Free Stuff  

• FINAL WEEK: Give the gift of sight
  Next week, the team heads to Bali to visit the John Fawcett Foundation and see the impact your donations are making — restoring eyesight for those who need it most.But there’s still time to be part of it! If you’ve been meaning to give but haven’t yet — this is your chance.Every $25 donation funds a cataract surgery, and every surgery changes a life forever. 👉 Donate now!

• The RBA has cut interest rates! Could this be the start of a new rate-cut cycle? 
  Tune in to Ben’s LIVE cash rate announcement, where we cover this and deep dive into the local and global trends shaping Ben and Evan Lucas’ outlook. Listen now >>

• Guests & Episodes Mentioned: 
  • Julia Hartman   
  • 471 | How He Built His $2.3M Property Portfolio After Leaving School At Just 16 – Chat with Ethan 

Questions We Answer

Q1) “Selling or Holding an Underperforming Investment Property?” from Sam
“Hey guys, just found you on Spotify a few weeks ago. The information I’m getting is phenomenal—keep up the great work. Really appreciate it, along with everybody else. 

Just have a bit of a situation that I’m in. My wife and I purchased our first home—a townhouse—15 months ago in Penrith. We’re planning to stay here long term. However, my brother, mum, dad and I purchased an investment property back in 2018—also in Penrith. 

The error we made was that we bought a unit. Over the past six years, it hasn’t performed all that well. If we’re lucky, we’re up about $100,000. It’s negatively geared, so we’re putting money into it each week.   

I’d like to get another investment property. But I’m not sure if we should sell this one and start fresh—maybe even get a couple. Or whether we should hold onto it and hope it increases in value. 

We do have a bit of equity in it. So another option is to pull that equity out and buy again without selling. 

The main question is—should we sell or should we hold? 

The property’s performance hasn’t been great. I think I’m trying to convince myself to hold because of the new airport being built in Western Sydney. Hoping that it will help push the value up. But I’m probably holding on to a bit too much hope there. 

Can’t wait to hear what you guys think. Have a good one!”  

 

Q2) “Seeking Advice on Selling Investment Property & Downsizing Strategy” from Scott 

Hi boys, long-time listener of your podcast—really good stuff. 

I’ve got a question for you. 

My wife and I are in our mid-50s. We’ve got a principal place of residence worth about $2 million. There’s a $170,000 mortgage on it, with $87,000 in offset. We also have an investment property we bought 20 years ago for $195,000. 

We’re looking to sell it now for around $700,000. There’s still a $95,000 mortgage on it. It’s positively geared, generating about $15,000 per year. We’ve got a combined super of about $1.5 million. We’ve kind of already started actioning a plan—but we’d love your thoughts to see if we’re on the right track. 

The plan is: Sell the investment house in Logan (south of Brisbane). 

Yes, we know we’ll have to pay capital gains. Then reinvest the funds into a unit, apartment, or townhouse in Brisbane. The idea is eventually to downsize our principal place of residence in Brisbane (worth $2 million). Then reinvest that into a unit on the Gold Coast. 

So, by retirement, we’d ideally have: One unit in Brisbane and one on the Gold Coast. Potentially rent one out for a while but ideally, not have to rent either of them out. Just use one as a Brisbane base and the other as a Gold Coast bolt-hole. 

Just interested in your thoughts— Are we making the right call selling the investment and reinvesting it? 

Or are we better off just hanging onto it? 

We wouldn’t ever live in the Logan property.  Thank you! 

Q3) “Thoughts on Rooming House Investments After Unexpected Property Loss” from Ethan 

G’day legends,  

Ethan from episode 471 here.  I’ve got a question regarding rooming / boarding houses. 

I recently had an incident at one of my investment properties. The property is going to be fully demolished. Thankfully, no one was injured and insurance will cover it. 

This event wasn’t part of the plan, but it’s led me to try and create a new opportunity out of the misfortune. That’s led me to do a deep dive into rooming houses. 

From all the research I’ve done, it seems like a very attractive investment. We’re talking ROI of 9% plus, and extremely low vacancy rates. Other properties in the area doing similar setups look promising.  

The Victorian government isn’t applying land tax to rooming houses. And the location I’m considering is under one kilometre from the centre of town. 

I’m fully aware of the extra costs and risks involved. Higher overheads, higher management fees, higher insurance, cleaning costs, and higher build costs—just to name a few. But the pros seem to outweigh the cons at this stage. 

Is it too good to be true? I’m still in full research mode and looking at a few other options too. I’d love to hear your thoughts on this type of investment. I know you guys are like me—you prefer to buy fully established rather than build. Keep up the good work, guys. 

Q4) “How to Sell Rooming Property Effectively?” from Viv  

Hi guys, 

I’ve invested in four rooming accommodation properties that have good income. They’re returning around 10%. 

I’m trying to figure out how to transition them into retirement. Do I sell them? Do I hold them? 

They’re a bit different from a standard rental because they’re semi-commercial. So they’re not as easy to sell at the drop of a hat like a regular investment property. I don’t want to feel restricted by that. 

Just wondering—have you had any experience with rooming accommodation? 

Two of the properties are built-to-rent. They’re five-bedroom, five-bathroom setups, with each room like an individual apartment. The other two are in my self-managed super fund. I converted those from existing properties already held in the fund. 

I’d really love to hear your feedback on rooming accommodation and where it fits into a retirement strategy. Thanks very much—love your show! Bye. 

Timestamps  

• 0:00 – Sell or Hold? Retirement, Rooming Houses & Real Regret-Free Decisions 
• 1:37 – Winners are grinners 😉  
• 2:49 – LAST WEEK before Bryce’s 50th birthday!   
• 3:20 – RBA Cash Rate: Could this be the start of a new rate-cut cycle?   
• 5:27 – Mindset Minute:  What is the best piece of advice you’ve ever received? 
• 7:32 – Q1) “Selling or holding an underperforming investment property?” 
• 9:29 – Purpose, unit uniqueness & recycling costs: Why these are key!  
• 12:43 – Future infrastructure = investing failure 
• 16:54 – 2 critical behavioural heuristics  
• 17:58 – Q2) “Seeking advice on selling investment property & downsizing strategy”
• 20:02 – Held your PPOR for over 10 years? You may be eligible for this!  
• 24:12 – What is your passive income goal?  
• 29:05 – Romance vs. Reality 
• 31:47 – Q3) “Thoughts on rooming house investments after unexpected property loss” 
• 33:45 – Q4) “How to sell rooming property effectively?” 
• 35:05 – Why room design matters here  
• 39:05 – The 3 questions you should be asking… 
• 41:37– Folks, this isn’t a “set-and-forget” strategy! 
• 44:28 – Water & property don’t mix 😉  

And… 

• 47:49 – Life By Design hack: If your kids want to do something, put it on paper!  
• 49:44 – WMPN: The latest bonds data: 24,384 properties lost in Victoria?!