Investing in Real Estate

Have you thought about investing in real estate? While the property market in 2019 is not what it has been over the past few years, many people still see that investment in ‘bricks and mortar’ is still the way to go. Here’s just a few reasons why investing in real estate might be a choice you could make in 2019.

  1. The expression ‘safe as houses’ pretty much sums it up. Watch the share market for twelve months and you will see great fluctuation, making investment in many shares akin to betting on a horse race. At the moment, the property market appears to be in a downturn but this is consistent with a cycle that has been going on for many years. If the time is right for you to invest, then this part of the cycle can provide buyers with more time and opportunity than the peak of the market cycle. Property can be a great investment, especially if it is part of your long term investment planning.
  2. Investment in property can provide you with an asset to assist your children in the future. This could be through reduced rent or use of the equity built up in the property. A property purchased this year could be what provides the boost your children need to gain a foothold in the property market of the future.
  3. Property is the great Australian dream. Buying property gives you a tangible asset that you can look at and touch. Spending money on a property over time adds further value. An investment property purchased today can be the perfect retirement package or even the home to which you retire.

For further information regarding property investment, call Accrue Real Estate on 9696 0085.

Advice for real estate investors starting out

When new staff started at our office, lunchtime conversation turned to the best advice we could give to someone starting in real estate. At Accrue Real Estate, we not only aim to assist clients with property investment but give them the benefit of our experience and knowledge so that they learn the process themselves. Through our discussion, we discovered there were commonalities between the advice we would give our new staff member and the advice we give out clients. Here’s our top four list for those wanting to invest in property and while this is about real estate, they are a fairly good list for success in anything.

  1. Learn from people who have been there before you.

Many, many people have had success in real estate investing. Before starting get an idea of what the property investment industry is all about and how and why profit and loss can occur. There are a large number of websites and blogs that you can explore to get this information. While there is a great deal of information, you will be able to find a few to hone in on; these will be the ones that outline clearly so you begin to understand the process. You can also talk to people; Accrue Real Estate welcome these initial discussions to help clients establish goals and get started.

  • Use what you have learned

Once you have the information, you have to do something with it! There’s an old Chinese proverb that says all journeys, no matter how long, have to start with one first step. It’s no good having lots and lots of information about property investment unless you are going to do something with it. Take that first step, make that first phone call – get started!

  • Take time and persevere

The first property might not be the one. The second property may be not meet the requirements either. Just as you spent time getting the information, don’t rush into the other parts of the process. Have conversations with people who know the area in which you are looking. Drive around the area at different times and use the public transport in the area. While this takes time, it is time well spent.

  • Know your “why”

This is probably the most important part of property investment. Knowing your reasons for the investment drive many of your decisions. Are you buying the property for rental income? Is it an investment now but down the track you will live in it? Is it an investment for you children? For retirement?  Knowing your “why” also allows you to narrow down your information search and really get to know what you need to do to succeed for your specific “why”.

Accrue Real Estate are a property acquisition service with many years of experience in the Melbourne market. If you are looking to invest, we can help you.

Finding the right agent

Finding the right agent can often be the key to success in real estate, and Accrue Real Estate recognise this in the way they go about their work.

At Accrue, they work hard to build relationships with the people that come through the doors of their South Melbourne office. They know that buying a property is a big commitment, so their emphasis is on ensuring the client is comfortable with the process and in control of the decision.

Accrue Real Estate offer options and solutions. They listen to their clients to better understand each individual situation and the specific goals and finances the client brings with them. Accrue tailor their options to present a realistic way for their client to meet their financial goals. Accrue present a number of properties so the final decision is with the client.

Having worked in the Melbourne property market for many years, Accrue Real Estate have helped hundreds of people realise their property dreams. Accrue understands what make Melbournians tick and know the suburbs in which the best value might be achieved.

Key to Accrue Real Estate’s success is their ability to draw on the expertise of others and offer their clients access to other professionals who can assist in making the process of property purchase clearer and easier to understand. This allows clients to make decisions based on the knowledge they gain from people with long experience.

For more information, have a look at Accrue Real Estate on or contact Accrue Real Estate directly on 9696 0085.

Why I Love My Job

One of the best pieces of advice I was ever given before finishing my education was, ‘find something you love to do and work hard at it.’ It has been to my great fortune that I was able to follow that advice and while ‘work is work’, I am happy to say that I love what I do. But, not everybody feels the same way about real estate agents as I do, so here are the top reasons I think what I do is great and why working at Accrue Real Estate not only keeps me busy but gives me both something I love and something I can work hard at.

  • Real estate agents help people make decisions that impact their whole life.

The people I see are looking to use significant funds to make a significant purchase. Some will be first time buyers, others will come with some experience, but all are looking to succeed with a real estate purchase. It’s a real privilege to be part of this success, and I never get tired of seeing the joy on my client’s faces when the contracts are signed, the deal is done and they are the proud owners of a great investment property.

  • Real Estate agents are life coaches

There’s an article that likes being a real estate agent to being a personal trainer. For me it’s more like being a life coach. I can’t make decisions for people but I certainly can use my experience and knowledge to show them what they can achieve in the property market. By working through their personal property goals, I guide them towards the right people who will help them with financial decisions. I show them a range of properties and what each would mean to their financial goals.

  • Real Estate agents are detectives

This is one of my favourite parts of the job. Once the clients have laid out their property goals – it’s all detective work, matching the best property to those goals. It investigation and foot work; looking through properties but also investigating the local market to discover trends and possibilities. Once this is all done, the ‘forensic investigation’ is all laid out for the client – rather than ‘who dunnit’ it’s ‘what does it’ – and the client can select the property that best suits their financial goals and needs.

The Bilbao effect

One of the more interesting parts of my job is to keep up with real estate trends, not just locally or nationally, but globally. Sometimes these trends reach ‘down under’ sometimes they are not appropriate for our climate or culture but it is always worthwhile to see what is happening in the world of real estate.

Recently I came across the Bilbao effect, which is the term used to describe the way in which suburbs and neighbourhoods have been revitalised when a museum or art gallery has been opened in the area. The effect is named after Bilbao, Spain, where the Guggenheim museum was built in 1997. The opening of this museum became a catalyst for a revitalization of the northern Spanish city, which among other awards, received the 2018 Best European City.

The Bilbao effect can lead to improved real estate values for a number of reasons. If the museum building itself is distinctive enough, it can attract home buyers for the view. It can also attract those interested in the exhibits, which in modern museums tend to be rotated with regularity and can also include guest lecturers or other activities that complement the exhibit.

More than this, however, a museum can also attract tourists, which in turn leads to the development of cafés, restaurants and hotels. With these types of facilities often comes development of transport routes to ensure quick access to stations or airports. Generally, retail will also develop as more people are coming into the area. All this leads to the area becoming more attractive for buyers.

While the article didn’t include any information specific to Australia (the focus was American and Canadian), I couldn’t help thinking of the way in which MONA in Hobart has created a very distinctive ‘flavour’ to Tasmanian tourism and certainly property prices around Hobart have seen growth in the last ten years.

Two ways to make Real Estate Investments

2019 might be a great time for you to finally realise your dream of property investment. The market is dropping, making it an even more attractive time for buyers – especially those with an eye to the long term. Here’s two ways you can become a property investor.

  1. Investing in real estate with rental properties

This is the most common form of real estate investment and, if finances are calculated correctly, works well because your tenants helping to pay off the mortgage of an asset that is (historically) going to appreciate considerably over a 5 – 10 year period.

Investing in real estate with long-term rentals requires you to have an eye on your cash-flow as you may be required to make repairs or cover the mortgage through periods of vacancy. Knowing the right area and property to buy makes investing with rentals more manageable.

  • Investing in real estate through a Self-Manage Super Fund (SMSF)

As more and more people have become focussed on how they will manage in retirement, SMSFs have increased in popularity. These funds allow you more control over the money in your superannuation, and you can invest in property using this money.

There are a number of rules in setting up a SMSF but once it has been done, as a trustee (or a director of the corporate trustee) you can select the property, manage rent income and choose when to sell. In some cases you can even borrow funds to assist in the purchase of the investment property.

As with any superannuation, it is advisable to get advice from professionals who can examine your situation and help in selecting and setting up the most suitable superannuation fund.

If 2019 is your year for investing, then Accrue Real Estate Melbourne are here to help. With expert knowledge of the general property market and long experience with the Melbourne market specifically, they can provide you with the support needed to make your investment goals a reality.

2019 Melbourne Property market

The downturn in the housing market became obvious in 2018, and most experts predict this trend will continue in 2019.

Figures from property data firm CoreLogic show that home values in Melbourne fell by around 7 per cent in the last twelve months, with the median home value sitting at $645,123. This level was last seen in February 2017.  By way of comparison, Sydney’s market dropped almost 9 per cent over the same time, with the median home value at $808,490, a figure last seen in August 2016.

The CoreLogic data also showed a diversity in housing market conditions; the market varies depending on the location of the suburb and the price point of the market.

Outside of the cyclical nature of the property market, one reason for this was tightening of lending standards brought about by the financial services royal commission.

Despite this, there is still significant building of new apartments and detached housing, meaning that supply will continue. With the continued population growth in Victoria – it runs at around 2 per cent based on official figures – there is still demand for new homes, especially in Melbourne where most people coming to Victoria choose to settle.

“It’s still a lot of people arriving in Victoria, particularly Melbourne, and that’s a lot of people that need a roof over their head,” says Housing Industry Association senior economist Geordan Murray. With rental vacancies at low levels, Murray sees that the new supply will be needed.

Most of these arrivals to Melbourne look to live within 12 kilometres of the city and those with or planning families look to be close to schools or transport to schools.

Even with the downturn in the market, good opportunities for real estate investment could exist if the right suburb and property is located. Key to your investment strategy is taking a long term view. Property Investment Professionals of Australia chairman Peter Koulizos advises, “When you look at last year’s figures then it was a very bad year. But if you bought in virtually any capital city 10 years ago you’re still in front. You just need to keep that in perspective.”

If 2019 is the year for you to invest in property, then Accrue Real Estate have the staff and expertise to help you realise your property investment goals.

The Number 1 Generalisation

We are often asked to give the most important thing about real estate investment, and generally, we won’t answer. There’s lots of factors that bring success in property investment. While we don’t want to lock in one single rule, there is a generalisation we do tend to follow over all others – and that’s the old saying ‘location, location, location’. If you were concerned about this when you purchased your family home, you need to be doubly concerned when you are looking for an investment property, and here’s why.

Property follows a cycle – values will fluctuate depending at what stage of the cycle you are. Properties in a good location will tend to be the last ones to be hit when the cycle turns downwards. They also tend to appreciate more rapidly and for longer periods than the properties in areas that are not as sought after locations. The opposite is true, of course. Prices of properties in poor locations are generally the first to go down and the last to rise. They can also have the biggest swings in value, exposing the investor to greater risk of losing out when they sell.

An investment property is usually rented once it is purchased. Location is also a contributing factor to your success I the rental market. If the location is attractive to renters, then rental prices will rise across time, increasing both the value of the property and your cash flow. Rental yield is higher in popular locations and these areas will tend to have a low vacancy rate, meaning your investment property in unlikely to be empty for very long.
The amenities of the area also determine how attractive an area is to live in and this of course impacts on investing in the area. Proximity to parks, shopping centres, gyms and food hubs can attract potential tenants.

Likewise, being close to schools can mean your property may be attractive to families, which may in turn lead to a long term consistent rental.

So … there’s no ONE rule, but keep location in mind when you are looking to add to your property portfolio. Don’t forget that Accrue Real Estate are here to help. We know the Melbourne property market and do the research to make sure the property you buy in in the best possible area.

What you need to succeed in real estate investment

If I asked you to close your eyes and picture a real estate investor, I wonder if you see a bespoke suited hipster, or a middle aged baby boomer or something else entirely?

My experience in real estate has taught me that an investor can look like anyone – the Accrue Real Estate office gets visits from young couples, older people planning for retirement, singles looking for a start in the market and parents aiming to support their children in the future through a current investment. These people come from all types of backgrounds, culturally and financially. There’s really no one image of what a successful property investor looks like. They will come with different goals, strategies and finances.

However, years of experience have taught the team at Accrue,that to achieve success in property investment, there are some commonalities in the people with whom we work. These characteristics would probably lead to success in any investment, but at Accrue we work to achieve success in real estate.

  • Goal! Goal! Goal!

Knowing what you want to achieve with your investment property is probably the most important key to success. It allows you to plan the finances, helps you to narrow down properties and gives you a focus if things ever get a little tough.

  • Patience you must have

This can work in a number of ways. Often the first property you see does not meet your established goals. You might have to look at two, three or four properties to find the one that is right for you. Likewise, property investment is generally not about quick returns. You are in for the long haul, so patience is required to see the full extent of your investment return.

  • It’s a big picture

The property market does not stay the same,but it is cyclical.While any investment comes with an element of risk, taking the big picture view will allow you to see that while property growth may currently be negative, in the long term there will be demand for property. Looking at specific types of property and specific locations are big picture planning strategies. Likewise, keeping emotion out of property and suburb choices also assists with the big picture of real estate investment.

  • No man (or woman) is an island

You don’t have to go into property investment by yourself. There are people who are able to assist you in the decision making you will need to be successful in property investment. Accrue Real Estate is an established and experienced property introductory service. The Accrue staff have the experience to take the stress out of the property purchase process.So, don’t go it alone… let Accrue Real Estate help you realise your property investment goals.

Investing in Property for Retirement

Do you have concerns about having enough money for your retirement? Many people have found that investing in property can offer an alternative to investment in stocks and bonds or other forms of retirement investment.

One of the key benefits of a property is that it can provide an income through rental return. A property bought early enough could also provide equity to allow you to grow a property portfolio. Property investment brings best returns when the investment strategy is future-focused, as the property cycle will have highs and lows. Like all investments, no one has a crystal ball to make accurate predictions, but over a long term period it is unlikely that a real estate investment will not provide a significant appreciation.

Property investment also provides many tax deductible expenses that wind up saving you money in the long run. Repairs, management fees and other owner related expenses can offset taxable income because the property is effectively ‘making a loss’. This ‘negative gearing’ means you will have less tax to pay when the financial year ends in June. Any expenses related to the property while it is rented or available for rent (i.e. when you are looking for a tenant) can be claimed as deductions. Interest on your loan is usually claimed immediately. Capital improvements, borrowing expenses and depreciation are deducted over a number of years.

A Self-Managed Superannuation Fund (SMSF) can also be means of property investment for retirement. These funds allow you to take greater control over your superannuation and use superannuation money for a range of investments (more information about SMFs can be found here and here).

If you are interested in exploring the idea of property investment, Accrue Real Estate is an experienced, premium property introductory service which will take any stress out of the investment process. The team at Accrue know the Melbourne property market and have well established relationships with a range of professionals across all the related areas of property investment. Make your property dreams reality by contacting Accrue Real Estate.