Introduction

Real estate prospects for Australia, per forecast done by QBE LMI Housing Outlook Report for three (3) years, 2011 to 2014 shows a healthy upward trend in the real property market. A recapitulation of the forecast by QBE for the state cities in the next three (3) years are as follows:

1) Sydney – a housing boom of 19-20% is expected. It was predicted that demand will outweigh supply and result to higher property values; Perth – a 19% to 20% growth rate is expected in real estate activity due to investment inflows from the mining sectors

2) Melbourne – is predicted to have the least growth rate of 6% due to oversupply of newly constructed houses at the low to medium price range

3) Adelaide, Hobart and Canberra – a moderate growth of around 6 to 8% is predicted

4) Brisbane – a healthy growth trend of 16% is expected, and

5) Darwin – a healthy burst of market activity is predicted at 17% growth levels.

Real Estate Industry Prospects in Australia

The industry experienced a difficult three (3) years from 2007 to 2009 which saw industry revenues falling to around 1.2% annually due to declining demands. The trend had only started to stabilize in 2009 and 2010. This was in line with the growth in Gross Domestic Product, and the robust financial outlook for that year – that lead to the upward spiral of prices in practically all states. The QBE LMI report likewise showed an optimistic outlook, with foreseen increase in demand associated with the entry of Asian investors.

Rentals in property is a growing trend in Australia at present, since prices of real estate has gone way beyond the reach of most first time home buyers. Mortgage interest payments have ballooned to levels that ordinary residents can barely afford. Though the industry outlook is optimistic, a vast number of residents still find it hard to have their own homes.

Property Rental Options in Australia

Renting Option

Renting falls into two categories. One would be a straight rent arrangement; and the second would be the rent to own scheme. Renting of properties, per se, or straight rent, would have its advantages as compared to a straight buy-out.

1. The first advantage would be – financial flexibility. Renting would entail a smaller capital outlay than outright purchase. A smaller rental payment could definitely save you a lot of cash than the much higher monthly mortgage payments.

2. The second advantage would be the low maintenance cost. The only problem that has to be surmounted here is the fixed monthly payment. Problems on repairs however, would be less of a financial burden, since these are normally taken cared of by the lessor.

3. The third advantage would be flexibility. Changes in personal circumstance – like a new career, or if by some stroke of luck, you suddenly find yourself jobless, this type of arrangements would not locked you in a situation, that you have to make payments despite of your inability to do so.

4. The fourth advantage would be – no market risk. Buying a property would entail a huge capital outlay in terms of initial deposit and monthly mortgage payments. You take the risk of expectation – that the rate of value appreciation of your property would be more that what you have paid for.

5. The fifth advantage would be – taxes and insurance. Rental payments are expenses, thus deductible from gross income. Insurance on the house is paid for by the lessor, hence lesser cost on your part.

6. The sixth advantage would be – the extra bonus in renting arrangement. This would be in the form of perks that you get if you move in. A good example would be the one (1) month rental free perk given by a number of lessors. There are also arrangements where the monthly rental payment would cover payment for utilities like water, cable and trash collections. This saves you the trouble of not making the monthly payment yourself.

7. The best advantage so far, when it comes to renting is that – you will never be locked in a situation of having to endure the existence of obnoxious neighbors next door. If you do not fit, you just move out!

Rent to Own Options

On rent to own schemes, the buyer enters into an arrangement, where he rents a property now and is given the first option to buy that property in some period of time. The scheme would entail a couple of procedures.

1. The first would be the agreement between parties (buyer and seller) on the selling price. The option runs for around three years, wherein the buyer is expected to exercise that option. The monthly payment for this type of arrangement is higher than a straight lease contract. Usually, an extra amount for the option fee is forked out by the buyer/renter on top of the monthly rent. The added cost gives him the privilege of having this type of arrangement be granted to him by the lessor.

2. Under the rent to own arrangement, the option fee becomes part and parcel of the initial down payment if the option is exercised. If not, the option fee goes straight to the seller/lessor as bonus. The option fee corresponds to around 1 to 5% of the agreed selling price. It cannot be refunded.

3. Monthly rentals with rent to buy option are normally higher since you have to pay additional for rent premium. If the option is exercise, all lease payments including rent premium goes to the payment of the property. If the buyer is unable to close the deal, the seller gets the entire rent premium as additional gain.

Rental Option of Warehouses in Australia

As regards warehouses for rent in Australia, there are many choices.

1. One of them is the temporary warehouse rental that is in various sizes – length, width, and height depending on ones’ requirement. The rental period is from three (3) three months to five (5) years. This can be installed in your own backyard without need of having to get through bureaucratic permits from local councils. It can be installed quickly. Features would include, having sheet metal sides for better security. This type of warehouse has insulated panels with good thermal properties. The structure can be move around using forklifts. This type of facility can be used by electronic and manufacturing companies, among many others.

2. There are many other warehouse facilities around the six (6) states of Australia that have warehouses for rent. The rent would depend on the facility that is available like electricity, thermostat control and basic amenities such as availability of potable water. Other facilities like washroom, restrooms and proper ventilation for the area would increase the desirability of the facility to would be renters. The location is of paramount importance. The nearness to commercial areas would probably entail higher rental fees. Other consideration would be security, and nearness to shipping routes. The choice of what to rent depends entirely on the specific requirements of the renter.