Welcome to the latest edition of Eagle Eye Property Insights! In this issue, we dive into some key considerations for property buyers, sellers, and investors.
Weatherside cladding on properties can put a lot of prospective buyers off. I recently viewed a 2-bedroom leasehold unit with weatherside cladding that had been on the market for 9 months. So, what’s all the fuss about? Weatherside is the brand name of a cladding product made from wood and glue in the 1970s and 1980s. If well maintained there is nothing wrong with the product. However, if chips and cracks appear and/or painting isn’t kept up-to date moisture ingress will make the boards swell and crumble like “weet-bix”.
We recently became aware of a client who had purchased a property in a run-down condition. They spent several thousands of dollars renovating the property prior to putting in a tenant. What a lot of property investors aren’t aware of is that the IRD views the renovation costs as non-deductible for tax purposes. Essentially the property was able to be purchased cheaply, and the renovation costs are just bringing the property up to its market value.
Selling a property to first home buyers can be frustrating with long finance clauses and extended settlement dates. What can you do as a vendor to push the sale through a bit quicker? Cash out clauses can be useful for a number of reasons. A “cash out clause” gives the prospective buyer who has the property under contract a set number of days (usually 3-5 days) to satisfy all their conditions. They also enable the real estate agent to continue to market the property to prospective buyers to achieve the maximum price.
Note: The above comments are for general information purposes only and do not constitute financial advice. We recommend consulting a registered financial advisor when considering your mortgage options.