WA’s top 10 property hotspots

It’s the bargain property hunter’s annual guide to the best places in WA to buy property

Terry Ryder, of hotspotting.com.au, has released his annual list of WA’s top “hotspots” – suburbs and towns where there is potential for good capital growth or better-than-average rental yields.

While the locations are little changed from last year, the reasons for buying have

Source  :  www.watoday.com.au

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Tenants warned to brace for increased rents

Perth tenants should brace themselves as rising house prices, improving economic conditions and more newcomers to the state combine to force up rents this year, a leading property researcher says.

The latest rental report by Australian Property Monitors shows asking rents in Perth have increased in the first three months of the year.

The median weekly asking rent for houses in the metropolitan area is now $370, a $10 increase on the previous quarter and the first rise in more than a year, while units increased $8, to $358.

But with rising house prices, increased rents have not led to increased yields. The gross yield for houses is now 4.06 per cent, while units are yielding 4.62 per cent.

That leaves Perth ahead of only Melbourne among all state capitals.

APM economist Matthew Bell said he expected Perth rentals to increase a further $10 a quarter for the rest of the year, with a strong resources sector and population growth the driving factors.

But this was unlikely to be fast enough to maintain yields, which would drop slightly as house prices rose further. The median Perth house price is believed to have passed $500,000.

Really, the outlook for both rents and house prices is pretty strong,” he said.

“Yields will probably soften again, but historically they are at pretty good levels.”

Houses were usually bought by investors for capital growth, with units offering better yields, Mr Bell said.

Meanwhile, the Urban Development Institute of Australia said its own research showed a six-month delay in planning approval could add 7 per cent to the price of an average block in the metropolitan area.

UDIA WA chief executive Debra Goostrey said developers were doing what they could to ensure “affordable” land was being made available during a time of increasing prices.

“We also need the support of a fast and efficient planning approvals process to avoid costs associated with delays,” she said.

Her comments follow those last week by property researcher Terry Ryder, who said claims of housing shortages were a beat-up by property industry lobby groups.

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Nedlands, Cottesloe top $1m+ sales list

Two of Perth’s western suburbs are all that stood between a total eastern states domination of Australia’s premium property markets last year.

Figures released by property analysts RP Data show Nedlands and Cottesloe as the only two non-Sydney or Melbourne suburbs to make the top 20 areas for $1 million-plus house sales last year.

The recovery from the global financial crisis showed in the figures.

There were 122 such sales in Nedlands, placing it 10th nationally, while Cottesloe (15th) clocked up 106 settlements.

The number of sales in Nedlands was a record for the suburb, six higher than in 2007 and almost double that of 2008.

But Cottesloe, while recording an almost 50 per cent increase on the previous year, was 15 short of its 2007 record.

Meanwhile, the seemingly never-ending building of apartment buildings in Earth Perth saw it top the state for sales of $1m-plus units.

The suburb shared the honour with South Perth. Both had 33 sales, placing them 17th nationally.

The number of East Perth sales was also a record for the suburb, beating the previous best of 32, in 2007.

That year, there were a record 52 $1m-plus unit sales in South Perth.

The inner-city Sydney suburb of Pyrmont topped the list, with 95 units sold, while just a few kilometres north, Mosman led the country for house sales, with 271 recorded.

RP Data national research director Tim Lawless said premium property markets generally provided stronger capital gains, mainly due to “inherently tight supply”.

However, they could be tricky for investors because rental yields were much lower, leading to cash flow issues.

Source  :  www.watoday.com.au

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Perth properties quickest to sell

Perth properties are being sold quicker than any other state capital, new figures show.

Research from property analysts RP Data and Rismark International shows it took 24 days to sell a house in November and two days fewer for units.

The time taken to sell a unit was the quickest in Australia, while only in Canberra (23 days) were houses sold quicker.

The average price for houses and units in the metropolitan area at the end of November was $460,000.

While that was a drop of 1.09 per cent on October, making Perth the only city where prices fell, it was still an increase of 6.47 per cent on the start of the year and a 5.87 per cent rise on the same time in 2008.

The average house price was $485,000, down 1.11 per cent on October, but up 5.94 per cent since the start of 2009, while units dropped 1 per cent on October, but rose 8.55 per cent in 2009, to average $385,000.

The news was not all good for homeowners. Landlords found rental yields dropping, to 3.94 per cent for houses and 4.41 per cent for units, both down 0.04 of a percentage point on October.

Rismark managing director Christopher Joye said the key drivers in the market in the latter half of 2009 were upgraders and investors, and this was expected to continue this year.

Once mortgage rates “normalised” to between 7 per cent and 8 per cent, price growth would drop back. As many borrowers did not reduce mortgage payments when rates fell, they should be well placed to absorb rises.

Source  :  www.watoday.com.au

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Relief for renters as rates fall

RELIEF may be in sight for renters who have been hit in the hip pocket by skyrocketing rents over the past few years.

There has been a small decrease in rental rates across Australia’s capital cities over the June quarter, suggesting rental yields may have hit their peak, leading property statistics agency RP Data says.

Weekly house rents fell by 3.5 per cent nationally over the June quarter while unit rents dropped 0.6 per cent.

The largest fall was in the Canberra market with a drop of six per cent for the June quarter in the housing market, where the median weekly rent fell from $530 in March to $498 in June.

The only mainland capital city to experience a nearly six per cent rise in rent was Darwin, where renters can expect to fork out about $100 more per week than those in Sydney, where rents dipped by about five per cent.

“It now appears that the rental market may have peaked with national weekly median rents falling slightly in each month post March 2009,” RP Data’s Tim Lawless said in a statement.

“And with rental rates now coming off the boil and property values rising we are seeing the first signs that rental rates are eroding.”

Rental vacancies remain tight across the nation with all capitals recording less than three per cent vacancy in stock.

Source  :   www.news.com.au  

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North Beach property tests property market

THIS North Beach property could confirm whether Perth’s struggling real estate market has turned the corner. 

Real estate experts say that during the height of WA’s property boom the 1346sqm ocean-front house on West Coast Drive would have fetched more than $5 million.

It is for auction on Saturday and the selling price will be a strong indication of whether property prices, especially for top-end homes, have started to recover.

Nexus sales consultant Peter Berridge, who specialises in the North Beach area, said the property would have been highly sought after during the 2006-07 housing boom.

“It’s a nice elevated lot, with a nice frontage. It’s got everything going for it,” Mr Berridge said.

“I don’t think it would be an over-exaggeration to think it might have sold for in excess of $5 million (back then). We were going through an era where it didn’t seem to matter what you paid for it, you were always going to make a packet until the proverbial hit the fan.”

Mr Berridge said he believed values had dropped about 40 per cent since the property peak.

“The last sale was 341 West Coast Drive in Trigg that sold for $2.2 million and it was a very choice piece of land _ something like that could have possibly pulled $4 million in 2007 and I can mention lesser blocks that sold for more than $4 million,” he said.

According to Landgate, North Beach has enjoyed solid property value growth in the past decade.
It recorded a 19.4 per cent average annual growth rate in the 10 years to December 2008. It also recorded strong growth last year and was among the Perth metropolitan area’s Top 10 performing suburbs, with a 17.7 per cent jump in median house prices.

But during this period it recorded a low volume of sales activity, with just 19 homes sold.
This could have skewered the statistics.

“There’s no doubt that the market for premium coastal property has come back since the height of 2007,” Real Estate Institute of WA president Rob Druitt said.

“Indications are that the first signs of recovery are starting to come through now, so there’s certainly a unique opportunity for buyers who are (looking) in that market,” he said.

Mr Druitt said it has been a bottom-up recovery, so if the top end was reasonably priced and sold, it could give a good indication that Perth’s entire property market had seen the worst.

Source  :  www.news.com.au

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Energy was well spent on Yanchep home

DINA and Brett Pappin took their time in choosing their dream home when work commitments forced them to relocate from WA’s south. 

Every house looked the same to the couple until they stumbled across this five-star energy-rated property in Yanchep.

“We were looking in Quinns Rocks because that’s where I grew up and then we decided to look in Yanchep because it was just up the road,” Mrs Pappin said.

The four-bedroom, two-bathroom energy-efficient home immediately caught their attention. 

The home has quality fittings and fixtures throughout, including granite benchtops, polished porcelain tiles, highly polished marri floors in the theatre room, and floor-to-ceiling porcelain tiles in both bathrooms.

“The main ensuite is better than a five-star hotel, with twin vanities, a corner spa and glass-enclosed showers,” Mrs Pappin said. “The bathroom and the kitchen are what sold it for me.”

Another plus for Mrs Pappin was the floor-to-ceiling windows in the main living area.

“I can stand in the house and see the entire backyard,” she said.

“It’s great because I have young children, so I can keep an eye on them while I am cooking dinner.”

The home has an outdoor area with a cedar ceiling and there’s a study. The property is in a cul-de-sac about a 10-minute walk from the beach.

“The Lagoon is the best beach in Perth; the kids love it in summer,” Mrs Pappin said.

Work commitments are taking the family back south.

YANCHEP
$629,000
4 Le Buse CoveFour-bedroom, two-bathroom house with a study/fifth bedroom, five-star energy rating, cedar-lined outdoor area, porcelain tiles, polished marri timber floors in the theatre room, and resort-style ensuite with spa.
Agent: Peggy Middelveld 0415566825, Peard Cox
Real Estate 9400 1599

 

Source  :  www.news.com.au

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How to avoid an end of financial year tax headache

• Last-minute tips to save on tax
• What to claim, how to file
• Plenty of help on ATO website

HAPPY New Year! Well, almost. With only 24 hours left until the end of financial year, what should you be doing today to ensure that you don’t end up with a big tax hangover tomorrow?

“Don’t forget to pay your expenses,” says Tracey Nicholson, the Assistant Commissioner of Taxation.

“Ensuring that expenses are paid and claimed in the correct tax year can save a lot of headaches in having tax returns amended down the track.”

Ms Nicholson suggests that some top-priority things for taxpayers to do prior to lodging their return include:

• Go surfing! The ATO website, that is.

“There is a wealth of information on the ATO website, both general as well as information that’s specific to various professions,” says Ms Nicholson. “It’s a great place to start your research on what you may be able to claim as a deduction.”

• Spring clean the house to find your receipts.

“At the end of the day you need to keep your receipts to substantiate your claims,” says Ms Nicholson.

• Lodge online.

If you are DIYing your tax, Ms Nicholson recommends the online e-tax process as a great way to complete your return.

“It’s free, and has a great step-by-step process that will help remind you of anything that you have forgotten,” she says.

It can be worth getting professional advice as well though. Bill Keays, founding director of WA-based Hales Keays Chartered Accountants says that in his experience there are a number of tax-related benefits that people sometimes overlook.

“Motor vehicle expenses are often overlooked,” he says.

“You can claim up to 5000 kilometres of work-related use based on a reasonable estimate of business kilometers, without needing to keep a log book. But some people think that if they haven’t kept a log book, they can’t claim.”

Another forgotten area, according to Mr Keays, is depreciation on a rental property.

“Sometimes clients are not aware of how much depreciation they can claim,” he says.

“For taxpayers who have a relatively modern rental property, engage a quantity surveyor to prepare a depreciation report. They will typically save you many times more than their fee due to the deductions they identify.”

But lest you get carried away with all the potential deductions out there, remember that you do need the paperwork to back it up.

“We conduct plenty of audits,”says Ms Nicholson.

“We’re going to have a special focus on truck drivers, sales and marketing managers, sales reps and electricians this year – but any taxpayer has the chance of being audited.”

And while it may be too late for this financial year, consider getting some professional advice for next year’s tax return because sometimes you don’t know what you don’t know.

“There’s usually always some way in which we can save clients extra money, either by identifying deductions or simply getting their tax structures right to start with,” says Mr Keays.

“The Small Business CGT concessions are a great example.

“One of my clients was expecting to pay capital gains tax of approximately $240,000 when he disposed of his business and he ended up paying nothing by applying these concessions.”

Your tax time checklist                                                                                                                                                                                           

To help you get the best tax return possible, here’s a few things to tick off your “to do” list today:

1. Are you eligible for the Superannuation Co-contribution? If so, it’s up to $1,500 of free money.

2. If you use your car for work, don’t forget to estimate your motor vehicle expenses.

3. A 20% tax offset is available for out of pocket medical expenses over $1500.

4. Donations of over $2 made to a deductible gift recipient are tax deductible.

5. The cost of having your tax return prepared is also an allowable deduction.

6. Income Protection insurance premiums can also be a tax deduction.

7. Small business owners who are selling business assets can take advantage of extremely generous “small business CGT concessions.”

8. You can claim up to $300 of work related expenses without the need to have written receipts. However once your claim exceeds $300 you must have receipts for the full amount.

9. Don’t forget all those miscellaneous work expenses such as union fees, seminars, trade journals, software and home office expenses. Even an appointment diary can be deductible.

10. Check the deductions fact sheet for your specific occupation to ensure that you are claiming everything that you are entitled to.

Source  :   www.news.com.au

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Stamp duty on home loans under review

STAMP duty on housing loans could be abolished after the Henry tax review, which is likely to recommend states be given a share of income tax to make up the difference.

The most likely path to do this would be for the Commonwealth to give the states the ability to impose their own surcharge on income tax, which would be collected for them by the Australian Tax Office.

 The Henry review has been inundated with submissions calling for the end of stamp duty.

Tax economists argue that the tax on moving house, although easy to collect, leads to poor use of the housing stock and poor labour mobility, The Australian reports.Having to pay stamp duty not only discourages elderly people from moving to more appropriate accommodation, it also deters people from moving house to a better jobs market. 

At a conference conducted by the Henry tax review at the Melbourne Institute last week, both international and Australian tax economists said stamp duty should go, with Melbourne University professor John Freebairn describing the tax as “a piece of garbage”.

The review panel is being influenced by state submissions arguing that replacing stamp duty by extending other state taxes, such as payroll tax or land tax, would be too difficult to implement nationally.

Tasmanian Treasury secretary Don Challen, who is close to the inquiry’s head, federal Treasury secretary Ken Henry, told last week’s conference that reform of state taxes would succeed only with leadership from the national government.                                                                                                                                                     

“If you want to achieve a difficult reform, you’ve got to make it a national one,” Mr Challen said.

He said it would be too hard to win political consensus to extend land or payroll taxes.

“It requires eight lots of political commitment and eight lots of legislation and that path is doomed to failure,” he said.

However, he said he believed states would be willing to act on stamp duty if the commonwealth provided an avenue for alternative revenue.

The idea of giving states a cut of income tax was pressed two years ago by the OECD, which suggested the states “piggy-back” on income tax. The OECD also urged states to drop stamp duty.

One of the world’s leading experts on federal taxes, Canada’s Richard Bird, said the states were heading for a financial crisis because they did not have a sufficient tax base to support their burgeoning health and education costs, which were all rising much faster than the consumer price index.

One of the problems with stamp duty for the states is that it is vulnerable to the state of property markets.

Stamp duty usually raises about $14 billion a year for the states, but the recent state budgets showed big falls of more than $1bn each in NSW and Queensland, in 2008-09, for example.

“In Australia, it should certainly be feasible to permit states to impose a surcharge on the federal personal income tax base,” Professor Bird said.

He said that, ideally, Australia would follow the Scandinavian practice of allowing states to have a flat tax surcharge on income, rather than mirroring the commonwealth’s progressive taxation.

The states would be allowed to set their own level, making states more responsible for their own finances.

Source  :  www.news.com.au

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Changes to the adjusted taxable income test for Commonwealth Seniors Health Card

From 1 July 2009, there will be changes to how certain types of income affect eligibility for the CSHC. Depending on your circumstances, these changes may impact on your eligibility for a CSHC and you may be required to provide additional information about your income to Centrelink.

The adjusted taxable income test for CSHC will include:

• assessment of total net investment losses. Total net investment losses are the sum of net losses from rental property income and net losses from financial investment income, and
• subject to the passage of legislation, reportable superannuation contributions may be included in the adjusted taxable income test for CSHC. Reportable superannuation contributions are discretionary or voluntary contributions, for example salary sacrifice contribution and personal deductible contributions. 

Note: losses from rental properties are already included in assessable income for CSHC. From 1 July 2009, the adjustable taxable income test will also include losses from.

Source  :  http://www.centrelink.com.au/internet/internet.nsf/payments/conc_cards_cshc.htm

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