This week we continue the series looking at suburbs posting the highest capital growth for houses in the sub $600,000 market - this week in Melbourne. We speak with Angus Kell from Archicentre about how to maximize the value of your home or investment property by renovating. And in this week’s tip we look at what the legal process is for tenants if a landlord has their rental property repossessed by a bank.
News. In property news, the Australian Bureau of Statistics released figures showing a 7.7 per cent rise in approvals to build new homes in July, compared to the month before. Following this, the Housing Industry Association released data showing that sales of new homes rose 0.1 per cent in July after a 0.5 per cent rise in June. And Australia’s central bank decided to leave interest rates unchanged at 3 per cent for the fifth straight month. Reserve Bank Governor Glenn Stevens says there are indications that the major global economies look to be starting to turn the corner, saying that local economic reports suggest that the Australian economy may recover sooner than expected. And in other news, Australia’s upper house has passed a climate change bill which in effect will mean that 20 per cent of electricity production will come from a renewable source by the year 2020. These sources will include wind and solar energy generation.
Suburb in Focus. As part of our series focusing on the sub $600,000 house market in capital cities around Australia, this week we are showing you two Melbourne suburbs that have recorded excellent house growth in the past 12 months. We’re looking at the house market in Lyndhurst but first off - St Andrews. St Andrews is located about 40kms north east of the Melbourne CBD and is a small town with only about 1,500 inhabitants and is located very close to where the bushfires destroyed houses earlier this year. It has a well known alternative market on weekends. 81% of St Andrews’s homes contain families and 60% of the families are couples with children - this is a family area and many of the residents are professionals. Stand alone houses account for 100% of the property market in the area because of the rural location. Rental properties make up just 7% of the housing market so this is an owner occupier suburb. Let’s have a look at the data. The median house price in St Andrews is $516,750 dollars, which is over 50% higher compared to a year ago. There were just 10 houses sold in St Andrews in the 12 months to June 30 and just 8 were rented out so there are a small number of houses that are causing the median price to jump by so much.
Now to Lyndhurst. Lyndhurst is about a 45km drive south east of Melbourne’s CBD and in 2006 only had a population of 408 residents. Today there are many housing estates as the suburb is developed and continues to grow. 82% of households contain families and 46% of families are couples with children. Stand alone houses account for almost 96% of dwellings in the area while units make up another 4%. Rental properties make up 21% of the housing market. Let’s look at the data. The median house price in Lyndhurst is $338,500 dollars, which is an increase of over 40% compared to a year ago. There were 146 houses sold in Lyndhurst in the 12 months to June 30 and 32 rented out. The median rent price for a house is $370 which brings the gross rental yield to 5.7%.
Tax Tip. This week we are looking at new legislation that come into effect in NSW on 19th June that applies to all repossessions on or after that date. This has been a common situation in the last year as the number of repossesions jumped and the legislation aims to clarify the rights of tenants in this situation. The major points of the legislations are that 30 days notice must be given to tenants before they are required to vacate the property and the tenant is not required to pay rent during this period. If the tenant has paid rent in advance to the old landlord, this money must be refunded. If the property is not to be immediately sold, the mortgagee can offer a new tenancy agreement. The mortgagee can also now authorise the release of band payments, rather than require the old landlord needing to. Of course, this is very general informtion and you can contact the Departent of Fair Trading if you would like to discuss your specific situation.
