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Episode 299 | Sell Everything And Run? Brand New Update From Leah Calnan, President of REIV

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If you listened to last week’s episode, you’ll know already that there’s been significant changes happening on the grounds in the real estate industry… particularly here in Victoria with Stage 4 and Stage 3 Restrictions now seriously impacting what we CAN and CAN’T do when it comes to property transactions and inspections across the state…

And since then, we’ve heard from the Commonwealth Bank CEO Matt Comyn on the current health of one of the Big Four and the damage faced to our banking system as they act as “shock absorbers” during the COVID-19 crisis…

.. so the question now is… Is It Time To Sell Everything And Run? And for us living in VIC, Should we flog everything and move to Queensland?!

In today’s eye-opening Q & A, we’re unpacking ALL this, plus – as promised – we have a Brand New Update from Leah Calnan, President of the Real Estate Institute of Victoria (REIV) with further insights into what buyers, sellers, renters, real estate agents & property managers are legally allowed to do in COVID-19 Victoria.

Leah will also be covering what services can still go ahead with up and coming settlements and end of leases… and smart ways to safeguard purchases and sales over the next five weeks.

So. What are we in for?

 

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The Questions

Question on Finance from Matt Feeley

If I buy an investment property with equity release and create two loan splits (let’s say 100k equity secured against PPR and 400k home loan). If I sell the PPR in the future to upgrade the family home, what happens to the 100k loan that is secured to the PPR? What are the options? Thanks a lot guys!!

 

Question on Selling Right Now from Cameron Hall

Not really a question, but thought I’d share our experience selling our home recently. Went on market two days after Melbourne went into stage 3, but despite individual inspections and the associated hassle, there was huge interest (25+ groups), and it sold in 5 days, for what we wanted, and a street record     . In a pandemic. No shortage of demand (at least in our area) from what we’ve seen. Hope this helps anyone worried about selling

 

Question from Maximus Decimus Meridias

This is a buy, rent and sell question and although specifically about the Perth market, I think it is valid for all of Australia. The media reported last night that the Perth median sell price has slipped below Adelaide and is 2nd from the bottom with Darwin sitting below Perth. However, the rental vacancy rate is

$200 less than last month and about half of what it was this time last year! I believe I heard you say in a podcast a few weeks ago that potential sellers are holding onto their properties because they know prices are real low. But has distressed selling pushed the median price down? Or are the media looking at stats at a certain point in time which reflects a bad run of  lower cost properties being sold in distress or otherwise? All these stats don’t match up with what I’m hearing about rental vacancy rates in other parts of Australia either.

And finally, we are looking at rentvesting, yet is it better to look at buying in Perth right now, rather than rentvesting or does that depend on the suburb?

 

Question from Hugh Gates

Hi guys, currently building a granny flat on the back of my PPOR at the moment which will be leased. My question is will my serviceability for a future  investment loan be increased if I lease the main residence also? The flip side is that the repayments on the house are lower than the equivalent I would pay in rent ie. Repayments $330 a week, rental $450ish. However the rental income I would generate on the house would be equivalent to that of the rent I would be paying. (Balanced out I guess)

Love the show boys and Stiggy, have listened to the lot and have read one of  your books keen to read the next! Thank you for your time and commitment to bettering others futures be it financial or otherwise!

Edit: sorry NSW based not Vic!

 

Question from Tee Dee

With stimulus being used to prop everything up, is it fair to say that we can expect to see an initial deflation in the market (10-20%), followed by a severe inflationary period as the mass amount of new money finds its way to the bottom of the pyramid when everything opens back up via rents and prices? If we keep our current monetary system the only way to repay this debt is through mass inflation. That tells me to hold my assets,  switch to interest only (despite low interest rates), and pay off my debt using tomorrow’s, devalued dollar. Is this a naive way of thinking? Thanks guys

 

Question from Jamie Attard

I’m hearing a lot of hype of a tree change from our major cities. Is there data out there to back this up and what regional areas are benefiting from this if any?

 

Question from Heath Ian Sullivan

Thoughts on Queensland being bombarded with melbournites trying to  escape from the city?

 

Question from Sonja Mallia

What to do if we have over 200k in offset, and the banks can now use our money if in financial ruins and not pay it back?

 

One Final Word…

If you’re worried about your finances or if you have no clarity on your cash flow position, we strongly recommend you to organise your finances now. It’s more important than ever to have a clear view, down to the exact cent, on how much you’re spending each month and how much surplus you’ve got. If you don’t know it, then log in to your Money SMARTS Platform here and update the numbers.

Don’t have an account yet? Create your free access below and we’ll also send you an e-copy of the instruction manual which is also our best-seller book, Make Money Simple Again. Just fill in the form below and we’ll email it to you right away.

 

 

 

 

Episode 298 | Property In A State of Disaster – Chat with Leah Calnan, President of REIV and Nerida Conisbee, Chief Economist at REA Group

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“Property in a state of disaster.” Yep. You heard it here first, folks…

And there’s no doubt we’re literally making property news with this timely, “double header” episode featuring two of the brightest minds in Australian real estate… (and, no, this breaking news is not “hot off the press”, either… we actually interviewed one of today’s guests BEFORE the press even got to them!! 😲)

Here’s the deal…

With Stage 4 restrictions now here in Metropolitan Melbourne and Stage 3 restrictions all across Victoria… the property market HAS been impacted as a result…

So, not only are we getting the update from the National Representative of Victoria, Leah Calnan, President of Real Estate Institute of Victoria about what we CAN and CAN’T do when it comes to property here in VIC, you’re also going to learn how (and if it’s even possible!) to transact property with these harsh restrictions now in place… and what the next six weeks is potentially going to look like for Buyers, Sellers and Renters.

PLUS, for our folks NOT located in or looking to buy in Victoria right now… our longstanding friend and indeed one of Australia’s best property and economic experts Nerida Conisbee, Chief Economist at REA Group, also joins us for a deep dive on what’s currently happening in the individual segments of the Australian property market, including…

It’s a BIG ep… but we promise there’s plenty of new updates and quality gold in here that we simply couldn’t NOT share with you! (Let’s just say there’s A LOT happening!!!)

 

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Here’s A Glimpse Into What We Cover…

  • Pandemic Brings New Rules For The Victorian Property Market… And They’re Not Great
  • How can you transact real estate in Victoria?
  • What are the unintended consequences of these harsh restrictions?
  • What does Real Estate Institute of Victoria (REIV) think about all this?!
  • How many known cases of COVID-19 have come from the real estate industry?
  • Can you still get a new tenant in with these new laws?
  • What about cleaning? Building and Pest Inspections? Pre and Post Settlement?
  • How is Nerida navigating the outlook of the property market when things are uncertain and constantly changing?
  • The September Cliff versus The September Slope
  • Where are we seeing distressed markets?
  • How many distressed sales are we seeing?
  • What’s likely to occur if the pandemic continues into 2021?
  • What is the Pilot Program and Why has it now been derailed?
  • Are investors buying right now?
  • What’s happening to premium property?
  • What are we seeing in the CBD and how will this continue to play out?
  • What on earth is “Revenge Spending” and how will this play a role in getting us through COVID-19?
  • Are predictions of 20 – 30% drops in the property market still relevant?
  • Around The Grounds in The Australian Property Market

 

One Final Word…

If you’re worried about your finances or if you have no clarity on your cash flow position, we strongly recommend you to organise your finances now. It’s more important than ever to have a clear view, down to the exact cent, on how much you’re spending each month and how much surplus you’ve got. If you don’t know it, then log in to your Money SMARTS Platform here and update the numbers.

Don’t have an account yet? Create your free access below and we’ll also send you an e-copy of the instruction manual which is also our best-seller book, Make Money Simple Again. Just fill in the form below and we’ll email it to you right away.

 

 

 

 

Episode 296 | (Part 2) How To Reach The Summit: Achieving $2K Per Week in Passive Income – Q&A

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We’re picking up where we left off last week… how to create $2,000 per week in passive income and actually design the lifestyle you’re proud of (instead of just daydreaming about it)!

This means we’re riffing through a stack of listener questions, including how to speed up the process (and what’s at stake if you do), the true power of compounding and the ‘secret sauce’ of property investing that has nothing to do with the amount you earn.

Plus, we’ll explain WHERE the smart money goes and why there’s always a “Flight to Quality” (something we’re currently witnessing… even during a pandemic!).

You’ll get the pros and cons of active vs passive investing, a mindset reframe on how to look at debt and, excitingly, a case study demonstration of capital growth versus yield! (yeah, Ben did a bit of homework for this one… shock horror!)

We obviously blew out with our answers (as per usual) so it’s another epic episode, but we’re positive the science of achieving $2K per week as a passive property investor (aka. reaching the summit!) is going to help set you up for life and take your property, finance and money management knowledge to the next level 😉

All Q’s listed below. Enjoy!

 

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And here are the questions!

Question from Esha Frykberg
Any advice for those who want to be able to semi retire on less with the portfolio sitting in the background working towards that goal? i.e. having a portfolio that is making $1k/week by age 50 with the aim to be making $2k/week by 65, or is this just going to be the natural progression of a maturing portfolio. Would like to be able to gradually have the option of winding back work rather than working hard for 20 years and stopping.

 

Question from Craig Chalmers
If looking to keep a $2k per week passive income in retirement. When do you switch from growth to yield assets for passive income? Or do you purchase both during acquisition phase as a balanced portfolio and then sell down the growth asset to realise the gains and pay off the yield asset for holding for passive income?

 

Question from Steve Gilmore
In retirement would you prefer $2 million worth debt free, or $4 million with 2 million debt?

 

Question from Adam Wild
Legends! first time caller, long time listener. What are the pros and cons of a passive vs active strategy to retire debt? What would you guys prefer given the choice to do either?

 

Question from Megan Mary
How do you achieve it without waiting 30 years+?

 

Question from Craig Cooper
How truly do-able is it over a 10-year time frame?

 

Question from Jeff William Simons
How do you keep patient and resist the temptation to sell?

 

Question from Kosta Dokolas
What strategies do you recommend to retire down the debt sooner than the 20-25 year slog? Thinking about older investors close to retirement or ambitious investors looking to get to that 2k per week sooner. Love your work, go blues! 😜

 

Question from Steven Jermey
Tips on speeding up the process on one income, ie 70-90k pa. I’m onto 3rd property (cheeper properties while renting. Interested on your take for the lower “average” income. For me it’s taken a long time, and balance between quality of life now (with a family) and looking to the future.

 

Question from Jared Kennedy
Is it possible on a single income (without any dependents)? Earning between 70 – 80k a year?

 

Question from Arty McFarty
I’d like to see the figures behind your claims.

 

 

 

 

Episode 295 | How To Reach The Summit: Achieving $2K Per Week in Passive Income – Q&A

By in Podcast, Q&A

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So… earlier this week, we posted this on our Facebook page:

And the response was overwhelming! Thank you to everyone that everyone that wrote in and that’s why, in this Q&A episode, we cover everything you need to know to build a property portfolio that pays you a passive income you can live off.

Here’s the deal… if you’ve listened to us for some time, you’ll know already that we bang on about “$2K per week” a fair bit. So, first we’re going to tell you what we mean by this “magical” number. Including why it’s NOT magical at all, but instead is actually ACHIEVABLE for many folks!

From there, we’ll dive deep on the considerations and investment strategies to build a portfolio, like the big one – how to finance multiple properties without significantly impacting your cashflow! Plus, we’ll walk you through heaps of new questions on this topic AND share the secret of reaching the summit of $2K per week!

It’s a big episode, but we’re about to deliver some fresh gold nuggets as well as some quality reminders. Tune in now & let us know what you think!

Psst… We’ll be continuing this episode next week as we received a tonne of questions on the “Who, What, When & How” of achieving a passive income… so keep an ear out for that.

You can suss all of the questions we answer today further down 😊

 

To the summit we go!

 

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Questions Answered In This Episode…

Question from Mark Bradicich:
Is it $2k clear of expenses?

 

Question from Samantha Dean:
How many properties, earning how much per week would you need to acquire within your property portfolio in order to earn a passive income of $2000 / week ? And would this be $2000 / week income be during length of loan (say year 10 of the loan – when it’s negatively geared?) or once loan is entirely paid off and all income coming from said property is positively geared?

 

Question from Hugh Nitt:
2k is a great target! Is it possible/likely for a couple to achieve this income individually as a goal? Granted that every couple would have their own set of specific financial / income scenarios that impacts this goal. For example, a combined 2k each. 4k total passive income. How rare is this to achieve?

 

Question from Christine Browning:
If you are over 58 can you still achieve this?

 

Question from Helen Harrison:
I’m 52 years old and woken up to passive income. Have I left it too late to build wealth? Have equity in my home of residence. Educating myself including a daily lunchtime dose of your podcast!! Thanks

 

Question from Jenny Ann:
With $500k to invest and low cash flow, can this be done and how? (Ps I’m 54, single and a sole trader with only 4 months income statements, otherwise debt free).

 

Question from Sabrina Gajnabi:
What is the best way to find an investment savvy mortgage broker?

 

Question from Benjamin Tuxford:
What is the best way to find an investment savvy mortgage broker?

 

Question from Angus O’Loughlin:
At what stage do you go to principal and interest to try and retire the debt?

 

Question from Angela Niznik:
s it a good idea to sell an investment property to wipe out most of the mortgage on own home and significantly improve cashflow for further investments property purchases?

 

Question from Mat Newbury:
Is using LMI a good strategy to buying a third investment property to get in quicker? Seeing as the LMI is tax deductible. Rather than waiting for the equity to build and potentially missing out on a good buying opportunity in that time. Currently have one in Melbourne and one in Brisbane and am a borderless Investor. Would love your advice!

 

 

 

Episode 277 | Coronavirus & Property FAQ

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There’s been a lot of questions coming in about the coronavirus and its implications to the property market, the finance sector and the economy at large — particularly in direct response to the higher levels of social distancing regulations we’re now seeing and its flow–on effect to unemployment and how we transact property. 

So, today we’re answering a whole heap of Frequently Asked Questions (FAQs) about how COVID-19 affects you as a property investor, a home owner, a first home buyer, or someone who’s in fortunate circumstances to take action on the opportunity. 

‘Cos, let’s be real folks… if you’re dining out on the news cycle, it’s a very scary place out there!! 

Again, we must repeat… our message of calm remains…. but we’re going to dig even deeper into what we’re starting to see as this pandemic unfolds. 

As well as answering a whole lot of your questions (all of them listed below), we’re ALSO going to give you some Frameworks and Tips to support you during this time so you’re prepared, have the RIGHT knowledge behind you and can navigate the “new world” we’re all now living through! 

We touch on it in today’s episode, but just in case you need a recap… folks are likely to fall into ONE of TWO categories during this time… 

  1. “Take Action” Club – This is a small percentage of folks who are ready to take action based on their individual circumstances (please seek professional advice before you do this) 
  1. “Money Management” Club – The vast majority of folks will sit here and during this moment-in-time of uncertainty, should focus on the gaps in their money management 

  

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And here are the Questions!

Question about “Investor & Tenant Relief” from Greg: 
Any talk from the banks/government on providing relief to Investors on investment lending so as to enable them to provide relief to tenants who find themselves in financial trouble? For many owners they would have tenants they don’t want to lose and would like to assist (if required) but may not be in a position to do that themselves… 

 

Question about “The Six-Month Freeze” from Jake 
Points to consider for the six-month freeze 🥶 on home loans?  Ie. how is the loan recalculated after six months? Will interest still be required to be paid during the freeze? And could this result in household having higher repayments on completion of the six-month freeze? Will it impacted your credit file? Cheers 🤙  

 

Question from about Property Prices Dropping from Nicole 
I just heard that Economists are predicting a 20% drop in house values. Would love your thoughts on this? If one is to take up the banks offer of 6months “off” from the mortgage — besides extending the loan time frame, how will it affect households and do you advise it in what circumstances? 

 
Question from about Waiting To Buy from James 
My partner and I are looking to buy in Queensland later this year. But are we better to wait until next year to buy?  

 
Question about “What the market will look like next year” from Jarrad 

What will the market look like next year? Would it be a good time to buy if I was planning to buy my first property? Could it be a good time to get a great priced asset? Thanks guys 

 

Question about Offset Account Protection from Matt 
Are offset accounts protected by the government up to 250k? Should I move funds above that to a different offset account, or should I use it to pay down principal on the loan? Would this then secure these funds in the hopefully unlikely event that a bank failed. Note that this is not a big 4 bank. 

 

Question About “Accessing The 10k Out of Superannuation” from Daniel 
If we have money in an offset account, can the bank access it to reduce their exposure?
Also, not sure if you can answer, what are the new rules around accessing your super? If you’re a couple can you both access the $10k per FY? Is it means or asset tested? 

 

Question about Finding a Remote Property Investment Advisor from Aaron 
Was about to redo mortgage and borrow additional funds for deposit on 1st investment property (which we are not really sure on the process, have to talk to mortgage broker),but now that everything is closing down not sure what our next steps are. Can we find a property investment advisor completely remotely? Is it a good time for a newbie investor to try and get into the market, when our only knowledge comes from the podcast and your book? 

 

Question About What To Do If Tenants Can’t Make Rent from Rebecca 
I am a single Mum with no family support … I have two investment properties but if tenants asked for ‘free rent’ don’t they realise that the landlord might be in a similar situation to them??? That this doesn’t make sense for tenants to ask for a pause on rent when mortgage payments still need to be made. I realise that some banks have waived the repayments for 3-6 months but I am actually not with the BIG banks who are doing this (WOW – it is impressive that it IS the big banks who are offering this support – makes me wants to transfer to one of them!)… any thoughts? 

 

Question from Andrew 
 it would be great for you guys to canvass the current situation around landlords insurance and what policies will and will not cover in terms of loss of rent due to coronavirus circumstances. ie ….Actually getting Coronavirus and not being able to work vs being laid off because of economic difficulties. I can see this being a bit of a snake pit in terms of insurance policies and wordings associated with ‘pandemics’. 

 

Additional Helpful Resources on COVID-19

National Update: Click here

State Update:

 

One Final Word…

And please… Just a (not so gentle) reminder. Stay at home if you don’t need to go out. Download our Isolate + Chill Pack if you want to use this self-isolation time to learn new things!

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