HIS last property sale earned him a tidy million-dollar profit, so it’s safe to say when it comes to “flipping”, Tom Hall knows his stuff.
The Melbourne man has been flipping property for 16 years, and has 10 successful “flips” under his toolbelt.
For the uninitiated, flipping refers to profiting from real estate, either by “buying low and selling high” or buying a run-down home and renovating it for profit.
Mr Hall, a former electrician and real estate agent, ventured into the world of flipping when he bought his first property at 24 for $124,000, renovating it before and after work and on weekends.
He more than doubled that investment when he sold it a couple of years later for $265,000 after shelling out just $14,000 in renovations – and his love affair with flipping began.
Knowing he was onto a winning formula, Mr Hall went on to purchase bigger, more expensive properties each time, culminating in the most recent sale of a Brighton property which he bought for $1.35 million, and sold for $2.35 million 18 months later.
In the early days, Mr Hall and his wife Alicia used to brave the “dust and dirt” and live in each property during the renovations.
With two young boys, that’s no longer possible, but today Mr Hall runs his own renovation business, Overhall Your Property, alongside his flipping passion.
“I’m a visual person and to see the property go from nothing to something amazing gives me a thrill,” he said.
“It can be a bit stressful – it never stops and it’s very consuming.
“But I wouldn’t have it any other way. I wouldn’t want to do anything else.”
Mr Hall said a successful flip came down to meticulous market research and the ability to do most projects yourself.
But is flipping always a sure-fire cash-cow?
New analysis from CoreLogic revealed 90 per cent of flipped properties sold last year made a profit – but as house prices ease in Melbourne and Sydney this year, a rise in loss-making flipped properties is expected.
“Although the proportion of flips at a loss has declined from recent highs in 2009 and again in 2012, there has been a clear increase in loss-making flips recently,” CoreLogic’s Property Flipping Report stated.
Nevertheless, while Mr Hall agreed property prices had already cooled slightly, he said there were still plenty of opportunities to make decent money flipping.
He said lower house prices could even help flippers enter the competitive housing market.
“If you put the right product to the market and keep the purchaser in mind you’ll have no problems selling property,” he said.
“The whole idea of owning your own home and renovating it is a big Australian dream – everyone wants to own property.
“There’s definitely still a future in it.”
So how do you make it in the flipping business? Mr Hall shared his top tips for flipping success.
DO YOUR RESEARCH
“If you’re looking to buy, educate yourself on the market – entry price is the most important thing. If you pay too much getting in, you won’t make dollars and cents at the end. I read heaps of books, and really annoy real estate agents on trends and what’s going on in the market. I always hassle them because they’re pretty much three months ahead of the market – they see what’s going on in the market before it hits the papers,” Mr Hall said.
“The main thing for me is getting in at the right price. Keep an ear to the ground in your market and don’t look at 10 different suburbs, look at two, otherwise you’ll just confuse yourself.
“On my way home I always drive a different way so I can see what boards are up and what’s going on. I’m a bit nosy, but you have to be if you want to do this seriously.”
“I have flipped 10 different projects varying from smaller properties and apartments to bigger houses. I really built my way up from something small into property worth millions now, and the way to get into it is to start small and learn from there – I’m self-taught.”
DO IT YOURSELF
“Hiring tradies can really chop into your budget. If you can always build on your skills and learn you will save yourself a hell of a lot of money, so the more you can do yourself the better off you’ll be at the end. Always use a licensed plumber and electrician, but for example if you have someone doing rendering, hang around and learn about a trade if you’re not experienced in it, so next time you can give it a go yourself and save big money.”
INVEST IN A GOOD FOOTPRINT
“My strategy is always renovating what is there – I’m not a new-build man, I’m an add-value man. I try to utilise the home’s footprint to add value. You’ve got to have a bit of forward thinking in terms of what you can do with spaces.”
KNOW YOUR BUYER
“Have a target market in mind. Whether it’s a family with children or a young couple, you need to do your research and tailor your design towards the purchaser. That’s the end game – it’s not necessarily for you, it’s about getting a sale from the right purchaser who will pay the highest price.”
Originally Published: sunshinecoastdaily.com.au
Buyer Demand Builds in the Outer Suburbs
Buyer demand has significantly jumped compared to last year across all capital cities aside from Melbourne.
The Domain buyer demand indicator shows that the market has rebounded in recent months—revealing the top suburbs piquing buyer interest.
Houses and apartments in the outer-suburban areas of Sydney, Melbourne, Brisbane and Perth, were the highest in demand for the month up to 6 September.
This follows a state of hiatus caused by caused by Covid which is ongoing in Victoria where restrictions have stopped inspections and dropped listings.
Domain senior research analyst Nicola Powell said they tracked people who were most likely to buy, indicated by shortlisting, sending inquiries, inspecting and frequently viewing photos.
“The current health crisis has changed the way we use our homes, and for some altered our purchasing decisions and property wish lists,” Powell said.
“And while Covid-19 lockdowns sent buyer demand into a state of hiatus, activity from people likely to buy has rebounded in all capital cities apart from Melbourne.”
Top greater Sydney suburbs
|1.||Hawkesbury demand increase since Covid||Rouse Hill-McGraths Hill||Wollondilly (Houses)|
|2.||Rouse Hill-McGraths Hill||Pennant Hills-Epping||Richmond-Windsor (Houses)|
|4.||Hornsby||Eastern Suburbs-south||Gosford (Units)|
|5.||Dural-Wisemans Ferry||Warringah||Hawkesbury (Houses)|
Top greater Melbourne suburbs
|1.||Whitehorse-west||Mornington Peninsula||Macedon Ranges (Houses)|
|2.||Macedon Ranges||Cardinia||Manningham-east (Houses)|
|3.||Manningham-east||Knox||Mornington Peninsula (Units)|
|4.||Mornington Peninsula||Maroonah||Yarra Ranges (Houses)|
|5.||Yarra Ranges||Kingston||Frankston (Units)|
Top south-east Queensland suburbs
|2.||Nundah||Coolangatta||Noosa hinterland (Houses)|
|3.||Carindale||Redcliffe||Gold Coast hinterland (Houses)|
|4.||Surfers Paradise||Ipswich inner||Noosa (Units)|
Meanwhile major gains have been made in national vacancy rates to pre-Covid levels with outer suburbs also showing the most improvements.
Residential property prices dropped by 1.8 per cent in the latest quarter according to the Australian Bureau of Statistics.
In Perth, Mundaring houses and Wanneroo units topped the list, Canberra’s Weston Creek was listed for houses and Gungahlin for units. Litchfield, Darwin topped the list in the Northern Territory for both houses and units.
Hobart was the only other city to record a fall in activity over the four week period to 6 September, along with Melbourne, where the most demand was seen for Sorrell-Dodges Ferry and Hobart.
Noosa’s Most Expensive Homes in Hot Demand from Buyers Across the Globe
The COVID-19 storm has spawned a hurricane of home sales across some of the Sunshine Coast’s hottest tourist magnets as property punters report unprecedented buyer action from city-based sea-changers in search of a pandemic-free paradise.
The rise of remote work and virtual inspections amid record low interest rates has further sparked the coastal migration with popular hub Noosa clocking millions of dollars in sight-unseen sales alone during the past month.
Adrian Reed, from Reed & Co Estate Agents in Noosa, said buyers from Brisbane to as far away as Hong Kong had pounced on the region’s high-end market, with the agency transacting $60 million in sales from April until August.
“It feels like there’s a gravitational pull towards those idyllic locations … and this trend has continued throughout COVID,” Mr Reed said.
“We sold $26 million in the past couple of months alone sight unseen.
“They are buying from abroad and domestically and then from Brisbane … and I think it’s likely to continue.”
He said the skyrocketing sales action had particularly centred around Noosaville, with $6 million of off-market property sold in the past six weeks.
The agency also clocked the latest Noosaville record for the spectacular mansion at 32-36 The Anchorage, which fetched $12 million. The property features 13 bedrooms and was the former home of the late businessman and founder of Hayco, Donald Hay.
Dan Neylan, from Dowling and Neylan agency in Noosa, said in his 27 years of real estate experience he’d never seen such incredible buyer activity.
“The average time on market for us has shrunk back to three weeks and most of our auctions are not even getting to auction,” he said.
“We had a sale for an apartment on the weekend where the reserve was expected to be $5.5 million but it sold for almost $6.5 million.
“Our biggest one was the sale of 46 Seaview Terrace which was Pat Rafter’s previous home – and that was sold in excess of [a record] $17 million at the end of May to the Rudds. They just saw the long-term value of Noosa.”
Mr Neylan said interstate buyers were particularly snapping up homes like hot cakes with the agency handling more sight-unseen sales than ever before.
He said many home hunters claimed the growing work-from-home-movement had finally allowed them to have a remote career from an idyllic place – and they were wasting no time pouncing on regional, coastal destinations.
“The future for us is pretty rosy and that’s going to last for the next two or three years and by then the international airport will be finished,” he said.
Tom Offermann, from Noosa’s Tom Offermann Real Estate, agreed the fierce buying storm was set to continue during spring with Brisbane buyers competing against interstate and overseas house hunters.
“This winter was like no other and out of the disruption caused by COVID came a storm of buying activity,” he said.
“We’re also seeing capital growth rates between 10 and 15 per cent … with the hot locations typically on the riverfront and the beachfront.”
Mr Offermann said last week’s sale of apartment 1 at Noosa’s prestigious Little Cove for a cracking $6.3 million following 38 bids from eight buyers, was the perfect example.
“This sale capped off another very successful week … with a string of high-value sales which included two breaking $10 million.
“There’s also been a string of nine sales between $5 million and $12 million but we can’t announce them yet because they haven’t settled.”
Despite the strong selling activity Mr Offermann said their agency was running at about 50 per cent of their normal stock levels, with nervous vendors still reluctant to pull the trigger amid the global uncertainty
This article is republished from https://www.domain.com.au/ under a Creative Commons license. Read the original article.
Brisbane Property Market Update – August 2020
The latest Corelogic Data shows overall dwelling values in Brisbane declined -0.1 per cent, but houses were stable and the decline came from the unit sector, down -0.3 per cent. Since January, Brisbane house values have reported an increase of 1.6 per cent, despite the pandemic, and yet unit values have slipped -1.8 per cent.
This stability has been seen in Brisbane, despite very early predictions from many of price falls across all Australian markets. The price changes in Melbourne have been more pronounced, with -4 per cent coming off the value of houses and -2.2 per cent off units over the last three months. On this basis, it seems that the performance of the housing market is intrinsically linked to the number of coronavirus cases in a particular region and the subsequent policies in place around social distancing. Stage 4 shutdowns seem to have had a big impact in Melbourne.
That said, in Brisbane, despite small cluster outbreaks from time to time, our strict border control measures appear to be keeping the virus under control. Most of us are able to return to the labour market, sentiment is fairly strong and we seem to be able to move around with a certain degree of freedom. This is all very positive for our local property market as well.
According to SQM Research, listing volumes are still 9.7 per cent lower in Brisbane than they were 12 months ago, and in the last month alone (between July and August 2020) listing volumes were down a further 5.1 per cent so we expect transactions volumes will remain low for some time yet, simply due to limited supply.
New research from realestate.com.au has revealed that Queensland property seekers are the most confident buyers in Australia. In Brisbane the suburbs with the highest views per listing according to realestate.com were as follows:
• Ashgrove Qld 4060
• Kalinga Qld 4030
• Qld 4155
• Holland Park Qld 4121
• Tarragindi Qld 4121
• Stafford Heights Qld 4053
We can confirm from being on the ground that these areas have strong demand from buyers with many properties going to multiple offer very soon after being listed. These are some of the areas that are outperforming, with upward pressure on prices. The high number of buyers, combined with limited listings, tends to have this effect.
The rental market in Brisbane remains resilient also at this time. We are seeing the vacancy rate at a city level continuing its downward trajectory, after an initial spike from March to April 2020.
Since then, rental markets have tightened, with many markets across Greater Brisbane experiencing the tightest vacancy for many years. We are also seeing multiple applications from prospective tenants being submitted on properties for rent, illustrating the shortage of quality rental properties available.
There remain some “at risk” locations in certain pockets of Brisbane. For example, postcode 4000 (which includes the Brisbane CBD) has a local vacancy rate of 13 per cent, which is extremely high-risk for an investor who may be looking at buying into that market.
While there is no evidence of distressed properties coming to the market in Brisbane, there continues to be talk about the economic cliff that is apparently ahead of us. Once JobKeeper and JobSeeker payments ease, and mortgage repayment deferrals stop, perhaps some people may need to sell as they are no longer able to hold their property. We remain of the opinion that different markets around Australia will be impacted in different ways.
According to a recent NAB announcement, Australian Home Loan deferrals are broadly in line with the total portfolio spread. This means the exposure of some states to potential “forced selling” is much less than other states around the country.
Queensland makes up approximately 17 per cent of the total number of NAB Home Loan facilities and 16 per cent of the total Home Loans that have been deferred across Australia. Compare that with NSW/ACT, which makes up 38 per cent of the total portfolio but 40 per cent of the total deferrals, and Vic/Tas, which makes up 31 per cent of the total portfolio and 32 per cent of the total deferrals. Then there is WA and SA/NT with much lower exposure again.
This provides a greater level of confidence for property owners and property buyers in Brisbane, given our exposure is a lot less than other locations around Australia.
Shane Oliver, AMP chief economist, also updated his forecasts recently for Australians’ property market. His thoughts are that Sydney and Melbourne are more exposed to price falls given their higher dependence on international migration, higher debt-to-income ratios, higher price-to-income ratios and greater investor penetration.
Over recent years, Brisbane’s growth has been underwhelming compared with Sydney and Melbourne, for example. While the other capitals experienced amazing capital appreciation, Brisbane property values remained quite flat. This is because local drivers of supply and demand vary considerably between different locations. Different property markets behave in different ways during various market conditions, so there is no reason to expect the outcomes to differ considerably throughout this pandemic.
Brisbane properties are more affordable and our income-to-debt ratio is a lot lower. The amount of our take-home income that we spend on our mortgages here in Brisbane is also a lot lower. Property markets around the country are all responding differently as a result of the pandemic, and at this stage we remain optimistic about the performance of Brisbane in the months ahead.
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