A review of your home insurance

Home insurance is the most important protection that you can have for your investment property. If damage occurs from an unexpected fire, storm, flooding or burglary, you want to have peace of mind that you are financially covered.

In reviewing your home insurance we have taken the time to list some thought provoking questions:

• Is your property adequately insured? If your property was destroyed could you rebuild the property to the same standard?
• Is your property overinsured? Remember, you do not need to insure the land value. If you purchase a property for $500,000 it is going to include a portion of land value.
• Do you know what is considered building and what are contents within the property? Insurance companies may classify these differently, which can affect the insurable value for the building or contents. You need to find out what an air-conditioner, carpets, blinds, light fittings, security systems, etc. fall under.

Some insurance companies have a limit on how long they will cover a home while it remains vacant. Is your property covered if it is vacant?

We strongly recommend that you discuss these questions and ask further questions of your insurance company or broker to ensure that you are adequately covered

EVALUATE YOUR POTENTIAL AGENT IN 15 Q's

Did you know that there are fifteen questions that will help you separate the professional from the not so professional agent when you are trying to work out who will sell your home? Compare two or three agents’ answers to these questions and you will not only know your local marketplace better but you will have a good idea of which agent is likely to do the best job of selling your home. 

1. How long have you been selling real estate?
    
2. How many properties have you sold in the last 12 months?
    
3. From what advertising sources do the majority of local home buyers come?
    
4. Approximately how many purchasers do you have listed on your books who might be interested in inspecting my property for sale?
    
5. a) Do you recommend advertising on the internet?
   b) If yes, what sites do you use?
   c) Do you use virtual tours?
    
6. Are Open Homes a good idea?
    
7. What is your agency’s attitude to auction?
    
8. If I were to auction what is your agency’s percentage, over the last 6 months, of properties sold
   a) prior to auction?
   b) under the hammer?
   c) after auction?
    
9. Over the last 6 months what has been the percentage variation in a local   property from asking price to sold price?
    
10. What is your agency’s average length of time from the first marketing activity to offer and acceptance?
     
11. What is the length of your agency period?
     
12. Do you provide a Service Guarantee?  If yes, can I see it?
     
13. If I am not happy with your service what remedies do I have?
     
14. a) What is the average cost of a marketing programme?
    b) Can I pay it off in two or three (credit card?) payments?
     
15. Why should I appoint you as my selling agent?

Source

How do you know if it is a tenant or landlord market?

There are a number of factors that market researchers rely on to determine whether it is a tenant or landlord market. However, the most commonly referred to statistical data is the ‘vacancy rate’.


In a recent article published by domain.com.au an expert in research, Louis Christopher, Managing Director from SQM Research, commented that “In almost all locations around the country, renters are facing an uphill battle in finding affordable accommodation”.

So...how do you know if it is a tenant or landlord market?

Overall, a market that favours landlords is said to exist when vacancy rates are below 3 per cent. Above this level, it starts to turn into a tenants’ market.

SQM Research recorded the national vacancy rate at 1.9 per cent, which represents a very difficult market for renters.

The data collected to determine the national vacancies rates was based on online rental listings that had been advertised for three weeks or more, compared with the total number of established rental properties.

The toughest market is Canberra at just 0.7 per cent, while the one that best favours tenants is Melbourne, which has a vacancy rate of 2.8 per cent. Sydney is recording 1.4 per cent, with the outer ring showing rates below 1 per cent. In some locations in Sydney’s west, vacancies are almost non-existent.


It was also noted that many affluent suburbs or higher-priced rental properties were experiencing higher vacancy rates, such as 4.8 per cent, leading to landlords having to offer discounts to attract quality tenants. This further demonstrates the demand for affordable housing.

A similar trend was witnessed in the second half of 2008 when vacancy rates in some more expensive suburbs reached 10 per cent.

Our current vacancy rate is 1.5%, however, if you are interested in the vacancy rate for a postcode or suburb you can visit www.sqmresearch.com.au to assist with your research.

LOOK CLOSELY AT TOUCH-UPS

When inspecting a home to buy it is always nice to walk into a property that is well-presented, with new paint finishes and everything spick and span. But sometimes it’s all too good to be true.

While most repairs and new paint represent the efforts of proud home owners paying attention to detail to maximise buyer interest, homebuyers should remember that recent renovations in properties for sale aren’t always what they seem.

Over time most houses will show evidence of the lifestyle of the people who have been living in them. Stains appear after friends have dropped in with a bottle of red, or under the debris left by teenagers cooking themselves dinner.  Most of these stains are normal wear and tear.

But some stains represent functional problems; a carpet stain might mean a leaky toilet or shower cubicle on the floor above or adjacent, or it might mean a crack in the foundations through which water is seeping; stains on paint or wallpaper near a window can indicate moisture problems caused by loose glass or fittings; stains in the middle of walls can indicate a (costly-to-repair) leaking internal pipe.  

Home buyers should pay special attention to improvements that appear isolated or surfaces that seem touched up. New paintwork, especially where small areas such as one wall or one corner of a room, or back-to-back walls appear to have been done rather than the whole room should be carefully assessed to see if it hides mould or temporarily conceals cracks. Be suspicious when some areas are slick with new paint while other rooms seemingly in need have been bypassed. Even new latticework may be less than innocent; it can be used to hide termite or other infestations.

Prospective purchasers should inspect any recent workmanship carefully. Most work will be just as it seems: conscientious home sellers getting ready for the big event. Still, training yourself to look carefully during inspections so that you spot the repairs that are little more than bandaids for larger problems is likely to cost less time, money and stress in the long run.