Is The Government Against Investors & Tenants?

First National Real Estate (FNRE) has criticised industry representatives who have said in recent media reports that the property industry would support moves to replace stamp duties with a broadening land tax or any other tax.

‘As far as we are concerned, when the GST was introduced, it was meant to phase out a number of various state and territory government taxes, duties and levies such as banking taxes and stamp duty’ said Chief Executive, Ray Ellis.

Suggestions that Stamp Duty should be replaced with Death Duties or a broad based, higher land tax – that would include the family home – would have the potential to drive investment into the ground and slow a safely moderating market.

Additionally, the Treasurer Wayne Swan has floated the idea of a new 4% sales tax on the sale of investment housing, similar to the initiative that brought building to a halt for the NSW Government in 2004.
Negative gearing also appears to be up for reconsideration at the forthcoming Tax Summit.

With a dramatic shortage of housing and an already tight rental market, disincentives for property investment could see a rush by investors for the exits.

Negative gearing ensures a significant supply of rental housing, which also holds down rents. Any dislocation in investment housing would affect those who can least afford it, people who pay rent.

Emergency Services Porkathon

Media Release – 27 April 2011

Kim Wiesner - First National Gloucester (NSW)

Kim Wiesner of First National Gloucester today announced a novel fund-raising campaign for Australian Red Cross Emergency Services. Calling the campaign her personal ‘porkathon’, Kim has set a goal of losing 20 kilograms by the time of the agency’s annual Trivia Night on 20 October.

‘I have come to the realisation that years of eating low fat meals while hiding Tim Tams in the freezer, sock drawer and filing cabinet, has taken a toll. After fudging around the issue for five years, the only way I can hold myself accountable is to make my weight loss commitment painfully public’ says Kim Wiesner.

‘People participate in marathons, walkathons, bikeathons, swimathons, and spellathons so I figured I might as well have my own personal porkathon’.

First National Gloucester is a permanent sponsor of Australian Red Cross Emergency Services and sponsors of Mrs Wiesner’s ‘Porkathon’ will witness a public ‘Weigh In’ at the agency’s Trivia Night fundraiser where the results of her hard work will be revealed.

Red Cross have faced some incredible challenges this year, helping communities all around Australia deal with the horrendous floods, cyclones and bushfires that took place over summer’ says Mrs Wiesner.

‘If I can help raise money to fund Red Cross’ crucial work while shedding 20 kilos, I’ll feel I’ve achieved a win for the community as well as myself’.

Mrs Wiesner will officially ‘weigh-in’ at the Gloucester Medical Centre on 2 May then begin an exercise regime incorporating daily five kilometer walks and dietary changes.

First National Gloucester is therefore calling for donations and will accept them over the counter at their office located at 135 Church Street, Gloucester. Donation forms will also appear at locations around Gloucester following Easter.

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Issued by: First National Real Estate

For further information contact Kim Wiesner from First National Real Estate Gloucester on (02) 6558 9077 or 0427 587 435

First National Bucks Industry Stance

Media Release – 21 April 2011

First National Real Estate CEO Ray Ellis, has snubbed industry representatives who have said in recent media reports that the property industry would support moves to replace stamp duties with a broadening land tax or any other tax.

“It has long been recognised that stamp duty as a tax is inefficient and a complete rort,” Mr Ellis said.

“So, while First National Real Estate agrees it needs to go, it does not support the notion that it be replaced with some other tax.

“As far as we are concerned, when the GST was introduced, it was meant to phase out a number of various state and territory government taxes, duties and levies such as banking taxes and stamp duty.

“Now, more than a decade on, we are still being burdened with stamp duty.  What’s worse, the property industry appears to be portrayed in some news articles as willing to settle for replacing the duty, instead of having it abolished altogether.”

Beyond the benefits to the property market of lowering the cost of buying, abolishing stamp duty would also serve to help the economy, by making room for the resources boom.

Stamp duty inhibits mobility for many, which mean mining areas which are desperate for workers are finding it difficult to encourage workers to sell their homes and move to another area,” Mr Ellis said.

“The government needs to look at policies that will encourage mobility rather than inhibit it.”

Mr Ellis said the upcoming 2011 Federal Tax Summit presents the ideal opportunity to get blanket approval from state and federal governments to abolish this duty and there should be no further talk of ‘replacement’, but to deliver what was promised in the first place.

“Affordability is rearing its ugly head again, and governments need to stop being greedy and looking to the property industry to make up the shortfalls in inefficient spending and ‘black holes’,” Mr Ellis said.

“As well as helping first home buyers enter the market, we need to keep stocks available in the upgrader and investor markets.  These people are looking at other investments because of the expenses involved in upgrading and investing in property.

“Governments even go so far as to put a stamp duty on the GST that is paid on commercial and industrial properties that are sold, which just seems ludicrous to me.”

Mr Ellis is at a loss to understand why governments are resisting the move to abolish stamp duty, when so many are in agreement that it needs to go.

“A recent article said the OECD supported the rationalisation of state and government taxes particularly stamp duty on house sales, the ex-Treasurer Peter Costello said it should have been eliminated when the GST was introduced and even the Henry Review recognises the need for it to go,” Mr Ellis said.

“The GST was meant to provide sufficient funding for state needs, and if they are not able to raise enough revenue through the GST they need to look at reform, rather than rorting hard-working Australians and replacing one tax for another.  We should get rid of stamp duty altogether.”
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Issued by: First National Real Estate.  For further information contact Stewart Bunn, National Communications Manager, First National Real Estate, on 03 9418 9111.

Hysterical bubble talk just a load of hot air

FROM: The Australian, Terry Ryder, April 16

SOMETIMES I feel like a voice in the wilderness, trying to be heard above the rising hysteria about house prices to inject some sanity into an increasingly irrational debate.
It’s not that no one agrees with me.

Most of Australia’s leading property analysts and, notably, Reserve Bank governor Glenn Stevens, agree we don’t have a price bubble, nor an affordability crisis, nor exceptional price levels by world standards.
It’s just that media tends to favour the views of those who cry “crisis”.

It’s ironic this all comes after a year in which Australia had one of its slowest years for price growth in the past decade, around 3 per cent, after adjustment for inflation.

It’s also odd to claim our homes are unaffordable when we have, still, one of the highest home ownership rates on the planet.

As is so often the case with media, it’s the noisy minority who attract the most attention.

Against that background, it was refreshing to read a report on house prices from Brisbane-based analyst Michael Matusik. One of Australia’s smartest and most experienced property researchers, he is seldom read in our newspapers. Matusik has been tracking real estate longer than I have, which means at least 30 years, and while I don’t agree with everything he says his views deserve respect, and a wide audience.
Matusik, like me, is increasingly asked whether Australia’s residential markets will follow parts of the US and Europe where values fell sharply.

The question reflects simplistic thinking, the notion that our values must fall because it happened elsewhere, without considering the reasons prices fell in those places.

Matusik presents seven reasons why he believes “we will not see major falls in homes values across Australia any time soon”. The first is population growth, which continues to be strong, albeit a little slower than before.

“Our domestic population is ageing, but our migrant intake is largely in the 20s to late 30s cohort, which means increasing household formation and greater demand for dwellings down the line,” Matusik says.

A key reason which differentiates Australia — from the US in particular — is our tight lending practices. Australia has full-recourse loans, which means lenders have the right to take borrowers’ assets if repayment obligations aren’t met.

“Many overseas markets which experienced a housing crash have non-recourse loans which essentially allow borrowers to walk away from debt if things get too tough,” Matusik says.

This factor was the single biggest reason why prices crashed in the US, where reckless lending practices and poor regulation created the recipe for a bust. Australians have high equity in property and a conservative debt position. Mortgage broker AFG says the present loan-to-value ratios average 53 per cent, much lower than the long-term average of 65 per cent.

Overall, our debt to overall assets ratio is just 19 per cent.

Household balance sheets are being strengthened by savings, with households currently saving 10 per cent of disposable income, which amounted to $74 billion last year. “This improved state of our personal finances further reduces the risk of house prices collapsing,” Matusik says.

He says that not every market segment or dwelling type is under-supplied in Australia, but generally the bottom third of the market has a shortage, which “helps place a floorboard under property values”.
Price levels are also underpinned by economic growth and low unemployment, whereas housing markets usually crash in concert with large falls in employment.

“As long as our unemployment rate stays below 8 per cent (it’s currently around 5 per cent and steady), then falls in property values are unlikely,” he says.

The US market was over-supplied, the economy struggling and unemployment rising when their prices collapsed.

Finally, Matusik points to a low rate of mortgage defaults.

Just 1.37 per cent of home loans across Australia are 30 days in arrears and only 0.54 per cent are three months behind. This low rate of mortgage defaults is inconsistent with the notion that our homes are too costly.
Terry Ryder is the founder of hotspotting.com.au
ryder@hotspotting.com.au (mailto:ryder@hotspotting.com.au) twitter.com/hotspotting (http://twitter.com/hotspotting)

A Home Office Is A Valuable Asset

Long commutes, improving technologies, and more workplace flexibility – these are just some of the many reasons why as many as one million Australians are now regularly working from home, according to First National Real Estate.

And a stylish and functional office is an increasingly valuable asset to the family home or singles’ apartment.

“With more people working and studying from home, the office is more and more a central part of the house,” National Communications Manager Stewart Bunn said.

“Not only can it add increased value to a home, it is becoming a required feature, especially in central parts of the city and in coastal or inland lifestyle properties where people only commute to the city for a meeting.”

“Today, many buyers want houses equipped with home offices that deliver a proper working environment. They are becoming as important as a spacious living room, or well designed kitchen.”
But what features are most important in a home office and what are most likely to add long-term value to a home?

“Getting the electrical fittings, layout, lighting and furnishings right are important to both the comfort and performance of the person working from home as well as boosting the value of the property,” Mr Bunn said. “The serious home office is designed by professionals, in the same way a kitchen or bathroom is.”

First National Real Estate’s tips for establishing a suitable home office include:

  • Consider crucial basics. Before renovating a kitchen or family room home- owners consider issues such as usage patterns, the amount of natural light, proximity to noise, and appropriate entry and exit areas, and a home office should be no different. “Think about how many people will use the room, if additional insulation may be needed to ensure someone can work in peace and privacy, if the room should have separate access, and how natural light will interact with computer screens,” Mr Bunn said. “The well thought out home office is a lot more than a desk and computer.”
  • Call in professionals. At the very least, work with an electrician to determine what fittings and outlets are needed, and ensure they are professionally installed.
  • Consider Occupational Health and Safety regulations. ”It can be tempting to by-pass the various regulations businesses are required to meet,” Mr Bunn said. “But safety is a critical feature of a proper home office.” First National Real Estate recommends investing in ergonomically designed furniture, correctly positioned technical components and the accurate positioning of shelving and storage.
  • Make it comfortable. A good home office will be efficient but not utilitarian, Mr Bunn said. “If the room is also to be used by children to access the computer, plan appropriate seating,” he said. “If it will also act as an adult retreat, consider wiring for anther television and even basic kitchen facilities such as a coffee making and mini-bar area so that the room’s potential is fully utilised.”

Mr Bunn said any investment in a professional home office would be likely to be recovered.

“We think it will increasingly become a key selling point, which is why we recommend careful consideration of design issues,” he said.

Put A Freeze On Costs To Keep Warm

Windbeeches on the Schauinsland in Germany (Bl...

Image via Wikipedia

Media Release – 6 April 2011

First National Real Estate CEO, Ray Ellis says there is a lot homeowners can do to keep power bills down when they usually increase as the weather turns chilly.

“Just a few simple changes to your home and your habits can make sure you and your family stay warm and cosy without costing the earth,” Mr Ellis said.

In winter, the typical Australian household consumes approximately 2700 kWh of energy, which is around 7 per cent more than in the warmer months.

Energy conservation is a vital environmental issue which is one of the reasons power costs are going to escalate, and it is better to tackle the necessary changes to lifestyles now than when it is too late.

“For every one degree temperature increase in winter, energy use increases by 15 per cent, so it is wise to warm up to the idea of becoming more energy efficient in the home.”

Mr Ellis said while many environmentally-friendly actions should be taken throughout the year, it is during winter we should remain diligent and follow a few additional guidelines.

Turn down – Consider turning down the thermostat on heaters by one or two degrees – homes should be maintained at temperatures between 18 and 21 degrees.  Every degree lower can decrease heating costs by up to 10 per cent. When heaters are on, close curtains and blinds to reduce heat escaping and retain it inside. Putting on warmer clothing, like sweaters, can also lessen the reliance on heaters as the main source for warmth.
Turn off – Lighting potentially makes up around 10 per cent of household energy usage.  Avoid leaving unnecessary lights on and switch them off when no one is in the room.  Outdoor lights should use motion sensors wherever possible.  Compact fluorescent lamps (CFL) use 80 per cent less energy than incandescent bulbs and last around 10 times longer.  Appliances, such as computers and televisions, should be turned off at the wall, if possible.  Standby power can account for up to 10 per cent of total power bills.

Seal up – Inspect for air leaks, commonly found in places like door and window frames, ducts, electrical outlets and recessed lights. Air leaks raise energy bills by allowing heat to escape outside.  Install draught seals and weather stripping around doors and windows and repair faulty seals – these simple measures will minimise heat loss through gaps and leaks around the home.

Insulate – Insulation helps retain heat during winter.  Attics, ceilings, walls, floors and basements are all areas that benefit from insulation.  Upgrading all areas of the home to recommended insulation levels can potentially save 5 to 25 per cent on heating and cooling costs.

Be efficient – Look at using or installing energy efficient appliances wherever possible.  Use major appliances, such as washing machines, dishwashers or dryers at bed-time and other low energy use times of the day, and avoid using them between 4pm and 9pm – this is the optimal time to power down.

Mr Ellis said cutting back unnecessary energy use is a simple and easy way to keep hard-earned money in the pocket as well as reduce the pressure on the environment.

“It’s a win-win situation all round, so everyone should be taking these simple steps to conserve energy, reduce waste and make a better carbon-footprint for the world to see.”

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Issued by: First National Real Estate
Contact:  Stewart Bunn, National Communications Manager, First National Real Estate, on 1800 032 332

Eco Warriors | Real Estate Agents Address Climate Change

Protecting the environment and cutting down on waste are important issues that concern us all and real estate agents are proving to be as active and innovative in tackling green concerns as any other industry.

By HELEN HULL, Real Estate Institute of NSW Journal, April 2011

Dealing on a daily basis with homeowners and tenants, First National Real Estate recognised there was an opportunity for its agents to play an influential role in helping Australians reduce their energy consumption.

An Energy Efficiency Kit which gave every agency in the network the resources they needed to help customers, a strategy for the reduction of energy consumption in their own businesses, and the opportunity to support Greening Australia was created by First National Real Estate National Strategy Manager Australasia Jason Verstak.

The kit was delivered to more than 450 member offices nationally and was backed by an ongoing strategy of internal communications to raise awareness and share the initiatives of individual network members around the nation.

Stewart Bunn, First National Real Estate National Communications Manager, says the initiatives, launched at the network’s 2009 National Convention by respected environmentalist Rob Gell, saw members receive education about the need for behavioural change, methods for change and the tools to effect those changes in their businesses and the community.

“To underline the commitment to change, the 2009 National Convention held in New Zealand, was paperless and members were issued with lanyards housing USB flash drives with which to collect information from trade displays and the networks suppliers,” Stewart says.

The network also donated $22,000 to Greening Australia to further the rehabilitation of vast tracts of the Australian landscape.

“At a corporate level, member communications became exclusively electronic and where hard copy documents were essential, only recycled paper was permissible,” Stewart says.

“We also encouraged our agents to implement proprietary systems that automatically build customer databases online, enable agents to start and build customer relationships through more effective service relationships, and completely eliminate the need for conventional door knocking, letterbox drops and, technically speaking, even newsprint advertising.”

The network this year introduced national and state awards to recognise offices that have reduced their carbon footprint, with winners of the state awards in line for the First National Energy Efficiency Agency of the Year.

In May, First National will also announce a new energy program in partnership with an energy distributor.

Stewart says the cooperative is also encouraging property managers to help tenants and landlords reduce their energy consumption by educating them about how minor renovations and investments in their property can make a difference.

“Few other professions have the capacity to influence behavioural change in the way agents can,” Stewart adds.

“Customers frequently discuss renovation plans, asking the advice of agents about where their investments will generate the greatest return. This presents agents with the chance to discuss energy efficiency measures that buyers value greatly.”

Developing environmentally

Andrew Finlayson, Managing Director of the Carrington Group, has taken the approach a step further by developing environmentally-friendly residential properties that the Group’s sales agents have taken to market.

“Over the years we have added to the green components we have in our developments,” says Andrew.

“More purchasers are asking questions about waste and the environment and the market is dictating that we go green.”

Andrew says that although the benefits as a developer are not huge, due to the additional capital needed to create the green infrastructure, there is substantial demand from buyers.

“They want to do the right thing for the environment and so do we.”

Every apartment in Carrington Group’s The Lainsborough development at Turramurra has been fitted with its own dedicated solar hot water system consisting of a solar collector and hot water storage tank.

The 36 apartments over two buildings have been pre-wired for the installation of a 1kW photovoltaic solar electric system and smart meters to allow apartment owners to sell electricity back into the grid.

“The systems installed have the potential to produce significant ongoing savings for the occupants of Lainsborough, while also retaining the flexibility for the systems to be individually updated as solar technology improves,” Andrew says.

At The Lainsborough, the Carrington Group has replaced incandescent lights, that generate heat and use excessive amounts of electricity, with various innovative forms of fluorescent lighting.

Fluorescent lights generate up to four times as much light for the same amount of electricity, thus cutting the electricity required to light the apartments,” says Andrew.

“Every apartment in the development also has the infrastructure installed to accommodate the installation of an energy-efficient gas fireplace heater within the apartment.

“We also collect the rainwater and have 60,000 litres of water in the basement which is used to irrigate the gardens and for dual flush toilets. Each apartment has low flow shower heads and taps which have substantial water savings.”

Green education

With the rise of developments like The Lainsborough, agents are taking it upon themselves to better understand the value of green properties by educating themselves with courses through the Green Building Council.

Jenine Cranston, CB Richard Ellis Senior Director Office Services, was one of the first agents in the country to boost her sustainability credentials when she and members of the CBRE leasing team earned Green Star Accreditation two years ago.

The program, which can be taken as part of the REINSW Continuing Professional Development, is designed to equip professions across a range of industries with advanced knowledge, expertise and competency of the Green Star environmental rating system. The Green Building Council also offers a Green Star Associate level.

“We became accredited professionals in 2009 and since then have become Green Star Associates,” explains Jenine. “At the heart of it, it makes commercial sense to get educated on what is going on at the green building council because I think building owners are more willing to use agents who understand green star building ratings rather than someone who has no idea about the efficiencies of the building.

Jenine says the green move has also affected the type of agent the firm is recruiting.

“We are hiring people who are of a like mind and there is the encouragement that they do the course.”

Jenine notes that an accredited professional undertakes 30 hours of training every two years, while as an associate it is 15 hours every two years.

“We felt the associate level is more appropriate as we don’t need to have the same technical knowledge as other professions but we haven’t lost the knowledge that we learnt as accredited professionals.”

Jenine says agents are now continuing to boost their green knowledge by undertaking a green interiors and internal fit-out course.

She says this course, along with being a Green Star Associate, has made her better equipped to explain to future tenants the benefits of green buildings.

“Employers are beginning to recognise that environmentally sustainable offices provide tangible benefits and can play a role in the attraction and retention of staff.

“We can leverage those elements in the leasing campaign and there is also a slice of personal philosophy to get the whole team of eight onboard which is reasonably significant.”

Following the competition of the Green Building Council’s program Jenine was responsible for a major lease of over 6,000 sqm at 39 Hunter Street, Sydney — the first heritage building in Australia to win a six star green star rating and the former home of Perpetual Trustees.

“All of our clients are now in some way green – the big brands including AMP, Colonial First State, Investa, Stockland have all realised they have to be market leaders in the green space,“ Jenine says.

As the environment continues to be a focus for those inside and outside the property industry, real estate agents will continue to develop programs and incentives for there staff. These agents show it’s easy to implement initiatives around the office and in the broader community. It’s simple to create your own program to help reduce cost to the business and to the environment. You can make a difference.

First National Nerang – Australia’s Top Medium Agency

MEDIA RELEASE: 4 April 2011

The Real Estate Institute of Australia (REIA) last week awarded its prestigious ‘Medium Residential Agency of the Year’ to First National Real Estate Nerang at the Gold Coast Marriott Resort.

First National Nerang has won the title for three consecutive years at state level and for a second consecutive year nationally.

‘It is an extraordinary achievement to be recognised at this level even once, but to receive the award for two years running makes me exceptionally proud of my team’ said First National Nerang principal, Mike Gray.

The agency has maintained its status as one of the top performing offices of the First National network and possesses an ethos to give back to the community in as many ways as possible. It therefore sponsors Red Cross Emergency Services and plays an energy efficiency education role through the provision of a series of web-related resources.

‘First National Nerang’s year on year donations to First National Foundation and Red Cross Emergency Services turned out to be the best way our agency could contribute to local community this year’ said Mr Gray.

‘Nobody could have predicted just how badly affected Queensland would be by floods in 2011 so our support could not have been better targeted’.

According to Mr Gray, it is the agency’s commitment to its clients that sets it apart and continually wins them business, and awards.

‘I am privileged to work with some of the profession’s best and brightest and this makes it possible to continually break new ground, both through technological innovation and fundamental customer service principals’ said Mr Gray.

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