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dethridgeGROVES Real Estate
Property Investment Services Newsletter
Dethridge Groves

PROPERTY INVESTMENT SERVICES

Winter wonderland Newsletter

In this edition we share with you a market update by our Principal and Deputy REIWA President Hayden Groves. We welcome Ros Anthony and Alicia Sorrell to the dG Property Investment Team. We discuss the benefits of depreciation reports before the end of Financial Year and why “presentation” is the key when advertising properties for lease in a competitive market.
 

MARKET UPDATE

At the time of preparing this information, the residential rental market continues to deteriorate with 7,500 properties listed for lease in and around the metropolitan area. This figure is roughly double the long term average for Perth and represents a vacancy rate of around 5 per cent based on current stock levels. The concern is that these conditions are likely to get worse as new dwelling stock, especially newly constructed apartments, floods the inner urban market. Property investors are well advised to pay close attention to the current market and the advice of their property managers particularly when faced with a renewing tenant seeking a decrease in their rent or if a break lease is requested.

In short, if offered less rent, take it. In some cases rents have fallen as much as 25 per cent. A rent of $750 per week twelve months ago is achieving around $560 today. In times like this it’s worth remembering that rents rose as much as 58 per cent in under two years from mid-2011.
Your dG property manager understands the local market conditions well and we have adapted well leasing an average of a property per day since January. We continue to do the extra things necessary to secure and maintain a quality tenant.

EXCITING TIMES

It is with much excitement that we wish Emma Boyd, our exceptional Operations Manager all the best as she welcomes her first baby into the world within the next month. As Emma heads off on maternity leave, Ros Anthony joins us as Operations Manager. Ros first ventured into real estate in 1998 and has been a licensed agent since 2003.  She is an experienced real estate and business trainer and holds a Diploma in Business Management. Through her time in the industry Ros has learnt the importance of understanding and exceeding client expectations.  Integrity and attention to detail are at the heart of her work ethic.

On another positive note, we also wish our fantastic Property Manager Ana Obradovic all the best as she too heads off on maternity leave. Ana will be welcoming her 3rd baby boy into the world in the coming weeks. Alicia Sorrell who has joined dG has completed a thorough hand over to ensure the portfolio is well cared for. As an experienced Property Manager, Alicia brings with her a wealth of experience and a dynamic personality that you will no doubt see the benefits of.

Should you have any questions about the changes within the dG Property Investment Team, please do not hesitate to contact your Property Manager or Ros Anthony, dG's Operations Manager. See below the wonderful new faces of the dG team!

Ros Anthony, Operations Manager
E: ros@dgre.com.au
P: 9336 1166
M: 0411 597 197

Alicia Sorrell, Property Manager
E: alicia@dgre.com.au
P: 9336 1166
M: 0488 058 891
 

BENEFITS OF DEPRECIATION REPORTS

Just like you claim wear and tear on a car purchased for income-producing purposes, you can also claim the depreciation of your investment property against your taxable income. The Australian Taxation Office (ATO) allows property owners to claim this depreciation as a deduction. Depreciation can be claimed by any property owner who obtains income from their property. Of all the tax deductions available to property investors, depreciation is most often missed as investors do not need to spend money for it to be claimed

There are two types of allowances available: depreciation on plant and equipment, and depreciation on building allowance. Plant and equipment refers to items within the building such as ovens, dishwashers, carpet, blinds, etc. Building allowance refers to construction costs of the building itself, such as concrete and brickwork. Both these costs can be offset against your assessable income.

In order to make a claim you need a report, better known as a depreciation schedule. Tax Ruling 97/25 issue by the Australian Taxation Office (ATO) has identified quantity surveyors as properly qualified to make the appropriate estimate of the construction costs, where those costs are unknown. Real estate agents, property managers and valuers are not allowed to make this estimate.
 
Please Note: The opinion expressed above is based on relevant industry information, it should not be used as legal advice. We recommend that each Investor source their own legal advice and/or information.

 

PRESENTATION IN A DIFFICULT MARKET

We love to hate competition, yet it is what to drives the industry. In the current rental market, there are two key factors that influence whether a property is leased or not. The famous “P’s”:  Price and Presentation!

Price is driven by market demand and supply and unfortunately there is very little influence or control that either the Investor or Property Investment Team can control.

Presentation on the other hand is a fantastic opportunity to create a point of difference and compete with the competition. Presentation is imperative in a slow moving market!  Prospective tenants have many choices and therefore look for obvious reasons to eliminate their options. The visual aspect from the ‘street view’ can be just as important as the internal presentation of a home and we want to eliminate every facet that could be used as a negative factor with regards to choosing a rental property.  The little things can often be a major factor with a prospective tenant either choosing or passing the opportunity to view your property!  A property that is tired in its appearance will also deter tenants in a high-vacancy market. To discuss how you can improve on the presentation of your vacant property please contact your Property Manager.
Emma Boyd
Ros Anthony
E: ros@dgre.com.au
P: 9336 1166
M: 0411 597 197
Ana Obradovic
Alicia Sorrell
E: alicia@dgre.com.au
P: 9336 1166
M: 0488 058891
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