Before the end of the 2024 calendar year – some housekeeping thoughts
The old adage being there is only X amount of weeks left before the end of the calendar year, and here we all are at the anticipated height of the real estate market in Victoria, with, to be honest, no sign of any great velocity in market transactions and demand.
The matters you seriously should consider as a property owner, vendor, purchaser, private investor or general participant within the industry before the calendar year closes:
1. Ensure that your Site Value pertaining to Rates Notice is deemed as being correct. Remember, your Land Tax Assessment is around the corner.
2. Rent reviews pending under the Retail Leases Act (RLA), noting the current market and where the market may be in 2025. Make a decision based upon professional advice and action. Sometimes it is better to have a tenant than a Land Tax bill and vacant property.
3. Ensure that if you are contemplating a sale of a property, when is the right time to place the property to the market and canvass how the process will and should be from inception to settlement.
4. Be wary of arrears of any kind, with the holiday season around the corner, the recoup on outstandings becomes harder as the year progresses.
5. If you are perhaps refinancing and/or funding your real estate transaction, be mindful that the valuation is only valid for three (3) months. Assess the market today visi your perception of the 2025 market.
6. Are proposed interest rate decreases being mooted for early 2025 really going to happen? And if so, how will this change current or future strategies?
7. Anticipated sale of assets would benefit from valuations, analysis and comparison of investments, also noting Capital Gains Tax and opportunity cost.
8. Don’t rely on one source of real estate consultancy to make your investment decision.
9. You cannot be an expert in all areas of your life, especially real estate investments, spend the money and get the best advice possible.
10. All participants definitely need to be aware that we are in the beginning of a “transitioning” period within the real estate industry, with changes from the past to the new evident in so many ways.
11. Private equity now starting to make headway into funding requirements and investor returns.
12. Mortgage funding visi direct property investment, know the positives and negatives.
13. Generational change, the equity market visi real estate investment.
14. Return on residential estate investment, net 1-2% is it worth it, without capital growth and with the Land Tax threshold having been reduced?
15. Should I negotiate with my tenant rather than compete in an open market?
16. What incentives are needed to acquire a tenancy in this marketplace?
17. Review your asset base, there is a good chance it has decreased, even though the media headlines don’t spell it out.
18. Make sure you plan for 2025.
These are some of the steps you need to complete in the next 10 weeks or so.
If I could suggest, the best advice would be to utilise your network and speak to third party experts. You, as we all are, are living in uncertain times, with the next twelve months providing a period perhaps that may be uncharted.
Commercial Insider Podcast
I recently joined Matt Nichols of Nichols Crowder on his Podcast “The Commercial Insider” where we discussed Melbourne’s retail strip centres, as well as commercial and industrial property values. Both are available to listen on Spotify, Amazon and Apple.
Understanding Retail Property
“You may not look at your local shopping strip the same way after listening to this podcast. Matt Nichols chats with Mark Ruttner expert retail valuer on the underlying structure of a strip.”
Understanding Commercial and Industrial Values
“The same property can have multiple values – How can that be?
Matt Nichols chats with commercial property valuer Mark Ruttner about the best types of property for investors who want flexibility.”
To discuss any related property matter herein or other issues, please contact Mark Ruttner, Managing Director
mr@fvg.com.au 0411 419 674
First Valuation Group
Suite 110/181, St Kilda Road, St Kilda, Victoria, 3182
valuations@fvg.com.au
