The Property Trio (formerly The Property Planner, Buyer and Professor)

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaIhttps://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week’s episode, Dave, Cate and Pete return to deliver part two of acronyms and terms. They will take you through:

1. Standard variable rate (SVR), Rate lock fees, P&I, I/O, Owner-occupier lending and EFT. Dave talks us through these terms and highlights a few key points of interest. 
2. Expressions of interest (EOI), ECOS, and period homes - Cate and Pete delve into these terms - Pete compares the differences between private treaty, EOI and auction campaigns. Cate sheds light on what an executed contract of sale really means. Pete details the different period and character homes and leans on Cate for some Victorian styles that are still prominent in the inner ring suburbs of Melbourne and some of our provincial regions.
3. OTP.... not the trio's favourite type of property, but Cate shares a surprising twist -  Off the plan doesn't just refer to a brand new dwelling. For a subdivided older house, an 'off the plan' contract can still apply. How?... tune in to find out.
4. FHOG... not what you suffer after a big night.  Dave shares with our listeners a fantastic offering posed by our States and Territories. The first home owner's grant varies from state to state and any eligible purchasers owe it to themselves to research this valuable opportunity.
5. FHLDS. This great initiative supports those with insufficient deposit savings on hand, and Dave and his team have been able to assist many clients over recent years due to the first home owner's low deposit scheme.
6. DHA and NRAS: Pete doesn't listen too hard to the negative rhetoric about defence housing. He emphasises that it's important to focus on the location, the returns and the term of the arrangement. 
7. OFI's, cooling off periods: Cate talks about cooling off periods, the ramifications of doing so, and the financial cost of deciding to cool off. Not for the feint-hearted.
8. Auction quotes - how do buyers approach it? is there a 'rule of thumb' way of deciphering the real price? or is there another method? Cate explains. Pete throws cat among the pigeons when he asks about rental price quoting also, and Cate talks about the occasions when cooling off in the state of Victoria is not an option.
9. Rental yield and terms contract - Cate talks through what these both mean, and how rental yield is calculated.
10. Deposit bonds... not common and often misunderstood. What are they? When are they often used and how do they work? Cate and Dave canvas this unusual deposit method.
11. EBITDA... earnings before interest, taxes, depreciation and amortisation. Dave walks our listeners through how this measure is calculated.
12. ...and our gold nuggets!

Peter Koulizos, the 'Property Professor's Gold Nugget: Pete recommends that buyers get some good advice on what all of these acronyms mean before they sign a contract. David Johnston, the 'Property Planner's Gold Nugget: And Dave implores borrowers to challenge their strategic mortgage brokers and advisors to explain any unknown acronyms. While they are exciting to ponder, these are industry terms that shouldn't be used for clients. https://propertyplanning.com.au/common-terms-and-acronyms-part-2-from-eois-to-deposit-bonds-we-unpack-them-all-ep-187-2/

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaIhttps://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week’s episode, Dave, Cate and Pete take you through:

1. The difference between ROI (return on investment) and ROE (return on equity). Pete explains this critical differential and he and Dave highlight the sheer power of leveraging with a simple example. Our Property Professor shares some valuable formulae to consider in relation to the time value of money, including net present value (NPV).
2. Gross lease vs net lease. Pete compares the differences and explains the critical things that commercial property landlords need to be familiar with when it comes to calculating and forecasting their rental returns.
3. Finance terms: LVR, LMI, AML, VOI, valuation types (short form, long form, desktop, curbside, AVM, as if complete). Dave takes our listeners through each of these terms, some of which may be very familiar for our listeners but he has some twists and turns to shed light on for some of the lesser known acronyms and he expands on some of the detail behind many of these concepts.
4. Valuation vs appraisal: why is this critical to understand? Even if the techniques are the the same, one is libel and one is just an opinion. Pete explores this important discretion.
5. AIP (approval in principle), partial and full drawdowns, LOO. Dave covers these acronyms for our listeners and shares some great detail on construction lending; something particularly detailed for strategic mortgage brokers and banks, but a concept that many wouldn't necessarily know.
6. COC and FTC : A certificate of currency (COC) is a requirement for every newly purchased property, and it's easy to arrange but often prompts a lot of questions. Funds to complete (FTC) is one of the most stressful last minute conversations when it's unexpected and raising a question around shortfall funds. Cate and Dave shed light on some of the causes of this so that our listeners can provision for the unexpected headache at settlement time.
7. ...and our gold nuggets! "Don't change your job while you're going for a loan or awaiting settlement!"

Peter Koulizos, the 'Property Professor's Gold Nugget: Pete suggests that any borrowers who find themselves confused about acronyms in their loan documentation or correspondence, they should ask their strategic mortgage broker or banker to explain it all. The team wish our listeners a happy 2023 with a special message each from the Property Planner, the Property Buyer and the Property Professor. Visit the show notes: https://propertyplanning.com.au/common-terms-and-acronyms-part-1-from-roi-to-voi-we-unpack-them-all-ep-186/

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaIhttps://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week’s episode, Dave, Cate and Pete take you through: 1. Our first listener question is a bit of a terrifying one.  Charlotte is looking to buy her first home next year and asked the trio if it is normal for a selling agent to offer a 'free' buyer's agent who receives substantial commission fees from the seller. Charlotte felt it doesn't seem right.... and the trio agree with her. 2. Matt is keen to access his available equity in his current investment property and asks the trio for some tips "Instead of having one six hundred thousand dollar property going up in value, you could have two six hundred thousand dollar properties, and in theory you're effectively doubling your net wealth in the future", says Pete 3. Shashank raises the question of how to manage building insurance with the rapid increase we're seeing in construction costs and the trio discuss the importance of understanding total rebuild costs, as opposed to relying on an online insurance estimate. "Did you know that 83% of Australians are under-insured on their properties?" (MCG Quantity Surveying) 4. Sarah, a Bayside resident of Melbourne asks the trio for some help with her scenario options. She and her children moved from 'beachside' Mentone to the other side of Mentone, yet she's missing her old neighbourhood and wonders what guidance the trio could offer. Should she rent-vest, buy/sell, or buy/invest. Cate says, "Follow your heart, and go back to the beachside. Buy there if you can, don't rent there. Your capital growth prospects based on the scarcity and desirability of the area will outperform non-beachside."  And our gold nuggets.... David Johnston, the 'Property Planner's Gold Nugget: Dave’s gold nugget relates to thinking through the various options before you jump in to make your next purchase.  Trying to find experts who can give you the numbers to enable us each to make an informed decision. "Our next purchase is always the most important one." Cate Bakos, the 'Property Buyer's Gold Nugget: Cate’s gold nugget is all about taking the opportunity to set your plan and arrange your finance over the holiday break so that you can hit the ground running in 2023 and make the most of the market when it reopens. MERRY CHRISTMAS EVERYONE! Wishing our listeners a safe and happy festive season. Visit the show notes: https://propertyplanning.com.au/listener-questions-and-a-great-dilemma-ep-185/

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaIhttps://propertyplanning.com.au/propertyplannerbuyerprofessor/ Pete kicks off this week’s market update circles in on the fact that the 'top end of the market' is the fastest falling segment. As he points out, it's the highest 25% of property that is dropping in value the most. Generally in a downturn, it's led by the more expensive properties. Dave tackles the cyclical nature of all markets, specifically the lending markets. Banks are coming up with more creative ways to get loans approved for people. Policies enabling low documentation are starting to appear, and it proves that when it comes to lending policy, every lender is different. Cate shares with the listeners the power of FOMO at the end of the year; even in a tougher market. The dwindling supply of stock is having an impact on the supply:demand ratio for buyers in the run-up to Christmas closure. 1. Why is repayment strategy so important? 2. Is it a good idea to pay down all of your debt? 3. Hold while you accumulate!  4. How do we optimise investment deductions? 5. The amount of money we have in our offset/savings account is one of quite a few benefits of having a war chest.  6. Which repayment strategy is RIGHT? And our gold nuggets.... David Johnston, the 'Property Planner's Gold Nugget: Dave shares two valuable key things for our listeners to take away;

1. Getting the repayment strategy right can help us retain property that may otherwise have required us to divest.
2. Getting the repayment strategy right can also maximise our deductible debt long term, and in particular, for property that may not have originally served as an investment property.

Cate Bakos, the 'Property Buyer's Gold Nugget: Cate reminds listeners that sleeping well at night is most important. If an investor is so stressed that they chose to divest a good property, this outcome is worse than losing on tax deductions and savings flexibility. Visit the show notes:https://propertyplanning.com.au/184-mortgage-repayment-strategy/

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaIhttps://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week’s market update episode, Dave, Cate and Pete take you through:

1. Continued positive signs as home value index results show rate of decline slows
2. Rents are still climbing in many cities, and while house asking rents have slowed somewhat, the rate of growth is still very tough on tenants. Units in almost every city are still climbing at a strong rate, particularly for Sydney, Brisbane, Melbourne and Adelaide.
3. New listings are the lowest in years and Pete shares a frightening chart that shows our winter volumes exceeded our spring volumes.
4. What’s the correlation between dwelling sales and consumer confidence? Consumer confidence continues to fall and house price expectations have had a significant fall.
5. A lot less people are borrowing money for property and investors' new loan weighting is declining. The uptake of finance continues to move into negative territory and the percentage of owner occupiers vs investors is still favouring owner occupiers
6. Amidst the bleak news, there is a sign of welcome change! The bond traders are demonstrating that they feel we're getting close to the peak for interest rate movements. The three year bond yield has declined over this past month and Dave shares the correlation between the bond yield and the cash rate.
7. Unemployment remains low and Pete notes that it's so much easier to find a job today than in previous years.
8. The headline inflation rate has come down! While we were all disappointed to see the cash rate move 0.25% again in December, we are relieved to see signs of easing in our inflation figures.

Gold Nuggets David Johnston – The Property Planner’s Golden nugget: Dave’s gold nugget involves looking back in the rear view mirror... for those fortuitous property owners who fixed their interest rate back in 2021, they were able to lock in a rate of 2.1% in Jan for three years, and then again in June at 2.15%, only a small increase. Five year fixed rates for the same months sat at 2.69% and 2.84% respectively compared to an astonishing 6.2% today for three years and 6.59% for five year fixed rates. What a change in a short space of time! Cate Bakos – The Property Buyer’s Golden nugget: Cate’s gold nugget aims to give listeners who are out there still searching a hot little tip. Given the stock levels for 2022 are now eroding as the trading year comes to a close, active buyers can ask their favourite agents for any insights (or early access) into some 2023 listings. Visit the show notes: https://propertyplanning.com.au/market-update-nov-2022-rents-are-still-climbing-stock-supply-is-tight-and-bond-yields-have-softened-ep-183/

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaIhttps://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week’s episode, Dave, Cate and Pete take you through:

1. Pet stats!
2. Legislation confusion? The trio uncover legislation around pets and rental properties, and just how dramatically the states and territories differ.
3. What is our biggest fear? Pete leads the taskforce with an overview of the top reasons why so many landlords fear pets in rental properties.
4. Illegal dog training
5. When saying yes to pets presents an advantage to a landlord
6. Pet rental application cover letters? You bet!
7. “Ohhh, THIS cat? It’s my friends cat and it’s just staying this weekend”. The trio talk about this old chestnut and focus on why some renters adopt this ploy
8. How expensive is it to clean up after a bad pet-experience?
9. What pet situations ring alarm bells? Pets pose a grave concern for a landlord, (or worse still, some pets and activities are illegal).
10. How do property owners tackle a surprise pet in an investment property? Cate and Pete share their best tips

Cate Bakos, the ‘Property Buyer’s Gold Nugget: Cate reminds listeners that the risks of scaring a tenant into driving pet ownership underground can end in tears. Cate’s approach is to be open about being open to pets so that pets are actually disclosed on the application. She also recommends capturing the age, breed and behaviours of a pet when asking tenants for pet bio’s. Peter Koulizos, the ‘Property Professor’s’ Gold Nugget: Pete adds that by encouraging pet owners, landlords also widen their market. Dave also asks for some good advice on managing an unwelcome neighbour’s cat…. Visit the show notes:  https://propertyplanning.com.au/182-pets-and-rentals/

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaIhttps://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode Dave, Cate and Pete take you through: 1. Market updates – comparing Australian property and Abu Dhabi’s property differences, NSW first home buyer optional stamp duty is now live! And Crypto currency risk bounces back onto the market update playlist. 2. This may surprise our listeners, but the first home should be selected with investment potential in mind. 3. Bigger is better when it comes to land size for the first timer, but location counts for everything. 4. Oldie, but a goodie! How old is too old? Cate and Pete dare to disagree… but the most important tip for listeners is to remember the importance of “land to asset ratio”, the trio’s golden rule. 5. Leave the luxe listings off the list!Grand kitchens, bespoke bathrooms… Pete takes us through all of the reasons why ‘luxing up’ an investment property is a terrible idea. 6. Dream home versus investment property – why we need to look at each with such different lenses. “Would I live in this place?” is usually the wrong question for an investor to ask, unless they are representative of the target tenant. 7. The best pool is someone else’s pool! As Cate often says to her clients, pools come with all kinds of responsibility and maintenance/safety issues. 8. Are larger dwellings the holy grail for capital growth? 9. Is it ok to luxe-up your dream home? Expensive and delicate features should be left for your dream home, not your investment property. 10. … And our gold nuggets! Pete shares his well-loved pearl of wisdom, “If you’re looking to make money, it’s about location, land and looks!”
Dave also share a have a plan for the big rock in the jar, (i.e. the family home). This can help investors finding themselves feeling financial pain or scrambling to divest their acquisitions down the track. “If you fail to plan, you plan to fail.” Visit the show notes: https://propertyplanning.com.au/181-first-home-vs-forever-home-dream-home-vs-investment-what-are-the-trade-offs-and-key-considerations/

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaIhttps://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode Dave, Cate and Pete take you through: 1. Our first listener question, which is an intriguing one. Our seasoned investor lifts the lid on some of the aspects of asset selection in relation to pinpointing outperformance capital growth. 2. Blue chip suburbs do in fact outperform over a longer period of time, but it’s all about the time horizon 3. Money grows where money goes 4. Show me the money 5. Data is King 6. Timing the market versus time IN the market 7. Should I stay or should I go now? 8. Why have units in Melbourne been so disappointing? And will they spring back? 9. Target tenants 10. Talk to your planner! 11. And… the gold nuggets Dave’s gold nugget relates to our second listener question, and the old chestnut, “should I hold or should I sell?”. He reiterates the importance of questioning “what else could I do with the money?”, and while it’s a huge decision for so many, Dave reminds us that we should be clear once the decision is made, and JUST DO IT. Cate’s gold nugget circles back to the COVID woes, and the impact of reduced rent and/or rental eviction moratoriums and she recommends that investors refer back to their property manager to get a clear understanding of the current market rental expectation so that they are in sync and commending the correct rental amount. Visit the show notes: https://propertyplanning.com.au/listener-questions-is-electing-a-higher-priced-a-grade-property-a-formula-for-disappointment-long-term-what-do-you-do-with-an-underperforming-asset-that-promised/

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaIhttps://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode Dave, Cate and Pete take you through:

1. Positive signs as home value index results show rate of decline slows
2. Rental market continues to struggle as increasing rents continue, particularly for units
3. Spring listings still slow, bucking typical seasonal trends
4. What’s the correlation between dwelling sales and consumer confidence?
5. How savings and YOLO factor into inflation
6. How job security is impacting consumer sentiment
7. New lending continues downward trend, however personal loans on the rise
8. What does the bond yield say about where interest rates will end up?
9. RBA revises inflation cap

And of course, our gold nuggets! Cate’s gold nugget relates to the buyers out there who could apply market segmentation to the options out there, and she suggests how some of these segments could be bought advantageously, namely first home buyer stock and land-banking sites. Both of these opportunities have presented as these two buyer contingents have reduced their appetite in the current environment. Dave’s gold nugget hinges around his sense that the property market is becoming a leading indicator, and he shares some great examples of how buyers can be savvy when it comes to taking advantage of the conditions we’re navigating. Visit the show notes: https://propertyplanning.com.au/market-update-oct-2022-regions-fall-faster-than-capitals-more-pain-for-renters-as-yields-catch-up-construction-finance-drops-off-a-cliff-yolo-hampers-rba-inflation-tactics-more-ep-17/

Got a question for the trio? - https://zfrmz.com/uLtjhyBskV96PY6eJfaI https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode Dave, Cate and Pete take you through: 1. The conundrum– Can we purchase the long-term home without selling any of our properties and retire in 20 years relying on passive income? This case study follows the journey of Andrew and Bec, podcast listeners in their early to mid-thirties who submitted their scenario to the team to unpack via the Property Planning platform. They started their property journey early and each own a property, one of which they currently live in. On the horizon, they would like to purchase their long-term home, start a family, and retire comfortably in 20 years. Would they be able to do all of that without selling a property? 2. Their portfolio and goals The trio discuss Andrew and Bec’s goals and their current property portfolio, one ofwhich is undergoing a construction. They have worked hard to get themselves in a great spot, and after the construction is complete, their portfolio will be worth $2M and they currently have $300,000 in savings. Not bad for a couple in their 30’s. Ideally, they would like to be earning $150,000 in passive income from their investment properties ($75,000 in today’s dollars). The key questions to unravel were: when do Andrew and Bec purchase their future home? Do they need to sell any properties to do so? When can they reach their passive income target of $150,000. Can they retire in 20 years time? Can they do all of this AND start a family as well? 3. Modelling the scenarios Five scenarios were modelled for Andrew and Bec, showing the sequential progression and timeline of decisions to be made and actions to take in order to reach their goals. The trio sink their teeth into the financial outcomes. Spoiler alert! Their passive income goal is reached but 1 year late. Given the laundry list of goals, we think this is a great outcome. Tune in to find out the threekey steps that Andrew and Bec need to take to get there, plus how having children willimpact their financial goals. 4. So you’re thinking of starting a family, who is going to scale back work? There’s no doubt that having children is an important life goal for many Australians. But let’s be real, along with that bundle of joy come cash flow implications as kids are expensive and one partner normally scales back work for a period of time.  In this particular scenario, Bec would like to scale back work permanently to 2 days a week in the first 6 years and 3 days a week thereafter. But that’s not the case for all families. The trio discuss how different scenarios can be modelled to make key decisions around employment when starting a family: which partner will scale back work, by how much and for how long? Visit the show notes - https://propertyplanning.com.au/property-planning-case-study-7-can-we-keep-our-two-existing-properties-purchase-our-long-term-home-start-a-family-and-still-retire-on-150k-p-a-passive-income-ep-178/