Saturday Summary – the most interesting articles I’ve read this week (2014/05/10)

There are more interesting articles, commentaries and analyst reports on the Web every week than anyone could read in a month. Each Saturday morning I like to share some of the ones I’ve read during the week.

Enjoy your weekend…and please forward to your friends by clicking a social link buttons on the left.

What part of this chart does Joe Hockey not understand?

In light of all the fuss about the state of the economy, leading economist Stephen Koukoulos asks which part of the graph below that Treasurer Joe Hockey does not understand.

ss9He says:

Mr Hockey’s crusade against the former government and its Treasurer Wayne Swan on the issues of economic management, debt and deficit shows a disturbing lack of self-awareness.

Mr Hockey doesn’t realise people are laughing at him like a down-and-out soothsayer proclaiming “the end is nigh” each time he raises those issues.

Indeed, it is a little embarrassing to see Mr Hockey discuss economic management without even the slightest understanding of the issues that make this one of the most extraordinary charts doing the rounds.

The information in this chart is likely to fuel a library of Ph D theses as the smart economists around the world work out what went right in Australia and what went wrong in the other advanced economies.

 

Cross-collateralisation | 3 big investor mistakes | Auctioneer tips on buying at auction | What’s happened to first home buyers

Another great Real Estate Talk show  produced by Kevin Turner. If you don’t already subscribe to this excellent weekly Internet based radio show.

Details of this week’s show:
Cate Bakos says the most significant mistake is not always the obvious one
Andrew Mirams answers two questions from listeners about cross-collateralisation
Nhan Nguyen believes that what is currently happening in Russia might impact us
Mark Armstrong, explains that people who are looking to enter the property market are forced to rely on patchy information

You should definitely subscribe to this weekly audio program. Click Here It’s free and you can listen on the go on your smartphone, iPad etc.

 

Interest rates – more important than they were

Regular Property Update Blogger Pete Wargent undertakes a detailed analysis of how interest rates affect house prices his blog and concludes that:

While pundits like to argue that in theory interest rates have little impact on housing markets, due to the deregulation of the Aussie financial system and higher household debt today, this is incorrect, as partly evidenced by the impact of rate cuts since 2010.

He then goes on to explain…

Why shifts in interest rates were formerly somewhat limited in their ability to impact housing markets – since both lending and deposit rates were strictly controlled – yet today the availability and expectations around the cost of capital can be a key driver of market sentiment.

Moreover, since household debt levels are so much more elevated today than they were in the 1970s, the scope for monetary policy and adjustments in interest rates to stimulate or clobber housing markets – and indeed other parts of the Aussie economy – is greater than it was before.

ss2Read more here.

 

Walkable homes are worth more

Homes with excellent “walkability” are worth up to 20 per cent more than comparable car-dependent properties, according to Domain:

Walkability is certainly increasing in value for a certain segment of the population and you are probably seeing it in some polarisation of prices in inner-city suburbs versus middle and outer suburbs,” says BIS Shrapnel senior analyst residential Angie Zigomanis.

“It’s hard to say what sort of value it adds to a property and would vary depending on differences in the level of amenity offered (but) from personal observation, in the suburb where I live (Preston) value is probably 10 to 20 per cent more but there are other factors at play too.”

Tony Kelly, managing director Melbourne of Herron Todd White agrees, adding that many buyers in the next decade will trade a traditional back yard for the convenience of walkable access to services, work and other facilities.

Market evidence shows us the ability to walk to services and transport is a factor that home buyers give strong consideration to,” Mr Kelly says.

“As the population grows, journeys by road will become more expensive (and) people are more and more acknowledging and appreciating the value of their time.”

9 Things I wish I knew about property management

Your Investment Property Magazine lists 9 things Prue Muirhead learned the hard way about property management.

1. I wish I’d known that a property manager’s average lifespan is only nine months in the job.

2. Property managers can be expected to look after 200 properties each; this equates to less than 10 hours per year spent on my property!

3. Most property managers are young and inexperienced and cost the landlord/property investor extra money through their lack of experience/knowledge.

4. Most property managers have no maintenance schedules, so if you live away from your rental property(s), you really do not know the general state of your property, which can lead to major problems that could have been avoided.

5. Property managers can be tough; they are generally the negotiators/peacekeepers between landlords/investors and the tenants, often blamed for situations that are out of their control.

6. Many property managers see their job as just a learning platform to move into selling real estate.

7. Property managers in SA do not need to have completed any studies/qualifications;

8. Legislation in SA is changing and it will be quite difficult to self-manage an SA property, as the fines will be huge if the legislation is not strictly followed.

9. I should have realised that property managers are generally not serious property investors.

 

John McGrath’s top 10 ways to add value to your investment property without over capitalisation

Property Observer lists John McGrath’s top 10 tips for adding a wow factor to your property without overcapitalising.

1. Paint it

2. Build a carport

3. Install new curtains or blinds

4. Install a skylight

5. Replace light fittings

6. Put in a Bar B Q

7. Steam clean the carpets

8. Sand the floors

9. Replace door handles and knobs

10. Install a dishwasher

 

10 Jobs That Make People Most Happy

New research  has revealed that being a member of the clergy is associated with the highest levels of life satisfaction.

Here are the top 10 occupations:

1. Clergy

2. Chief executives and senior officials

3. Managers and proprietors in agriculture and horticulture

4. Company secretaries

5. Quality assurance and regulatory professionals

6. Health care practice managers

7. Medical practitioners

8. Farmers

9. Hotel and accommodation managers and proprietors

10. Skilled metal, electrical and electronic trades supervisors

In descending order of life satisfaction, then, here are the 10 occupations in which people are least satisfied.

1. Plastics process operatives

2. Bar staff

3. Care escorts

4. Sports and leisure assistants

5. Telephone salespersons

6. Floorers and wall tilers

7. Industrial cleaning process occupations

8. Debt, rent and other cash collectors

9. Elementary construction occupations

10. Publicans and managers of licensed premises

 

Blogs you may have missed this week:

If you didn’t have a chance to read my daily blog, here’s a list of some of the blogs you missed this week:

Fail Your Way to Success – Louise Bedford

5 Lessons You Must Learn If You Want You To Succeed In Life

Advertised rental growth sluggish but still some stand-outs- Cameron Kusher

How do you know when it’s the right time to buy your next investment property?- George Raptis

What’s really happening in the Sydney Property Market?- Pete Wargent

This week’s property market trends | RPData

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Michael is a director of Metropole Property Strategists who create wealth for their clients through independent, unbiased property advice and advocacy. He's been once agin been voted Australia's leading property investment adviser and his opinions are regularly featured in the media. Visit Metropole.com.au


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