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NEWSLETTER SPRING 2009 Powered By Docstoc
					       Contact Us: 059 914 3061
                                                                                                    Newsletter Date

          SPRING 2009
ISSUE:                    What a year for the property       peak of the market in 2006, con-      We are in a cycle, no-one can
Market Update        1.   market, not just in Ireland but    struction exceeded 90,000 units,      say with any degree of certainty
                          globally. There is an unprece-     this was never going to continue.     that we are nearing the bottom
                          dented level of confusion in       Our current housing stock is less     but that is the popular thinking
                          the reporting media and we         than previously forecasted by         among economists. In reality, if
First-Time           1.   are seeing first-hand the frus-    economists and only 19,000 units      we could establish that we are,
Buyers                    tration of buyers looking at the   were completed in 2008 with less      in fact, at rock bottom it would
                          moment. For that reason, we        expected to be completed in           be a huge source of comfort to
Mortgage             2.   want to instil some perspective    2009. These are well below pre-       buyers . Unfortunately, that
Matters                   and hope for buyers and sell-      dicted figures. As a result, even     knowledge will be retrospective,
                          ers out there that property        with lower take-up rates by buyers    we will only know after the fact.
                          transactions, albeit at a re-      and investors, surplus stocks of      For that reason, we urge buyers
Thinking of          2.                                      vacant properties should be largely   to make the assumption that
                          duced value and volume, con-
Trading Up?               tinue. In general, our national    depleted within a period of ap-       there will be further drops in the
                          demographics remain strong         proximately 24 months. In effect,     near future and to make provi-
Overseas             2.   and they support sustainable       the next two years will be an op-     sion for that while negotiating
                          demand for 40,000 new units        portune time for buyers before        current purchases, contact us
Properties                                                   sellers take control again by 2011.   for further information.
                          annually nationwide. By the
Investors: Benefit   3.
from confusion
                                                                                                       “We look
Commercial           3.
Property                                                                                               forward to
Buyers Broker Ltd    4.                                                                                welcoming you to
                                                                                                       our new
                                                                                                       offices at
                                                                                                       Shamrock Plaza,
                                                                                                       in the heart of
                                                                                                       Carlow town.”
 “Buyers, remember
 that you make your
 money on property        FIRST-TIME BUYERS
 the very day you buy
                          Great news for first-time buyers, you are offi-     that their employment is not heavily reliant upon
 - buy low and you        cially the mortgage lenders clients of choice!      vulnerable industries for example, construction,
 will manage the other    Property prices have dropped, competition           manufacturing and other industries perceived to
 variables.”              for properties (even bargain properties) is         be badly affected by the recession.
                          down, as are interest rates.
                                                                              Unlike investors, first time buyers should use all
                          Do not try to value the property using re-          financial resources available to them to the
                          search from sellers websites, remember that
                          those prices are merely optimistic. Also,           maximum while buying their first property in the
                          shop around to find now only the right prop-        current economic climate. Buyers, do not be
                          erty but also the right seller — this is crucial.   swayed by gimmicks or marketing incentives
                          Those of you employed in so-called                  offered by developers in place of real price-     “recession-proof” industries, in particular         adjusted reductions. Avoid developers’ price
                          nurses, teachers and members of An Garda            guarantee schemes, demand value… and then a
   Always on your side                                                        little bit more! Finally, the market is yours, but
                          Siochana will receive more favourable
                                                                              don’t be so eager to do a deal that you do a bad
                          lending terms. All others will need to show         one. Take advice and know your strengths.
N E W S L E T TE R                                         SPRING 2009

  Over the past 3 years     MORTGAGE MATTERS
  we have learned quite
  a bit from buyers.        The mortgage needs of buyers       mortgage and                       payments are frozen for a set
  We understand that,       have changed hugely over the       financial needs.                   period of time. After the agreed
                            past 12 months. The lending        Of particular relevance, Ambit     period of time has lapsed, the
  for some, house-          criteria of most banks and         can advise customers where         financial institution will
  hunting might be a        mortgage providers has also        one of the following occurs:       reschedule mortgage payments
  pleasurable hobby         changed. Levels of gearing,
                            which is the level of money        1. Reduction in work-week (to 3    to include the accrued interest.
  and negotiations a        borrowed in relation to the        days);                             Whether you are a first-time
  relished challenge!       purchase price of the              2. Made redundant at the work-     buyer, looking to re-mortgage
                                                               place;                             your home, reduce monthly
  For this reason we        property, are down significantly
                                                                                                  costs, or arrange finance to build
                            from 110% to 75% — 90%,            3. Financial difficulty and the
  have introduced a         depending on the type of prop-     need to get back to normal.        that extension, contact Margaret
  new advisory service      erty. For commercial lending                                          O’Gorman and the team at
                                                               Under the above circumstances
                                                                                                  Ambit Financial Services, M7
  for clients who wish      that figure may be further         there may be an option of
                                                                                                  Business Park, Naas on 045
  to source and             reduced. It has never been         converting a mortgage from
                            more important to seek profes-                                        883828 or visit the website on
                                                               capital-and-interest to an
  negotiate their own       sional, independent advice
                                                               interest-only mortgage,
  purchase with the         before securing finance.
                                                               therefore reducing monthly
  support of our            Buyers Broker is delighted to
                                                               repayments. Alternatively, it
                            recommend Ambit Financial
                                                               may be appropriate to apply to
  experienced buyers        Services, who offer customers
                                                               the Financial Institution for a
  agents. Buyers            a one stop service for all their
                                                               moratorium period whereby
  Broker will
  independently advise
  buyers on their                                                THINKING                  OF TRADING UP?
  selected properties                                            We strongly urge buyers that        We also remind people in this
                                                                 are involved in a chain i.e.        position that 20% reduction
  and expertly guide                                             needing to sell before you buy,     in the selling price of their
  them through the                                               to call a halt to all house-        home may not be sufficient,
  offer process.                                                 hunting until you have              25 - 35% may be more realis-
                                                                 contracts signed on your            tic, depending on the property
  Contact:                                                                                           and area in question. Then,
                                                                 existing property. Yes, there                                           are amazing deals, particularly
                                                                                                     as a finance - ready buyer at
                                                                                                     the upper end of market, you
  or phone 059 914 3061                                          at the higher end of the residen-   will be in a position to secure
                                                                 tial market, however, until you     a greater level of discount for
                                                                 are free to buy, very few ven-      your new property and we
                                                                 dors will enter into serious ne-    look forward to helping you
                                                                 gotiations with you and you will
 “Investors, do not                                              not be in a position to find out
                                                                                                     maximise the value you get
 make assumptions                                                                                    for your budget.
                                                                 their “bottom line”.
 about your borrowing
 capacity , all the rules
 have changed. Talk         OVERSEAS PROPERTY                                                    “Just imagine if we could
 to your lender and be                                                                           show you how to invest
 prepared to pay up to      In October 2008, in response       them. Most importantly, we
                                                                                                 your money BEFORE you
                            to client demand, Buyers           undertake due diligence in
 25-30% of total trans-     Broker Ltd. launched it’s                                            pay tax and then imagine if
                                                               addition to the proffered
 action costs upfront       overseas service.                  documentation and use             we could ensure that, for
 in cash.”                  Our dedicated overseas             local, real market informa-       the duration of the invest-
                            agent will independently           tion to extract the actual        ment, neither income nor
                            source, negotiate and              return on investment and          capital gains tax (CGT)
                            acquire quality investment         likelihood of capital appre-      would
                            properties on behalf of            ciation over a period of time.
                            clients . As we do not sell        If you need practical, inde-      apply …”
                            property, we are well placed       pendent and non-product       to objectively compare the         focused advice on overseas
                            various investment products        property investing please         Well, imagine no more,
   Always on your side
                            available and independently        email us on                       just contact us on
                            advise clients on the best for for
                            performing investment for          further information.
   N E WS L E T T E R                                       S PR I N G 2 0 0 9                                                      Page 3

                                     Right now there are many dis-          Talk to your lender and be
                                     tressed sellers who need to dis-       prepared to pay up to 25-30%
                                     pose of properties immediately         of total transaction costs in
                                     and for that reason, they are          cash. In effect, there is a glass
                                     willing to accept a significantly      ceiling of 75% on Residential
                                     reduced price (well below              investments. Mortgage provid-
                                     “current value” - if, in fact such a   ers will look to repayment
                                     thing can be ascertained). These       capacity from personal and           “The same winds
                                     opportunities tend to present in       investment income further-           blow on all of us, the
                                     apartments. Houses continue to         more; the lenders will assess
                                     prove a better long term invest-                                            winds of market
                                                                            the security and continuity of
                                     ment (a fact that the Irish inves-     that income.
                                                                                                                 forces, the winds of
                                     tors have long since suspected)
                                                                            We are advising investors to         taxation, the winds
                                     but if you can secure a well lo-
                                     cated apartment, realistically         focus on areas where you have        of economy. All of
                                     yielding upwards of 6% - 6.5%          control. The old adage is a          them blow equally
                                                                            good one - you make your
                                     then re-evaluate your thinking. In
                                                                            money on the day you buy – so        on everyone alike
                                     particular, if the last 12 months
                                     have left your portfolio in a vul-     buy low. Since early 2008, we        but whether you
                                     nerable position then a low            have seen a change of strategy       harness the wind to
                                                                            from short to medium and long
 After fifteen years of
                                     value, high-yielding property can
                                                                            term — which is historically the     take you into port or
                                     boost income and compensate
 positive growth, the                for other properties. This will        most successful strategy for         whether you simply
                                     help you to convince your lender       property investing.                  allow it to blow you
 last year has left many                                                    There is increased competition
                                     of your abilities as an investor.                                           onto the rocks is
 investors reeling.                  Do not make assumptions about          for limited available credit; this
                                     your borrowing capacity - the          means that only the very best        down to one thing
 Where to next?                                                             investment deal proposals will       alone—the set of
                                     rules have changed.
                                                                            go through.                          your sails.”
                                                                                                                         - Jim Rohn

Many residential investors     tionwide, greatly discounted
who ventured into the com-     prices (up to 45% and count-
mercial arena in recent        ing) and not forgetting the
years now find themselves      reduced stamp duty rate from
in a much stronger position    9% to 6%! More importantly,
than investors with a purely   up to 75%commercial credit
residential portfolio.         for owner-occupiers is still                                                       “There has
Having said that,              available to business owners
                               with strong personal income                                                        genuinely never
speculative investment in
commercial property is not
                               and this can be backed by a                                                        been a better time
                               pension mortgage fund to
winning the support of                                                                                            to purchase a
                               maximise tax efficiency.
mortgage lenders right now.    For residential investors look-                                                    commercial
unless it is yielding in       ing to acquire commercial
excess of 6% p.a. and          investments below €1 million,
                                                                                                                  premises for leasing
backed by a financially        there is limited credit avail-                                                     to your business…”
strong applicant. There is     able to fully or partially
some good news for small to    tenanted deals and we cur-
medium-sized business          rently have access to a num-
owners who currently lease     ber of off-market deals in rural
commercial premises for        cities and large towns nation-
their business. There has      wide. Subject to exceptions,
genuinely never been a bet-    we are not advising clients to
ter time to purchase a
premises for leasing to your
                               pursue speculative Invest-                Contact us on                 
                               ment at this time, particularly
business due to unprece-       in over-developed rural areas.           059 914 3061 for                          Always on your side
dented stocks of commer-
                               Think strategically about
cial units available on, and                                           more information.
indeed off, the market na-     location, do your homework!
NEWSLETTER                                                  SPRING 2009

Contact Us:                  Buyers Broker News
Buyers Broker Ltd.,
                             Dear Clients & Colleagues,
Main Street,
Baltinglass,                 2008 was an exciting year for Buyers Broker and for property buyers agents in Ireland, it was a
County Wicklow.              year of extreme highs and lows. We experienced such a shift in the market, in favour of prop-
                             erty buyers, that we were able to secure the very best deals for finance-ready clients.
Telephone:                   Since we first opened our doors in early 2006, the range and quality of our services have evolved
059 645 1927                 and continue to evolve to meet the changing needs of buyers and investors. Knowledge is the key to
Email:                       successful investing in the current climate. In this regard, we have recently launched an advice-         only information service, please contact us for further details.
                             Also, we are currently updating our website to facilitate greater levels of traffic to the site and to
Also at:                     enhance the quality of interactive communication and information available to our clients. Any
                             feedback and suggestions from clients will be greatly appreciated.
Buyers Broker Ltd.,
Suite 13B,                   We proudly launched our buyers’ agency franchise (below) and it is hoped that you will soon be
Shamrock Plaza,              able to find us in every town you pass through!
Shamrock Square,
Carlow.                      Finally, 2009 is set to be a challenging year for the property market and Buyers Broker is fully          committed to meeting this challenge head-on. As founding members of the Association of Prop-
                             erty Buyers Agents in Ireland (APBAI) we will be supporting various media, state bodies and
059 419 3061                 professional representative organisations as they lobby for accurate data collection and reporting.
                             We feel that this is extremely important to our work with buyers and will benefit all parties to a
Email:                       transaction. We look forward to meeting your properties needs throughout 2009 and beyond.
&                                                                  Kind regards,
                                                                             Carol, Orla & the team at Buyers Broker Ltd.

 Building Energy Rat-
 ing (BER)                    Franchise Opportunities
                             Buyers Broker Ltd. was the first buyers’ agency in
                             Ireland to operate a full range of services for all
 As of 1st January 2009,     classes of property buyers, from first-time buyers to
 every dwelling must be      commercial investors, nationwide. The property
 assessed prior to sale or   market has changed dramatically since our incor-
                             poration three years ago and our well-considered
 letting. Log onto:          services have evolved along with it.
                             In 2008, Buyers Broker Ltd. launched Ireland’s first
                             property buyers agency franchise offering a fantas-
                             tic opportunity to train with some of Ireland’s
          Or                 primary property buyers agents and to build your
                             own business, based on a realistic and sustainable          business model. We operate a long term franchise
                             strategy, whereby a lower initial franchise fee is
                             charged, making the success our franchise
                             business largely dependent upon franchisee
                             turnover. Effectively, we do not start making        money until you do!
   Always on your side       Those interested in franchising through Buyers’
                             Broker Ltd. should email
                    for further information
                             or contact 059 419 3061.

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