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As the real estate market continues to struggle along and properties take longer to sell, Mansion Minders keeps up the homes whilst at the same time providing plush living quarters at a cut rate.
For example, a resident has to clean the pool like it’s their own, even though it’s not.
“Mansion Minder’s” are basically live-in house sitters for homes on sale, paying less than they would normally pay for their home, whilst living in a better property.
The rules are that the property must be kept spotless, disappear when required should the property needs to be shown by the broker, and move out in less than one month if it sells.
Mansion Minders are not renters but effectively sub-contractors (and thus without tenant’s rights). Instead, they pay the company what’s called a participation fee, which is about 25 percent of a monthly mortgage. The participation fee is based on the home price.
Fashion designer Wayne Cooper’s Luxury Sydney home in Sydney’s Eastern Suburb of Tamarama failed to attract a bidder at auction yesterday.
The entire process has been disastrous from start to finish with Wayne Cooper being convicted of assaulting her last Friday. An apprehended violence order was amended so he could attend the auction.
A bidder offered an opening offer of $2.2 million, with the auctioneer rejecting the bid and opening with a vendor bid of $2.9 million. From that point on there was complete silence from any “real bidder”.
The one size fits all auction mentality is just not cutting it.
The sale of Luxury Homes is for specialists and unfortunately the agent responsible for conducting the campaign was not a Luxury Agent and not a recognized member of The Who’s Who In Luxury Real Estate – the invitation-only worldwide peak industry body.
I find it amazing that agents choose to sell homes in the same way regardless of value – failing to recognize the difference between those involved in purchasing Luxury Homes. The market in Australia is proving week after week that clearance rates for properties over $1 million are extremely low – yet agents continue to cling to auction as a way of getting vendors to spend thousands of dollars on advertising their home in several newspapers in a very short period of time, or simply because they don’t know how to tell things as they are to their client.
Little if any thought is given to post auction strategy and research done by the National Association of Realtors is now indicating that almost 90% of buyers first find their home online – so why are agent’s still encouraging vendors to spend so much money on newspaper advertising? The answer is that it helps promote the agent – it’s a disappointing fact that so many agents give such poor advice.
The other issue at the moment which is making auctions more than difficult is that buyers are taking longer to make purchasing decisions – a 3 or 4 week concentrated campaign rarely works for Luxury Homes. Ms Marsh (Wayne Cooper’s former partner) had opposed yesterday’s auction because she feared it would not attract a good price due to the weakening market – she was totally right!
In fact Ms Cooper was so determined to have the auction postponed that she took her case to the Supreme Court – unfortunately she was unsuccessful.
Having worked with McGrath Estate Agents early in my career I understand that the auction method of sale is pushed onto vendors and agents are under enormous pressure to convince vendors to auction their properties – unfortunately there is little evidence either domestically or abroad to support auctioning and wasting thousands of dollars on what is fast becoming outdated newspaper advertising.
It has been reported that the McGrath Agent responsible for the sale has blamed the domestic violence issue for the property’s non-sale. I would suggest that proper training, advice and strategy formation from the beginning would have resulted in different advice being given as to the correct sale method and I strongly believe that Luxury Agencies like Marquette Turner Luxury Homes are by far the best choice when selling top-end properties.
Marquette Turner Luxury Homes has been awarded the Who’s Who in Luxury Real Estate’s 2008 Most Outstanding Luxury Agency in the World operating for less than 2 years – beating around 6000 agencies and 121,000 Luxury Agents.
The global market’s erratic performance over the last week has certainly called into question the financial strategies of many (including, it could be said, of the hapless President George W Bush). Regardless of whether one agrees or not in principle or practice with the Federal bailout in the United States, we should at least begin to see a little more stability.
That’s not to say that all will be bright from hereon in. The market crunch, or more specifically the credit crunch, has seeped into all nations and has affected all manner of finances, including Australia. Confidence has definitely been damaged.
The simple fact is that Australian property prices cannot help but be affected given the high levels of debt in Australian households, and our relatively high interest rates as a ratio of household debt to GDP compared to the US.
Even should interest rates be cut further in Australia, as they likely will, we are simply likely to feel an ease of the stress of mortgage pressure rather than an immediate flock to property: the credit crunch has reduced the amount of credit available, and many people have more than enough debt to suggest they’ll have a proclivity to take on more.
The Land of Opportunity
These are also the times of opportunity. With confidence dented all around and property prices sluggish and unlikely to head in any northerly direction for even close to the next 18 months, there are many good buys on the market now, and many that will come onto the market.
Those buyers that are willing to take a long-term view on property values – as one always should (the “quick-buck strategy” is never one that is risk-free) – as well as applying sensible purchasing decisions based on the amount they can borrow with a comfortable buffer in addition to intrinsic good value – will in a few years be looking back upon these times with great satisfaction.
Not panicking during an alleged crisis, taking smart, confident and unemotional decisions, and investing wisely will mean that property – right now and in future – is logical and rewarding as one can hope to find.
What Will Happen Next?
Expect an interest rate cut by the Reserve Bank next week and more in the following 12 months. Expect housing demand in Australia to remain relatively buoyant given our growing population. Expect an easing Australian economy (together with more manageable inflation) due to weakening demand from China, whose economy is heavily hinged on US demand.
Quite simply, so long as share market’s are unappealing, property investment will remain ever the attractive option.
With the average value of homes in Australia having increased by approximately 150 per cent since the millennium began, this well earned increase will generally be retained, and further goes to highlight the intrinsic opportunity that wise, long-term property investment provides.
IMPORTANT: If you are finding it difficult to cope financially, read our article on Coping with Financial Stress