Planning your purchase ahead of Christmas
If you’ve been in the property market long enough, you would know that the market is ever changing even on holiday seasons. With around 2 more months to Christmas, we thought it would be best for us to write about planning ahead for people who are currently looking to buy a property and what to look out for.
The property market comes alive in Melbourne at this time of the year, especially with the Spring racing carnival and other major events leading up to Christmas. From a property perspective, given we are into the middle to later part of October now, a 60 day settlement term will puts us squarely 5 days on this side of Christmas. There is no doubt that it is a difficult time of the year from a vendor, purchaser, removalists, and conveyancer/solicitor point of view.
As an owner occupier, you need to consider the implications of the holiday season. On the plus side, it would be a good time to settle around December because you would then have time to move home and start the New Year in a new place! On the other hand, you need to plan ahead because the removalists and utility providers will either be very expensive or have very limited opening hours and you do not want to be paying rent for another month.
Having an investment property settling around the Christmas period can be an absolute disaster if you have not planned well enough ahead. Many mistakes have been made with a rental property sitting vacant for many weeks if not months during this time when the majority of the public are not considering moving house focusing instead on the holiday season and time away from work and spending it with family and friends. This is not to say that people do not move at this time of the year at all. Some do but they are in the minority. For some investors who had not accounted for such vacancy times, it may mean a very tight if not negative cashflow position.
The stressed landlord with a vacant property hemorrhaging cash may be forced to desperate measures such as reducing the rents to below market rate or worse, take on a problematic tenant to put a quick fix to their short term cash flow issues and this can backfire big time. If you are unfortunately forced into this situation, we would suggest you sign a lease on a short term period to give yourself some flexibility and options should a problematic tenant become an issue.
At Empower Wealth, we shield our investors from these issues by putting in place strategies that suit their unique circumstances. If you would like to know a little more about how our Buyers Advocate team can help you, call us to discuss further.