One person doesn’t know if their properties are worth the out-of-pocket costs. 💸
Another couple isn’t sure if they should strike when the market is hot….or if it’s best to wait.
And another investor just wants to know, ‘Are we absolutely sure that Queensland’s Land Tax is off the table?!?’
We’re back with another mega-exciting Q&A Day that speaks to the Psychology of Investing, especially in an environment with rising costs and interest rates. 😮
From the common mindset blocks that investors face (like loss aversion and sunk cost) to how you can carve a path for yourself when you just don’t know what to do next…
We’re unpacking why investing isn’t for everyone, the Quality of Living trade-offs, how and why you’d want to split your variable and fixed rates and tons more wisdom!
Basically folks, this episode has a bit of gold (and anxious feelings) that we can all relate to.
Another fantastic episode filled with your awesome questions, tune in now folks!
P.S. And if you want help identifying the next step on your investing path, book a free, 100% no-obligation consultation with our award-winning team of Property Investment Advisors here.
Questions We Answer
Question 1: Anonymous on Confirmation that QLD Land tax is off the table
I’m a property investor contemplating my next purchase.
I heard that due to lack of support QLD’s premier has had to back-track on her proposed new land tax which would see the subject tax calculated on one’s total Australian land holdings (where before was only based on holdings in QLD).
Reason I am touching base is the QLD premier stated she would have to revoke the proposal and would have to be tabled and passed in parliament. Not understanding this process, I wondered if you might know whether the proposal has been formally revoked and/or if you can advise how or where I could direct this enquiry to obtain absolute proof this land tax is now off the table.
LOL, there is no way I would want to proceed buying in QLD knowing the new land tax could send me broke. I need to see it set in stone. 😂 Thanks for any help you can offer.
Question 2: Travis on Out of pocket expenses to maintain to IP
Hi gents hope you are well.
My question and advice relates to out-of-pocket expenses for me to hold 2 investment properties, because at the moment after all costs and tax rebates I’m around 15-18k PA out of pocket. I own a ppr and have a vic & qld IP.
My Moorr platform is up to date and has me in the surplus of 4K per month but only at the moment.
My issue is I don’t see current benefits with the high out of pocket expenses which are only going to increase & a couple of costly expenses to address on each property with water issues one being a requirement to put in a pit drain to tackle storm water and the other a fixed awning to combat heavy rain over a balcony, 4K and 3.5k respectively.
With all this expense and the impact on quality of life due to concerns of having to pay for the next big cost I wonder if it’s even worth it.
I have spoken with my advisor and informs me it’s ok but I wonder if this is sustainable or do I sell out for a more comfortable quality of living.
I appreciate that there is some sacrifices but 15-18k YOY with little prospect of that moving to a favorable portfolio holding I just don’t see.
To add there will be continuous improvements to spend in the coming years just to keep up with the age of the properties and keep them fresh I don’t feel rental increases will help the catch up.
Please share your advice and thoughts.
Question 3: Rose on A question on paying investment loans
Hi Ben and Bryce,
This is Rose, I love the podcast and have really enjoyed the personal stories in your summer series. I’ve never heard of financial anorexia before, but I definitely have it. So I was wondering if you could give me some guidance.
I bought a small investment property August 2021. I had a lucky guess that interest rates where going to go up sooner than the RBA was suggesting, and I fixed the whole loan at a lower rate than the bank offered for the variable.
However, this means I don’t have an offset account and I’m only aloud to pay off extra up to a limited amount per year.
This is an investment loan, and the property is positively geared.
I’ve heard old adages about how you shouldn’t pay off investment loans because they’re tax deductible, but the saver in me wants to pay down the loan.
So I’m asking you two as the experts, should I still pay off extra on my property investment loan now, while I have a low rate for a few years, or just keep paying back the minimum and invest the extra money elsewhere?
Question 4: K on Using equity – the now or never mentality
Thirty-something female listener here from Sydney, and big fan of all your work. You made lockdown liveable – thank you.
While I have met with one of your team already for a free consultation, I have to say I am finding taking the plunge my biggest challenge
My partner and I will be having a baby within a year, and have some modest “rainy day” savings in our offset – which took a few years to build. We purchased our home (PPR) in late 2020 and also have an investment property (unit) in Sydney purchased in 2018.
We now have a window of opportunity to use the equity in our home and investment property to buy our next investment and scale up.
I note in a recent Q&A episode you talked about borrowing capacity (for some) decreasing over time and becoming a tad harder, plus the mortgage environment will be generally more challenging with interest rates hikes etc.
I am not afraid of the macro changes going on in the world too much, but the ultimate question is: do we strike while the iron is hot, or wait?
The challenges ahead aren’t small (new human on the way, parental leave considerations, reduced income, rising interest rates etc)?
Free Stuff Mentioned…
- Leave us a Question on our SpeakPipe! Click here to send us your questions.
- UPDATED Money Management Platform: Check out Moorr, our free Lifestyle By Design platform which we upgraded over the weekend! We’re talking a new virtual assistant, better goal organisation and much more! Check it out here.
- Read CoreLogic’s Report on the 2022-23 Federal Budget here.
- Check out the Bills Before The House that Ben references in Q1 here.
- Ben’s Moorr Educational Series:
- Other Episodes Mentioned:
- RBA Cash Rate November 2022: Rate Hike Again But When Will It Stop?
- Episode 403 | Do You Need a Buyers Agent in Today’s Market? (Part 2)
- Episode 406 | How to Beat the Banks at Their Own Game
- Episode 398 | From Financial Anorexia to Financial Peace of Mind – Chat with Jack
- Episode 348 | From Refugee To $140000 A Year In Passive Income!
Want to work with Bryce & Ben’s Award-Winning Team?
- a roadmap to $2k per week passive income? >> Start a conversation with our Qualified Property Investment Advisors…
- buying an investment-grade property in an investment-grade suburb? >> Start a conversation with our independent and experienced Buyers Agents…
- set up or review of your borrowing strategy? >> Start a conversation with our Investment Savvy Mortgage Brokers…
- your defence implementation? >> Start a conversation with our Financial Planners…
- maximising your tax refund? >> Start a conversation with our Investment Savvy Tax Accountants…
Here’s some of the gold we cover…
- 0:00 – This week we’re tackling…
- 1:21 – We’ve had a MASSIVE upgrade to our Lifestyle By Design platform!! Check it out here.
- 7:44 – Quick Recap: CoreLogic, the RBA rate hike & Hot Property Data
- 10:33 – Feeling uneasy? This is what you should do.
- 13:02 – Here’s how a previous TPC Guest is implementing our lessons….
- 16:01 – Why you should chase your curiosity!
- 17:28 – Q1) Confirmation that QLD Land Tax is off the table
- 18:35 – The process behind amending legislation like this!
- 20:40 – Off-Ramping: Why you shouldn’t be concerned….
- 24:03 – Q2) Out-of-pocket expenses to maintain an IP
- 26:00 – This a classic conundrum that investors face…
- 27:56 – The Psychology of Investing: Sum Cost, Loss Aversion & Comfortable Quality of Living
- 29:06 – Over the long term, THIS disappears…
- 30:25 – Here’s how Travis can face his anxiety
- 31:47 – THIS is why some people aren’t suited to be property investors
- 33:28 – “You don’t believe it”
- 36:45 – Why investing is just like a bottle of wine…
- 39:16 – Q3) A question on paying investment loans
- 40:19 – What is Financial Anorexia?
- 41:20 – Some of the catches to consider…
- 42:49 – How to split your variable and fixed rates
- 44:18 – Ben’s Answer (In theory)
- 46:01 – What’s the benefit of going part-variable?
- 46:51 – Q4) Using equity – the now or never mentality
- 48:29 – Why you should focus on long-term horizons!
- 51:04 – How to find your pathway forward…(Psstt…if you’d like help with this, why not book a free, no-obligation consultation with one of our highly qualified Property Wealth Planning advisors here.)
- 54:30 – The 3 Golden Dials!
- 57:03 – How we make the “Invisible, Visible”
- 1:01:47 – Made a mistake on your iPhone calculator? Here’s how you can wipe your last move
- 1:02:58 – Why Re-grading Property Investment in Cairns is outrageous!
- 1:08:08 – Keep the Qs coming folks! Submit them on Speakpipe.