Help with negotiating a new rental property
Q: We are about to lease our new unit to a real estate agent for rentals in Sydney. What are the essentials that we need to negotiate with the real estate agent? - Frank
You would think the most logical thing to negotiate is the management fee. Management fees in Sydney on average range from 5-7%. In truth, you may be able to shave off 0.5% if you have some bargaining power. On a $600 per week rental, this amounts to $150 annually.
However, the real expense for landlords comes from two other areas. Firstly a vacant property. Every week your property is not rented is incredibly expensive for you. So it's essential that you make sure your agent is investing in premium placements for your property listing on Domain and REA. Spending a little more here will get more eyeballs on your listing which will help to rent it out sooner.
The second significant expense comes from repairs and maintenance on a property. Most people don't know this, but you can negotiate the terms of repairs and maintenance in your management agreement. For example, you can remove the authority for an agent to source and pay tradespeople. Instead, you can take responsibility for this and save yourself money. Sourcing tradies yourself can be a game changer as repairs can be expensive and it makes sense for you to know who is doing the work.
What do I do with my first home buyers grant?
Q: I have recently bought a property in Sydney and have got government tax rebate as a first home buyer. I didn’t move into the property so far. Meanwhile, I got an attractive job offer in Melbourne. I wonder if I can rent or sell the property to move Melbourne. Would you please advise me - Vijay
A: Hey Vijay, For you to be eligible for the first home buyers grant (and keep it) in NSW you need to occupy the property for six months within 12 months of when you purchase. There isn't any way around this. There are penalties for making false claims, so I encourage you to contact First Home Buyers Assistance scheme (FHBA) and work it out.
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No chequebook on auction day
Q: We are going to an auction next week and if we are successful, don't have a chequebook what other options are there to pay the 10% on the day? - Amanda
A: No chequebook? No worries!
"You can visit the bank during the week and get a bank cheque. You need to have the cheque made for 10% of your maximum bid beforehand."
If the sale price is lower than the amount on your cheque, the additional cash gets added to your property.
Commonwealth bank charges $15 to issue a bank cheque at a branch, so if you’re unsuccessful at many auctions, this could add up.
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