Wednesday, October 28, 2015

Investing in Adelaide; look below the surface to find the hidden gems.

There have been some big announcements across the residential property market this week. The banks are lifting variable rates on November 20 to strengthen their capital position and meet the regulator's new rules. And one of China's biggest financial institutions announced they are offering the option of non-deposit home loans to purchase apartments in new developments being carried out in Melbourne and on the Gold Coast. 

This month, RPData, a leading property analyst firm, reported that rental growth in Australia is at its slowest on record. In fact, capital city rents have increased by just 0.5% and the trend is moving downwards.

Locally, the current news headlines and surrounding concerns about our unemployment rate and recent job cut announcements are top of mind for most investors. This is undoubtedly contributing to the market as a whole.

RPData also released their Top Five suburbs report, based on 12 month rental growth for each capital city for September and we were pleased to discover that there are still investment 'gems' out there defying the trend... you just might have to dig a little deeper to find them. So, where are they?


According to the report, the top three suburbs for rental growth in houses are Hyde Park (increase of 23.2%) followed by Adelaide CBD (16.5%) and Semaphore at 12.5%. And the top three suburbs for units were Mile End (10.9%), Mitchell Park (10.5%) and Findon coming in at 10.3%. To put this in perspective, Melbourne's top performing suburb came in at 20% and Perth, Hobart, Darwin and Canberra all recorded below 9%.

The key conclusion is that investors who own properties in sought-after locations with less supply (more competition) will stand the best chance of increasing returns and accelerated capital growth opportunities.

So what are we finding on the ground?

Properties close to the city or the beach and the CBD are attracting a lot of interest from tenants. The real hot spot at the moment is the East End/Hutt Street pocket. Cottage properties are hotly contested as are those close to shops and restaurants.

North Adelaide is also extremely popular. A recent property for sale in the area attracted so much interest that it sold two weeks before auction. Our rental team then had it leased two weeks before settlement for the new purchaser. That's a dream run in our world, and an incredible result for the seller, purchaser and tenant!

We are seeing a number of interstate investment companies flying into Adelaide to purchase property. One company we are dealing with want 150 investment properties, in key locations. This is happening more and more. 

While the reports tell us that collectively capital cities may be under performing, we have individual suburbs that are achieving exceptional results. We love investing and helping our clients find their first or next investment property. To find out more, give one of our team a call, we'd love to chat! There is still great buying out there, but the secret is to know where to look to find the investment 'gems'.


Regards,
Suzannah Toop

Thursday, October 22, 2015

Real Estate’s Night of Nights... Wow, a very humbling moment!



Last Saturday was a very special night for Toop&Toop at the 2015 Annual Real Estate Institute of South Australia (REISA) Awards. More than just awards... real meaning.

Background. On the 1st January 2015 I changed my role from Managing Director to Chairman of Toop&Toop, a big move for our family. My daughters, Genevieve (Gen) and Suzannah (Suz) took over operations two years ago and are currently taking over planning and strategy. My wife, Sylvia and I along with some of our senior TeamToop members have been mentoring them, as have experts from outside the business.

As our next generation mature into the roles, Toop&Toop has returned to its roots. A family business, with passion and high expectations of ourselves.  


Back to last Saturday night. The REISA Awards recognise the best of the best in South Australia. It was so special for Sylvia and I because the results were clearly nothing to do with us, but rather the efforts of the entire TeamToop - new leaders, new thinking, new technology and new management style.

Tim Thredgold, with our 28 years working together, was recognised as the state's top sales person for 2015...Such an incredible guy and ambassador of the industry. The irony is that last week Tim and the Thredgold team took residence in the recently vacated office of Peter Veitch, who last month officially retired. Peter has been the only South Australian to ever win the nation's number one sales person award, and was Hall of Famed out of the competition in 2008. Both Tim and Peter are amazingly wonderful human beings and role models of what the elite real estate profession should look like - humble, proud, and highly professional with a competitive spirit.

I've spoken to Tim and naturally set an expectation for him to become the second South Australian to achieve number one in the country.

We had 13 finalists with Joel Rauer, Troy Tyndall, Sally Cameron, Mandy Doolan, Len Allington and Kevin South all receiving individual awards of excellence, showing outstanding depth and breadth to our new TeamToop.

The State's Best Auctioneer, Bronte Manuel was also recognised for his achievements winning 2015 Auctioneer of the Year in REISA's inaugural auction competition.

In 2016 we will carry the flag for an unprecedented five major categories into the national award arena.

Toop&Toop is a proud South Australian family business with a remarkable team that I believe have only just begun to realise their potential. It is unquestionably an entirely new and exciting era of real estate excellence. 

Although things are very different around Toop&Toop now, in so many ways they are exactly the same as they were in 1985 when we started the business. With our Wellness Centre, the new Toop Crche, and our full time IT developers... we are moving to a whole new level of excellence. To dare to dream that there could be an even better way!

Thank you to all those in the community who believe in us and support us through thick and thin and changing times. We are extremely appreciative of that support.

Regards,
Anthony Toop

Thursday, October 15, 2015

Investors, the most important question to ask your agent... "Am I compliant?"

Earlier this month we had two unrelated incidents where a fire broke out at one of our properties under management as well as one of our own offices after hours. In both cases, all it would have taken was a matter of moments for it to have been a dramatically different situation. We are very fortunate that apart from some very shaky tenants and community members at our office, everyone came away unharmed.

What really hit home across our team is how differently things could have gone. It could be life changing for an investor if your smoke alarms did not go off in an emergency and something happened to your tenants.  

What's become clear over the past two weeks is that it seems for a lot of investors, compliance is an unknown quantity. There is uncertainty as to exactly what is required and as a result it becomes a very emotive and worrying topic.

We know that State legislation says all SA homes must be fitted with a working smoke alarm. The expectation is quite clear but it is the testing component as to whether the alarm is 'working' where varying views have emerged.

Some investors take a more practical view, that pressing the button or replacing batteries is sufficient, where others feel best practice requires annual checks as well as fire blankets, buckets and fire extinguishers.

Further adding to some investor's angst is the idea that they are getting ripped off or that an agent is benefiting from this new buzz word 'compliance'.

Based on the number of man hours and resources that have gone into running this initiative within our own business over the past two weeks, I can personally vouch that this is a huge job, and your agent would not be doing it unless they cared. We have dedicated significant resources to it and other projects (such as those in our Innovation Lab) have had to take a back seat for a few weeks.

That said, if you are unsure, definitely ask your agent to get some comparable quotes. There are a number of providers in the market and before putting together our compliance packages we met with a number of companies from across Australia to obtain the most competitive prices for our clients.

Times are certainly changing and the expectations on landlords are increasing, not just here in Adelaide but across the country. We are finding that compliance discussions are fast moving away from an upsetting deduction on an end of month statement, to a factored in, sophisticated practice of risk management. Ensuring compliance isn't something that has dropped to the bottom of the 'to-do list' is what matters here. It is a big task for any agent to drive this but one we feel is too important to let slide.

Now really is the time to ask... "Am I compliant?"


Regards,
Suzannah Toop

Thursday, October 08, 2015

East is running hot!

So which suburbs are leading the pack?

As real estate agents one of the most common questions we are asked is, "Where are the property hot spots right now?!" It is a really interesting question and always exciting to see the trends unfolding.  

We have reported a great deal about the investment opportunities in the Fleurieu, the North East Hills and beach suburbs, but it really is time the classic prestigious Eastern Suburbs took a bow. 

Recently we have seen stellar performances in two particular suburbs. St Peters and Dulwich are hot on all fronts at the moment and buyers can't get enough.

Dulwich is one of the smaller of the eastern suburbs and is traditionally tightly held with a conservative turnover of 16 to 17 properties per year. But right now we are seeing this suburb experience huge activity! Median house prices have risen by $71, 250 and Dulwich has already superseded their 2014 sales total of 16 and is sitting at 17 property sales for the year so far.  A staggering 13 or 70% of these have been in the last three months!!

St Peters, while a bigger suburb with 235 more properties than Dulwich is following a very similar trend. In the last three months there has been 13 properties sold in St Peters which is huge if you compare this to the same period last year when there was only five sales! That's almost a 300% increase in volume!

St Peters has always been a very strong market for us. We currently hold 25.3% market share of the sales in the area - and our figures are backing up this trend as well, with 67% of our Toop sales occurring in the last three months, and these strong results are expected to continue. We currently have four listings in the area, and believe St Peters is on track to well exceed the 42 sales the suburb had last year!

Demand from buyers online is extremely high. According to realestate.com.au, Dulwich properties are receiving a monthly average of 2,458 views online and St Peters properties 1,698 views, both well exceeding the South Australian average of 506 views!

This demand is flowing through to inspection numbers and in the last month we have had 169 buyer groups through our inspections at Dulwich and 110 in St Peters, with 2,365 buyers registered with us to hear about properties in these areas as soon as they become available! 

The Eastern Suburbs of Adelaide have always been, and I imagine always will be, in high demand and right now it's St Peters and Dulwich which are providing some fantastic opportunities for owners who picked the trend early. 

If you are one of the lucky few who live in these amazing suburbs, it's reassuring to know that you have a 'first mover' advantage and can leverage this current buyer attraction to the area!



Thursday, October 01, 2015

Our tech journey to better business

Innovation isn't a fad, it's now a money maker for our investor clients. 

Genevieve, Marcus (our Head of IT) and I were extremely fortunate to be invited to attend the Telstra Vantage Conference in Melbourne earlier this month. What an incredible two days of learning from some impressive speakers across a range of industries! We were like three kids in a candy store, walking around the 'Village' seeing the forefront of new technologies.

For 'tech head' enthusiasts like myself, seeing a Samsung virtual reality booth at the Telstra Vantage conference or hearing the announcement that the driver-less car is being tested here in Adelaide in November, is very (very) exciting.

Our ‘My Maintenance’ software is creating real
cost savings and returns for landlords.

For us in real estate, striving for new ways of doing something is in our Toop DNA. We invest heavily in our Innovation Lab (headed up by four full time IT Programmers) but also in our PEOPLE to think differently. Challenging the norm isn't something we see as 'nice to have', it is expected in our team. And we love it!

So in my world of property management we see a huge upside for investors when we start to think differently. Let me explain.

It is the industry norm for property managers (across Australia) to be running at a million miles an hour just trying to get 'day-to-day' tasks completed on time. And that's without adding in any emergency works that must be actioned immediately such as overnight storm damage or a dangerous gas leak. It is a recipe for disaster and the staff burnout rate in our industry is extreme.

In my view the whole model is completely unsustainable and has to be fixed.

Our response has been to embrace technology and create quick efficiencies to reduce the number of steps in our processes. My Maintenance, our game changing patentable software, is a prime example of this technology in action. It has completely redefined the way property maintenance is managed.

In such a process driven industry, focusing on automation creates a huge upside to investors as our team have more time to, firstly, think calmly and rationally and, secondly, focus on doing the things that matter; the things that will optimise our investor's returns.

Our aim is not to replace relationships or the human element with technology - quite the opposite in fact. By utilising technology correctly, we can remove 'the noise' to allow a greater focus on what matters; you, our customer.

At Toops we are passionate about exceptional performance and using technology to do better business and create greater cost savings and returns for our clients. 

Technology is genuinely fast becoming a game changer for investors... investors can now pocket the cash driven by better systems, better accountability and new systems.


Regards,
Suzannah Toop