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THE BEST looking property could actually represent the worst real estate investment you have ever made.
Remember that Commercial real estate investing is all about … the Deal, the Terms and the Return on investment. Here are some tips for successful Commercial real estate investing. [Read more…]
Well, not here in Australia anyway! And even overseas, things are vastly different this time around.
In 2008/09, it was private debt causing the problems … because nobody was too sure which banks were overly exposed to the sub-prime mortgage problem. [Read more…]
For the past few weeks, the world’s media seems to have been dominated by two unfolding dramas:
However, as Amy Auster reported in Saturday’s Financial Review, there was also a really positive development last week (certainly for Australia), which seems to have simply “snuck under the radar”. [Read more…]
The mid-year report from the Property Council of Australia (PCA) has confirmed a tightening of all major Office markets — except for Sydney and the Gold Coast.
As you can see from the graph, Sydney’s vacancy rate actually increased from 8.3% to 9.3% during the six months to July 2011.
For the remainder of Australia’s office markets, there was an overall improvement — as demand for space exceeded supply, and yields began to firm.
According to Peter Verwer (PCA’s chief executive): “This is a good result, especially now with a lot of uncertainty about Australia’s economic resilience … demand and absorption are well above the historical average, except for the orphan Sydney.”
From this second graph, you will also notice that the Melbourne Office market has been consistently outgrowing Sydney, since about July 2004.
Furthermore, because of Sydney’s heavy dependence upon the financial sector … this growth trend is unlikely to change any time soon.
Melbourne, on the other hand, has its Office demand spread across a wide number of sectors. And therefore, has been far less exposed to the recent global turmoil.
Bottom Line: Despite all the stock market gloom, the underlying fundamentals for Commercial property are strong — particularly in Melbourne.
And historically, it is in times like these when shrewd investors have laid the foundation for their extraordinary fortunes in Commercial property.
Last week, you looked at the reasons why lenders view Commercial property in a different league to Residential property, when it comes to finance.
And then, we moved to the various aspects Commercial lenders look at as far as Risk is concerned.
More importantly, just how these aspects will determine whether or not they will actually lend against the actual property you are looking to purchase.
However, what you really want to know is … [Read more…]
Commercial property finance is one of those aspects probably the least understood — and therefore, can lead to some are rather poor decisions by investors.
The most important thing you need to grasp is that there are basically no hard and fast rules about the various factors like … the leverage that is available … costs associated with Commercial loans or … the actual lending criteria most financiers and adopt.
When it comes to Commercial finance, everything has to be viewed in relation to the strength and size of each particular deal. [Read more…]
Last week’s article entitled: “OK … What’s Really Going On?” seemed to capture the interest of quite a few readers.
So, tell me … how many people have you spoken with lately, who are fearful about the European and US debt problems?
And have you stopped to find out how few of them realise that the problems confronting those countries may actually be GOOD news for Australia.
Perhaps it is worth explaining how that could possibly be — because there are several things you need to appreciate. [Read more…]
LAST WEEK, I promised to reveal those key Consultants to whom I’d be prepared to entrust my own property deals. So, let’s progress a little further with that.
No doubt you will have experienced your share of problems, when it comes to arranging the finance for a recent purchase you may have finalised.
As you’re probably aware, most vendors are unwilling to enter into a contract in the current market, containing a “subject to finance” clause. Because it would simply tie up their Commercial property, without any certainty of a sale. [Read more…]
Capture The Benefits
Depreciation is probably the most under-used weapon to legitimately shelter a significant portion of your property income.
And as a Commercial Investor, you really do have an unfair advantage over somebody investing in only residential property.
Therefore, let’s now set about dispelling a few of the common Myths concerning Depreciation.
[Read more…]
