I believe you must engage a Buyers Agent with every property purchase, Using a Buyers Agents/Buyers Advocate and Property Advisor is key to more property investment success. These are extracts from my latest book “The Australia Property Investment Handbook 2018-2019″. In all good book stores now. Also Read Property Finance Made Simple and Property Investing Made Simple. Property investment, using buyers agents/ buyers advocates, is so important, and if looking in Melbourne for example, you should look for Melbourne Buyers Agents or Melbourne Property Advisors. We also service NSW and QLD, so look for Sydney Buyers agents and Brisbane Buyers agents, and QPIA advisors
Investment strategists, property investment, buyers agents, Melbourne buyers advocates, Melbourne Buyers Agents, Melbourne Property Advisors.
Median House Price
Median price can often be misleading and unreliable. Half the properties in a suburb are under the median price and half are over. Sometimes buyers think if they can buy under median they’re doing well. Often the contrary is the case. It is not enough just to buy in a good suburb, although this is 75-80% of the work done, but it is important to buy in a good street in the suburb. The best streets in a suburb outperform the average and certainly outperform the worst streets.
Of course, it is worth mentioning that if you purchase under the median, of a better street or pocket of the suburb you are acquiring more capital growth potential from the start.
Be very careful also of a false median. When new stock in an area comes onto the market or land has been carved up and two or three townhouses built on it, this can lead to sales of property in the area with prices way above the median. The sales prices can lead novice buyers to believe there has been significant capital growth in the area, when in fact prices may not have even risen. What could have happened is one of many things. For example:
- A newer property has sold for more than an older property.
- Larger parcels of land, or development sites may have been sold.
Of course, don’t rely too heavily on the median price for a suburb for one more very important reason; the suburb is comprised of different sized dwellings.
Size can be:
- Number of bedrooms
- Size of each bedroom
- Number of living areas
- Number of bathrooms
- Size of land
- Garage versus carport
- Quality of inclusions is another consideration.
So median can come back by a third or half in one month then double in another.
At a bare minimum, only ever use the median price of the particular size dwelling you are trying to buy, as a starting point, never the median for the suburb. Compare apples with apples in other words.
So look at three bedroom house and four bedroom house medians separately, for example. This provides a more accurate guide as to what you would expect to pay for the same size dwelling. Accompanied by an online valuation containing comparable sales, this can be used to make a more informed decision as to what to offer at auction or what to pay during negotiations. It also allows you to compare the capital growth and yield based on a specific number of bedrooms to see which is more popular in the suburb, besides looking at the demographics of the area.
The more popular the dwelling size the easier it may rent, as there’s more demand – ensuring you understand what the supply is in comparison to the demand of course.