's priced. I 146 00:06:51,000 --> 00:06:54,000 Speaker 2: think also when properties are in strong demand and there 147 00:06:54,000 --> 00:06:56,880 Speaker 2: are a few properties available, a higher offer is often 148 00:06:56,880 --> 00:06:59,000 Speaker 2: needed to beat the competition. So it just gives you 149 00:06:59,040 --> 00:07:01,760 Speaker 2: that very curate test of what is happening in that 150 00:07:01,800 --> 00:07:02,719 Speaker 2: market you're looking at. 151 00:07:03,080 --> 00:07:05,680 Speaker 1: Okay, So in terms of figuring out how much it's worth, 152 00:07:05,720 --> 00:07:09,040 Speaker 1: which I do feel is kind of the most opaque 153 00:07:09,160 --> 00:07:11,960 Speaker 1: kind of thing to do because every property is different, 154 00:07:12,000 --> 00:07:14,280 Speaker 1: But you are checking the estimated value, using kind of 155 00:07:14,280 --> 00:07:17,760 Speaker 1: online tools to do that. You are checking auction results. 156 00:07:17,960 --> 00:07:20,800 Speaker 1: You are going along to auctions, physical auctions, so that 157 00:07:20,880 --> 00:07:24,760 Speaker 1: you can feel what the market is actually like, the hype, 158 00:07:24,800 --> 00:07:27,080 Speaker 1: the excitement, or whether there isn't any because that is 159 00:07:27,120 --> 00:07:32,800 Speaker 1: going to inform your own offer. Step three is to 160 00:07:32,960 --> 00:07:36,360 Speaker 1: know what you're getting then with the property itself. And 161 00:07:36,520 --> 00:07:38,320 Speaker 1: this part, I know I talked about having to do 162 00:07:38,400 --> 00:07:41,360 Speaker 1: research and doing a bit of legwork in the last step. 163 00:07:42,200 --> 00:07:43,600 Speaker 1: The legworks in here, isn't it? 164 00:07:44,040 --> 00:07:46,640 Speaker 2: This really is? This is your due diligence that really 165 00:07:46,680 --> 00:07:50,720 Speaker 2: is required. Now. Obviously people can outsource is to buy 166 00:07:50,760 --> 00:07:52,760 Speaker 2: as agents and they can help people do that, but 167 00:07:53,080 --> 00:07:55,560 Speaker 2: this is a step that can be done by the 168 00:07:55,560 --> 00:07:58,200 Speaker 2: actual buyer themselves. But however you choose to do it 169 00:07:58,240 --> 00:08:01,440 Speaker 2: yourself or outsource it, it is incredibly important one. And 170 00:08:01,480 --> 00:08:04,160 Speaker 2: it involves things like having an inspection report done on 171 00:08:04,200 --> 00:08:06,480 Speaker 2: that property, and that sucks that when you're buying a car, 172 00:08:06,600 --> 00:08:09,800 Speaker 2: having you know, tested by the mechanic pride, just to 173 00:08:09,880 --> 00:08:13,120 Speaker 2: understand what's really going on beneath the surface of that home. 174 00:08:13,960 --> 00:08:15,640 Speaker 1: I like the thing I like about the building and 175 00:08:15,680 --> 00:08:19,080 Speaker 1: pest reports, the inspection reports. Those they are usually quite 176 00:08:19,120 --> 00:08:22,800 Speaker 1: easy to read, that they are summarized quite well, and 177 00:08:22,840 --> 00:08:25,360 Speaker 1: it kind of almost gives a rating of kind of good, poor, 178 00:08:25,560 --> 00:08:27,080 Speaker 1: kind of needs a lot of work, all that kind 179 00:08:27,120 --> 00:08:30,680 Speaker 1: of thing. The one that confuses me that I have 180 00:08:30,840 --> 00:08:34,720 Speaker 1: absolutely no idea where to start with is this strata report. 181 00:08:34,800 --> 00:08:37,960 Speaker 1: If you're buying perhaps an apartment, Those things can be 182 00:08:38,320 --> 00:08:39,640 Speaker 1: hundreds of pages long. 183 00:08:40,120 --> 00:08:43,160 Speaker 2: They really can. And that's why sometimes you know, people 184 00:08:43,520 --> 00:08:46,640 Speaker 2: would benefit from having sort of a translation, someone with 185 00:08:46,720 --> 00:08:49,320 Speaker 2: a legal mind to go through it and actually say, look, 186 00:08:49,440 --> 00:08:51,600 Speaker 2: what that actually means is is that you're never going 187 00:08:51,640 --> 00:08:54,600 Speaker 2: to be able to sell the parking title attached to 188 00:08:54,640 --> 00:08:57,800 Speaker 2: that apartment, for example, all that two years ago there 189 00:08:57,840 --> 00:09:02,199 Speaker 2: was a huge impass amongst the body corporate and they 190 00:09:02,240 --> 00:09:04,200 Speaker 2: never resolved what to do with the pool. It will 191 00:09:04,360 --> 00:09:07,040 Speaker 2: just give you a bit more clarity about the dynamics 192 00:09:07,040 --> 00:09:10,360 Speaker 2: and the politics of the property that you're entering into. 193 00:09:10,440 --> 00:09:12,800 Speaker 2: But again, I think it's an incredibly important part of it, 194 00:09:12,800 --> 00:09:16,040 Speaker 2: because if you're not aware of maintenance required for the 195 00:09:16,040 --> 00:09:18,679 Speaker 2: building or how issues have been resolved in the past, 196 00:09:19,040 --> 00:09:21,760 Speaker 2: you're going into that situation not with the full sort 197 00:09:21,760 --> 00:09:24,600 Speaker 2: of context of what and what you're actually walking into. 198 00:09:24,920 --> 00:09:26,800 Speaker 1: Yeah, that makes sense and so okay, so that's the 199 00:09:26,800 --> 00:09:29,480 Speaker 1: building and pest report, the strata report. Then there's a 200 00:09:29,520 --> 00:09:33,280 Speaker 1: lot of the almost the physical conditions as well. And 201 00:09:33,320 --> 00:09:35,480 Speaker 1: this is the part that I kind of enjoy this. 202 00:09:36,000 --> 00:09:38,880 Speaker 1: It's a very practical step. It is about exploring the 203 00:09:39,040 --> 00:09:42,400 Speaker 1: environment around you and around the property, isn't it? 204 00:09:42,400 --> 00:09:46,600 Speaker 2: It is? And it's something that is actually beautifully quite simple. 205 00:09:46,720 --> 00:09:50,360 Speaker 2: You know, it's about walking around the neighborhood, seeing what 206 00:09:50,440 --> 00:09:53,640 Speaker 2: neighboring properties are like, walking around that property at different 207 00:09:53,679 --> 00:09:56,400 Speaker 2: times of the day and night, and walking on different 208 00:09:56,400 --> 00:09:58,400 Speaker 2: times for the day of the week. So it's literally 209 00:09:58,440 --> 00:10:01,120 Speaker 2: as simple as after the open from inspection, walk to 210 00:10:01,160 --> 00:10:03,480 Speaker 2: the local park and grab a coffee. See how that 211 00:10:03,520 --> 00:10:05,880 Speaker 2: neighborhood feels. Does it feel like something that you want 212 00:10:05,920 --> 00:10:08,360 Speaker 2: to be a part of. Is there a vibe or 213 00:10:08,400 --> 00:10:10,360 Speaker 2: is there not a vibe? And does that tick the 214 00:10:10,360 --> 00:10:12,000 Speaker 2: box for you or not tick the box for you? 215 00:10:12,360 --> 00:10:15,199 Speaker 1: Yeah? And my favorite tip on this, and really I'm 216 00:10:15,240 --> 00:10:16,800 Speaker 1: not the expert here you are, but I'm going to 217 00:10:16,800 --> 00:10:19,640 Speaker 1: give a free tip as well, is head there at 218 00:10:19,760 --> 00:10:21,960 Speaker 1: five point thirty on a weekday and try and find 219 00:10:22,000 --> 00:10:25,040 Speaker 1: a park in the street or in the surrounding area. 220 00:10:25,080 --> 00:10:27,400 Speaker 1: And it's a great indication of one of the biggest 221 00:10:27,400 --> 00:10:30,160 Speaker 1: complaints that people often have is that there's so much 222 00:10:30,200 --> 00:10:32,600 Speaker 1: parking on the weekend. Your head there after work on 223 00:10:32,640 --> 00:10:34,760 Speaker 1: a weekday and suddenly it is a nightmare. 224 00:10:35,120 --> 00:10:39,000 Speaker 2: Love it or go there during the school runtime, you know, 225 00:10:39,000 --> 00:10:41,160 Speaker 2: because I think school runtime can be another thing. Because 226 00:10:41,200 --> 00:10:43,880 Speaker 2: also if you think, okay, Grace, I can live here, 227 00:10:43,960 --> 00:10:46,120 Speaker 2: my kids go to school here, and you've got this 228 00:10:46,200 --> 00:10:48,280 Speaker 2: idea that your children can now finally walk to Schots 229 00:10:48,280 --> 00:10:50,240 Speaker 2: only a five minute walk. But if you go there 230 00:10:50,280 --> 00:10:53,320 Speaker 2: at that time and suddenly see traffic banked up, no 231 00:10:53,440 --> 00:10:56,240 Speaker 2: crossing person on that main road, you know, just ensure 232 00:10:56,280 --> 00:10:58,320 Speaker 2: that it's going to fit the needs of your situation 233 00:10:58,440 --> 00:11:00,400 Speaker 2: and your family. And the only man to do that 234 00:11:00,559 --> 00:11:02,160 Speaker 2: really is just to do it yourself. 235 00:11:02,440 --> 00:11:04,160 Speaker 1: Yeah, And then it gets into kind of a whole 236 00:11:04,200 --> 00:11:06,960 Speaker 1: lot of other things like phone black spots that the 237 00:11:07,000 --> 00:11:09,720 Speaker 1: traffic noise, train noise if you near a train line, 238 00:11:09,760 --> 00:11:12,839 Speaker 1: and like water drainage and trees and things like this 239 00:11:12,960 --> 00:11:15,600 Speaker 1: that you wouldn't think. So it's so easy to get 240 00:11:15,640 --> 00:11:18,080 Speaker 1: swept up and caught up in the emotion of seeing 241 00:11:18,080 --> 00:11:20,800 Speaker 1: this property the property that you love, but kind of 242 00:11:20,840 --> 00:11:22,760 Speaker 1: six months down the track, a year down the track, 243 00:11:22,840 --> 00:11:24,720 Speaker 1: it is going to be the drainage that is driving 244 00:11:24,760 --> 00:11:26,400 Speaker 1: your nuts, or it's going to be the fact that 245 00:11:26,440 --> 00:11:28,800 Speaker 1: you cannot make a mobile phone call from the front yard. 246 00:11:28,880 --> 00:11:30,559 Speaker 1: So you need to actually stand there and test these 247 00:11:30,559 --> 00:11:31,079 Speaker 1: things out. 248 00:11:31,160 --> 00:11:32,319 Speaker 2: And that's it. So if you can go on a 249 00:11:32,400 --> 00:11:35,240 Speaker 2: day and open for inspection when it's actually pouring with rain, 250 00:11:35,280 --> 00:11:37,280 Speaker 2: that's the best thing. Then you can see those puddles 251 00:11:37,280 --> 00:11:40,280 Speaker 2: in the driveway and think, Aha, caught you. So I 252 00:11:40,360 --> 00:11:42,319 Speaker 2: do think things like that, and that's why when people 253 00:11:42,360 --> 00:11:44,920 Speaker 2: say I don't want to inspect the property again, it's like, 254 00:11:45,000 --> 00:11:47,080 Speaker 2: you just have to be disciplined. This is the biggest 255 00:11:47,120 --> 00:11:50,520 Speaker 2: investment you're going to make. You need to do every 256 00:11:50,960 --> 00:11:54,120 Speaker 2: eye and across every tee and see that property as 257 00:11:54,160 --> 00:11:56,040 Speaker 2: many times as you can if you're able to. 258 00:11:57,080 --> 00:11:59,440 Speaker 1: Another one that fits into this category. I suppose of 259 00:11:59,440 --> 00:12:03,960 Speaker 1: knowing what you're getting is the council zoning and the 260 00:12:04,000 --> 00:12:07,320 Speaker 1: potential for developments to be taking place around you and 261 00:12:08,080 --> 00:12:12,720 Speaker 1: what could be popping up within the neighborhood. I don't 262 00:12:12,720 --> 00:12:14,560 Speaker 1: know about asking you this. Can you just ask the 263 00:12:14,600 --> 00:12:16,400 Speaker 1: real estate agent or do you have to go and 264 00:12:16,440 --> 00:12:17,120 Speaker 1: do it yourself. 265 00:12:17,640 --> 00:12:20,520 Speaker 2: You absolutely can ask the agent and they are obliged 266 00:12:20,559 --> 00:12:22,880 Speaker 2: to tell you what is going on and any sort 267 00:12:22,880 --> 00:12:25,600 Speaker 2: of red flags that might be changing the sort of 268 00:12:25,640 --> 00:12:28,480 Speaker 2: scope of the area that you're looking at buying in. However, 269 00:12:28,600 --> 00:12:31,240 Speaker 2: again I really firmly believe in taking this into your 270 00:12:31,240 --> 00:12:33,600 Speaker 2: own hands, and it's a simple call to your counsel 271 00:12:33,720 --> 00:12:35,680 Speaker 2: or a simple look at the website of the accounts 272 00:12:35,720 --> 00:12:38,080 Speaker 2: that you might be buying in, just to see any 273 00:12:38,160 --> 00:12:41,960 Speaker 2: zoning changes, any planning applications in the area that you're 274 00:12:41,960 --> 00:12:45,240 Speaker 2: looking at that might adversly affect your property. Is there 275 00:12:45,400 --> 00:12:47,839 Speaker 2: about to be a sort of mid level development built 276 00:12:47,880 --> 00:12:50,080 Speaker 2: next door to you? And I particularly think in our 277 00:12:50,080 --> 00:12:51,920 Speaker 2: big capital cities at the moment we are going through 278 00:12:51,960 --> 00:12:54,160 Speaker 2: a complete renaissance when it comes to the structure and 279 00:12:54,200 --> 00:12:56,839 Speaker 2: the planning of our cities at the moment. So it's 280 00:12:56,840 --> 00:12:59,120 Speaker 2: an incredibly important thing to be mindful of in this 281 00:12:59,240 --> 00:13:03,240 Speaker 2: current environment. And again it's not to put people off, Michael, 282 00:13:03,280 --> 00:13:06,439 Speaker 2: It's just to understand why a property might be priced 283 00:13:06,440 --> 00:13:08,199 Speaker 2: at a certain way, why there might be more people 284 00:13:08,200 --> 00:13:09,920 Speaker 2: interested in it or not. So it's not to say 285 00:13:09,960 --> 00:13:11,680 Speaker 2: you can't buy it, but at least you will know 286 00:13:12,440 --> 00:13:15,520 Speaker 2: everything you need to know and make an incredibly informed decision. 287 00:13:15,840 --> 00:13:18,120 Speaker 1: Would you ever knock on the doors and have a 288 00:13:18,200 --> 00:13:20,360 Speaker 1: chat to the neighbors? Like I said, how far would 289 00:13:20,400 --> 00:13:22,760 Speaker 1: you take your due diligence in this scenario? 290 00:13:23,200 --> 00:13:26,760 Speaker 2: Pretty much nothing stops me. And I'm a complete nosey 291 00:13:26,800 --> 00:13:29,320 Speaker 2: Parker with things like that. And I will always talk 292 00:13:29,360 --> 00:13:30,640 Speaker 2: to the neighbors. And that's why if you go to 293 00:13:30,760 --> 00:13:33,400 Speaker 2: auctions in the area, the neighbors will always give an 294 00:13:33,400 --> 00:13:36,080 Speaker 2: opinion and say, oh gosh, this area is it's really 295 00:13:36,080 --> 00:13:38,760 Speaker 2: going to the dogs, you know, and they will say 296 00:13:38,800 --> 00:13:41,040 Speaker 2: things like, you know, the neighbor up there's you know, 297 00:13:41,080 --> 00:13:43,120 Speaker 2: they put their planning in permanent in every year it counts, 298 00:13:43,120 --> 00:13:44,960 Speaker 2: something gets keeps getting rejected, and they'll give you all 299 00:13:45,000 --> 00:13:49,520 Speaker 2: the goths. And look, I'm not disingenuous with not saying 300 00:13:49,520 --> 00:13:51,440 Speaker 2: that I might be interested in the property, but I'm 301 00:13:51,480 --> 00:13:54,360 Speaker 2: just gathering information and some of it should be taking 302 00:13:54,400 --> 00:13:56,680 Speaker 2: to the pinch of salt. You know. You obviously can't 303 00:13:56,720 --> 00:13:58,760 Speaker 2: really verify a lot of that information, but it just 304 00:13:58,880 --> 00:14:02,320 Speaker 2: again adds another layer that can't hurt to know about. 305 00:14:02,600 --> 00:14:04,400 Speaker 2: And I think it also gives an insight into what 306 00:14:04,480 --> 00:14:06,640 Speaker 2: sort of the neighborhoods like that you're looking at buying in. 307 00:14:06,840 --> 00:14:09,640 Speaker 1: Yeah, suddenly you might realize that you'll fit in remarkably well. 308 00:14:10,280 --> 00:14:12,120 Speaker 1: Everyone's just happy to have a big old chat about 309 00:14:12,120 --> 00:14:13,920 Speaker 1: property and something. Oh i'm home. 310 00:14:13,800 --> 00:14:16,439 Speaker 2: Exactly, there we go. And I also think even going 311 00:14:16,480 --> 00:14:18,280 Speaker 2: to the local park with your kids. If you've got kids, 312 00:14:18,320 --> 00:14:19,880 Speaker 2: go to the local park, put them on the springs 313 00:14:19,920 --> 00:14:21,880 Speaker 2: and the slides, see and just see how that feels. 314 00:14:21,920 --> 00:14:24,360 Speaker 2: Does it feel like a place for you and your family? 315 00:14:24,440 --> 00:14:26,160 Speaker 2: And you know, parents always willing to have a natural 316 00:14:26,160 --> 00:14:28,320 Speaker 2: about stuff like that. So that's my advice. 317 00:14:28,520 --> 00:14:30,560 Speaker 1: All right, So that is a that's a bumper step 318 00:14:30,600 --> 00:14:32,840 Speaker 1: That one is, isn't it? Know what you're getting? Step 319 00:14:32,920 --> 00:14:36,200 Speaker 1: number four you've put all of this together, you put 320 00:14:36,240 --> 00:14:38,520 Speaker 1: all of your information together, and you've kind of used 321 00:14:38,520 --> 00:14:40,880 Speaker 1: all of that information to figure out kind of an offer. 322 00:14:41,400 --> 00:14:45,320 Speaker 1: Step number four is deciding whether or not your offer 323 00:14:45,480 --> 00:14:46,760 Speaker 1: is actually realistic. 324 00:14:47,360 --> 00:14:51,080 Speaker 2: This is an important one because you don't want to necessarily, 325 00:14:52,040 --> 00:14:54,560 Speaker 2: you know, just create what is considered a low ball 326 00:14:54,640 --> 00:14:59,080 Speaker 2: offer and end up, you know, eliciting and not ideal 327 00:14:59,120 --> 00:15:01,960 Speaker 2: emotion from an agent. Not that it matters, but you 328 00:15:02,000 --> 00:15:04,040 Speaker 2: sort of need to think, I've got to work through this, 329 00:15:04,200 --> 00:15:05,760 Speaker 2: and what you ideally want to do is put your 330 00:15:05,760 --> 00:15:09,360 Speaker 2: best foot forward. So I think understanding the price that 331 00:15:09,400 --> 00:15:11,760 Speaker 2: you're in is in the right realm of what you're 332 00:15:11,800 --> 00:15:15,760 Speaker 2: actually going to offer, but also understanding the current market conditions. 333 00:15:15,760 --> 00:15:17,840 Speaker 2: So we know in spring, for example, there's a lot 334 00:15:17,920 --> 00:15:20,960 Speaker 2: more options available and that if it's not right, people 335 00:15:21,000 --> 00:15:23,120 Speaker 2: will often go to the next property. If you're buying 336 00:15:23,160 --> 00:15:24,600 Speaker 2: in the winter months, you're not going to have as 337 00:15:24,680 --> 00:15:28,160 Speaker 2: much choice, for example. So understanding about how your off 338 00:15:28,200 --> 00:15:31,280 Speaker 2: will probably be met is a very useful thing and 339 00:15:31,360 --> 00:15:33,560 Speaker 2: often you can get that information from an agent. Also 340 00:15:33,600 --> 00:15:36,040 Speaker 2: throughout the campaign, you will say to them, have you 341 00:15:36,040 --> 00:15:38,520 Speaker 2: issued many contracts for this how many people request the 342 00:15:38,560 --> 00:15:40,640 Speaker 2: contract for this property? And it will just give you 343 00:15:40,680 --> 00:15:43,080 Speaker 2: a bit more insight into understanding how many other serious 344 00:15:43,120 --> 00:15:46,160 Speaker 2: buyers are on that property. All that being said, Michael, 345 00:15:46,320 --> 00:15:49,240 Speaker 2: we hear about it every single weekend that someone just 346 00:15:49,320 --> 00:15:51,880 Speaker 2: rocks up at an auction, hasn't even walked through the 347 00:15:51,920 --> 00:15:55,720 Speaker 2: property bids and often wins the keys. So there is 348 00:15:55,760 --> 00:15:59,520 Speaker 2: a certain element that you just cannot be aware of. 349 00:16:00,120 --> 00:16:02,960 Speaker 2: View yourself, commit as prepared as possible and know what 350 00:16:03,000 --> 00:16:04,800 Speaker 2: your limit is. And I think when it comes to 351 00:16:04,880 --> 00:16:08,600 Speaker 2: that offer, it's about knowing the absolute maximum price you 352 00:16:08,600 --> 00:16:11,320 Speaker 2: will go to, YEP, your ideal price of what you 353 00:16:11,480 --> 00:16:15,000 Speaker 2: pay for it, and the bargain price you'd think, my gosh, 354 00:16:15,120 --> 00:16:16,760 Speaker 2: I just got the bargain of a lifetime to get 355 00:16:16,760 --> 00:16:19,360 Speaker 2: that property. Those three prices, I think is a really 356 00:16:19,600 --> 00:16:21,440 Speaker 2: sort of clever way of approaching this. 357 00:16:21,920 --> 00:16:23,720 Speaker 1: And so in terms of they're making an offer, you 358 00:16:23,760 --> 00:16:26,720 Speaker 1: are picking, You're using all of the information that you've gathered, 359 00:16:26,840 --> 00:16:29,160 Speaker 1: and would you actually take some of that information to 360 00:16:29,360 --> 00:16:32,320 Speaker 1: the agent, Say, for instance, the building and pest report 361 00:16:32,720 --> 00:16:35,520 Speaker 1: turned up a bunch of issues, or the strata report 362 00:16:35,600 --> 00:16:37,720 Speaker 1: kind of has a whole lot of challenges, or you 363 00:16:37,800 --> 00:16:40,280 Speaker 1: realize that there's a phone black spot in the front 364 00:16:40,320 --> 00:16:42,040 Speaker 1: driveway or something like that's probably not going to have 365 00:16:42,040 --> 00:16:44,200 Speaker 1: a huge impact on the sale price, but anyway, we'll 366 00:16:44,200 --> 00:16:46,720 Speaker 1: put it in there regardless. Can you take all of 367 00:16:46,720 --> 00:16:49,960 Speaker 1: that information along and say this is my offer, this 368 00:16:50,040 --> 00:16:52,680 Speaker 1: is why it's probably a little bit under what you're expecting. 369 00:16:53,040 --> 00:16:54,840 Speaker 1: Does it give you a little bit more credibility as 370 00:16:54,880 --> 00:16:55,280 Speaker 1: a buyer? 371 00:16:55,920 --> 00:16:59,560 Speaker 2: Absolutely? And then the agent then acts as that mediator 372 00:16:59,680 --> 00:17:02,800 Speaker 2: for still between you and the seller. So when the 373 00:17:02,840 --> 00:17:06,080 Speaker 2: agent takes that offer, your offer and the context around 374 00:17:06,119 --> 00:17:07,840 Speaker 2: it and how you got to that price as long 375 00:17:07,840 --> 00:17:10,880 Speaker 2: as it's reasonable, they then discussed that to the seller 376 00:17:10,920 --> 00:17:12,960 Speaker 2: and the seller is like, that's way below what I wanted. 377 00:17:13,000 --> 00:17:15,760 Speaker 2: And the agent will point out the fact that this 378 00:17:15,960 --> 00:17:19,000 Speaker 2: buyer has referred to that the house across the road, 379 00:17:19,040 --> 00:17:21,520 Speaker 2: so over this last year, this house has got this 380 00:17:21,600 --> 00:17:23,960 Speaker 2: coming up to it, as well as the fact that 381 00:17:24,000 --> 00:17:26,880 Speaker 2: it's got termites and needs to be restumped, for example. 382 00:17:27,280 --> 00:17:29,639 Speaker 2: And then it just helps the owner move along in 383 00:17:29,680 --> 00:17:33,000 Speaker 2: their mind to get to that middle ground I suppose. 384 00:17:33,160 --> 00:17:35,359 Speaker 2: And again it's not putting it on the cell that 385 00:17:35,400 --> 00:17:37,600 Speaker 2: they have to accept that offer, but it's helping them 386 00:17:37,640 --> 00:17:40,360 Speaker 2: to understand why you're offering that amount. 387 00:17:41,320 --> 00:17:44,240 Speaker 1: Goodness me, we have just created a four step recipe 388 00:17:44,640 --> 00:17:48,119 Speaker 1: for the perfect home offer. Well, I mean assuming, but 389 00:17:48,160 --> 00:17:51,160 Speaker 1: that also then assumes that you have control over every step, which, 390 00:17:51,160 --> 00:17:53,639 Speaker 1: as we just discussed, you really don't. There are always 391 00:17:53,720 --> 00:17:55,879 Speaker 1: going to be external factors coming in. But if you 392 00:17:55,920 --> 00:17:57,960 Speaker 1: follow these steps, it does put you in the best 393 00:17:57,960 --> 00:17:59,399 Speaker 1: position you can possibly be. 394 00:17:59,800 --> 00:18:01,800 Speaker 2: I think you can only control what you can control, 395 00:18:01,840 --> 00:18:04,640 Speaker 2: but you can at least be as armed as possible 396 00:18:04,720 --> 00:18:07,080 Speaker 2: to go in this situation to put your best foot forward. 397 00:18:07,320 --> 00:18:10,320 Speaker 1: All right. Step one, know what you can afford. Step two, 398 00:18:10,640 --> 00:18:13,440 Speaker 1: know how much it's worth. Step number three know what 399 00:18:13,480 --> 00:18:16,480 Speaker 1: you're getting, and step number four figure out is your 400 00:18:16,520 --> 00:18:20,080 Speaker 1: offer realistic? They are the four things that every home 401 00:18:20,119 --> 00:18:22,160 Speaker 1: buyer needs to know before making an offer. 402 00:18:22,640 --> 00:18:25,439 Speaker 2: Thanks very much, Alis, Thanks Michael, great chatting with you. 403 00:18:25,760 --> 00:18:28,840 Speaker 1: That was real estate expert Alice Stults, national property editor 404 00:18:28,880 --> 00:18:31,399 Speaker 1: at Domain, and I'm Michael Thompson. Make sure you're following 405 00:18:31,400 --> 00:18:33,680 Speaker 1: the podcast and we'll be back next week with another 406 00:18:33,720 --> 00:18:36,800 Speaker 1: episode of The Property Pendulum, brought to you by Domain 407 00:18:36,920 --> 00:18:39,320 Speaker 1: and Fear and Greed, the podcast that tells you which 408 00:18:39,320 --> 00:18:41,440 Speaker 1: way the property market is going to swing and how 409 00:18:41,440 --> 00:18:42,199 Speaker 1: to make the most of it.