Property Investment & Wealth Creation Australia | The Michael Yardney Podcast

Today I share 9 reasons not to invest in property, and in my mindset moment, I'm going to be a bit of a thorn in your side.

Then my guest, Pete Wargent gives us some predictions for the future of property.

9 reasons not to invest in property

You should NOT get involved in real estate investing if you're:

1. Looking for tax savings and ignoring property investment fundamentals
2. Fear of missing out or FOMO
3. Wanting to get rich quick
4. Not understanding how investment property works
5. If you are not financially fluent in budgeting, spending, and handling debt
6. Looking for your property to do multiple things like be a holiday home or retirement home as well as an investment
7. Your finances are not in order
8. If you can't afford an investment grade property
9. Trying to time the market or find the next hot spot

Mindset Message: You are not your fears, but you create your fears.

• Pull out the thorn and face your fears, so that they never bother you again.

Pete Wargent's prediction for the future of property

Pete explains where we should be investing based on the following likely trends over the next decade:

1. Falling homeownership rates
2. More Asian migration and overseas investment
3. More high-rise construction and apartments
4. Jobs in "service industries" are becoming more prevalent

All this means that real estate investors will need to get smarter in their decisions

Links and resources:

• Michael Yardney
• Metropole
• Rich Habits Poor Habits
• Pete Wargent's blogs on Property Update
• Pete Wargent
• Pete Wargent on Twitter @PeteWargent
• The Untethered Soul: The Journey Beyond Yourself
• Pete Wargent on Property Update

Quotes:

"Buying property to save on taxes can lead to ignoring the fundamentals of property investing." Michael Yardney

"Investing based on emotion leads to bad judgement." Michael Yardney

"Property investment is a long-term endeavor that usually takes about 30 years to reach financial independence." Michael Yardney

Never miss an episode and keep up with all the good things going on at the Michael Yardney podcast by subscribing on iTunes.

You can also subscribe to MichaelYardneyPodcast.com to keep up with the latest information including bonus material that comes out between the podcasts.

Everybody wants to know what is ahead in the world of real estate, but I was recently asked about the biggest changes I have seen looking back over the last decade.

Today I share these, and then I look forward to my 9 property predictions for the next decade.

In my mindset minute, I talk about what I would do differently if I started over again and ways to learn smarter and faster and "getting a bigger cup".

Today's discussion includes:

• In 2007, Sydney was the most expensive city with a median price of $500,000
• Perth was the second most expensive capital city
• About 70% of new buildings were being built on the fringes of capital cities rather than in the CBD
• I had just written my first book which became a classic - How To Grow A Multi-Million Dollar Property Portfolio - in your spare time
• We were on the cusp of the biggest economic downturn in almost a century and nobody realized.
• Yet strategic investors stayed the course, didn't panic and look how well they've done
• Back then I spoke about holding residential real estate for the long term and nothing has really changed
• No one foresaw the 3 big drivers of the property markets over the next decade:
• • Significantly lower interest rates
  • Strong population growth
  • Our mining boom led by the surging Chinese economy.

9 predictions for property in the next decade:

1. We're in for a period of lower capital growth
2. We're also in an era of lower interest rates
3. There will be significant growth in our service industries
4. Our property markets will become more fragmented
5. More people are going to live in apartments
6. There will be a bust in the inner city apartment markets in some areas
7. We'll have significant population growth
8. There will be a lot more white noise
9. Always expect the unexpected

Mindset Message: What would I do differently if I started investing all over again?

• I would spend more time educating myself.
• I would learn from others by modeling the most successful people and upgrading my "programming."

Links and resources:

• Michael Yardney
• Metropole
• How To Grow A Multi-Million Dollar Property Portfolio - in your spare time
• Unlimited Power by Tony Robbins
• Rich Habits Poor Habits

Quotes:

"You can't predict the future by looking at the past." Michael Yardney

"I now look into the future not the past. I focus on where future growth is likely to occur." Michael Yardney

"Learn from mentors and others because learning from your mistakes can be slow and demoralizing." Michael Yardney

Never miss an episode and keep up with all the good things going on at the Michael Yardney podcast by subscribing on iTunes. You can also subscribe to MichaelYardneyPodcast.com to keep up with the latest information including bonus material that comes out between the podcasts.

Today, in this special episode of the Michael Yardney podcast, I replay an interview with me by Tyrone Shum of Property Investory.

I'll share my story – how I got started in property, what's I'm up to today and what inspires me.

In this show Tyrone asks me:

• What a typical day looks like.
• Where I grew-up and a bit about my personal story.
• How I started in property and what motivated me then
• The story behind the name Metropole Properties
• How I learned about the importance of cycles and finance for property investors
• My biggest a-ha moment.
• I share how learned the hard way that not everything that glitters is gold and to be a more cautious investor.

Links:

• Property Investory
• Michael Yardney's Mentorship Program
• Michael Yardney's Property Update Blog

Today I discuss a very important topic for property investors - the future of interest rates.

Do you think they are going to stay the same, fall or rise?

Would you be surprised if they went up eight times in the next two years? One expert believes that could be the case.

Could you cope with that?

In my mindset moment, I discuss why you should be doing the opposite of everyone else. And this doesn't just relate to real estate investing.

I will also share with you seven questions you should ask before locking in interest rates.

Today's discussion includes:

• How John Edwards, a former Reserve Bank board member, predicts interest rates will go up eight times.
• What "normal interest rates" rally are
• Why if rates do rise significantly, it would mean that the economy would be booming and that could be a good thing.

3 Reasons Why It Is Unlikely for Interest Rates to Go Up Any Time Soon:

1. We're in the middle of a credit squeeze and banks have already raised interest rates
2. The Reserve Bank wants to keep the Australian dollar weak
3. The world's economy is still sluggish

Mindset Message: Why you must do the opposite of everyone else.

1. Become great at something by focusing on that one thing and putting all your eggs in one basket.
2. Choose one thing and do it really well and become an expert at it.

7 questions to ask before locking in on interest rates:

1. Will I want to sell during the fixed rate loan?
2. Will I want to access the equity during the fixed period?
3. Do I need an offset account?
4. Can I make extra repayments on my loan?
5. What balance of fixed and variable rates do I need in my portfolio?
6. How long should I fix my rates for?
7. If rates fall, what will locking in today cost me?

Links and resources:

• Michael Yardney
• Metropole
• When will interest rates rise?
• John Edwards' interest rate prediction
• Rich Habits Poor Habits

Quotes:

"Once the economy improves, the Reserve Bank may need to increase interest rates." Michael Yardney

"To be successful, you need to dismiss common beliefs." Michael Yardney

"Locking in interest rates gives you an advantage of knowing what your commitments will be for a predetermined time." Michael Yardney

Never miss an episode and keep up with all the good things going on at the Michael Yardney podcast by subscribing on iTunes.

You can also subscribe to MichaelYardneyPodcast.com to keep up with the latest information including bonus material that comes out between the podcasts.

In this special podcast I explain How to Profit from Renovations in the current property markets.

Listen as I discuss:

• My 8 step process for profiting from renovations.
• 5 tips for successful renovations
• Why renovations make sense in today's property market
• The one thing that many renovations courses teach that is patently incorrect.

I explain the 4 big benefits of renovations: -

1. Increasing the rental return and therefore yield of your investment property
2. Increasing the aesthetic appeal of the property and thereby attracting a wider tenant pool and often a better-quality tenant.
3. Increasing your depreciation allowances.
4. "Manufacturing" capital growth thereby increasing the overall value of your property, even in a flat market.

I also walk through my 8 Step renovation process

1. Why – what is your reason
2. Preparation - finance & structures
3. Where? Research target areas–due location diligence
4. What - Find a property with value add potential – due diligence analyze
5. Purchase – at "wholesale"
6. Plan & Budget – consider your target market and end values
7. The renovation process – create a higher and better use
8. Post Renovation – my preferred strategy is lease, refinance and repeat

Watch out next week for the second of this 2 part series where I discuss the 9 Step Property Development Process

Links:

My Property Renovations and Development Workshop

Michael Yardney's Property Update Blog

Today, I answer the frequently asked question - "how many investment properties do I need to retire?)

This just may be the wrong question because the number of properties you need before quitting your job depends on your assets value and how hard your money is working.

To become financially independent you need to build a cash machine by growing a substantial asset base of high growth properties. These are the steps you take.

1. Build your asset base
2. Transition to lower loan to value ratios
3. Start living off your property portfolio

In my mindset moment, I chat with best-selling author Tom Corley about a study that concluded that we are hardwired to be miserable.

Today's discussion includes:

• How many properties you need to retire
• The principles of real estate investing
• Calculating how big an asset base you require to get the income you need to live off your property portfolio
• How to create a cash machine with your investment properties
• Having the right finance strategy
• Having an asset protection plan to see you through the ups and downs
• Following a known, proven and trusted real estate investing strategy

Mindset Message: We are always striving to improve and better ourselves.

• If human beings are going to be successful, we can't be happy all the time or we won't push ourselves to achieve more.

Links and resources:

• Living Off Equity Spreadsheet
• Michael Yardney
• Metropole
• Rich Habits Poor Habits
• David Buss
• Thomas C. Corley
• Michael Yardney's Property Update Blog

Welcome to episode two of the Michael Yardney podcast.

Today, I'm going to discuss three things. One of them is a very common thing I get asked.

1. Is it too late to get involved in property investment at this stage of the cycle?
2. Difficulty getting finance from the banks
3. A lesson that changed my way of thinking about all sorts of things not just property investment.

Today's discussion includes:

• What other factors to consider with investing besides timing
• Countercyclical investing
• It's not the external world that determines if you make money, it is something inside
• If you are waiting for the perfect time to invest, the timing will never be perfect for you.
• Buying properties when everyone tells you not to
• You are not buying the market, you are buying an individual property within that market.
• Maximize your profits in the upturns while being prepared for the next downturn
• Why it takes the average investor 30 years to become financially independent
• Sometimes the right thing to do is nothing.
• Buying one property each year is unrealistic.

Mindset Message: Don't Wish It Were Easier Wish You Were Better

• When life happens we can choose to be the victim or the victor. We have to be able to face a changing landscape daily.
• Our mindset and our passion for improvement every day through consistent action will set us apart from the average person.

Links and resources:

• Michael Yardney
• Michael Yardney's Property Update Blog
• Metropole
• A Tale of Two Cities
• Jim Rohn

Welcome to episode one of the Michael Yardney podcast.

Over the years, I have probably educated more successful Australians than anyone else in the area of wealth creation through property. Now it's time for me to share my thoughts about what is going on in the world with property investment, the economy, and why the rich keep getting richer all through my new Michael Yardney podcast.

This is going to be a weekly show that comes out every Tuesday, where you can pick my brain on property investment and more. I'll also share some thoughts from my advisors in my mastermind group. I will try to get to as many of your questions as I can.

Today, I'm going to talk about one of the reasons many investors fail and how to find an investment grade property. I also share how to become the pilot of your life and not the passenger.

Today's topics include:

• How the majority of property investors in Australia fail
• Buying investment grade properties that produce wealth building returns
• Characteristics of a good investment
• Four ways that property investors make money
• Building an asset base and transitioning to cash flow stage
• Six stranded strategic approach to buying properties
• Following a proven blueprint that other investors have followed

Mindset Message: How to Become the Pilot of Your Life Not the Passenger

• As the world changes, we can attribute success to things outside our control or things that we can influence. People who take responsibility and are accountable for things that happen tend to earn more money, be more successful, and achieve more. We can change our beliefs and improve how we look at the world.

Links and resources:

• Michael Yardney
• Metropole
• Michael Yardney's Property Update Blog