The Real Estate Industry over the World - Assignment Example

Residential Property Project Customer Inserts His/Her Name Customer Inserts Grade Course Customer Inserts Tutor’s Name 8th June, 2012 Introduction The real estate industry operates in all regions of the world and in most cases several rules are used in locating the best properties in the world. The location, economic factors and other factors are utilised in the process of selecting and marketing a property. Land laws and regulations have to be adhered to strictly in the process of selecting and owning property in Australia. Home ownership has been on the increase in Australia and this has helped people acquire and build modern homes. Land ownership is controlled by laws such as land titling and every individual has a stake in the ownership of the land or property, he/she is interested in. Factors such as land title, location, amenities and the use of the property have to be considered in the process of purchasing land or property. Property Description The property under discussion is an apartment house located within Waymouth Street in the city of Adelaide in Australia. The property is located in a community estate along Waymouth Street registered under the name Jeanette Marie Carroll for the purposes of residency. The property is owned under a community ownership scheme whereby the overall land where the apartment building is located is communally owned by house owners. Whereby, the apartment building has one title while the apartment owners have been given allotment letters to show their joint ownership of the building’s title. The apartment is located within a residential estate in the city of Adelaide (Hyam, 2009). The apartment house is located within a high rise apartment building that overlooks most of the view in the Waymouth area. The apartment building is located in clean environment serving many residential property owners. Most of the residents are employed people who work in the city and are constantly in the pursuit for good careers. The area within the Waymouth area has been designated as a residential area for exclusive residential use. Location The location of the property is in one of the most urban regions in the world whereby the social setup is made up of small families. The Waymouth area is located within an estate of residential buildings where a lot of people live at. The area where the apartment building is located in served by different social and infrastructural amenities such as schools, sports club and churches. Most of the residents living in the area are middle income individuals who are single or have small families. The household structures of the people living in the apartment are young people with outgoing careers and spend less time within their houses. Few of these people use their apartment homes as their offices and meeting places (Griffin, 2010). The apartment building has been zoned within the capital city zone and it is served by adequate water and sewerage systems. The land prices from a recent valuation place the site value at $ 8,100 while the capital value of the apartment at $ 156,000. The land prices and value of the land has been on the upward trend within this region. The government has not designated the land within the apartment building for any specific use but the land has been designated as other use. Most of the properties within this region are located and used as residential, institutional residential or college/university accommodation. The location of the apartment building close to very strategic amenities and it use by many young people makes the apartment attractive to outsiders (Hyam, 2009). As a result, apartment houses located in this region have experienced increase in prices in the recent past. Land Description The land where the apartment building is located is within the city area and the land is used for the purposes of building residential homes and properties. The apartment building is conventional in design and its close proximity to the city makes the development of the land to be less costly due to access of infrastructure. The land where the apartment building is located is located 6 miles from the city with a flat topography that allows for a lot of activities to be undertaken. The topography of the land allowed for minimal development costs for the apartment property. Moreover, the soil and topography of the region can support any type of structure. This is witnessed by the high rise buildings and properties that are coming up in the area. The land under which the apartment is constructed is owned communally and therefore, the valuers and agents have prepared deeds for the acquisition and sale of the properties. Land rates and taxes on the property are paid out by the tenants and owners of the property. The neighbourhood around the apartment are other two apartments and a small maisonette estate some 50 metres away. The land allows for better views for individuals living high up in the apartment building. Building The building has been constructed in a conventional manner and it is still new having been built in the year 2009. Concrete was used in the construction of the building with a steel roof decking. The main space within each apartment is 25 metres square and all the houses in the building are either three of four bedroom apartments. The building is designed to allow of lighting to reduce energy consumption while most of the houses are designed with wide window panes to allow air circulation. This environmentally friendly design makes the building stand out and reduce harm to the environment. All the apartments in the building are served with an elevator and staircase ways that allow easy access into the building (Bryant, 2008). The stairway is accessible from all the apartment houses and it acts as fire escape or evacuation route for all tenants and apartment house owners. Moreover, the building has a secure underground parking lot for vehicles. The security has been enhanced by use of CCTV cameras to monitor the movement of tenants and visitors within the building (Griffin, 2010). Intercoms are used for communicating with house owners by visitors or the building’s caretaker. Maintenance and repairs to the building are done within a period of two years and this ensures the building still looks new. The building is also served with enough water due to overhead storage that keeps a lot of water for tenants. Within the building, provisions have been made for shop fronts to be leased out to serve resident with groceries or services such as laundry for all apartment house tenants. Site Features The location of a property has to take a lot of considerations when a person is purchasing or building a property. Apartment owners in the building are assured of good security since the Waymouth neighbourhood is served by street lights and access to police protection is easy. Access and movement from and to the city are easy since the apartment houses are located close to the city and it is served by major transport links. For instance, buses and trains to the city are closely located to the apartment house. The site also features good communication systems with most of the apartment houses having access to wireless internet and good telephone network. The site location of where the apartment building is located in a fairly flat land and therefore it is easy to evacuate people in case of floods, fires or other natural calamities. The building has been designed and constructed with use of concrete because of the Mediterranean climate within Adelaide (Bryant, 2008). The apartment site features houses with three or four bedroom houses with one bedroom which is master en-suite. The master en-suite has a bathroom with a Jacuzzi and shower. All the bedrooms have shelves to store the personal effects of all the house residents. The kitchen design is small and compact covering around 40% of the living room area and it is accessed through the living room. The living on the other hand is the largest room in the building and it has a balcony that presents a view outside the apartment. Other rooms in the building include a common bathroom and a lavatory. The house has a main storage room which can be used as a store or laundry room. Marketing Opportunity Real estate is considered a good investment by many experts and business people all over the world. As a result, we have to look into the value of property at any given time and moment. The apartment in which Jeanette is living in is good investment since she can easily market and sell the property. In this case we will look at appraisal of the property and the methods of sale of the property. Property Appraisal: The purpose of undertaking a property appraisal is to determine the value, costs, income potential over a long period of time. Within the appraisal we also look into the legal, physical and environmental factors that currently or in the future will affect the identified property. The apartment house presents an opportunity for real estate dealers to market the property based on several considerations such as location, price and value. The location of the apartment within the Waymouth area gives the apartment an advantage of it attracting good market prices since it is strategically located near schools, the city and many social amenities. As a result, the 2009 sale price of $ 195,000 that was paid for the property is a good price since the property prices in Adelaide city zones is set to increase in the future (Griffin, 2010). Since the property was bought more than two years ago, we see that the price of the property has appreciated by around 20 % cumulatively. i.e. (195,000 * 10) = 19, 500, then 195,000 + 19,500 = 214,500 (1st Year). Then the second year; (214,500 * 10) = 21, 450; Total price = 214,500 + 21,450 = 235,950. The current value of the house equals to around $ 236,000 based on appreciation alone. Moreover, the location of the property is safe and environmentally friendly and thus it could be challenging to estimate the cost of the property in the future. This is because is the city of Adelaide experiences growth then the property prices will go up otherwise the prices of the property might eventually go down. Current trends show that more people prefer to live in urban areas due to availability of many services. Environmental consideration will look into safety, natural disasters effect on house prices and location of properties. The flash floods that affected Melbourne in Australia cannot be affect the Adelaide area and this was established through the feasibility study conducted (Bryant, 2008). Method of Sale: There are various methods which could be used in selling this property in the real estate market. One of the methods includes selling the house on cash basis. The location, site and property description of the apartment house makes it an attractive for marketing the houses for sale or lease. The best method of selling the property would be through cash since the land title on this property allows for simple transfer of the property for cash. Another good method that would allow for Jeanette to sell the land is through a mortgage agreement. This method would easily net Jeanette more money in the long run. Using this method of payment, Jeanette being the real estate owner can contact her lawyers and bankers to arrange a mortgage agreement (Bryant, 2008). This agreement will take the consideration of how long the mortgage should exist, for instance the agreement could last for a period of eight years. The agreement will look into the monthly payment that Jeanette will earn from the agreement and the fees that will be paid to the bankers and the legal fees for property transfer (Griffin, 2010). Using this method of mortgage the new owner will pay monthly and this will earn Jeanette good income for an agreed period of years. Marketing and Advertising: Residential properties are treated like all other goods or services and they need to be marketed and sold. The marketing aspect of any property looks into the value and the preferred methods of sale. In the process of marketing any property we must develop a marketing plan and a budget. In this case, Jeanette Marie Carroll being the property owner will have to initiate the process of selling and marketing the property. The best process of starting a marketing plan is to decide the price which the house will be sold at. Moreover, we are going to be guided by the appraisal report and the methods of sale. From the appraisal report we get to see that the property in which Jeanette is appropriately worth around $ 236, 000 and the property earns around $ 3,000 in rental income in month. Using the information from the appraisal of the property we get to know that the property can be turned to good due to the value of the property. The marketing budget should consider several factors such as the percentage of the cost in relation to the cost of the property. For instance, the cost of the advertising and marketing the property should not cost more than 10% of the property value and this amount should represent around $ 23,600. The best marketing plan that could be used by Jeanette is to contact a good property agent who will advice her to advertise and sell her property. Making use of online real estate listing sites will enable her to get good contacts to sell her house. On the other hand, Jeanette could advertise her property in the newspaper so that it can get the notice from different and potential investors (Bryant, 2008). The best strategy to be used by Jeanette as the apartment house owner would be to market the house as an investment opportunity. Several investment opportunities exist for investors or speculators since the property is located within an area where land prices are high. The average price of the apartments is around $ 250,000 and this price is set to increase as prices of houses in this area are on the rise. Thus, this presents a good opportunity for real estate dealers and speculators to purchase land in this area. The apartment houses are served by good social and physical amenities and therefore investors can purchase the properties and lease or rent out the properties for a good rental income (Griffin, 2010). During the marketing of the property these factors should be used to market the house. Conclusion Real estate or house ownership used to a prestigious affair long time ago but today it is a necessity. Australian laws allow the ownership of land though different means such as land, Torrens or community land titles. Land or property is used for the purposes of residential or commercial concerns. Apartments are a new way to own property in Australia and in this essay we take a look at how land is owned communally in a residential or apartment building. Location, amenities and other factors are considered in the process of owning land or property. The building where the apartment is located has to be secure and the site has t be attractive to the potential investor or house owner. Apartment houses present opportunity for investors to make good money out the listed properties since apartment houses are in demand in major cities around the globe. Moreover, the demand and service of amenities make apartment buildings to be the best choice in terms of acquiring property. Marketing apartment houses for sale or lease is quite easy than modern townhouses. Moreover, the investment options available for acquiring or selling apartment houses are numerous thus we can conclude that Jeanette got a good deal in acquiring the apartment house. References Australian Property Institute, 2008, Australian property journal: Volume 36, Pelshiver, Melbourne. Bryant, M & Isbister, H 2008, Property, SAGE, Chicago. Griffin, J, 2010, Residential Construction Management: Managing According to the Project Lifecycle, J. Ross Publishing, New York. Hyam, A, 2009, The Law Affecting Valuation of Land in Australia, John Wiley and Sons, Sydney. Read More