My development partner used to laugh at me when I would create branding and name the project before we even purchased the property. I did this because I wanted to identify my target market allowing myself to establish the potential buyer meant we chose colours and little add ons that would suit the end buyer. For example on our 1 bedroom apartments near the beach, we added outdoor showers, not expensive to build however it gave a real “surfers feel”. In all of our 2 bedroom apartments we tried to still add a study nook as most 2 bedroom buyers wanted the second bedroom however an area they could have a computer in was a really nice touch. The Planning at the start, meant the architect, planner, real estate agents and even council were all on the same page.
INVESTMENT: RETURNS LINKED TO INTEREST
We have not seen rents go up and in many cases we have seen a decline. We must remember only a year ago 4.5% was a common interest rate. Currently 2.5% is a very common rate. In our opinion there has never been a better time to take advantage of this and pay down debt.
PROPERTY MANAGEMENT: “BE QUICK TO ADJUST THE SAILS”
Rental markets very quickly, Sydney right now, especially the Inner City, has a huge amount of vacancies. You have two choices, either move down slowly with the market, for example adjust the rental amount down $25 per week or change it aggressively and drop it by $100 per week. I find if you slowly adjust, the market moves faster than you and you’re always asking for more than what tenants are willing to pay. Recently one of my properties in Waterloo came up for rent. I was getting $770 per week and the agent suggest I put it on for $620 (a huge drop) I followed their lead, 3 weeks later and I still had no tenant. I then dropped the rent to $580 per week and got a tenant that week. A huge $200 drop, however I would much rather have it rented.