Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMA lovely listener, Zak has written in to the the Trio. He and his partner have worked hard as young professionals and have acquired two properties; each with high 80's LVRs. One is a boutique apartment in Melbourne's leafy inner south/east, and the other is a character brick house in beautiful pocket of Ballarat. But despite their strong incomes and dedication to their financial goals, their borrowing capacity has precluded them from further investing for now. The question he has is, "how is it that some individuals (often in their early to mid thirties) are able to amass large portfolios of (say) 10+ properties?"Can it really be done, or is it a mirage?The Trio enjoy unpacking this one. Dave starts with some possible explanations for how these young multi-property portfolio investors manage it, and he also shares some interesting data direct from the ATO about the percentage of multi-property investors. Scarce indeed!"Let's talk about the psyche of someone who wants ten-plus properties". Cate sheds light on what drove her to pursue a quick succession of investment property purchases when she was younger. Mike leads the conversation around ego-metrics too.The Trio challenge some of the mirages out there that investors claim as 'investments', and Cate talks about the headache factor of a large portfolio, particularly when she considers upkeep on interstate holdings.Mike challenges Dave to share some of the alternative financing sources that our listener duo could consider to break past their borrowing capacity constraint. Dave delves into cashflow and buffers, and he talks about risk and where it is relevant when it comes to multi-property investors.Dave and Cate agree on one key ingredient that can certainly optimise an investor's chances of attaining a multi-property portfolio... and it's time.Lastly, our gold nuggets…… Mike Mortlock's gold nugget: Forget the white noise! Just stick to the simple stuff. There's no tricks. Set a plan based on what you want your retirement to look like.Dave Johnston's gold nugget: Work out how much passive income you need for retirement (in rent), work out the total property value you are aiming to purchase, and consider the number of properties that this represents. Shut out the superfluous noise and don't worry about what others are investing in.Cate Bakos's gold nugget: Time is your best ingredient, so don't sit around waiting to jump into property. When you can, you should.Show notes: https://www.propertytrio.com.au/2023/12/11/unravelling-the-mystery-of-how-investors-amass-ten-plus-properties/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMWhat does it take to become a great strategic mortgage broker?"You need to listen with intent", says Dave. There is so much more to effective mortgage broking than just having a good grasp of numbers and a sharp recall of loan products.The most successful professional advisors ask seven times more questions than the average advisor.Cate weighs in with a comment about how a good advisor can deliver an answer. She also talks about the privilege of being a trusted advisor. And Cate doesn't worry about scripts and dialogue. It's all about listening and asking the right questions.The ability to notice body language and the EQ required in a role like this is intriguing. Tune in to hear more!Why is mortgage strategy so much more important than rate? Dave runs our listeners through all of the important considerations in the mortgage strategy.What are some of the technical skills required to be a SMB (strategic mortgage broker)?Mike challenges Dave about the Royal Commission and the change in legislation for Responsible Lending. Dave sets the record straight! And he shares some good stats too. Cate and Dave discuss the broker commissions and the practical reasons why SMB's maintain good, ongoing relationships with their clients.Dave and Mike discuss the processes required to mitigate the consumer's risk when it comes to deposits and settlements. Deadlines and clauses govern a lot of tasks, and attention to detail is critical. Dave shares some of the worst case scenarios.Lastly, our gold nuggets…… Mike Mortlock's gold nugget: Mike recalls witnessing mortgage brokers and accountants arguing about add-backs and servicing calculations. This early awakening showed Mike the value of a good quality mortgage broker.Dave Johnston's gold nugget: Dave reminds listeners that he has hardly mentioned interest rates in this episode. Strategic mortgage broking goes so much beyond rate.Cate Bakos's gold nugget: "If you win them on rate, you'll lose them on rate". Cate relays an important message about the importance of looking beyond offering the cheapest rate.Show notes: https://www.propertytrio.com.au/2023/12/04/unveiling-the-secrets-of-elite-strategic-mortgage-brokers/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMCate talks candidly about buyer's agency and how she found her way into this space. Is a university degree essential? Important? And what other past experiences help a BA on their journey? Tune in to find out.Mike also speaks about some of the impressive BA's he's met and interviewed, and he considers the importance of analytical skills, soft-skills and diverse backgrounds. The Trio ponder the challenges of adapting to BA-life. From long/late hours to liability, deadlines to negotiation pressure, the role is nothing short of dull. As Mike says, "It's nowhere near as glamorous as it seems."What extra skills can give BA's an edge? Great question, Dave. The Trio move on to buyer's agency training."It's not the piece of paper you want, it's the knowledge." Cate shares her thoughts on some of the pathways that BA's can learn. She also talks about specific past roles that will be complementary for aspiring BA's.The Trio tackle the training backgrounds and previous jobs that can be problematic for new BA's. Can leopards change their spots? It's an interesting debate.Cate shares a short experience she had when she was in 'gardening leave' in a government organisation and she draws upon the disparity between that role and the world she works in.And Mike reminds Cate that she was a rubbish dining companion when her clients called during a work dinner. Dave dares to ask Cate about some of the short courses available that concern her. Tune in to hear more! Lastly, our gold nuggets…… Mike Mortlock's gold nugget: Mike splits his answer into two. For aspiring BA's, they really need to take the training seriously. He cautions people to do a lot of research. And for consumers who are looking to select a buyer's agent; put a great checklist together and be prepared to quiz them hard.Dave Johnston's gold nugget: Dave feels consumers should ask for a BA with at least two years' experience in a BA firm. Cate Bakos's gold nugget: #askforexperience Shownotes: https://www.propertytrio.com.au/2023/11/27/becoming-a-buyers-advocate/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMMike has prepared some industry-first data and the Trio deep-dive into it for our listeners this week.Dave's overview of this special city spans it's impressive performance of late, and the uniqueness of Perth when it comes to the house to unit ratio. Mike also weighs in with some interesting history about WA's quest for independence. 66% of Western Australians voted to leave the commonwealth in a 1931 referendum, but for technical reasons, the vote didn't initiate change. The mineral wealth stands WA disproportionately from other states in terms of federal funds allocated per state and territory, and Dave delves into the state budget and the revenue generated by WA. With WA accounting for half of the nation's exports, this important statistic is very telling when it comes to understanding what drivers influence markets.Mike's data compared Q1 2022 to Q1 2023 and found that WA had moved from the 4th most popular state for investors to 2nd in that 12 months. In real terms, it was a 22.49% change in favour of WA with every state except the ACT declining in favour over that period. WA represented 9.38% of all residential investor activity in Q1 2022, and jumped to a whopping 22.49% in Q1 2023 second only to QLD at 37.97%. Despite this recent renaissance, Cate reminds listeners that for the 14-year period starting 2007 to the end of 2020, the Perth property market essentially stayed flat. At the start of 2007 Perth had the highest median house value of Australia’s eight capitals, and at the end of the next 168 months, it went nowhere, while house values actually doubled in Sydney. Mike's insights into population changes are fascinating.. tune in to find out! Reading the iron ore crystal ball is no mean feat, but Dave shares his outlook. The Trio share their concerns for investors who are rushing in without understanding the volatility and drivers of a market like Perth. Timing the entry and exit is never an easy thing to do. As Dave points out, an over-reliance on mining is a risk.Lastly, our gold nuggets…… Mike Mortlock's gold nugget: It's important to be heavily researched on the location as best you can. Thinking about resale and retirement should be a key consideration also.Dave Johnston's gold nugget: "The most important economy to be across is your own economy. Ultimately you need to make decisions that are right for you." Cate Bakos's gold nugget: The tyranny of distance needs to be factored in to any investor's interstate purchase decisions. Long term buy and hold plans need to be consider the maintenance burden that long distance renovating can create.Show notes: https://www.propertytrio.com.au/2023/11/20/perth-property-gold-rush/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMThe October data has Perth leading the chart, but as Dave reports, the mid-sized capitals are the capitals that are showing us the strongest results. There is a correlation between growth and listing rates though.Listings have jumped in Spring for Sydney and Melbourne, supporting Dave's correlation theory. Cate identifies data integrity issues, citing Hobart's data as an example. All it would take is a disproportionate number of listings at either end of the market to skew a data set in a city as tight as Hobart.The Trio ponder foreign buyer disincentives and taxes, in particular the impact on Australia with other countries applying new taxes and restrictions. Dave notes the rate of immigration Australia is currently experiencing and notes that it's at an all-time high, hence putting additional pressure on housing. Yet, as Cate says, we need more people in this high inflationary environment to assist with providing services. Such a difficult balance!Are the mid-cities thriving because they are more affordable right now? And what impact is the return to the city by the tree-changers and sea-changers having on the data? Cate explains... Cate shares some insights into investor-led sales, and she also talks about which buyers are soaking up these investor sales. Check out our Resources below for more. No real respite in store for renters in most cities, unfortunately. The Trio note that the vacancy rates are as low as they've seen in their time. At this stage, there is no real stimulus on the horizon that is likely to change this issue for renters. Dave cites some scary stats. But as Cate points out, household formation rates may return to former levels as house-sharers re-band, young adults move back 'home', and singles re-partner.Listing activity is up nationally, but the Trio discuss the drivers for this, the differential compared to past years, and the overall resilience of the market.Mike wonders whether the number of Perth sales could be initiated by vendors who have been practising Loss Aversion. Are they happy to sell, now that values have finally returned? And the opposite of Loss Aversion is a Distressed Sale Cate and Dave point out the fact that the states that the media report are 'in crisis' are not showing large numbers of distressed sales, relative to total listings.In Mike's words, "Media beat-up?" Maybe. Total housing lending fell 7.8%, but it's still 1.5% higher than a year ago. The 'mortgage wars' we saw in past months are not quite as rampant as they were. Dave proposes we'll see some competition in refinances.Will APRA bring down the buffer? Tune in to hear Dave's thoughts....And... time for our gold nuggets... Cate Bakos's gold nugget: New listing activity for the remainder of the year..... most markets slow down for Christmas break. So, for anyone who is thinking that 2023 has a few exciting listings to come out; we only have a couple of week's new listings remaining.Dave Johnston's gold nugget: It's a good buying time in Melbourne and Sydney with rising stock levels. Dave feels that this 'purple patch' opportunity for buyers will continue. Show Notes: https://www.propertytrio.com.au/2023/11/13/ep-231-october-market-update/

Got a question for the trio? https://forms.com//form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMA great listener question prompts today's show. Sam writes;"We brought our 4 bed 2 bath mid century family in Greensborough area in mid 2021 for 1 mil approx. Since then the price has fallen then risen, and generic real estate apps pricing it at around the same value. The house is older style, has good bones but over time we would love to undertake a moderate renovation. The property is in a good family friendly/school zone, and with the right modifications there is immediate reasons to move from this property. We are getting close to 80%LVR, which I understand is a threshold for accessing finance. The original plan was to build our plan out with two more 600k investment properties."From accessing equity to balancing investing versus renovating, Sam has a handful of great questions for The Trio.Dave unpacks the question about unleashing equity."Cash-Out" loans are something they could consider, and as Dave explains, equity access isn't limited to those borrowers who need to stretch to 90% loan to value levels. The question of mortgage insurance is an interesting one, and both Cate and Dave share some interesting insights, along with some exciting new loan products to suit today's market. The mechanics of accessing equity can vary. Dave explains how investors can sensibly approach this task, from examples, process steps, and timeframe expectations. The important point Dave makes relates to renovations, though. And how many listeners have heard of "as-if complete" valuations? Dave and Mike share some special tips.Investment versus lifestyle conundrum is something that strikes often, and Dave works through some of the questions that investors need to think through. Cate debates where she would invest the money.Cash-outs versus progressive drawdowns... Dave walks our listeners through some of the options. And is there a magic number for LVR's and equity access? Tune in to find out.Lastly, our gold nuggets…… Mike Mortlock's gold nugget: Identifying the strategy is essential. "Ruthlessly efficient decisions!" And Mike shares "SIC Building syndrome".... something to google!Dave Johnston's gold nugget: Some situations warrant a good property plan, and Sam's questions could constitute this. Informed and educated decisions are the best decisions.Cate Bakos's gold nugget: CMA's are just automated valuation tools that can sometimes get things horribly wrong. Algorithms can't always recognise important factors. Getting a proper appraisal with some science backing the data up is a great approach when working out what a property is genuinely worth. Show notes: https://www.propertytrio.com.au/2023/11/06/listener-question-renovate-or-invest/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMCate kicks off the episode with some quirky title types that can be sometimes found for apartments. Particularly when considering an Art Deco era apartment, buyers need to brace themselves for Company Share and Stratum titles. They are generally cheaper products, but they come with danger for some borrowers. Cate explains the differences between these types and she expands on why buyers need to exercise caution when deposit funds on hand are less than 40%.Can Stratum and Company Share be converted to Strata? Yes, indeed they can, but it's not always straight forward and it's often more than the mere cost of the legal fees and the subdivision.Dave discusses the options that buyers have when it comes to lending policy restrictions for apartments. Small apartments can wreak havoc for some borrowers, as can apartments with commercial zoning. Dave ponders whether zoning will be altered for office spaces that are being converted to residential products. Mike's high rise apartment case study is alarming; and it goes to show how rules can be changed within a development. Owning an apartment in a complex is nothing short of complex! Cate talks about the elephant in the room; strata fees for off the plan apartments. It's a must-listen! Dave opens Pandora's Box when he asks Cate about the risks of high rise, high density properties. From cladding issues to to Air BnB issues, car stackers, special levies and location woes, Cate drags out her laundry list. Cate details what it is she loves about boutique blocks. The list is broad, but downsides do exist. Tune in to find out! And... what do you do if pets aren't allowed in an apartment block? Lastly, our gold nuggets…… Mike Mortlock's gold nugget: Too many investors think that low strata fees are attractive, but they need to think about their sinking fund schedule and the long term cost of ignoring important things. Cate Bakos's gold nugget: Cate also chats about low strata fees. It's a bit of a Goldilocks conundrum. Too low, or too high... there is a sweet spot when it comes to strata fees.Show notes: https://www.propertytrio.com.au/2023/10/30/all-things-apartments-part-2/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMThe Trio kick off this exciting ep by defining where apartments sit in the unit subset, and Dave shares with the listeners his favoured types of apartments. Some of Dave's criterion paves the way for a high-scoring gem... he shares some valuable must-haves and nice-to-haves. Highly sought-after, great allure, attractive land to asset ratio and unbeatable locations! Dave shares some startling facts about the recent historical capital growth performance of apartments versus houses. Core Logic did a study in August 2022 for the last thirty years across the two data sets. While the data showed that combined capitals exhibited 450% growth for houses, while units only clocked 307%, and for regions the house data set tracked 314%, and units, 213%. Cate discusses some of the reasons for this relative underperformance and she also chats about the mistakes that some have made in the past when they were aligned to one geographic base and ignored other gentrifying options with strong growth drivers. As Mike says, "Blue chip or bust? It doesn't make sense. Their model doesn't have flexibility." Will the older style apartments bounce back? Only time will tell, but Cate discusses the 'apartment renaissance' that she's noticed of late, particularly with an aging population. Mike cracks into the 1,000 Assets Study, specifically a trip down memory lane since 2016. Initially 47% of their investor study were purchasing units. Into 2018/2019, it dropped to 40%, and following this, a huge drop-off surprised Mike, with a recent figure of 18% recorded. Mike puts this down to a few factors, including the pandemic, horrific building defects and cladding issues, and the evolution of investor education. This, coupled with the increasing number of units per building has translated into heightened apartment avoidance for many investors.Unit complexes are getting bigger and the average count of apartments per building has risen from 61 to 110 over this period. Buyers do tend to red flag huge developments, particularly of late. "Your job is to help them grow wealth, not to save them tax" is one of Cate's sayings when it comes to accountants recommending new properties. Cate shares some of the common reasons why buyers have been more fearful about some apartment subsets in recent years. From off the plan risks to lender appetites, there are a few alarm bells that listeners should pay attention to.But the Trio talk about some of the positive changes they've seen across developments and designs of late. Cate talks about the elephant in the room; strata fees and expensive special levies. It's a must-listen!And Mike treats our listeners to a chapter on the Rental Loss Index and their subsequent study. From oversupply to high vacancy rates, this insight is particularly powerful for investor insight. And our gold nuggets……Cate Bakos's gold nugget: Cate takes a leaf out of the Property Professor's handbook. She urges investors not to purchase off the plan, high-rise apartments.Mike Mortlock's gold nugget: Mike reminds listeners that not all units are bad! They can also have a decent Land to Asset Ratio. Show Notes: https://www.propertytrio.com.au/2023/10/23/all-things-apartments-part-2/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMThe September data throws us a few mixed bag items!Dave shares his takeaway: listing levels and an interesting correlation. Cate identifies the eighth consecutive month of national price growth, and she draws listener attention to capital cities versus the regions. The Trio ponder the power of commuting distance to major cities.Is there a sweet spot ratio when it comes to listing volumes and price movement? Mike ponders... tune in to find out.What's happening with rents? And why is the pace of growth easing in so many cities? Household formation rates are changing and this is having an impact on rental growth. Cate shares a bit of insight into a recent journalist interview about this very topic. She also talks about the specific challenges within the rental market when it comes to families.On a related topic, Dave points out the pre-COVID, post-COVID and historical average rental vacancy rates and it's a particularly telling reflection. The Trio canvas the pace of this change and contrast today's yields to past decades. Things have evolved remarkably for investors over the past decade."Time is your most powerful ingredient when it comes to yield", says Cate.Cate shares a Core Logic chart with Mike and Dave; it illustrates the importance of looking longer term at any city's performance. Both Perth and Hobart demonstrate opposing performances when 12 month versus ten year charts are contrasted. Some cities and regions are particularly cyclic and investors need to be aware of this.And finally, consumer sentiment; as Mike says "there's green shoots!" The major household item figures have notched back up above last month's dip. Have four consecutive months of holding rates contributed to a greater willingness to spend again? Dave has some great state-based figures to cite also.Housing finance is an interesting chart to ponder. Mike and Dave debate the impact of rates on hold, and Dave points out that the mix of owner occupiers to investors remains quite the same as recent historical levels. Importantly, he points out reductions in building costs.Related to decreasing costs, Cate includes the Freightos Baltic index in this monthly update.Dave and Cate pick out some of their most noteworthy segments from the September data... Listen in to hear what each spotted. Dave notes core inflation was down, yet headline inflation increased. This suggests that the markets could be anticipating another rate rise. What is this attributable to? Services, insurances and transport are among a few. Services inflation remains an inflationary problem. And... time for our gold nuggets... Cate Bakos's gold nugget: Cate shares context around the Freightos Baltic index; a whopping 62% reduction this week, compared to the same week a year ago.Dave Johnston's gold nugget: We're likely to hit our record market high again within a month or so based on the data and the rate of growth through 2023. Show notes: https://www.propertytrio.com.au/2023/10/16/ep-227-september-market-update/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMThe Trio enjoy fielding this second question from a loyal, long time listener, Alison. Only last year, Alison reached out to ask the Trio to weigh in on a stay/move question. Alison and her daughter were living in a recent purchase on the inner-side of Melbourne's Nepean Hwy, but missed their days by the beach in their former home. Alison had purchased a four bedroom townhouse on 'the other side', but aside from missing her beach life, she also found the home was too big for their needs.The Trio encouraged her to make the move back to their old stomping ground, and Cate recalled some of her happy days in her old 'hood in beachside Mentone too. Alison, now 47, took the plunge this year. She rented out the four bedroom townhouse and purchased a three bedroom unit back on the beach side of Mentone.This time, she writes to the Trio to ask about their thoughts on whether she should retain the four bedroom townhouse, or whether she should sell. With all of the changes to land tax and possible changes to planning laws, ongoing rental reforms and heftier interest rates, Alison is feeling a little bit nervous and wondering what the Trio think. She notes that her large townhouse is projected to be cashflow neutral in six years, but she is also mindful of the pressure she faces as a sole bread-winner. She is also managing a property in the Bass Coast and while her long term intention is to retain this property into retirement, Alison throws out the question to the team about her entire portfolio. "Do I hang on to the 4 bedder and wait until it has enough value to clear my ppr mortgage? Or should I hang on to it for the longer term- past 6 years until it is earning me money? I know it won’t be for a long time." First and foremost, the Trio congratulate Alison on her achievements and in particular, her ability to pivot quickly. According to the Australian Landlords Association, landlords own more than 80% of rental properties. Despite this significant contribution, it often feels like landlords are somewhat overlooked (and in some cases, trampled on) in discussions focusing on the challenges facing renters. Dave starts with Alison's property planning and shares some astounding projections. Alison currently owns $2.92 million worth of property at age 47. If Alison is able to hold onto these assets over a long term growth rate of 5% per year, by age her wealth position will be as follows:60 - $5.36m65 - $7m70 - $8.8m80 - $12.94mThis gives listeners a glimpse into the power of time. Dave also delves into debt retirement and timeframes for cashflow neutrality.... tune in to hear more.The Trio then step into Alison's future rental returns and they also consider the necessary evils; land tax and other taxes. When it comes to property portfolio management, knowledge is power, and cashflow is king.Dave's overview is valuable and his preference for targeting capital growth assets comes to light in this listener Q&A. Tackling interest costs, short term cash shortfalls and buffers is a popular theme for this gripping episode, but what Cate shares in relation to rental growth is important for Alison to take note of. Like a strand of DNA, the rent does broadly grow in line with the rate of capital growth, but not always in perfect synchronicity. Gross rental yields are typically elastic, and Alison can look forward to enjoying long term rental growth at the same rate as her capital growth rate.From selling Bass Coast to selling the townhouse, holding all and working hard for more years, the Trio each share their thoughts, pro's and cons, risk mitigants, and they each give Alison some good food for thought. No divestment decision is easy for investors, and Alison gets three points of view in this Listener Q&A ep. And our gold nuggets....Mike Mortlock's gold nugget: Mike shares a carrot and stick analogy. The stick is the tax, but the carrot, (the capital growth) is harder to focus on because the stick can hurt. It's important to remain objective. Dave Johnston’s gold nugget: "The starting point for any successful property plan is understanding the numbers and the long term implications for any options and choices that you have in front of you." Cate Bakos's gold nugget: Cate uses a real-life, personal example to share with listeners the power of time. Show notes: https://www.propertytrio.com.au/2023/10/09/sell-or-hold-listener-question/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMMike bravely delves in to mortgages.... and dares to ask whether the mortgage cliff is a threat to our property market.Is it a beat-up? Or is it something we should be bracing for? Dave mentions the Y2K bug and questions the power of fear."Miliions on Mortgage Cliff" is a headline Mike cites, and he plans to challenge the magnitude quoted.Mortgage stress, mortgage delinquencies and timelines are on Mike's discussion list.Firstly, Dave explains the concept of the fixed rate cliff, and sheds light on what is is that the media have many gripped with fear (or hope) about. It essentially hinges on a large volume of exceptionally cheap loans that are coming out of fixed rate and re-adjusting to today's variable rate. For many borrowers, their holding costs will be considerably higher this year. However, the Trio are determined to uncover the numbers, the percentages and the truth about the fixed rate cliff claims.Cate ponders why more people didn't fix during the pandemic and finds a good bar-tab comparison."The determinants of mortgage defaults in Australia; evidence for the double-trigger hypothesis" is a paper that Mike stumbled across. Jokes aside; negative equity is strongly correlated with whether a loan is in arrears. The Trio define and unpack this for our listeners.From high LVR loans to reducing credit, Cate and Dave ponder the impact of regulator intervention. Dave points out that global economies vary greatly, and the pair share some examples of past lending practices that are not so commonplace today.While Mike has some fun with the special effects and the audio bleeps, Dave gets serious about shedding light on the real numbers when it comes to mortgage arrears. Rising property values and regulatory control over credit have certainly shielded our nation from broad arrears.Mike shares some stats and it's a compelling data set. Tune in to find out more... Cate asks Dave about refinancing activity. Despite the value of new lending deteriorating, the rate of refinancing is HUGE. The value of external refinancing is up a massive 21% over the last year. What are the reasons? Dave expands... it's intriguing to hear first-hand from a business owner about the behind-the-scenes of a mortgage broking business during COVID."Mike, the numbers seem large..." Cate quizzes Mike about some of the stats quoted in relation to the expiry of fixed rate loans and Mike puts the numbers into perspective. It's a must-listen!The vast majority of lending is on variable rates and Mike's numbers-brain looks over the data and contrasts it to the claims. "There's a lot more to be positive about than the media lets on".Cate considers the plight of first home buyers who were not entirely prepped for higher interest rates, and she points out that two per cent was never sustainable."One third of people have a mortgage, one third of people have paid off their mortgage, and one third rent". And Dave's overview of ASIC's position and the non-bank lenders is intriguing.We hope our listeners have gleaned some good insight from this ep.And our gold nuggets…… Mike Mortlock's gold nugget: While some new variable rate mortgage holders will be feeling some pain, spending is moderating and Mike holds hope that the 'mortgage cliff' is a bit of a beat up. He believes that rate cuts are likely to be around the corner. "It's not a cliff... that's my summary.'Dave Johnston’s gold nugget: Dave also feels that it's not a cliff either. It will likely have a 'slow tail' and there will be some pain, but not so much in the owner occupier residential market.Cate Bakos's gold nugget: Overall, there will be a mortgage cliff for some individuals, but Cate doesn't think that there will be advantageous buying conditions as a result. We have to consider the other forcefields; new arrivals (skilled migrants), a rapid increase in rents, and we also have to consider the impact of inflation on property values, and lastly; confidence from high employment.Show Notes: https://www.propertytrio.com.au/2023/10/02/breaking-into-buyers-agency-2/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMToday's listener question opens up a very popular discussion topic.... buyer's agency. James writes in to ask the Trio about a change of career... from carpentry to Buyers Agency. He's unclear of the pathway into the industry and he's keen to know how to be a great Buyers Agent. Cate shares some information with our listeners, from state/territory based qualification requirements to online groups and portals. Firstly, Cate steps listeners through the training and licensing regimes in Victoria, separating out the formal classroom training from the 'apprenticeship'. The difference between a regular Buyers Agent and a great one comes down to dedication, mentorship and commitment to learning the technical skills required.The Trio discuss some of the barriers to entry and the challenges that budding Buyers Agents face; from study to the difficulties of running a business, salary expectations and lack of financial safety nets. Cate talks candidly about the hardest parts of the role for those who decide to embark on Buyers Agency as a career. "The three toughest things are.... the hours, the hours and the hours." Dave used to run a Buyers Agency with Property Planning Australia many years ago and he draws upon some of the key attributes that the successful BA's had. He outlines five attributes and relates them to a successful client journey. Dave asks Cate to articulate what she meant by 'responsibility and liability' that a BA carries. 'Caveat Emptor', as Cate describes it is the risk that a buyer takes on when purchasing a property. Cate also outlines some of the potential nightmares that need to be identified in the pre-purchase due diligence phase.She describes her work tasks as 40% communication with clients, agents, legals and others, 40% due diligence, 20% actually looking at properties. Cate wraps up the episode with some recommendations for budding BA's, along with some of the worst mistakes and poor assumptions some make. And our gold nuggets…… Cate Bakos's gold nugget: The three ingredients for a great buyers agent are:Commercial grit - be able to negotiate well and stare someone downAnalytical ability - you need to be great with spreadsheets and dataHigh EQ - you must be very good at putting yourself in someone else's shoes and genuinely relating to themDave Johnston’s gold nugget: "Expect it to be bloody hard work. Just like any profession at the high end."Mike Mortlock's gold nugget: You can't disclaim away your area of expertise. Being cognisant of the reasons why people engage a BA is really important for every BA. Show notes: https://www.propertytrio.com.au/2023/09/25/breaking-into-buyers-agency/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMNow that our Stig (aka Sound Editor, Jamie) has sorted out our audio, we bring a new sound clarity to our listeners... we hope you enjoy!As our residential Australian property market ticks over to a ten trillion dollar value, Cate shares the August stats with our listeners and points out that the market is doing more than just demonstrating a recovery. The market is now moving reasonably solidly, and even Hobart's rate of contraction has slowed.While Dave is reluctant to call the bottom of the market for Hobart, he does point out the home value index, particularly for Sydney. Although he touches on the volatility of Sydney's performance over recent years. Dave highlights the sheer weight of some of our regions such as the Gold Coast and the Sunshine Coast, however he maintains that we have an increasing disparity between capitals and regions.Mike asks Cate about the mass exodus from city to regions, and whether there has been a reversal, but Cate clarifies her answer. "A regional city is very different to a coastal holiday hotspot." Tune in to hear more... Mike notes the crazy pace of change for unit rents, but Cate highlights the trajectory of Melbourne house rental growth and ponders the relationship between some of the tough reforms and taxes facing the southern city. Mike asks "How are rents still going so strong in Perth?" and Cate has a theory that links to Wage Price Growth. See our ABS chart to illustrate this.Moving on from the perks and perils of WA, the Trio turn their gaze to the rental vacancy rates. Mike ponders whether the vacancy rate has stabilised, but as Cate suggests, it can't get much lower.Cate shares the reality from the coal face in relation to listing volumes. "As quick as they can supply them, the buyers are grabbing them." Dave considers the impact of higher migration rates on the supply and demand ratio also. And as for the Westpac Consumer Sentiment Index... Family finance vs a year ago; a huge change for September. Things have tightened considerably and Cate debates whether the mortgage cliff has had effect, or whether 'talk' of the mortgage cliff itself is impacting sentiment. And finally, the major household item figures are declining in response to higher interest rates.Dave reports on the lending figures for August. Refinances hit a record high, once more and construction continues to tumble, demonstrating that we just aren't building new dwellings at enough pace. Dave note unsecured lending to find holidays is up, and this is not habit that we want to encourage. Mike shares a great saying that one of our industry friends, Pete Wargent voiced."Spend less than you earn and invest the difference."Dave and Cate pick out some of their most noteworthy segments from the August data... Listen in to hear what each spotted.And... time for our gold nuggets... Dave Johnston's gold nugget: Time in the market versus timing the market... Dave shares what investors should be basing their decisions on.Cate Bakos's gold nugget: Buyer sentiment, stock levels, and upgrading/downsizing... should people buy first and sell second, or vice-versa? Show notes:https://www.propertytrio.com.au/2023/09/18/ep-218-july-market-update-rental-increases-are-slowing-2/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMToday's listener question opens two fantastic conversations, each about two very differing scenarios. Nick (34) and his wife (33) have not only achieved a great start with a principle place of residence loan being fully offset, but they have other properties in their portfolio too. Cate congratulates them on this achievement, particularly given their ages and the fact that they have a baby too.They have been cognisant of their cashflows and they have saved and managed their money superbly. One twist to the story, however is that some of the total offset funds belong to Nick's parents. While it helps with the interest repayments, the Trio talk about some of the challenges and risks that can result from arrangements like this. From personal interest repayment arrangements to obligations and burdens that can be created, Cate talks through the emotional difficulties that some can face. And if the parents decide to ask for the money back, will this negatively impact the couple's future plans. Dave points out the importance of flagging a loan from parents as a sum that could be repayable on demand. He also unpacks the way that lenders view such arrangements, and maintains a pragmatic view for our listeners.Nick also asks the Trio about converting their principle and interest rate to interest only... a perfect segue for Dave to discuss the merits of an interest only loan arrangement for disciplined investors. Preservation of the loan balance leads to higher tax deductions, greater control of their money, cash buffers to go towards the future home, and enhanced choice going forward.It's easy, but it's not simple and so many people miss this incredible strategy. But.... it's only for disciplined investors. Preservation of the loan balance leads to higher tax deductions, greater control of their money, cash buffers to go towards the future home, and enhanced choice going forward.Mike prompts a question about refinancing to increase tax deductability and Dave and Cate shed light on "The Purpose Test", and the rationale that the ATO apply when it comes to deductable debt. The Trio's finale for Nick and his wife relates to their question about when and where they should buy. Cate says, "It's a very ambitious goal, and don't let me separate ambition from reality. I think that the two can go hand in hand when you've got a great plan." Dave reinforces Cate's point about the importance of planning and he offers some good questions for them to consider.Mike opens our second listener question from an Adelaide family... Jess has three properties with her husband George. They have tackled moving home since having a child, and they ask the Trio whether they should consider selling down a property to renovate a property within their portfolio. They also consider two other options; one revolving around avoiding capital gains tax. Cate speaks about the importance of happiness when it comes to the family home, whereas Dave talks about the need to consider postponing the move into their family home. He talks about setting up the goals in stages, alongside a robust financial plan, and Dave spells out each of the five important stages. Cate shares two real life experiences for our listeners that involve a two and three step renovation that moderates the expenditure and the risk of overcapitalisation. From investor concerns, dwelling types that investors wish to invest in, states they'd like to invest in, and investor intentions over the following year, the survey findings show some intriguing predictions. We hope you have enjoyed this episode.And our gold nuggets…… Cate Bakos's gold nugget: Cate likens a long term debt reduction strategy to that of a Grand Prix. From coordinating break times, fueling up at pit stops, and maintaining a long term focus, it shouldn't be a short, face race.Dave Johnston’s gold nugget: The lifestyle vs investment conundrum is such a consideration. People have to decide how much, ultimately they will put into a family home. It's unique to every family and every couple, and it takes clear communication and patience. Mike Mortlock's gold nugget: The end goal cannot be pushed too far away. Is buying an investment property pushing the family home purchase too far down the road? Shownotes:https://www.propertytrio.com.au/2023/09/11/futureproofing-your-home-and-investment-portfolio/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMCate enjoys playing host again, this time as the trio unpack the API survey, (Australian Property Investor magazine). They reminisce about the good old days, when the mag used to hit the shelves each month and they'd earmark articles, celebrate their own appearances in the magazine, and collect the publications, filled with post-it notes.The gap in performance between houses and units has closed a little recently and Dave notes that the data doesn't really capture this in the survey. "In fact, houses are the preferred intended purchase over the next 12 months among 37 per cent of respondents, a seismic shift from the mere 21 per cent with that intention just three months ago." From land to asset ratio to cultural housing preferences, there are a few reasons why houses are still preferred dwellings.Mike addresses the issue that developers are currently facing as they are deterred by building sector cost woes. Numbers have declined from 16.5 per cent to just 9 per cent of those planning to procure a property. Mike shares how he expects this indicator to play out in the market now that new dwellings have become a headline topic for every second political story. Another interesting question that the survey polled related to the transacting activity in the last year. The proportion of people saying they’d made no property moves in the past year soared from 13 per cent to a remarkable 30 per cent in just three months.... not surprising given the interest rate moves, but Dave tackles this question and talks about some of the challenges buyers face beyond funding costs. The survey also found that of the 70 per cent of respondents who transacted on property in the past 12 months, 63 per cent of those did so on more than one property. Mike discusses the obvious opportunity that many investors took advantage of during this time. Interest rates remain, together with the associated difficulties caused by a lack of finance availability, the biggest concerns confronting survey respondents.Dave addresses this issue head on and he and Cate discuss how they have seen purchasing decisions, buyer motivation (and timing) impacted by RBA rate decisions. Their insights may surprise our listeners... Cate shares the survey findings around decisions to buy and decisions to sell. Surprisingly, it's the buyer camp who are most impacted by rate increases. This is despite record low listing activity during this period. Mike considers the RBA and the respondents' feelings about the performance of our Reserve bank. A troubling 47 per cent of respondents gave the RBA a fail mark for having performed to a poor or very poor level. The amount that gave the RBA a mark of average or above was 54 per cent, well down from the 61 per cent of last quarter. Tellingly, the big shift was in the proportion that rated the RBA’s efforts as very poor, which took off from 15 to 25 per cent in the past three months. The trio pick apart some of the key mistakes that our former RBA Governor made.Rents continue to be a heady topic. Cate and Dave break down some of the findings and they ponder the negative views of investors within the community, and how investor disincentives are playing out now. The Trio often talk about the Westpac consumer sentiment figures on property recently, but this survey highlights some different views; Respondents believed that there is plenty more upside in the property market, with 72 per cent expecting property prices to increase nationally, while 55 per cent believe regional property prices will increase. Time will tell!From investor concerns, dwelling types that investors wish to invest in, states they'd like to invest in, and investor intentions over the following year, the survey findings show some intriguing predictions.We hope you have enjoyed this episode... and especially with some of Mike's 'easter eggs'. And our gold nuggets…… Dave Johnston’s gold nugget: If we look at the things that are putting people off buying, it's the external factors. "The most important economy is your own economy."Mike Mortlock's gold nugget: Mike talks about the disparity out there right now in relation to buyer sentiment. "If you're in a position to purchase a property, now is the time to do it." Shownotes: https://www.propertytrio.com.au/2023/09/04/analysing-market-mindset-the-api-survey/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMCate enjoys playing host again and she congrats Dave on the preparation of this challenging set of eps. Simplifying difficult concepts is one of the hardest things to do when presenting information to others.What data does the Reserve Bank monitor when deciding whether rates should be increased? Household consumption - from the Wealth Effect to COVID savings giving rise to YOLO, Dave suggests that this driver is only just starting to come down. Mike recalls the supply chain woes and the cash stimulus that got us to where we are today. Given that most people's wealth is tied up in property, it is of little surprise that spending went hand in hand with property value growth following the post-COVID price surge.Labour markets - Dave describes what this term really means, and he highlights the relationship between unit labour costs (productivity), unemployment and wages growth. "If wage growth is higher than inflation, then our spending power will increase. But we have to get a little bit better at our jobs each year for this to happen," says Dave.Neutral/Preferred Level of Unemployment and Cash Rate - What impact does the unemployment rate have on inflation? Tune in to find out..Productivity - From migrant worker initiatives to the Australian Productivity Commission, Mike and Dave cover off the importance of productivity. Mike shares an example about his widget factory with our listeners to illustrate an interesting point. "Long term productivity growth is the key driver of our living standards," points out Dave.Overseas Economies and Interest Rates - From economic interdependence to the flow of capital between countries, there are plenty of factors that are important to note when it comes to overseas economies.Rising inflation, interest rates, wage costs, and unemployment.... The trio talk about how these might negatively impact the Australian property market with regards to purchasers and renters.Why have property prices been on the rise despite all of the negative factors weighing on the economy? Dave takes our listeners through nine reasons, (and drivers) that explain why our property markets have been so resilient during tough economic times.What could cause prices to rise again, even if they start to plateau? The Trio ponder this together. We hope you have enjoyed this technical episode. And our gold nuggets…… Cate Bakos's gold nugget: "For any listeners with interstate property, it pays to scout around for some good tradespeople." Dave Johnston’s gold nugget: Prices are starting to stabilise. "Your trend is your friend" states Dave, but what happens once prices have plateaud? Dave shares his predictions for economic activity and how this will translate into property price movements. Mike Mortlock's gold nugget: Mike reminds listeners that they don't need to master economic data, but they should at least pay attention to RBA meeting notes, what's happening with the cash rate, and what the RBA is looking at. "....but if you don't want to subscribe to the RBA, just come to the Property Trio". We have resources available on the Resource tab of our website.Shownotes here: https://www.propertytrio.com.au/2023/08/28/decoding-the-data-behind-rba-decisions/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMCate hosts this this exciting second trilogy episode and the Trio enjoy working through some of the burning questions about the RBA and their responsibilities, actions and challenges.What is the RBA’s mandate and how does it relate to inflation? Dave kicks off with the answers. FIrst, stability of the currency keeps Australia's purchasing power optimised, and on par with other economies in the world. Secondly, maintenance of full employment in Australia, "Everyone who wants a job, has a job," states Dave. And third is the economic prosperity and welfare of the people of Australia. These responsibilities are within the RBA remit: Monetary Policy: The RBA uses monetary policy tools, primarily through adjusting the official cash rate, which influences short-term interest rates and helps control inflation and support economic growth.Currency and Payments System: Issuing and managing the Australian dollar currency. It aims to maintain confidence in the currency and ensure the smooth functioning of the payments system, which involves overseeing the operation and stability of Australia's financial infrastructure.Financial Stability: Promote the stability and resilience of the financial system. It monitors and assesses risks to financial stability, implements policies and regulations to address those risks, and collaborates with other regulatory bodies to ensure the overall stability of the financial sector.Economic Research and Analysis: Conduct economic research and analysis to gain insights into the Australian and global economy. This research informs the bank's decision-making process regarding monetary policy and other areas of its mandate.Banking Services: Provides banking services to the Australian government, other financial institutions, and some international organisations. These services include managing the government's bank accounts, issuing government debt, and facilitating the smooth functioning of the financial system.2. Why do we need inflation? Encourages Spending and Investment: Inflation can incentivise consumers and businesses to spend and invest rather than hoard cash. When people anticipate rising prices, they are more likely to make purchases and invest their money in assets or projects that have the potential to generate returns. This increased economic activity can stimulate demand, drive production, and contribute to economic growth.Supports Debt Repayment: Inflation can make it easier for borrowers to repay their debts. When there is inflation, the value of money decreases over time. As a result, borrowers can repay their debts with money that has less purchasing power compared to when they initially borrowed. This can provide relief to individuals and businesses burdened with debt obligations.Facilitates Wage Adjustments: Inflation can help in wage adjustments and maintaining labor market flexibility. As prices rise, wages tend to adjust to reflect the increased cost of living. This flexibility allows wages to respond to changes in supply and demand conditions in the labor market. It can help ensure that workers' wages keep pace with the overall price level and maintain their purchasing power.Encourages Long-Term Investment: Inflation can incentivise long-term investment over short-term speculation. When inflation erodes the value of cash holdings, investors are more likely to invest in productive assets such as stocks, bonds, or real estate to preserve or grow their wealth. Long-term investments contribute to capital formation and can support economic development and productivity improvements.Provides Monetary Policy Flexibility: Inflation allows central banks to use monetary policy tools to manage the economy. By adjusting interest rates, central banks can influence borrowing costs, control money supply, and steer the economy towards desired outcomes such as price stability and sustainable growth. Inflation provides a reference point for central banks to set their policy rates and implement appropriate measures.3. Why the target for inflation is set at 2-3 per cent? A target range of 2-3 percent inflation is often considered a good target for central banks for several reasons: Price Stability, Facilitates Monetary Policy, Avoids Deflationary Pressures, Supports Real Income Growth, and International Consistency.The trio ponder these various reasons and apply some relevant examples.4. Why do we make cash rate adjustments? Reducing the demand of goods and services in response to the spending that has pushed prices up at a fast rate. In addition, we are controlling the supply of money via bond management are two of the reasons, according to Dave.Dave sheds light on some of the RBA open market operations, and makes the point that fiscal policy must work in tandem with monetary policy.Mike shares with us all his explanation of Quantitative Easing, aka "Money Printing". He demystifies this concept superbly by outlining the drivers for QE, the purpose of QE, and some of the outcomes of QE.The unintended consequences are something we need to consider and Cate presses Mike on this.5. Outcomes from rising rates to reduce inflationReduced Consumer Spending:Increasing interest rates make borrowing more expensive for consumers, including mortgages, auto loans, and credit cards. Higher borrowing costs can discourage consumer spending, particularly on big-ticket items, leading to a decline in consumption. This reduction in consumer spending can have a dampening effect on economic growthDecreased Business InvestmentHigher interest rates can also raise the cost of borrowing for businesses.This can discourage investment in new projects, expansions, and equipment purchases.And our gold nuggets……Dave Johnston’s gold nugget: Through understanding the risks that sit in the economy, investors can be better placed to understand the market long term. The benefits of long term planning hinge around managing risk.Mike Mortlock’s gold nugget: "You can see that there's a very complex interplay between things", and Mike believes that every property investor should familiarise themselves with the RBA meeting discussions. The implications discussed in the RBA meeting minutes do have a real effect on property investors. Knowledge is power when it comes to making long term property decisions.Shownotes: https://www.propertytrio.com.au/2023/08/21/managing-inflation-through-targeting-interest-rates-and-the-necessity-of-economic-inflation/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMCate points out that the capital cities have outperformed the regional cities of late, and Dave draws our listener's attention to the sheer performance of Brisbane, Adelaide, Perth and Sydney when contrasting the median value ladder places. Despite the upturn, many major cities are still beneath their cyclical highs.Cate's discussions at the coal face signal that some of her listing agent friends are quite busy with their appraisal activity - always a precursor to higher listing volumes. Mike quizzes Cate on this leading indicator and it's something all buyers can take a pulse on when chatting to agents, but data is also available on CMA report generation; a great relationship to note between appraising and listing.And Mike circles Perth as a discussion point. Dave and Cate are reluctant to suggest that Perth's outperformance will sustain longer term, but both agree that the combination of growth and yield hold Perth in a 'watch this space' category.Mike quizzes Cate on the movement from the regions back to the city and Cate corrects Mike's assumption. The viability of country-life hasn't necessarily changed for those who moved away from the city during lockdowns, but now that bosses are calling their staff back to the office, many buyers are buying a 'second home' option as their city pad. Cate shares a recent client's purchase; a $365,000 unit in Melbourne's Footscray. With an appraised rental of $380pw, an asset like this demonstrates that 5%+ returns are possible in Melbourne.Cate's concerns about depleting rental stock are attributed to a few factors, including higher divorce rates and city-pad, part-time dwellers.Dave speaks about the rate of rental increases easing, but still cautions the state governments to consider the negative consequences of rent freezes. Cate discusses the need to consider each market separately, given that different drivers and threats are destabilising some markets more than others."If you are a tenant and you're copping a 15% rental increase each year, you'll absolutely feel it", says Cate.The Trio discuss the fact that growth in national rents reached 35 consecutive months in July - the longest stretch since 2013.They also chat about 'optimal' vacancy rates and all agree that 2-3% signifies a healthy rental market. Cate threw in an Office Vacancy chart to share with Mike and Dave. The chart shows some significant vacancy rates (circa 13%) and Cate explains why office vacancies are so contrasted from residential vacancies. Tune in to hear why.... Dave and Cate discuss the Spring market and ponder whether buying conditions will improve during this season. Cate circles October/November as her ideal buying months for 2023, and notes that listing numbers have improved through the months of July and August.As the "All listings" chart shows, however, buyers are still soaking up the listings and buyer demand still outstrips seller motivation.The Westpac Consumer Sentiment data is out, and it's somewhat puzzling for the Trio. "Time to buy a dwelling" is slightly higher, while sentiment shows that house price expectations show that we expect house prices to go up."I wish I could, but I can't" suggests Mike as a good explanation for this unusual set of data. Cate's 'toys' index has still slightly gained. Trips to Europe seem to be the flavour of the day for a lot of people.Lastly, Cate shares some extra observations for our listeners; an uptick in first home buyer activity, low dwelling approvals, reducing distressed listings, and a troubling increase in personal (unsecured lending).These all tell an interesting story in their own right. Tune in to hear more. And... time for our gold nuggets... Dave Johnston's gold nugget: Dave talks about some of our two-speed markets, citing the Gold Coast, South-East Tasmania and Newcastle/Lake Macquarie as high performers, and he delves into some slow performers in Victoria. There really are markets within markets! Cate Bakos's gold nugget: Cate anticipates higher listing figures in Spring and feels that the 2023 opportunity for buyers could match late 2022's. Show notes here: https://www.propertytrio.com.au/2023/08/14/ep-218-july-market-update-rental-increases-are-slowing/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMInflation... What is it, why is it a problem and what causes it?Mike hosts this this exciting special episode and the Trio work to demystify this economic phenomenon, along with some of the terms that we often hear in the news. Inflation is also known as the CPI, short for the Consumer Price Index, because this is the index that records the changes in pricing of all the goods and services in the economy. So, if someone says CPI they are referring to the rate of Inflation.As Dave points out, wages growth is also a significant part of the picture and our RBA is attempting to engineer our wages growth to slightly outstrip economic growth, (aka inflation), our standard of living will then improve as our incomes outstrip the cost of goods and services that we are buying. Bringing economic growth back into the target band is a delicate balance as our RBA aim to avoid a recession and aim for a 'soft landing', as Mike puts it.Dave steps through our listeners in a structured, easy-to-comprehend way. In General - Inflation can be caused by several factors, including these four key ways which we will place in the order of which they have occurred in current times:1. Monetary Inflation: When there is an increase in the money supply in the economy, it can lead to inflation if the production of goods and services does not keep pace with the increased money supply. This is often influenced by central banks and their monetary policies.Covid times this has been the massive government stimulus to infinity, money printing and reducing rates to zero or below. Historically inflation has sat at 2.5%, although our inflation levels prior to 2021 were particularly low. In fact, as Dave points out, inflation was concerning on the 'low side' at this time.Productivity was the key concern at the time, and for six years our RBA held rates at very low levels to stimulate spending. Dave walks listeners through the hefty rate of inflation increases that we've been experiencing for the past 18 months and Cate points out some important context about other previous low interest rate periods. Mike quizzes Cate on her experience as an investor spanning more than two decades and Cate shares her teenage memories about the 1988/1989 impact on her family during a really tough economic period.Mike tackles some of the pressures the RBA face in relation to fiscal policy (government) vs monetary policy (the bank). Dave shares with our listeners some of the ways that our government influenced the economy, particularly through the COVID period. From quantitative easing to the provision of the funding facility to the lenders, over-stimulation is now the issue that the RBA are now tackling.Cate steps through CPI from the chart below and she sheds light on some of the non-permanent inflationary pressures, and also those that can be attributed to external factors such as the Ukraine invasion and COVID lockdowns. Mike touches on "YOLO", (you only live once) challenges following the lockdown and concedes that our appetite for lifestyle experiences such as travel are working against the RBA's actions to tame inflation. As Dave coins it, "Revenge Spending".2. Cost-Push Inflation: This happens when the cost of production, such as wages or raw materials, rises and businesses pass on those increased costs to consumers in the form of higher prices.Covid times this was the breakdown of supply chains due to closed borders, the lack of availability of workers and reduction in trust between many western countries and China in particular, then the Russian invasion of Ukraine all pushing up the costs of supply. The prices of goods increased strongly as retailers pass through the costs associated with supply chain disruptions and higher shipping prices which are now starting to subside.Meanwhile, the cost of building a new house – the largest component of the CPI basket – increased at its fastest rate in more than a decade due to a boom in construction activity (due to government stimulus for building new dwelling and renovations for the first time ever) and record inflation in building material prices.3. Demand-Pull Inflation: This occurs when the demand for goods and services exceeds the available supply, leading to an increase in prices.In the March 2023 quarter - Services annual inflation recorded its largest annual rise since 2001 is the real worry now for the reserve bank. “This happened due to all the stimulus, increased personal savings, growth in property values and desire to travel again and revenge spend that happened in 2022 and into 2023.”4. Expectations: If people anticipate higher future prices, they may adjust their behaviour by demanding higher wages or raising prices, thereby contributing to inflation.“This is the final phase that the reserve bank is very wary of which leads to a wage price spiral, entrenched expectations for prices, especially for services to continue to rise at this faster rate”, says Dave.Mike shares a frightening example of post WW1 hyper-inflation in Germany. Four to five marks to the US dollar increased to a trillion marks to the US dollar. Mike regales some other horrendous real-life stories.Cate and Mike chat about the impact of a high-inflation environment, from stagflation to vulnerability for those who don't own assets. Cate talks about the contingent who aren't likely to be negatively impacted by inflation.What is the negative impact inflation has on the economy and individuals? While moderate inflation is considered a normal feature of a healthy economy, high or hyper-inflation can have adverse effects.It erodes the value of your savings relative to cost of goods, services or asset prices such as housing,Reduces purchasing power because every dollar you earn is reducing in value relative to the prices of goods and services,Distorts economic decision-making meaning governments and individuals start to make different, unusual or abnormal decisions, andThis can create economic instability and lead to a reduce standard of living for the country citizens.And our gold nuggets…… Dave Johnston’s gold nugget: we have to be prepared to deal with changing financial circumstances on our journey... from those we can control, to those we can't. Succeeding, (and thriving) all comes down to your risk mitigation strategies and buffer accounts. We need to understand these things are a possibility, and we need to plan for them.Cate Bakos's gold nugget: We are going to share our comprehensive show notes in our Resources tab on our website here.Show notes: https://www.propertytrio.com.au/2023/08/07/the-inflation-conundrum-unravelling-its-causes-and-consequences/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMDave hosts this episode and opens by suggesting that appraising property requires a delicate balance of art and science.Appraising a property: How do we discount or add on a premium when something noteworthy is impacting the property positively or negatively?How do we apportion a premium or a discount when a feature is a stand out or a significant detractor? And how do we know how much to apply to the premium or discount? Dave quizzes both Mike and Cate how they tackle this very question.Dave delves into positive attributes first.Notable designers or architects, and Cate shares a reference to Eltham's Alistair KnoxNew works/extension/renovationMike shares the different methods of valuing, from recent comparable sales analyses to the summation method. Cate discusses the importance of comparing apples with apples when it comes to attributes, such as isolating specific zones when selecting recent sales.Quiet courtTrain station within 200-500mAttractive zoning (ie. growth zone vs standard, residential zoning)North facing rearGreat viewsUltra wide block (from a development point of view)Ideal floorplan (let’s use cottages as an example)Heritage signfiicanceDave then moves to the detractors.Properties in serious need of repairSouth facing rearChallenging zoningDave sheds light on some of the lending challenges that buyers will face with some of these negative attributes, in particular, challenging planning zones and tight internal floor areas.Main roadsHigh voltage power linesTrain linesUgly surrounds (ie. industrial buildings)Tough overlays (ie flood, bushfire)Bank lending policy issues, ie. floor areaSignificant strata fees or high special leviesBrick crackingObvious problematic neighboursFlight pathsDevelopment sites next door/over the back fence that could threaten privacy and natural lightRestrictive covenantsHouses with sordid historiesCompulsory acquisition possibilityEasements in awkward spotsHow do the Trio suggest buyers can apply a discount or a premium when a property is impacted by any of these? Should buyers a rule of thumb percentage value-change for any of these?Cate's answer may surprise our listeners... tune in to find out.Mike discusses the difference between Quantity Surveyor due diligence and Buyers Agent due diligence, but he does need to take into account some attributes such as poor quality soil, flood or fire overlays, and restrictive covenants when generating reports.And lastly, Cate shares how buyers tend to approach compromised properties and the risks of selecting bad quality off-markets. Not forgetting Pete's famous analogy, Cate cites his bad bag of apples quote.And our gold nuggets…… Mike Mortlock’s gold nugget: Mike is struck by the exhaustive list that Cate shared in this episode and he implores buyers to catalogue the list each time they check out a property.Cate Bakos's gold nugget: "When you buy a bargain, you sell a bargain."Show notes: https://www.propertytrio.com.au/2023/07/31/valuing-uniqueness-appraising-property-with-special-attributes/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMThe Trio decided to celebrate Bastille Day by giving this listener a pseudo name; Amelie. Our listener sent through a multitude of great questions and the trio decided to circle in on Amalie’s challenge for this episode. Amelie* is in her mid-twenties and she co-owns a property with her brother in Sydney’s west. She’s a good saver, has a good job and she is keen to purchase her second property. She has a few ideas, but her brother has very different thoughts. With such an important person in her life creating a bit of a debate, Amelie wonders if she should reconsider her original plans. From units versus houses, to market timing, first homeowner grants, alternative cities and co-ownership, she has quite a few variables that her brother has challenged her with. Amelie puts her conundrum to the Trio and asks for some help. The Trio broke Amelie’s questions into seven main segments; 1. Timing the market vs timing the market.Dave’s general rule is “buy when you’re ready.” It is very difficult to time the market, and lost time can be costly. The clear steps that Amalie needs to initially take hinge on getting great, specialised advice. After all, we don’t even know what Amelie’s borrowing capacity is as this stage.Cate asks, “Where do you want to live? And how quickly do you want to get there? Are you happy renting/living at home for now?”Mike suggests that Henri is “trying to get a bit too fancy with timing cycles.”2. House versus unit.Although the twenty-year price history demonstrates that median house price growth has outperformed median unit price growth, Dave points out that this is general data only, and there are markets within markets. Unit buyers need to be cognisant of the negative impact of buying new, along with the associated strata costs.Capital growth is directly linked to a high Land to Asset Ratio, and it’s integral that investors give their portfolio the best chance of high performance by noting this important ratio.Other special attributes, particularly for units in Sydney include;- views/vista- quality street- great suburb- boutique block- scarce, older style blockDave also notes that Sydney in particular is quite different to other cities when it comes to apartments because Sydney offers the highest proportion of apartments and units in the nation.Cate has concerns about Amelie’s affordability comment. She focuses on the need for thorough due diligence to avoid surprise costs and cashflow threats. Cate also sheds light on the challenges that borrowers face when co-borrowing, particularly in relation to ‘joint and several’ borrowing.Mike shares concerns about Amelie’s safety net ideal and he discusses the risks that could impact family relationships when cashflow gets tight and parents are asked to help financially.3. Buying in the city you live in.Dave talks about the difference between buying in a familiar city, versus buying in the city where you ultimately plan to live. Gaining a foothold in the market where you wish to live is a great risk mitigation strateg. Hedging against another location underperforming is the path that Dave is going down.Cate needs to see Amelie’s borrowing capacity before she can agree with Dave’s approach. If Amelie’s borrowing capacity is too insufficient for a quality Sydney property, she may well be better placed to consider alternative cities.The Trio all agree that timeline is an important consideration for Amelie.4. Outer-ringAs Cate points out, investors will get a different result in an outer ring and the negatives include;- tougher socio-economic demographics- the threat of low scarcity and surrounding house and land package areasAnd Cate suggests that contrasting an inner- or middle-ring location within a nearby regional city against the Sydney outer-ring options is a valuable exercise. Dave shares some of the merits of such an approach too. Tune in to find out why this could be a great alternative.5. Rental yield.This consideration is driven by current cashflow requirements, future acquisition projections and Amelie’s ability to increase her income over time. Rental yield can’t be overlooked, otherwise the risk of an unplanned sale (or co-ownership) will rear it’s head. 6. First home buyer schemes.Sometimes saving $30,000 now is very valuable for a buyer, but for someone like Amelie who has good savings on hand, the scheme may cost Amelie far more than the $30,000 of upfront savings. The Trio talk about the false economy that is sometimes represented in the quest for pocketing the grants or discounts.“It’s a bonus, not a driver”, says Cate about the opportunity cost.7. Buy and hold versus selling earlier.The Trio unanimously agree that Amalie’s brother’s recommendation in relation to selling is not the best advice for her situation.Dave talks about the importance of understanding how she can use equity to leverage and get into her next property. And our gold nuggets…… Cate Bakos’s gold nugget: Cate draws on her client experience over the years and notes that many have ultimately unwound their co-owned property structures with family members. This is due to a combination of joint and several lending restrictions and changing personal plans. Mike Mortlock’s gold nugget: Mike congratulates Amelie but he implores her to think about where she wants to live and to develop a good strategy that incorporates her principle place of residence. Dave Johnston’s gold nugget: suggests that Amalie needs to figure out her price point with a strategic mortgage broker and then consider how her next purchase fits within her property plan. Show notes: https://www.propertytrio.com.au/wp-admin/post.php?post=490&action=edit

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMMike kicks off our episode with the fresh announcement of our new RBA Governor. The trio wish Michelle the very best in her new role, and they also chat about the departure of Philip Lowe and the key mistake that likely drove the change in Governor.Mike points out that the overall national increase of 1.1% is not really a national story and Cate reinforces that the strength of the Sydney market is driving much of this positive growth data. Dave also draws regional performance to our listeners' attention. The capital cities are outperforming the regions; a twist that we have been anticipating but haven't seen for quite some time. The pace of growth across the board has slowed down, however, and this could be apportioned to the continued rate rises through June.Internal migration patterns have normalised; our rate of moving to the regions has certainly calmed down since COVID lockdowns. In some cities (such as Melbourne) we are seeing some elasticity and people are returning to the city. Cate shares an interesting observation from her coalface. She is taking enquiry from quite a few Sydneysiders who are either investing in Melbourne, or moving to Melbourne. The disparity between the two biggest cities is greater how than historical ratios, and Sydneysiders are obviously seeing value in the Melbourne market now that the differential is higher.Cate also mentions that established, boutique units in the Melbourne market seem to be demonstrating capital growth too, and this is something that Melbourne hasn't experienced for over a decade. Mike has been chatting to many business owners and property managers about the proportion of sales that are investor-owned properties. Rent rolls are eroding as many investors opt out of property, and anecdotally this is obvious across the board in many cities, but particularly in Victoria. "The sales department are basically setting fire to their rent rolls...maintaining rent rolls as a steady source of listings," says Mike. The Trio look at the 'days on market' data but Cate uncovers a key reason why this data isn't neccessariliy a perfect reflection of buyer/seller demand. In auction-centric markets, agents have strong control over the type of campaign that a property can be sold by. Auction campaigns have a usual four week lead time until the sale date, and surely this data skews the data."It's not an organic reflection; it's deliberately controlled by agents."Mike prompts the underquoting debate also... perhaps this is a good topic for another episode! Stay tuned.Hobart and Canberra are the two capital cities that have bucked the trend and had strong listing activity. This supply and demand imbalance is reflected in the growth data, unsurprisingly.Mike asks Cate and Dave about distressed listings, and despite the media suggestions that the fixed rate cliff and the increased interest rates could give rise to distressed listings, Cate points out that this is not occurring, and the data supports this.And the CoreLogic findings for new listings vs total listings is telling. New listings are still well below the historical five year average, however the total listing figures have nose-dived. This illustrates an increased buyer appetite for old listings, (those with greater days on market than 180 days), a sure sign that buyers are outstripping sellers. Mike asks Cate to comment on the vacancy rate data. A slight amount of easing is evident in some markets, but as Cate points out, "there are markets within markets" so the data is not entirely reliable. Melbourne is still surging with house rents, and units remain tough propositions for renters. Dave suggests that migration (both internal and overseas) are still contributing to the rental issue.Mike does challenge the relationship between new arrivals and unit rents; it's an interesting conundrum.The Westpac Consumer Sentiment data is out, and it's somewhat puzzling for the Trio.Cate's 'toys' index is a concerning figure. We are still spending, and the increasing interest rates haven't curtailed our attitudes towards spending like our RBA wish they would.As Mike says, "It's the buying-stuff activity that is keeping our inflation high."Lastly, Dave shares some clever data about purchase activity. It might surprise our listeners! Tune in to hear more.And... time for our recaps this time, (because Mike forgot about gold nuggets)..Dave Johnston's gold nugget: Dave summarises the market by saying price growth is slowing down, but it's still positive. He also touches on investor-led sales and he hints at supply of new listings increasing... happy news for the buyers out there. However, upgrading remains a challenge for a large cohort of buyers. Cate Bakos's gold nugget: We have a segmented market and the renovation projects remain a significant challenge while builders and trade materials are in limited supply. Mike Mortlock's gold nugget: it's an uptick in sentiment, and an uptick in investors getting out of the market. Show notes: https://www.propertytrio.com.au/2023/07/17/ep-214-june-market-update-what-is-driving-interstate-interest-to-melbourne/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMMike's planning for this episode has Cate and Dave laughing... our newest muskateer is challenging the Trio with his cheeky script. But they won't fall prey to his tricks.Today's episode is all about some insightful data that Mike and the team at MCG uncovered about changing investor behaviours during the Queensland land tax proposed changes of 2022. "Anecdotally, (investors) were avoiding Queensland when they were legislating the land tax changes." Mike's data captured three significant segments in time: pre, during and post the land tax legislation and eventual repeal. "I was pretty unimpressed as an investor," says Cate, who considered selling her Queensland property at the time. Cate sheds light on the attitude of investors at the time of the legislation changes. Buyer behaviour was a reflection of the concern about increased land tax obligations. Focusing on the data - as Mike points out, 40.9% investment purchases in Australia were in Queensland prior to the legislation being enacted. "During that 98 day period, the figure dropped to 33.6%, representing a 17.8% drop", says Mike.Cate queries some of the other variables that may have impacted the data, including interest rate increases, COVID lockdowns. Dave asks Cate about the impact of this legislation on the rental market. The volume of sales would have no doubt eroded the rental stock, and as Cate points out, Queensland was enormously impacted by homelessness.Mike also sheds light on how the State Government taxes are offset by Federal Government negative gearing benefits.. Tune in to hear more...The Trio are clearly not supportive of the Queensland Government's land tax move on land tax in 2022. Post-the repealed date, the figure only rebounded to 34.73%, a figure that still signals that investors were spooked. Combined with the Greens' policies, the investor market are cautious, particularly in Queensland.And as Dave noted, a lag effect can last a long time. Victorian land tax changes, combined with tough rental reforms and a supply/demand imbalance will likely erode Victorian rental supply and the two resident Victorians in the trio discuss this. Household formation changes, combined with Air BnB and investor fears are playing havoc with Victoria's investor stock levels.As Cate says, "it goes beyond assuming that it will net itself out." Mike discusses the 'build to rent' and superfund theories that are populist decisions presently. The conundrum is that the conditions are just making things tougher for renters. From developers to local council to The Great Australian identity.... Cate sheds light on some current Victorian government established property acquisitions and the challenges that are associated with high rise social housing stock. She also chats about the current vacancy rates and how historically significant our current vacancy rates are. As far Queensland's land tax legislated land tax changes boded; "It's misguided and it has unintended consequences", says Dave. Cate discusses the need for continued investor participation to quench the current renter thirst. Combined with limited control over this asset class, the Trio agree that things are precarious for the current rental housing crisis. Lastly, Mike feels that Queensland didn't acknowledge that they got it wrong with the 2022 policy. Moving on to our gold nuggets!... Cate Bakos's gold nugget: For our investors who are wondering how all of this legislative change impacts them. Check your legislation and find out all about market rent, how regularly you can increase rent, and what new policies impact you.Mike Mortlock's gold nugget: It's very unpopular to discuss positive roles that investors provide in society. It's a tough juggle socially for many who are balancing the need to grow their wealth with the altruistic drive to provide housing. Show notes:

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMThis episode is all about the things that buyers should look for when inspecting property; the red flags, practical tips, seeing beyond hire furniture and fresh paint, .... and the non-negotiables."Before we put any inspections in the diary, we check Google Street View."Cate talks through the things that she's looking for when selecting properties to shortlist for her clients. From electrical transformers on power poles, speed humps and roundabouts, to dodgy neighbourhoods, Street View can safe wasting time driving across town.Technology really has revolutionised how we do business.Cate also looks for title types and zoning before getting excited about a listing. She and Dave ponder the importance of this in relation to lender scrutiny too. As Dave points out, understanding where true value lies can save buyers from wasting time and missing out on a lot of viable opportunities.Dave asks Cate to share some of the steps she recommends when embarking on price analysis. Starting with recently sold examples on the sold tab of the search engine is a great first step. We can't underestimate the value of talking to friendly local agents too.Mike sheds light on how he also looks forensically at past sales of the subject property, overlaying capital growth forecasting based on sale dates. He also throws out an AI challenge to our listeners! And Mike chats about the need for buyers to dig deeper when a property listing photo is missing a facade picture. Tune in to hear more...Checking the status of the sale is important too. Sometimes properties are under offer, withdrawn, or about to sell quickly, so it's a worthwhile phone call before you plan a drive across town."When you arrive, what is important to note before you even get out of the car?"Parking and any parking restrictions - can you get a park nearby when you visit?Surrounding area - does it feel safe?Neighbouring properties - are they well kept? Are they shadowing the property?Any noises or smells?Ease of getting in/out of the property - can you pull in and out of your own drive?Dave quizzes Cate on what she looks for once she's inside the property. She starts with the agent conversations, and the ways that buyers can be remembered for all the right reasons. Capturing video notes is a very handy tool that Cate employs, but she always asks permission from the agent. She sheds light on the aspects of the inspection that she notes in her inspection videos, and explains the benefits of doing so.COVID really changed things for property inspections, particularly for the lockdown cities. "If you remember back to 2021, we had just five minute inspections at one stage", says Cate.Mike talks about the value of a virtual inspection for spacial awareness; an understanding of the flow of the property. The trio talk about the hidden things that buyers don't always capture, and how a video inspection can aid this. From subfloor to gutters, there are tips and tricks that they share to give our listeners an extra edge with their inspections. And MIke's Quantity surveyor strengths shine though in relation to understanding functionality and age of items. Functional obsolescence is a term they all have a chuckle about, but understanding ATO effective lives is a great insight for investors....And our gold nuggets! Cate Bakos's gold nugget: Going in with a really clear idea of must-haves and nice-to-haves is integral. If the property has a deal-breaker, buyers need to be prepared to walk away.Mike Mortlock's gold nugget: Imagining the property without styling and staging is a real blind spot of people and we have to remember that staging is designed to make us pay more for the property. He also notes that many investors make the mistake of looking through the wrong lens. Lastly, asking the agents the right questions is critical. Being coy won't help buyers at all, particularly in this market.David Johnston's gold nugget: Differentiating what is 'easily changeable' from what isn't is is Dave's big tip. It's the unchangeables that make a difference in the long run.Shownotes: https://www.propertytrio.com.au/2023/07/03/unlocking-the-secrets-of-inspecting-property-with-expert-strategies-for-assessing-properties-like-a-pro/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMThe trio enjoy a catch up after Cate's visit to Adelaide and a day out with Pete and the students. Pete sends a special hello to all of our listeners! Mike's weekly market update circles around the RBA minutes and the monetary policy paragraphs. He notes that "the case for justification is getting stronger" and he highlights the increased risk of inflation returning to the target, hence the interest rate move. Cate's interlude into off-market transactions may surprise our listeners. "Situational" off-markets can be ideal, but "Opportunistic" off-markets are becoming problematic.Dave weighs in with his insights also and shares Cate's concerns about buyer's agents who purport to transact a heavy weighting of off-market sales. Our episode entails two great listener questions.The first is intriguing: Llohyd bought a rundown house in Hillcrest, SA for $550K with $440K debt November 2022. It’s in the process of getting subdivided to build two. His broker has just conducted a CBA desktop valuation and his property has almost $120K equity, and his options are bountiful. He reaches out to the trio examine his options and it's an enthralling conversation. Does he build? Sit tight? Consider other options?Tune in to find out what the trio discuss. From considerations around build cost to equity positions, long term land banking to selling with plans and permits, all options are on the table. Our second listener question is always a ripper. Jasmin asks the trio, "If I have a loan for $820K with an LVR or 80%, can I use that to buy two properties worth, and should I consider that option. Or can I only buy 1 property? " "If I had a dollar for every time I've been asked this question, I'd have a piggy bank full of dollar coins", says Cate. Cate asks whether our listener is investing for capital growth, or for rental yield. There is no right or wrong answer, in fact it boils down to an investor's personal financial position. Mike supports this view but he also loves the idea of diversification, however he focuses on asset quality and the need for an investor to understand what it is that they are trying to achieve.Dave sheds light on the risks associated with price point selection, the power of compounding, the perils of procrastination, and the impact on the ability to purchase their family home. "Make sure you've got the big rock in the jar sorted out", says Dave. A true key point for Jasmin to consider. ...And our gold nuggets! Cate Bakos' gold nugget: The winter market can be tough on the southern states, so for people who are contemplating shopping through the winter months, perhaps thinking about gearing up for spring is a good idea. Bear in mind supply and demand during winter months and don't put pressure on yourselves.Mike Mortlock's gold nugget, (or black opal): Mike ponders the merit of having full context of our listener's long term plan. We can't just tell Lloyhd and Jasmin to opt one way or the other... it all comes down to planning. Shownotes: https://www.propertytrio.com.au/2023/06/26/listener-questions-june-2023-2/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMMike kicks off our market update with Sydney - up by 5% for the quarter. While this big city does a lot of heavy lifting when it comes to median figures, Cate points out that every single capital city is recording positive median price movement for the month of May. Dave brings our attention to the pace of growth for the city markets over the short term, as we see these markets gain pace over the regional markets as they play catch up.Dave also chats about the breakdown of the market segments, specifically pointing out the relative volatility of the top quartile of the market. As history has shown us, the highest priced properties are often the first to tumble in downturn and the fastest to rebound in a recovery. An intriguing fact that the Trio discuss as media headlines focus on the mortgage holders' pain is the cohort who are paying cash for their purchases. Whether they be down-sizers or those who have inherited wealth, many purchases are actually settled without the need for lending. First home buyer participation rates are another side-topic of conversation for the duo and Dave notes some of the grants, opportunities, initiatives and changes that give today's FHB's some significantly higher benefits than in previous years. "The bank of Mum and Dad's average assistance is over $50,000 nowadays," says Dave.Dave points out the distortion caused within the median values data when it comes to houses and units. Taking two very different cities into consideration (ie. Melbourne and Brisbane) is a case in point when we consider the ratio of units to houses. And Cate raises another data-distortion consideration; what happens when we have an overrepresentation of sales from one particular segment of the market? Mike reminds us about the impact of initiatives that favour particular price-points too. We need to remember that data analysis sometimes needs to be drilled much deeper. Dave reports the rental movement for capital cities and regions. Capitals are still experiencing pressure and new arrivals will be amplifying this impact. Regions are slowing down, and as Dave explains, only about 15% of new arrivals head to the regions, with the vast majority heading to the capital cities.Units rents are rising much faster than houses and an obvious reason for this is affordability; units are simply cheaper to rent. Listings are well under the five year average. Mike questions Cate about the slight uptick in May, but Cate is quick to put it down to Easter school holidays avoidance. There are no signs of reprieve for buyers who are experiencing the impact of stock shortage, unfortunately.House price expectations have increased; indicating that people are expecting house prices to rise. Key changes include 'time to buy a major household item', 'economic conditions over the next five years', and 'time to buy a dwelling'. Mike delves into this last one; it seems a strange contradiction, but as Cate points out, this measure wasn't much different a year ago. Even in the crazy pace of 2021, this figure still sat below 100 which suggests that the broad consensus is that it's not a good time to buy a dwelling. People are pessimists!Dave's pet subject... lending! "But we're not lending anymore", says Mike. Dave unpacks these loan commitment figures and hints that investors may be turning a corner. Cate queries the investment loan data and whether these figures could be including vacant (or personal use) dwellings that aren't actually housing tenants.Productivity remains a key concern and stagflation represents a threat to our economy if things don't improve. Dave details this risk for our listeners.Lastly, our new favourite index, the Freightos Baltic Index is a revealing chart. Freight costs have returned to pre-pandemic levels and this could be a positive beacon for our inflationary problems. And... time for our gold nuggets...Dave Johnston's gold nugget: The breakdown of Goods and Services is an interesting dilemma. With services costs rising but goods settling down, our RBA has their work cut out for them. Cate Bakos's gold nugget: Freightos Baltic Index! This is a compelling chart when it comes to gauging the cost of freighting goods; a significant proportion of the overall cost for imported goods. Mike Mortlock's gold nugget: When will our spring selling season arrive? Or could listing activity remain low? Mike talks about the challenges buyers face while our supply and demand ratio sits at current levels. Show notes: https://www.propertytrio.com.au/2023/06/19/ep-210-may-market-update-from-generational-shifts-to-the-r-word-recession/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMMike's market update focuses on some new tax data which identifies the highest earning suburbs in Australia. WA's Cottesloe and Peppermint Grove take the lead and the range of incomes will surprise a few. Among other facts and figures, gender wage gaps, average superannuation balances and richest professions all featured in Mike's segment."The average Australian taxable income currently sits at $63,882." Our first listener question asked the Trio about their take on the Four Corners Episode that aired in late March 2023. The show focused on poor agent behaviours and conflicts of interest, and our lovely listener wondered what sort of controls exist around such behaviours and duty to disclose. Cate pares it back to two important things that buyers must remember.agent behaviours, andwarning bells for consumersOur listener also asks about agents' representation to buyers when it comes to asking prices and auction quotes. Cate shares her thoughts about underquoting and some of the challenges that are faced by both listing agents, vendors and consumers.While underquoting is a horrible practise, Cate agrees with Dave's message. Buyers owe it to themselves to be familiar with resultant sales prices in their area, and applying some pricing methodology is not a difficult science for a committed buyer. Mike's reference of cognitive bias is so true for so many vendors though, and it's crucial that vendors maintain a realistic approach. Impartiality is the key word and Cate, Dave and Mike decipher what can go wrong for consumers when their trusted professional has a conflict that undermines their fiduciary duties. Our second listener question is a special one; a loyal listener (and property investor) is keen to help her friend get a strong foot holding on the property ladder and she asks the Trio whether her friend's Melbourne apartment is one to hold or one to sell in the quest for a strong performer longer term. Cate, Dave and Mike rise to the challenge with their individual strengths shaping some ideas about how our listener can best help her friend. Cate focuses on another element that loving friends and family often overlook.... we can't imprint our own values and dreams on others. Property investing needs to be prompted by a fire in one's belly, and dragging a friend along for the ride is often a difficult challenge.As Mike points out, strategy, deliberation and commitment is essential for a committed investor. And Dave discusses the need for a desired spending limit, methodical cashflow analysis, and a determination of savings on hand, LVR and borrowing capacity... and then accessing funding is another step yet again....And our gold nuggets! David Johnston's gold nugget: Dave addresses both listener questions. For our first listener, Dave harks back to the most important point to retain: "Do your due diligence." And his advice for our second listener's friend is to "Do your plan!" Simple, but not easy. Mike Mortlock's gold nugget: As much as we want to be kind and look after our friends, we can't go too far with it. "Imagine if Da Vinci was petrified of not being able to pay the rent and wasn't sketching in his notebook, what kind of world would we be living in?" Show notes: https://www.propertytrio.com.au/2023/06/12/listener-questions-june-2023/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMThis midweek updaate was too juicy to wait for, so the trio bring to light three new market updates to share with our listeners.Mike talks about some breaking data signalling a weakening job market and he sheds light on what futher changes could mean for the economy.Cate touches on an interesting rental story where a tenant took on the landlord at a tribunal.And Dave discusses a new lender option for some borrowers who may be eligible for a significant buffer rate reduction; a surpring move in a sea of 3% buffer rates.

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMThe trio kick off this exciting episode with a discussion about the Westpac consumer sentiment index and the recent changes that our markets have been experiencing.Dave and Mike ponder the role that the media play versus the money market commentary, and Cate highlights the shrinking confidence about the time to buy a major household item index, a positive signal that the RBA rate increases could be (slowly) taking effect.Today’s show is all about the distance people buy their investment properties from where they live and whether that has changed over the last few years. The popular view is that people typically buy very close to where they live because they know their own backyard. However, we’re diving into some new industry research that dispenses with the stereotypes and gets down to facts with real data. We are fortunate to have some valuable and telling data at our fingertips due to MCG Quantity Surveying's 1000 assets study; an annualised data release that Mike and Marty share with the property community and media. Mike shares with the listeners what it was that prompted this collation of information. Mike challenges Dave and Cate to consider how far they each thought investors were generally prepared to travel. Cate also asks Mike to shed light on some of the 'accidental investment' examples, and how this data signals such a property. Dave chats openly about the biggest risks associated with dual-purpose investing and Cate also talks about some of the emotional reasons that can lead an investor to purchase 'around the corner'. The trio talk through the changing figures associated with this amazing measure, from pre-pandemic to pandemic, through to post-pandemic. Prior to the pandemic, the average distance that an Aussie investor's property was from their home measured 293km.The pandemic average distance shifted to a colossal 599km, a startling change. The trio unpacked the drivers, the changes and their thoughts on the significant jump. The intriguing question that Mike asks is, "what on earth happened post-pandemic?" ....and the answer may surprise (we won't ruin the surprise for our listeners!)This incredible evidence supports some of the trends that we've witnessed in Australian property investing and we love that Mike and Marty's business have some clever data that is unique to what we'd typically find through the usual data channels.The trio sift through the radii findings listed in this table, not only analysing the pre-, pandemic and post- average distance, but also the changes within the shorter-distance data findings. It's a ripping episode and one that showcases our third muscateer's appreciation for great data."While it appears that we’re transitioning back to a more normal reality in the post-pandemic era, there’s no doubt some needles have shifted forever. In fact, discussion about modern history will almost always be divided along pre- and post-pandemic lines." Shownotes: https://www.propertytrio.com.au/2023/06/05/decoding-the-proximity-puzzle-for-property-investors/

Got a question for the trio? Click hereThis ep is crafted around two excellent listener questions that hinge around mortgage strategy. But before the trio jump into the questions, they share their market updates.Land tax reforms (and other 'fruity' ideas) are the topic of conversation for many Victorian investors, and Cate talks through the changes with Mike and Dave. She touches on some of the challenges that Victorian property owners have faced through the pandemic and she also considers some of the negative implications of the new changes. Cate wonders whether the direct impact on renters will result in segmentation due to the vulnerability of cash-flow neutral investors. Dave ponders the impact of this tax change on the Victorian market, and holds concerns that the unintended consequences could the exacerbate the existing rental problems in the state. With supply issues at record lows and such tight vacancy rates, Dave fears that this will just make the problem worse. Mike asks Dave and Cate a left-field question, "as land tax increases state revenue in one state, federal government tax revenue decreases. How does our Federal Government feel about this?" Our first listener question is sent to us by Emily, who asks the Trio about converting her home loan to an interest only loan product once her offset account is working at full capacity. Dave's rationale for recommending interest only is intriguing, but it's important to note that this information is not designed as a 'one size fits all' solution.Investors need to have a plan, understand their options and remain focused on the long term goals when it comes to stepping-stone properties. Accidental investing is not necessarily a great outcome if the property is not a suitable long-term asset to hold as an investment. Some of the key benefits of an interest only loan as outlined by Dave include;More interest to claim once the property becomes an investment propertyBuilding up savings more rapidly, and in turn these savings can be used to pay more for a future home and will reduce the debt balance on the non-deductable loan.The big unknowns, according to Dave are; "most people don't understand the strategy, and we also can't be certain that the home will eventually be an investment property down the track."Dave's sagely explanation of this common dilemma is gold for our listeners, and many investors benefit from this approach when a stepping-stone property is no longer personally used and a future home acquisition is on the agenda. The Trio remember the old days when lenders offered much longer interest-only periods to investors, and they compare the differences now that today's investors face, particularly when it comes to loan amortisation. Our second question comes to us from another fabulous listener, Marco, who asks a great question about the use of equity, as opposed to applying higher loan to value ratios, (LVRs) and paying for Lender's Mortgage Insurance. "Is LMI the devil, or should we consider holding onto that cash as a buffer?" asks Mike. Dave distils some of the important details when it comes to mortgage insurance and LVRs, pointing out how tax deductions are optimised, and savings are maximised in tandem. Cate adds some questions that are important for investors to ask themselves; understanding how much time remains to achieve the investment goals, what incomes they'll potentially earn in the future, how long they wish to work for, what the short-term economic cost impact is, and what is in their plan.Life throws up curveballs, but one eye-opening aspect that Dave touches on is the importance of remaining patient. Some acquisitions take many years, but the visibility that can be offered through clever modelling software can't be underestimated. Having a clear plan and a scope of timeframes is integral to a successful journey.One of the biggest costs that Dave sees impacting property investors is selling a property that they could have otherwise kept if they'd had the right mortgage strategy. Thank you to our listeners - we appreciate these great questions. We have more listener questions eps to come too! And... our gold nuggets! Mike Mortlock's gold nugget; "don't be the cleverest person in the room!" Mike supports reaching out for specialist advice - the financial difference when it comes to getting great advice can really add up. "It could be the best ROI you ever get."Cate Bakos's gold nugget relates to the first listener question.... refinancing! Cate implores investors to stay on top of their paperwork, supporting documentation and their credit conduct so that they can ensure that refinancing isn't a nightmare. David Johnston's gold nugget: If you get your mortgage strategy right and align it to your property plans, (particularly in relation to converting a current home to a future investment property), you can not only optimise your tax deductions and have more cash to put towards your next home, your extra property in your portfolio will make a significant difference to your retirement.Shownotes here: https://www.propertytrio.com.au/2023/05/29/ep-207-mortgage-mastery-for-investment-borrowing-and-the-hold-or-fold-dilemma/

Got a question for the trio? Click hereThis ep was about FOBBABO, an acronym Cate made up years ago.She coined this phrase a while back when buyers started having second thoughts after an ideal property came along. This episode is dedicated to the trick buyers often play on themselves… some of the reasons why, things that amplify FOBBABO, why it can be dangerous, and ways to tackle it when it happens to you.Dave hosts this exciting episode and explores with Mike and Cate some of the other psychological challenges buyers face, from FOMO (Fear of Missing Out), to 'the winner's curse', an segment that Dave, Cate and Pete covered back in episode 94. Dave asks Cate to share how FOBBABO usually manifests and becomes obvious to a buyer’s agent, and Cate also sheds light on the pro's and cons of FOBBABO, which market cycles it usually strikes in, and why the media can be quite unhelpful for those who are struggling with this fear. Dave also challenges Cate to delve into some of the painful lessons that FOBBABO can create, and the trio speak about the difference between our most recent property downturn and previous downturns.Dave shares his insights on the impact of inflationary pressures, rising interest rates and in particular, diminished borrowing capacity for many buyers as a result of the rate hikes. This time, FOBBABO presents even more dire risks for some buyers... tune in to find out more! The trio talk about some of the ways that buyers can limit the negative impacts FOBBABO can cause and Cate talks listeners through her 'reverse search engine' exersise. This not only helps give perspective for buyers who are feeling the threat of FOBBABO, but also enables them to construct a clear feasibility study that highlights not just the likely types of eligible properties, but their frequency of sale also; an essential element to note for anyone who is concerned about a moving market. The trio share eight tips to ward off the chances of FOBBABO biting... check out our show notes. And... our gold nuggets! Mike Mortlock's gold nugget is all about buyers making sure they have their brief nailed down. The reverse search engine exercise caught Mike's attention and he encourages our listeners to utilise this tool when it comes time to circle in on their purchase plans. Cate Bakos's gold nugget relates to the importance of taking action. Buyers have to be informed to be prepared to pull the trigger.... but once they have made the decision to buy, they just have to go for it! Shownotes here: https://www.propertytrio.com.au/2023/05/22/ep-206-mastering-the-art-of-property-decision-making-and-conquering-the-fear-of-buying-before-a-better-option/

Got a question for the trio? Click hereMike opens his first official Market Update episode and kicks off the conversation with the Federal Government's budget night announcements. Notably, the trio talk about the impact on the property market, in particular the measures that are proposed to ease the cost of living and the government's approach to tackle the rental crisis. The Trio ponder the complexities of long lead time and expensive building costs when it comes to targeting the new supply side of the equation, and Cate points out the contrasts between this particular budget night and past budget nights. Dave discusses the Build to Rent sector and the challenges that this initiative poses for the government, and he sheds light on the management trust withholding tax changes and the impact that this proposed easing will have on investment in the sector. Cate's word of caution about this type of investment category with controlled rents is an interesting one for pragmatic investors to consider. The initiative that the Trio all agree is a good one is the First Home Buyer shared equity scheme. Opening up the offering to those who have previously owned a home more than ten years prior, and allowing siblings and friends to co-purchase is a significant change to what was already a good offering. "It's much harder these days to buy a property as a single", says Dave, and this opportunity will make a positive difference for a lot of Australians, (including permanent residents) who are keen to get a foot on the property ladder. Cate particularly likes this initiative for several reasons, including the fact that it is less likely to segment the market and result in a dual speed rate of growth for first homebuyer stock vs all other stock.The side impacts that could increase house prices in specific areas include parental leave changes, (as household incomes grow), and green energy infrastructure upgrades in our existing steel manufacturing locations. Moving into our April Market Update... As Dave points out, Sydney is the "absolute standout", but other capital cities are also rebounding. Low listings, record new arrivals and a general stabilisation of rate increases are the current tailwinds behind the property market.Cate speaks about listing volumes and the drivers that influence them. Currently, vendor participation is low, and buyers are pouncing onto 'old stock', which is in turn eroding 'all stock'. Negative media sentiment and data lag are likely drivers of the current low listing rates. "Until vendors have confidence that the market isn't horrible, vendors are going to sit on their hands", says Cate. And she also shares her concerns about a particularly quiet winter; something that will be difficult for buyers, especially in the cooler climate cities.Dave also comments about something important: listing activity is also low because owner tenure is extended. People are holding their properties for longer. The trio focus their attention on the Westpac Consumer Sentiment Index and debate some of the drivers and changes that are noteworthy forward indicators for our housing market. New loan commitments are interesting, and according to Mike, "the refinancing goldrush has become a hallmark of 2023". Dave discusses a rebound he's seeing; both owner-occupier financing group and the investor financing groups have grown in size. First home buyers have grown by 15%; possibly amplified by the NSW stamp duty changes. The annual change in rents for houses continues to challenge several markets, but the change in unit rents is quite shocking for tenants in the affected cities and regions. But why is Tasmania lagging when compared to the other states? Mike asks Cate to explain and her answer may surprise listeners. And what is the story with Canberra? Dave eludes to the challenges associated with the public sector wage freezes, combined with the work from home acceptance.Cate's curious finding about eastern seaboard capital city top rental performers is intriguing.... we won't spoil the surprise.Distressed listings are not as 'distressed' as the media would have had us believe. The charts are not showing that the impact of interest rate increases have dismantled home ownership like the headlines suggested they would.The trio focus their attention on the Westpac Consumer Sentiment Index and debate some of the drivers and changes that are noteworthy forward indicators for our housing market.New loan commitments are interesting, and according to Mike, "the refinancing goldrush has become a hallmark of 2023". Dave discusses a rebound he's seeing; both owner-occupier financing group and the investor financing groups have grown in size. First home buyers have grown by 15%; possibly amplified by the NSW stamp duty changes. And... time for our gold nuggets... Dave Johnston's gold nugget: the separation between unit rental growth and house rental growth is a great one to watch. We saw cyclical highs in the last quarter, and Dave is tracking the relative historical differential between unit and house rents with an educated hunch that we could see units turn a corner. Cate Bakos's gold nugget: Any prospective vendors who are wondering if/when it will be a good time to sell. Cate implores them to hit the pavement and to check out some auctions in their area. They may be pleasantly surprised. Mike Mortlock's gold nugget: Mike points out that we've seen the data starting to turn around, and he says it's important to understand data lag. The best way to get a feel for the up-to-the-minute market conditions is to jump into the coal face and experience it in person. Shownotes here: https://www.propertytrio.com.au/2023/05/15/ep-205-april-market-update-rising-rents-and-budget-night-how-do-we-solve-this-issue/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMWelcome to The Property Trio! Formerly The Property Planner, Buyer and Professor, we've rebranded!The trio ponder the RBA rate increase decision. Cate points out that while the rate of inflation is reducing, the inflation figure is still "a million miles" above the target band, (in Mike's words), and our regulators are doing what they can to slow down the rising cost of goods and services; particularly the latter, as Dave points out. Despite the fact that the decision was not what the majority of economists anticipated, we still have some short-term pain to go, in an effort to thwart long-term pain.Will Mike's prediction be correct? A lumpy return to growth for the property market? Only time will tell. Cate harks back to the market sentiment index and the indicators that we need to look out for.Heading into episode 204, our second instalment on the various ways that buyers can purchase.Family loans are a common helping hand in today's market. Family assistance is not restricted to just parents, but often financial assistance comes from parent(s).Dave digests the difference between a genuine gift vs a loan. A loan will impact the borrower's serviceability when receiving a portion of the funds from a parent in the form of a loan, and lenders usually apply a thirty year loan term to the portion that is funded by a family member. A gift, however doesn't impact borrowing capacity adversely, yet it requires a few important steps to satisfy the lender, as Dave explains. Genuine savings is a major focus for banks, and Dave sheds light on this hurdle for our listeners and has valuable advice that may come as a surprise.Security guarantee, (also known as Family Pledge) is another common way that parents can assist their children on the property journey and Cate talks through some of the benefits and intricacies of such an arrangement. Dave talks through the pro's and con's of this interesting loan product, and shares a great example about a first home buyer client who has $200,000 saved, and is borrowing 106% of the purchase price with the assistance of a parental security guarantee.As Cate suggests, for this particular client, their ability to preserve their cash savings for renovations will enable them to target a renovation project; something that most first homebuyers don't have a viable chance at embarking on. How can children relieve their parents of the obligation to provide security? The trio ponder the likely ways that this can occur. And how can parents help children when they have multiple kids?Shared equity is the next topic that the trio tackle. From state-based to federal initiatives, there are a few options for buyers in today's market who are keen to get a foot on the property ladder.Mike details the federal scheme and what it means for buyers. "Instead of buying with a friend, you're buying with the government".Cate asks Dave how owners can get that monkey off their back, touching on the limitations to property improvement activity, buy-back rules and the income thresholds that buyers face in terms of eligibility criteria.Cate shares her experiences with working alongside clients who have utilised the Victorian state-based shared equity scheme. While it's quite restrictive, (and not for everyone), there is no doubt that it's a special opportunity for those who would have otherwise been precluded from the property market.Co-ops is the last conversation for this episode and Dave explains how a co-op functions. Best described as voluntary, member-led organisations. Common Equity Housing Limited, (CEHL) is the board controlling the co-op, with 25% of the tenant's income contributing to the cost of the housing co-op. As Mike and Cate point out, the arrangement is contingent on members being aligned. Mike shares the advantages and disadvantages to our co-op arrangement.Dave chats about the history of co-ops and the benefits on offer for buyers who embark down this path.And.... our gold nuggets....Dave's gold nugget: If you're a parent who plans to help a child, or a child who is seeking to get some help from parents.... there is a little bit to think about, so have the conversations early. Initiate conversations well in advance... it will save a lot of time, heartache, pressure and stress. Remember .... genuine savings!Mike's gold nugget: There are a number of ways for Aussies to get their foot on the property ladder, and taking into account our capital growth rate in our nation, getting in today could have a much greater benefit for you than getting in five or ten years later.Shownotes here: https://www.propertytrio.com.au/2023/05/08/ownership-structures-part-2/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMWelcome to The Property Trio! Formerly The Property Planner, Buyer and Professor, we've rebranded!The trio ponder the current market and share their thoughts on the improving conditions and some of the contradicting economist and media views. Cate highlights some of the reasons why our market has been underpinned, with an uptick of buyer appetite Mike brings perspective to the Silicon Valley bank concerns, citing Peter Costello, our past-treasurer in a recent interview.Kicking off episode 203.... What are some of the motivations for co-owning property? Affordability is a significant reason for co-ownership, but as Cate explains, sometimes it's all about bringing someone you love onto the property ladder. Her own real life story about purchasing with her stepson is a great example of a co-ownership success story. Debt aversion is another common reason, but as the trio uncover later in the show, co-borrowing can have an adverse impact on future borrowing capacity... something to ponder before diving in! Dave speaks about a sobering reason for co-ownership also. More joint income purchases have made it proportionately harder for singles to enter property ownership though. "Today, it's much harder for a single to buy a property than it was twenty, thirty, forty years ago", says Dave. Mike asks Cate to explain the difference between joint ownership and tenants in common; an important concept when it comes to estate planning and tax. And Dave points out that too many people think about 'the now' and not the future. Jumping into a decision without planning and consulting the relevant professionals can cost owners a lot in the long term. The trio chat about the benefits of pooling resources;DiversificationReduced cashflow commitmentThe chance to buy a better asset with a stronger budgetGetting into the property market earlierBeing enabled to enter the property market when you'd otherwise have been precluded. For example, complementary financial positions such as a cashflow rich, cash-poor individual combining forces with a cashflow poor, cash-rich individualSome of the issues that are often overlooked though are plentiful too.When one person has a sudden need to access their capital. Reasons can range from financial distress, new relationships and a desire to buy a home, etc.Lack of agreement about important issues, including the agreement itselfAn inequitable set of responsibilities between each owners and a feeling of dissatisfactionRisks to the relationship/friendshipPrepping for the entity decision is critical, and they must be arranged long before signing a contract.Mike asks Cate some good questions about the risks of buying at auction without a clear understanding of the entity, and Dave also sheds light on the ability of owners to switch between joint ownership and tenants in common after the property has settled. Dave touches on just some of the less-considered details that co-owners need to delve into before they embark on the journey, including the exit-strategy, a dispute resolution clause, a financial default plan, and the distribution of profits. Are they paying down the loan with the rental proceeds once the property is cash positive, or are they distributing the funds? So much to think about.... "Once you dig under the surface, there are a lot of things to think about." Mike quizzes Cate and Dave on the pro's and cons of corporate entities and trusts, from company tax rates on profits to the costs associated with the structuring and ongoing professional advice.Mike opens the conversation up about asset protection and the need for some owners in high-risk roles to consider alternative ownership structures. Joint and several borrowing can unravel a co-ownership arrangement if the borrowers are unaware of the impact of the joint and several arrangement on future borrowings. What happens when a co-buyer owns 25% of a property with a friend, and then decides to purchase their own home a few years later, only to find that their bank servicing is insufficient due to the co-ownership loan? Dave gives an excellent example for buyers to consider when contemplating co-ownership.Mike asks Cate about some of the things that people get wrong with trusts. "People try to out-sophisticate themselves", says Cate. Too much information can be a dangerous thing, as can cutting corners with budget advisors when setting up structures. Tune in next week for part 2, where the trio will cover more about alternative entities. And.... our gold nuggets.... Dave's gold nugget: Often people are looking for a shortcut to make money, but there is no such thing in property. Having a plan and good advice is so important Cate's gold nugget: "Guard your relationship. Making money is great, but destroying a relationship is an enormous cost and it's the worst".Shownotes here: https://www.propertytrio.com.au/2023/05/01/ownership-structures-part-1/

Formerly The Property Planner, Buyer and Professor.Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMFor this exciting episode, some 200 eps following the original podcaster intro's, Dave and Cate introduce Mike! They chat all things quantity surveying, but drill into the Novocastrian man behind the microphone... from his dangerous hobbies, to what it was that led him to his career as a 'construction economist'. Mike's candid demeanour brings something special to the trio, and this particular recording sheds light on Mike's zest for trends, data and the identification of property market drivers. Cate delves into the various facets of quantity surveying that requires Mike's skillsets. This ranges from depreciation schedules, replacement cost estimates for insurance purposes, strata management schedules, among other activity. We are thrilled to welcome Mike to the show and we look forward to scheduling some great episodes derived from his MCG Quantity Surveying 1,000 Assets Reports. Mike shares some intriguing snippets of data about lost depreciation benefits and the figure is staggering... .tune in to hear the details!Gold Nuggets: The Quantity Surveyor, Mike Mortlock: Journalistic bias is something that buyers should keep in perspective. Cognitive bias creeps into our thinking often, and it's important we recognise this when making property decisions.The Property Planner, David Johnston: Dave suggests that investors who haven't actioned their depreciation schedules need to get in touch with a good Quantity Surveyor to claim their deductions. (As Mike says, "Thanks Dave... the cheque's in the mail!") Shownotes: https://www.propertytrio.com.au/2023/04/24/ep-202-meet-the-quantity-surveyor-mike-mortlock/

Got a question for the trio? https://forms.zohopublic.com/propertyplanningaustralia/form/GotaquestionforthePropertyTrio/formperma/zYCQAxzE_24CVlDafP1ozyzwtmB-8m1iCNtCTgDvHXMWelcome to The Property Trio! Formerly The Property Planner, Buyer and Professor, we've rebranded!We are proud to be bringing your regular episodes to your podcast feed with our newest musketeer, Mike Mortlock. Cate and Dave decided to throw Mike in at the deep end with his first hosting gig, and he didn't disappoint. The Trio reflected on the March data and in particular, the question on everyone's minds; Has the market turned, or is this a dead cat bounce? Dave and Cate are both confident that our market strength is sustainable, however Mike chimes in with some context around the quantum of the rebound for the month of March. Cate makes a point about the impact of buyer confidence, (and acceptance) of the rate increases, particularly now that it's evident the rate increases are easing, inflationary pressures are reducing and skill migrant arrival numbers are climbing. "It's refinancing gold rush times at the moment", says Mike. "I think double digit growth isn't out of the question."The Trio crack straight into the data as follows.Monthly Data - Sydney rebounded strongly with 1.4% growth in one month, and Dave brings market segments and price points to light when he shares that the upper quartiles are the highest performing price segments for the eastern capitals. Dave highlights the separation between Perth, Hobart, Darwin and the other capitals. The Trio canvas the accuracy of some of the most skilled economists and the reliability of their projections and Mike touches on the difficulties of predicting price.Peak to troughs - The sea change/tree change movement is obvious in this following table, and the trio but the March uptick signals a recovery in the regions also. Despite the fact that many of our cities are plagued by low stock supply, we have this to thank for placing a floor under price falls. Cate touches on the elasticity she's seeing, however when it comes to Lockdown Escapees returning to the city.Sales volumes are down - Dave shares an interesting thought; the number of sales as a function of total dwellings are diminishing. From stamp duty avoidance to low confidence, and also taking into account the insufficient options for prospective vendors to choose from, our market forces are not conducive to vendor listing activity. Dave predicts a listing rebound in the Spring months of 2023.Dave confirms the high demand (and activity) for refinancing is evident in the data and at his coalface - it seems refinancing activity is a hallmark of 2023.Rents... Mike shares a scary news item - he read about a rental provider advertising a tent inside his living room for rent. Looking at the rate of change for rents, almost every capital city except for Canberra is exhibiting frightening rates of rental growth. Brisbane is an interesting case to ponder, particularly following the repealed land tax changes and the impact it had on investors. Mike quotes one of our Property Professor's pieces of wisdom dating back to August last year. "Rents have grown at only half the rate of inflation for the past decade. With inflation at over 25% for the decade, and yet the property rental growth average sitting at 11%, the trio ponder the concept that rents are just playing catch up.Sentiment - Mike highlights bond yields and the correlation with sentiment and ponders whether the consumer sentiment figures are actually indicating a rebound. Cate suggests that a dose of YOLO (you only live once) combined with added lockdown savings have delayed the intended impact of the RBA's rate increases. Note we have since sourced an updated April Westpac Consumer Sentiment chart to overlay with the previous March chart discussed on the show.And... our gold nuggets! The Property Planner: Dave feels that late last year was indeed the best time to buy and he notes the markets are broadly in recovery mode now, and Mike agrees with him. The Property Buyer: For any upgraders who are feeling disconcerted by the lack of housing options to pursue, they should consider a long, (or flexible) settlement period to give themselves time to shop.Shownotes: https://podcasts.apple.com/au/podcast/the-property-trio/id1476039942

Dave and Cate share with the listeners the appointment of Mike Mortlock to 'Third Musketeer' status on The Property Trio.Mike's job interview and Cate and Dave's discussion prior about the key attributes they're searching for. This little mini-ep taster provides a bit of humour and some insight into Mike's wit and charm.We welcome our clever Quantity Surveyor to the show! Congratulations, Mike!

Formerly known as The Property Planner, Buyer and Professor, we've rebranded to The Property Trio. Our listeners who have subscribed to our show don't need to do a thing. Each week's episode will keep landing in your feed.Got a question for the trio? http://bit.ly/3mlk8RwShow notes: https://propertyplanning.com.au/our-200th-ep-a-special-farewell-to-pete-and-some-wonderful-memories-to-share-of-our-journey-ep-200/As Dave and Pete said at the start, "We made the double century". This special episode is not only our 200th, but our last as "The Property Planner, Buyer and Professor. The trio enjoyed reminiscing about the early days when the concept of the show became a reality. Speaking openly about their hopes, fears and feelings when the pilot launch aired back at the start of 2019, this retrospective is a special one. From mapping out the first episodes to investing in the studio, Dave chats about the inspiration that led to the podcast that it's become today.Pete recalls the turmoil that COVID caused for so many, and the ways that they worked around lockdowns with technology, enabling every episode to land in their listener's feed during tough times.Dave explains how the show has taken shape over the years with listener questions, case studies and market updates peppered in between unique episodes, taking inspiration from listener feedback over the years.This episode has some past sound bites from early episodes including some early calls and insights in relation to the inflation challenges the economy is grappling with today, and Cate's potty mouth during Melbourne's earthquake gets some laughs from the guys.Cate shares some special listener reviews and our newest muscateer sends a special shout-out to Pete. While Cate and Dave are particularly sad to be saying cheerio to Pete, he's never going to be too far away and this episode was a joy for them all to produce. Wishing our Property Professor many, happy years of semi-retirement, (because we all know he will truly never quite be able to fully retire from his love of property!).Pete.. thank you for the memories and the fun on the show. Your clever one-liners, valuable stories and incredible ability to impart your property knowledge have been appreciated by us all."You don't need to be a genius to do well in property. You just need to know a bit more than the last person". To sign off the 200th episode, we replay Pete singing us a special song. ...and in the coming days... Look out for our mini-episode launch of "The Property Trio" where Dave and Cate shad light on the interview process and the quest for the new third muscateer. Listeners who have downloaded The Property Planner, Buyer and Professor podcast in their feed don't need to do a thing. Your feed will automatically update to reflect the new name, The Property Trio. Our new show notes will move to the new website following our 200th episode.

Formerly known as The Property Planner, Buyer and Professor, we've rebranded to The Property Trio. Our listeners who have subscribed to our show don't need to do a thing. Each week's episode will keep landing in your feed.Got a question for the trio? https://zfrmz.com/0S6ddQ7y4WzaE3qX3xZtShow notes: https://propertyplanning.com.au/the-property-professors-memoirs-part-3-ep-199/This is arguably one of the trio's favourite set of episodes. Taking a trip down memory lane was not only a thrilling chat for Pete, but a wonderful way to share some very important learnings with our listeners.Following on from last week's episode 1 where Pete got started on his property journey in 1984, this week's episode introduces listeners to Pete's learnings as he embarked on value-adding to his investments.Episode 1 - Getting Started. It starts back in 1984 when Pete and his wife purchased their first home in High Street, Ardrossan (SA) and spans the the purchase of their first upgrader home, as well as some early value adds and long-term investments that Pete embarked on.Episode 2 - Property Speculation. Pete branched into purchasing value add properties and wised up to other ways that investors can value add, other than gaining a DA.Episode 3 - Property Development and Construction. Pete started building and retaining properties in this particular investment phase. In Episode Two, Dave delves into Pete's 'mid-journey' property acquisitions and upgrades.In the last of these three special episodes, Cate hosts this episode and looks into the various ways that Pete's skillset and experience have enabled him to achieve success and to have choice as he approaches semi-retirement. Episode Three hinges on Pete's growing expertise in relation to subdivision and building."Two equilateral triangles make a square"... Listen in to find out how Pete optimised two sites for development.Pete also touches on his experience post-GFC with his NRAS scheme properties, and the implication of the benefits that have spanned ten years of his investing journey.Cate reflected with Pete about his growing national brand and his achievements over the years. Pete appeared in almost every API magazine, contributed to journalist articles, authored two books; firstly in 2008 and then in 2013, he's continued his studies, maintained his passion in property as an active investor, and in 2013 Pete had what he describes as a 'landmark year'. His Masters of Urban Regional Planning study commenced, he was teaching full time, he managed authoring his book and he was training for a marathon. No small feat indeed."Knowledge is power in many different fields, and it's no different when it's in property."Pete emphasises the need for investors to take action, because time is only a wonderful thing once you're investing. He considers some of the students he's taught and the people who have asked him for help over the years, and he touches on the sad reality that many didn't take action to actualise their goals. Pete's saga about his daughter bidding for him while he was holidaying in Melbourne. While sitting outside a fashion shop waiting for his wife, he trawled the internet on his phone. Recognising a poor listing on the internet that had previously been incorrectly uploaded, Pete set himself the challenge and geared up for an auction (with his daughter's help) in a tiny space of time. It's a wonderful story! Tune in to hear why this particular property caught Pete's eye.Another great project that Pete shares with our listeners relates to a quadrilateral shaped block that one of his students identified, and in fact it's one of his favourite developments. Pete built the townhouses and holds them to this day, retaining them as a key piece of his retirement plan."You don't need to be a genius to do well in property. You just need to know a bit more than the last person".The trio ponder the properties they've sold, the losses they've averted and the reasons why they sold at the time. Pete's sensible words of wisdom shine through as he reminds listeners that sometimes we make decisions that were the right decisions to make *at the time*.To sign off the episode, Pete happily sits in the hot seat and answers Cate and Dave's questions. From his best performer, to his tips for success, this episode can't be missed.And... our gold nuggets!Pete Koulizos, the Property Professor's Gold Nugget: "Surround yourself with like-minded people to help you on your property journey."David Johnston, the Property Planner's Gold Nugget: Dave asked Pete a fantastic, burning question that he wanted to bring to light for the listeners; was Pete's property journey the right journey for *him*?Cate Bakos, the Property Buyer's Gold Nugget: Pete's success can be attributed to his passion, continuous learning and his willingness to take action, but a significant ingredient that Pete had on his side was all about time. He got started early.

Formerly known as The Property Planner, Buyer and Professor, we've rebranded to The Property Trio. Our listeners who have subscribed to our show don't need to do a thing. Each week's episode will keep landing in your feed.Got a question for the trio? https://zfmz.com/uLtjhyBskV96PYeJfal Show notes: https://propertyplanning.com.au/the-property-professors-memoirs-part-2-ep-198/This is arguably one of the trio's favourite set of episodes. Taking a trip down memory lane was not only a thrilling chat for Pete, but a wonderful way to share some very important learnings with our listeners.Following on from last week's episode 1 where Pete got started on his property journey in 1984, this week's episode introduces listeners to Pete's learnings as he embarked on value-adding to his investments.Episode 1 - Getting Started. It starts back in 1984 when Pete and his wife purchased their first home in High Street, Ardrossan (SA) and spans the the purchase of their first upgrader home, as well as some early value adds and long-term investments that Pete embarked on.Episode 2 - Property Speculation. Pete branched into purchasing value add properties and wised up to other ways that investors can value add, other than gaining a DA.Episode 3 - Property Development and Construction. Pete started building and retaining properties in this particular investment phase. In Episode Two, Dave delves into Pete's 'mid-journey' property acquisitions and upgrades.One of Pete's interesting achievements involved subdivision activity without building activity. In 2001, and by the time his young family were old enough to travel abroad, Pete proudly took his wife and two eldest to Greece to celebrate some of their property investing achievements. Interestingly, Pete's motivation to avoid building stemmed from a sloping block representing too many challenges for him to tackle. But block after block, Pete perfected adding value through planning approvals, although he notes that it was easier twenty years ago than it is now.Why did Pete decide to sell his holiday house though? He offers a great explanation... Pete's children's sporting commitments, friends, and weekend plans got in the way of he and his family being able to enjoy their holiday house. The trio have discussed holiday houses at length over past episodes, but this real-life example from our very own Property Professor sheds light on the viability of the holiday house ideal for this family.Pete and Dave discussed debt, home renovations, personal priorities and the need to put family needs before investment desires at times. Pete's authentic personality shines through in this episode. "I'm a big believer in that your home is your castle." ....."there's no point in having a fantastic place that somebody else is living in and renting, and then you're living in a not-so-nice place."From value-adds via clever planning insights, Pete's winning formula as his property knowledge grew became a feather in his cap and a very effective way to grow his wealth. His salient advise is peppered throughout this exciting episode, and yet another piece of advice from Pete rings true. "Most approvals do not last forever".Pete reminds us about recessions, the GST introduction, the GFC, first home buyer grants and all of the eternal drivers that influenced the vibrant market conditions of the late 1990's and early 2000's. It's a gripping episode, and one the trio enjoyed.And... our Gold Nuggets!Pete Koulizos, the 'Property Professor's Gold Nugget: "Property booms are wonderful things." Pete's tip sits outside of timing markets, but he reminds listeners that owning property during a boom period is powerful for any investor's portfolio.Cate Bakos, the 'Property Buyer's Gold Nugget: Cate reminds investors not to take town planning advice from an agent. Independent advice is paramount. "Property purchases are BUYER BEWARE."

Formerly known as The Property Planner, Buyer and Professor, we've rebranded to The Property Trio. Our listeners who have subscribed to our show don't need to do a thing. Each week's episode will keep landing in your feed.Got a question for the trio? https://zfmz.com/uLtjhyBskV96PYeJfal Show notes: https://propertyplanning.com.au/the-property-professors-memoirs-part-1-ep-197/This is arguably one of the trio's favourite set of episodes. Taking a trip down memory lane was not only a thrilling chat for Pete, but a wonderful way to share some very important learnings with our listeners.Episode 1 - Getting Started. It starts back in 1984 when Pete and his wife purchased their first home in High Street, Ardrossan (SA) and spans the the purchase of their first upgrader home, as well as some early value adds and long-term investments that Pete embarked on.Episode 2 - Property Speculation. Pete branched into purchasing value add properties and wised up to other ways that investors can value add, other than gaining a DA.Episode 3 - Property Development and Construction. Pete started building and retaining properties in this particular investment phase. In Episode Two, Dave delves into Pete's 'mid-journey' property acquisitions and upgrades.For Episode One, Cate delves into Pete's early days and asks all kinds of questions about his early influencers, his savings regime and some of the significant differences that he faced as a first home buyer back in 1984 compared to today's new starters on the property ladder. Interestingly, Pete's driving force to purchase a transportable home Ardrossan related to a sensible look at the cost of ownership versus the cost of renting, particularly in a country town.How did Pete fare with his negotiating ability with his first home? Tune in to find out what his bonus inclusions were! The growth of Ardrossan was reasonable back in the 80's and it equipped Pete and Mrs K to be able to leap frog into an upgrader home in Torrensville, Adelaide with their firstborn child in 1991.Cate asked Pete about how much his father helped and taught him with his property knowledge. "It was all leant by osmosis", was his telling response. But tackling how to explain investing and debt to his parents was a different type of challenge. Like many young investors, Pete had to be cognisant of his parent's fears and concerns about his appetite for risk and wealth creation.Why does Pete pay full price for a property? He offers a great explanation...The trio chat about Pete's early investment property experiences, including;managing cashflow,his aversion to battle-axe blocks,mistakes he made,investing with business partners,enabling a viable project with a clever JV idea, andinterest rate pressure and other financial challenges.Pete also talks about a block of flats that he secured some forty years ago that are still in the family (...and it's a great story!)Cate probes Pete about his rationale for selling some outstanding performers and his answers are particularly grounded. Pete is generous, humble and an absolute wealth of knowledge in this gripping first episode in this special trilogy.And... our Gold Nuggets:Pete Koulizos, the 'Property Professor's Gold Nugget: "Buying and holding is the best strategy to make money in property, but it's not the only strategy."David Johnston, the 'Property Planner's Gold Nugget: Dave notes that having a longer term plan, taking some risks and making firm decisions can enable investors to retire wealthy. They don't have to make many decisions, they just need to make good decisions.

Got a question for the trio? https://zfmz.com/uLtjhyBskV96PYeJfal ShowShownotes: https://propertyplanning.com.au/when-property-and-money-decisions-upset-relationships-part-2-ep-196/ Dave's market update is a special one - he has been in the mortgage industry for over twenty years and his mortgage intel is always exciting. One lender has re-introduced negative gearing into their serviceability calculator. This essentially means that "shading" on rental incomes enables heightened borrowing capacity for investors. While it's just one lender... these situations often mean more will follow.Cate's market update relates to civil and infrastructure works. From a planning point of view, home owners and investors should be mindful of the impact of these works. From compulsory acquisition to road widening to zoning changes, buyers should look into these changes and consider the impact to their purchasing plans.Following on from Episode 194, the trio uncover the common triggers for upgrader/family home buyer discord. From provisioning cashflow to enable parents to stay at home with young children to managing thoughtful discussions about retirement plans, Dave sheds light on the benefit of having buffers and a strategy to navigate some of these often-treacherous waters.Dave, Cate and Pete discuss some of the other tricky aspects, including;identifying the need for living in a show-home vs enjoying a simpler life- debt comfort level misalignment- investing vs nesting- location preference disharmonyCate reminds the listeners that having a mutually shared spot on the Venn diagram is essential to overcome couple's different preferences and clashing risk profiles. Dave raises an interesting point about the relationship between financial focus and personality traits. Not all people are financially literate and many have to be taught about the difference between good debt/bad debt, and the merit of having financial goals. What are some of the triggers for investor couples when it comes to upsetting a relationship? Pete uses a great example to illustrate the importance of remaining unemotional and pragmatic decision when it comes to investment property selection.And his two 'fundamentals' questions highlight just how pragmatic the Property Professor's approach is: "Is it in a good location, and does it have a good land component?" To support Pete's philosophy, Cate's favourite saying for her investor clients is; "You don't have to love it, in fact you don't even have to like it, but I want you to be proud of it." This extends to those who also confuse investment with holiday homes and future use potential.Sacrificing family home dreams is another common source of upset, as is impatience. Dave's example about the kids who were offered one marshmellow immediately, versus those who were rewarded with two marshmellows if they could wait for five minutes had the trio chuckling. Property investing really is a long game and it does require sacrifices at the start. The trio also chat about misalignment of preferences for asset classes, and bad previous experiences with property investing tarnishing enthusiasm.And... our Gold Nuggets!Cate Bakos, the Property Buyer's Gold Nugget: Cate shares some good tips based on personal experience. To get yourself in the best position to present to a financial advisor, Cate recommends couples take the time to understand each other's positions on wealth creation and debt aversion, and she encourages couples to be prepared to talk to each other about their sensitivities.David Johnston, the 'Property Planner's Gold Nugget: Dave notes that the crucial conversations are the hardest ones to have, but to push past the discomfort, remain open-minded, and to chat consistently is critical for couples who want to be on the same page.

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaI Show notes: https://propertyplanning.com.au/market-update-feb-2023-ep-195/ 1. Price falls are substantially lower this month, compared to last month February saw even more of a slowdown in the rate of price decline, and interestingly, Sydney's positive price movement of +0.3% in February carried the national and combined capitals/regions average to almost negligible price movement at -0.1. Cate sheds light on why 2023 is quite different to past years.  COVID lockdowns impacted agent activity significantly in the lockdown cities and and agents took the chance to take a holiday this summer after two consecutive, challenging summers. And what's behind Hobart's recent under-performance? 2. New listings and total listing figures are still substantially under the previous five year average, but the discrepancy is slightly smaller than last month. Much like Cate and Dave's point for February sales, it's likely that the listing activity was lower than typical January/February periods due to agents and vendors taking advantage of a summer break. 3. Unit rents are looking dire for renters in most cities, but what is going on with Canberra? Dave has an ear to the ground with some of his family in our nation's capital and his late night text to Pete and Cate sheds some light on the issue. Namely, three forces are at play for Canberra right now; Public service wages were frozen. Lots of interstate people can work from home doing jobs based in Canberra. And the cost of living is very high Canberra relative to it size. 4. Tighter rental vacancy rates – as rents continue to climb, some of our capital cities (for both houses and units) are exhibiting further tightening rental yields. The falling rents during COVID are a stark contrast to the rate of rental increase today. 5. Sales activity is still low despite an expectation that our emerging autumn markets usually start to demonstrate a peak of activity at this time. The volume of sales currently, when contrasted against the higher number of houses and increased population count within our capitals, presents quite a surprise. Pete discusses the decreased consumer sentiment and the correlation this has with listing and selling activity. 6. Consumer sentiment has continued to wane, although the trio point out some interesting indices on the latest Westpac Consumer Sentiment chart. Pete refers to current consumer sentiment at the start of the episode and makes a point that the sentiment levels today are among some of the lowest we've had in recent times, despite the fact that our interest rates are still comparatively low compared to historical rates. 7. Our bond yields continue to tell us that interest rate equilibrium is getting closer, although money markets indicate that we may have more rate rises than earlier expected. 8. Unemployment continues to stay at historically low levels. As Pete says, "Ahhh, but some good news!" Gold Nuggets Cate Bakos – The Property Buyer: Cate reminds listeners to factor in the impact of COVID on our markets, and in particular, the ongoing effects that have continued to shape our data. David Johnston - The Property Planner: Dave has some sagely advice for our governments when tackling the number of available properties for sale. Without policy intervention and changes to stamp duty, he feels the issue is not likely to go away.

Got a question for the trio? https://zfmz.com/uLtjhyBskV96PYeJfal Show notes: https://propertyplanning.com.au/when-property-and-money-decisions-upset-relationships-part-1-ep-194/ The trio make a bitter-sweet announcement at the beginning of the show. Pete is leaving the podcast to enjoy his semi-retirement, and while Dave and Cate are excited for Pete, they are pretty sad to be saying goodbye to Pete. He's not leaving quite yet - they have the 200th episode coming up in April and they have a special three-part series with Pete coming up. They also share they will be announcing Pete’s replacement in the coming weeks…..stay tuned! In this week’s episode, Dave, Cate and Pete cover some of their best tips for navigating tough property decisions as a couple, particularly when risk profiles, preferred locations and priorities for home versus investment differ. 1. What are some of the triggers for first home buyers when it comes to potentially upsetting a relationship? From separate savings to differing salaries, parental support and pre-nuptial agreements, the trio canvas some of these sensitivities. Pete talks about some of his experiences with these situations and Dave points out that it's not uncommon for couples to have different feelings and views about things and shares some interesting examples for you to be aware of. 2. How do couples broach pre-nuptial agreements or substantial cash contributions? Dave's experience with past clients precipitate some great questions that first home buyer couples can discuss at the onset of their journey, and he also shares a great podcast with our listeners that tackles pre-nuptial agreements. 3. What do you do if your partner enjoys 'living in the moment' financially more than you? Cate mentions a reasonably common issue that sometimes creates tension in first home buyer relationships; a different approach to saving and spending. YOLO, (you only live once) is a fun way to look at life, but it has it's place. Unfortunately YOLO doesn't have such a great place when it falls within a dedicated first-home savings regime. In addition to investment appetites and debt aversion, many couples face differences of opinion when it comes to location. Proximity to work, family, friends, schools and community can sometimes clash. 4. What is a common trigger than can be avoided? Dave notes that a significant stressor relates to the overall plan; home or investment. Plenty of couples and individuals blur the lines or lose track of the primary reason for a purchase. Whether it be a stepping stone property or a fully-fledged home, a future-use investment or a rent-vest approach, so many start the process without thoroughly canvasing what they should be focusing on. The trio talk about their various approaches to 'getting two people on the same page'. Cate refers to Venn Diagrams and the shaded, overlapping part. Dave discusses the need for a firm plan well before specific locations and dwelling types are up for consideration. Approaching cashflow, cash buffers and deposits is an important part of the pre-planning and Dave sheds light on some of the clever questions couples can answer together before embarking on the property criteria phase. Gold Nuggets Cate Bakos, the 'Property Buyer's Gold Nugget: Cate shares some good tips for first home buyers who are navigating the process with parental input, (solicited and unsolicited) in their ear. Ultimately it's an important decision that is made by the couple, not parents. David Johnston, the 'Property Planner's Gold Nugget: Dave encourages property buyers to plan early. It's all about investing more time in the planning up-front, as opposed to during the search phase.

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaI In this week’s episode, Dave, Cate and Pete answer two great listener questions; one is as the title describes, and the trio address growth drivers, assumptions and some of the things that don't always correlate with property price growth in the way that people expect them to. 1. A great question from Phil about historical average capital appreciation in capital cities. Hello gang! When you quote property appreciation estimates, you usually say something like 7%, based upon the historical average appreciation of the capital cities. That 7% has been made up of a number of factors: -population growth -increases in general wealth -increase in dual income -foreign investment -government positive incentives (first homebuyer schemes) -government mismanagement (not building enough housing, or a mismatch between where the housing is built and where people want to live) -falling interest rates, (since ~ 1990: 17% to 0%, then bouncing back up recently) So my question is: How much of the 7% return we have seen would be due to falling interest rates, and how should we alter our expectations of returns going forward? Dave answers this compelling question with the aid of some charts. Looking at what happened prior to 1990 is a telling example of interest rate rises not necessarily correlating with price declines. From foreign investment to government mismanagement, Pete and Dave touch on some of Phil's points, and they maintain that "government not building enough" is not the root cause of heightened property price growth at all. As Pete states, it's generally the private sector that builds most of the housing because government (or community housing) is represented by only about 10% of housing. Pete also notes that property price growth is not directly related to interest rate movements, and he cites some specific periods that prove that more elements influence property price growth than just interest rates.  2. And a fabulous question from an anonymous listener who asks the trio about open home etiquette. To leave your name and number? Or to seek a different approach? Tune in to hear some valuable insights... A neighbour attends an Open House but complains to your assistant at the door that they do not wish to give their details to be logged on to the Register as they do not wish the vendors to be told of their interest. You need to address their concerns and advise them of their rights and your obligations. How would you address their concern, whilst trying to build rapport with the potential buyer?  The trio have fun with this question and Cate sheds light on some exciting undercover jobs she's had in her career when it comes to working with clients who wish to remain anonymous. 8. And ..... our gold nuggets! Cate Bakos, the 'Property Buyer's Gold Nugget: If a buyer has a decent relationship with the agent, they should be prepared to politely ask the agent not to call them about a particular property. Aside from saving the agent time, it will demonstrate to the agent why it's not the right property for them. David Johnson, the 'Property Planner's Gold Nugget: Dave talks about long term capital growth and the need for investors to be invested in an asset class that outperforms inflation. Regardless of short reduced overall yields, Dave firmly believes that investors are better off to invest long-term, than to risk inflation eroding their future wealth by waiting it out. Show notes - https://propertyplanning.com.au/listener-questions-will-property-continue-growing-at-7-pa-on-average/

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaI 1. Nationally a 1% median price reduction was our smallest rate of decline since June last year All falls for capital cities were also less than their falls last year – an interesting observation considering the unwelcome December rate increase. 2. Melbourne’s median value may fall to below the pre-pandemic level in the coming month – an interesting one to watch! But many of the other capital cities seem likely to remain above their last pre-COVID peaks. 3. Unit rents are still climbing in many cities, and while house asking rents have slowed their pace of growth somewhat, the rate of growth is still positive across the board. Units asking rents in every state remain problematic for renters. Combined with net overseas migration reaching a record high, the threat to the rental market undersupply issue is further amplified by the announcement from the Chinese Government for overseas students to return to their place of study. 4. Tighter rental vacancy rates – the majority of our capital cities (for both houses and units) are exhibiting further tightening rental yields. The heightening asking rents correlate with the tightening vacancy rates and also the increasing rental yield figures across our various capital city and regional markets. As Cate points out “We’re still seeing a sea of green!” 5. New listings are still low after a particularly quiet spring season nationally - what is causing this though? Our new listing activity is 24.5% lower than the five year national average and buyers at the coalface are experiencing this first hand. 6. Sales activity – people are still buying, but sales volumes are low. Pete explores what factors lead vendors to make the decision to sell in this climate. While we had a little bit of a late flurry of purchasing activity leading up to Christmas, the sales number across combined capitals still remains lower than the previous five year average. 7. What’s changed since our last rate increase? Things aren’t quite as dire as some may have guessed they’d be… tune in to hear more. Dave segues perfectly into our economic conditions and consumer sentiment changes. 8. Thirty percent less people are borrowing for housing – no wonder the banks are being so competitive! Unsurprisingly, refinance activity is very strong in response to three things; increasing interest rates, and hungry banks as a result of this lending reduction. 9. Our bond yields tell a compelling story – and Dave points out the visibility that these yield overviews enable us. The three year bond yield remains sub 3.2 still; and digesting this in tandem with longer term bond yields shows us that we’re reasonably close to the likely cash rate equilibrium. 10. Inflation continues to plague us; particularly house prices. Although Cate notes that recreation and culture haven’t really diminished. 11. And... our gold nuggets! Cate Bakos – The Property Buyer’s Golden nugget: Cate raises an important lender offering that some buyers may wish to know more about. David Johnston – The Property Planner’s Golden nugget:  One for our maths brains…. Dave reminds us that a ten percent rise is not the same as a ten percent reduction! Show notes: https://propertyplanning.com.au/market-update-jan-2023-tight-listing-supply-is-creating-a-few-buyer-challenges-ep-192/

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaIhttps://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week’s episode, Dave, Cate and Pete cover some of their best tips for managing risk.  Tune in to hear why mortgage strategy underpins this, and what can go wrong when mortgage strategy is ineffective ... 1. Seeking the help of a strategic mortgage broker. Dave takes our listeners through some of the key things that can go wrong when a mortgage strategy is ineffective and he differentiates a strategic mortgage broker from a transactional mortgage broker. Dave's 'six areas' of strategic mortgage broker are fascinating - tune in to hear them all. 2. Tax deductions. From negative gearing to depreciation, offset account facilitation to tailored advice, tax concepts are crucial to a successful portfolio. 3.  Being forced to sell is a sad outcome that can stem from ineffective mortgage strategy. But there are clever ways to mitigate this risk. Buffers are integral for any property investor to implement, but interest only and cashflow optimisation should be considerations too ... it's all about clever mortgage strategy. 4. LVR and equity management - Loan to value ratio can be varied to suit an investor's risk profile, and this aspect of risk management is particularly important for those with properties in more volatile growth locations. 5. Buffers - what is the difference between a cash savings buffer and a cashflow buffer? Cash on hand, cash that can result from liquidation of shares and offset savings are all considered cash savings. Cashflow buffer simply relates to the amount of money that is left at the end of the month after living expenses and other commitments. Cate asks Pete to share some of the effective ways he's been able to manage tight situations in the past. Listen in to hear more about Pete's celebration budget! 6. To fix or to leave variable - which is best? Dave explains that there is no right or wrong answer. This decision is entirely contingent on the individual's own timeframe and risk profile.  He reminds listeners to allocate ample variable rate for early repayments and/or offsetting though, as most fixed rates don't enable either of these. 7. One lender or multiple lenders? - Cate raises the question to both Dave and Pete. It is interesting to hear how each of the trio approach this so differently. Dave discusses the pros and cons of each outcome and he also discusses cross-securitisation.... an often misunderstood borrowing option, and not always the ogre it's made out to be. 8. And ..... our gold nuggets! Gold Nuggets Pete Koulizos, the 'Property Professor's Gold Nugget: "When you're looking at risk, consider the possibility of something happening, and consider the consequences if this something happens." Pete's matrix model allows us to consider risk in perspective. David Johnson, the 'Property Planner's Gold Nugget: Dave encourages borrowers not to do themselves a disservice by overlooking the importance of mortgage strategy. Selecting a strategic mortgage broker is an important step when it comes to setting up the right foundations early on in the investment journey. Visit the show notes: https://propertyplanning.com.au/risk-management-and-the-things-that-can-go-wrong-when-mortgage-strategy-is-ineffective-ep-191/

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaIhttps://propertyplanning.com.au/propertyplannerbuyerprofessor/ 1. Pete and Cate shed some light on how they each manage the administrative tasks for their retrospective portfolios. And listeners may get some good ideas when they hear how these two investors segment the tasks. 2. Each share the tools and programs they use. Nothing beats Pete's excel spreadsheets! From hardcopy folders to cloud based files, the trio all have their own systems to share with listeners. No amount of record keeping can substitute for a great property manager though. 3.  How do they track their deductions? This is potentially one of the most important questions for the episode. Getting it wrong can be costly in so many ways, and Dave details some of the critical things that investors need to keep top of mind. Some might surprise you... it's all about clever mortgage strategy. 4. Working in sync with accountants - What do investors provide each year to their accountant? What's on them to manage?  What record keeping is mandatory for investors? And what are the timelines of importance? Tune in to find out. 5. Managing property managers - what's OK, and what's not? The trio talk about some of the things that they've clearly marked as property manager tasks, and why it's so crucial to select a great one. From insurance to financial statements, Pete talks about his own revered property manager as a great example of an A-grade professional. 6. Due diligence applied when choosing between rental applications - how do Pete and Cate manage this? What attributes do they look for, and how can they glean this information? Pete and Cate have slightly differing approaches, but each share their best findings. Pete's hot tip is for investors to pay careful attention to the condition reports each time they are issued. Cate's two top priority issues include managing any water related issues, and people discord issues. Both can start small and end up big when ignored. 7. Ownership structuring is a critical aspect to investment administration - Cate raises the importance of understanding tax implications and also the impact of ownership on borrowing capacity. Both require a clear channel of communication to a good accountant and/or financial planner. Dave encourages listeners to focus on what's best for the whole journey, not just today. 8. And do the trio go back to their forecasts over time? Their answers may surprise you! 9. And our gold nuggets! Cate Bakos, the 'Property Buyer's Gold Nugget: Short and sweet... Never underestimate a good property manager! Pete Koulizos, the 'Property Professor's Gold Nugget: To manage a portfolio yourself requires great organisation. Unless you can apply the skills and time to the task, Pete recommends investors appoint a good property manager instead. Visit the show notes: https://propertyplanning.com.au/the-admin-paperwork-and-responsibility-of-running-an-investment-portfolio-ep-190/