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Episode 070 | Q&A – Buying a property with another person, security guarantee and rentvesting in Gold Coast

Back to back Questions and Answers episode! We’ve had a great time yesterday on our Facebook Live and hence we thought we should answer some of our other listeners’ questions. This week, Bryce and Ben looks at the questions below. Thanks again for submitting your questions!:

 

  • Question on entering the property market from Glenn: I have 2 daughters in their early 20’s. What advice can you give them on the best way to enter the property market? Thanks
  • Question on buying a property with another person from Stevie: I am interesting in the issues associated with buying property with another person. For example, I currently own two houses (bought years ago) with my brother as investments and I now want to buy another within to live in (as I can’t get a loan with just my salary and want to use the equity in the houses in lieu of deposit). This will then restrict my brother’s borrowing capacity to buy a property to live in if he wants to do so in a year or so, and we are at a bit of a (friendly) stalemate with what to do about it – buy another or not.
  • Question on Buying a property with another person from Michael: Hey guys – just wanted to say I’m loving the podcast. Found it about a week ago, have listened to hours of content in a short amount of time. Such a great resource. Has been good to hear that a lot of my ideas and research is being validated in what you’re saying, but has also given me some other things to think about. I’m about to buy my first property in partnership with my cousin, am making an offer today on a great find that’s too good to pass up. 15km north west of the Melbourne CBD. $150k under median price in the area. Quick sale needed as the vendor needs finance asap. Just wondering, what would be a bad figure in terms of rental yield and annual growth? And then I guess what would be the better figures to see? Thanks again for such a great learning tool.
  • Question on rentvesting from Samuel: I am very open to the idea of Rentvesting, however I am torn between Rentvesting or purchasing a Principle Place of Residence, of which I would live in for 12 months and then be rent out for 6 years (thus avoiding CGT), plus rent out the other room/s whilst living in the property. I would love to hear both your thoughts on this one given the current market conditions and also the Gold Coast Suns performance this year.

 

Some of the resources mentioned in this podcast:

  • Episode 54 | Entry into the property investment market, debt reduction and investing in house and land packages – Listen here
  • Episode 59 | Rentvesting: What is it and who is it for? – Listen here
  • Facebook Q&A Replay Video – Watch here

 

If you like this Q&A episode (Buying a property with another person, security guarantee and rentvesting in Gold Coast), don’t forget to rate us on our iTunes channel (The Property Couch Podcast) and our Facebook page. Any questions or ideas? Feel free to drop us your thoughts here: http://tpcaustralia.wpengine.com/topics/

Episode 069 | Q&A – Where is that sweet spot between Growth and Yield, investing in metro or regional and more

It’s Questions and Answers time! This week, Bryce and Ben looks at the questions below. Thanks again for submitting your questions!:

 

  • Question on Growth and Yield from Steve: Anyhow, a question for the podcast. Growth and yield are like a sea saw. As one goes up, the other goes down. Where I wonder is that sweet spot? Where both balance nicely and their feet dangle without touching the ground? For example, the best growth may be on Sydney Harbour with a view, but you may be negative $1,000 a week. So you go one suburb back, negative $800 a week. So you go one more back negative $600 a week. At some point you must hit a spot where you say, that’s the best growth I can afford. How do you decide that sweet spot? Is it different for all investors? Even if James Packer said to you, “Get me the best growth you can, income is not a problem” would there still be a point where you think, “Geez, even if we buy him a house on the harbour, the growth still won’t cover that massive shortfall over time.”Great show, keep it up. You are both a shining light in a dodgy, unregulated shark-filled industry. After all, my experience with people who talk very confidently but don’t know what they’re doing, (the enthusiastic amateur you effectively call them) I came up with my own saying, “Confidence does not equal competence“. Unfortunately, all you need is a little doubt in your own abilities and you default to the more confident person, who you may well know more than.
  • Question on Metro or Regional from James: I am looking to invest in my second property with my partner, we live in a rural area (Albury/Wodonga) and have around $100,000 in equity in our current owner occupied dwelling and good incomes with a maximum borrowing capacity of around $700-800k. Do you suggest trying to break into a Metro market (i.e. Melbourne) with a property in an investment grade suburb, which will in turn max out our borrowing capacity, or alternatively buy 1-2 properties in a major rural city?
  • Question on forecasting capital growth from Kayne: Just have one question in regards to forecasting Capital growth. I know you are conservative with your vacancy and interest rate assumptions (7.5% & 10% respectively) in your models. Are you also conservative in your CG assumptions (e.g if historical growth was ‘x’ would you round down a percent or 2 or keep it the same?) if you’ve covered this and I’ve missed it sorry for the double up, if not I look forward to your answer.
  • Question on active investing from Brian: Hi guys love the podcast immensely! If possible could you discuss views on being able to be an active investor to essentially create an income while still passively investing through leverage? Is this a possible scenario or what would someone need to look into to be able to do something similar…. I’m a tradesman so majority of the work I could do myself. Thanks very much!

 

Some of the resources mentioned in this podcast:

  • Report from CoreLogic : A profile of the Australian Investor – Who, Where and What? – Download here
  • Episode 37 | Understanding the Scarcity factor in Property Investment – Listen here
  • Case Demonstration: 4% Growth and 6% Yield vs. 6% Growth and 4% Yield – Watch here
  • Episode 51 | Will Labor’s proposed changes to Negative Gearing policy be good or bad for ordinary Australians? – Listen here

 

If you like this Q&A episode (Where is that sweet spot between Growth and Yield, investing in metro or regional and more), don’t forget to rate us on our iTunes channel (The Property Couch Podcast) and our Facebook page. Any questions or ideas? Feel free to drop us your thoughts here: http://tpcaustralia.wpengine.com/topics/

Episode 068 | Common complaints we hear from property investors

It has been some time since our last episode on investing and mindset framework so this time, Bryce and Ben will be unpacking the common complaints they hear from property investors. Here are the top 9!

  1. Wrong asset
  2. No buffer in place
  3. Mentoring was actually salesmanship
  4. Not maximising tax depreciation with Quantity Surveyor
  5. Solo sport
  6. Self property management (Check out Episode 31)
  7. Poor cash flow management (Check out Episode 3)
  8. Not starting early enough
  9. Selling

 

Apart from that, they will also be sharing some insider information on ‘offers’ they’ve received from property spruikers out there, Labor’s debate on negative gearing and the changes on foreign buyer stamp duty. Also, if you are interested in the BMT Tax Depreciation Application Form mentioned in this podcast, just fill in the form below and we’ll send it to you right away:

Free resources: BMT Tax Depreciation Application Form

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Other resources mentioned in this episode:

 

PS: We’ll also be holding a Live Q&A Event on Wednesday, 29th of June at 8:30 pm. Check out our Facebook page for more information!

 

If you like this episode (Common complaints we hear from property investors), don’t forget to rate us on our iTunes channel (The Property Couch Podcast) and our Facebook page. Any questions or ideas? Feel free to drop us your thoughts here: http://tpcaustralia.wpengine.com/topics/

Episode 67 | Property valuation process and the journey of a property investor – Chat with Kieran Clair

We have a guest on the show today! Kieran Clair, Editor of Australian Property Investor Magazine joined Bryce and Ben to talk about his role in the media and publication industry specialising in property investing. Prior to journalism, Kieran was an experienced property valuer and has more than 20 years of experience valuing properties for owner occupiers and property investors. So for today’s show, the three of them will be discussing:

  • Kieran’s experience as an investor and what motivated him to build his portfolio
  • The mistakes, lessons and investing tips he learned as an investor
  • His role as the editor of API Magazine
  • How the property valuation industry has changed over the years
  • What’s the property valuation process like
  • The types of properties that tend to be valued at below market price
  • Factors and considerations that would affect a property’s value from a valuer’s point of view

 

Other links:

 

PS: You may have noticed that the audio quality for today’s podcast is not as clear as it usually is. We experienced a few technical difficulties while recording and we do apologise for this hiccup.

 

If you like this podcast: “Property valuation process and the journey of a property investor – Chat with Kieran Clair”, don’t forget to rate us on our iTunes channel (The Property Couch Podcast) and our Facebook page. If you have any questions or ideas, feel free to drop us your thoughts here: http://tpcaustralia.wpengine.com/topics/

Cory

Bryce and Ben have been providing me with free property education each and every week. They start from the beginning and lay out the who, what where, when and how of investing in property. Being a frequent listener of their podcasts and also a reader of their book, I have gained so much confidence and feel education enough to take the next step and begin looking for my investment savvy team! In addition – these guys have a great yarn, share some incredible dad jokes (yes, you Ben!), interview intelligent, professional, positive people and they’ve even lead me in the direction of self motivation; pointing me to the likes of Zig Ziglar. The Property Couch has become part of my life an I thank you gents and Ivise for providing such a great podcast for people to better their financial situations! I’ve recommended the podcast and your book to friend and family! – Cory on iTunes, June 2016

Episode 066 | Winter is coming and the air will be colder up high

Well, technically winter is already here. However, we will be talking about the Property Market in this episode and for all of you who are a fan of Game of Thrones, you’ve guessed it right. It’s not going to be a good news story.

Now, you’ve heard us talking about the danger of high-density developments before but this time, we are hoping to solidify our message by sharing some numbers with you. It is not a secret that we’ve seen a whole lot more of high to medium density apartments coming into the market in the last 24 months and a lot more will be completing in the next 18 months. Below is the table that Bryce and Ben were talking about in the podcast.

 

Capital city # of Unit Sales Average Annual unit sales past 5 years Total New Units next 12 mths Total New Units next 24 mths
Sydney 34,216 43,442 34,300 81,696
Melbourne 28,506 30,781 29,541 80,503
Brisbane 15,880 14,932 16,652 44,511
Adelaide 6,988 6,195 2,581 6,002
Perth 5,331 6,834 7,031 13,797
Hobart 1,026 1,005 201 442
Darwin 864 1,026 985 1,256
Canberra 3,384 3,929 811 2,922
Combined 96,195 108,144 92,102 231,129

* This data is an extract from CoreLogic’s article dated 16 May 2016 called ‘Record high unit construction increases settlement risk’. To read CoreLogic’s commentary, please click here.

So how will this affect the Australian Property Market and its existing properties? Will there be a significant market correction and if so, should buyers stay off until this happens? Bryce and Ben will also be answering a question from Vlad:

John Symond on 3AW predicted a 10-20% fall in property prices if Labour’s policy on negative gearing were to be implemented. Given the uncertainty, is it prudent to wait until after the election to make decisions about investing in property and to see, should labour win, what their sledgehammer will do to the market?

 

PS: We’ll also be holding a Live Q&A Event on Wednesday, 29th of June at 8:30 pm. Check out our Facebook page for more information!

If you like this episode (Winter is coming and the air will be colder up high), don’t forget to rate us on our iTunes channel (The Property Couch Podcast) and our Facebook page. Any questions or ideas? Feel free to drop us your thoughts here: http://tpcaustralia.wpengine.com/topics/

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