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

https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode #70 of the Property Planner, Buyer and Professor Podcast, the team discuss "Tax optimisation - using mortgage strategy to create wealth ", as Dave, Cate and Pete take you through: Weekly market insights 1. RBA revises low interest rate forecast Governor of the RBA Phillip Lowe has said that he expects interest rates to remain low for the next 4 years, extending from his previous forecast of 3 years. In addition, there are no concerns on the horizon about an asset bubble forming for the property and share markets. It's game on! 2. Demand spikes for hot property At the coal face, we're seeing floods of prospective buyers at open for inspections, with not everyone in the queue able to inspect the property. Supply is not dramatically shorter, but the numbers of buyers have gone through the roof. The last time there was this much activity was after the GFC where the government was throwing money at first time buyers and interest rates dropped to 5%. Now, rates are even lower, stimulus is greater, and consumer sentiment has spiked; creating the perfect storm to propel the property market. 3. Comparative sales In light of demand and market movements, if you're interested in purchasing a property, you should be looking at comparative sales from the last 2 to 4 weeks. Anything over that is too old in many markets, and likely to give you dated sales results to depend on. 4. Property predictions The trio share their predictions for when regulators will step in with macro prudential measures to dampen property market activity and run-away prices. They also share their individual insights into how they feel the measures will be rolled out. Tax optimisation 1. How can you optimise your tax deductions? Tax optimisation is multi-dimensional and you only have one opportunity to borrow funds to purchase an investment asset. There are many mortgage strategies you can put in place to ensure you're getting the most bang for your buck. 2. Using equity to maximise borrowings Although counter-intuitive, maximising your investment loan can put you in a better financial position. The trio explain why you should consider borrowing the full purchase price plus costs of the investment if you have equity available in an existing property. 3. Paying principle and interest on your home and interest only on your investment loan The aim of the game is to pay down your non-deductible debt as fast as possible, while preserving your deductible debt to make holding your investment property more affordable. 4. Preserving the balance of your home loan if you plan to upgrade This is a critical point to consider for anyone who has purchased a stepping stone home and has plans to keep their home as an investment when upgrading to the long-term home. The Property Planner outlines the mortgage strategies that can be employed to make the most of your future tax deductions. 5. Why do so many people get this wrong? Many of us are taught by our parents and grandparents to pay down debt as fast as possible, without realising that you may be shooting yourself in the foot and killing wealth. We advocate that everyone should pay down their debt by using the right strategy, which will hold you in great stead when you transition to the flexibility stage of life. 6. Redraw v offset accounts The Property Planner explains the difference between redraw and offset accounts, and why the smart use of offset accounts means...

https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode #69 of the Property Planner, Buyer and Professor Podcast, the team discuss "Self-managed super funds (SMSF) in Australia - Pros and Cons", as Dave, Cate and Pete take you through: 1. What is an SMSF? The trio take you through a crash course in SMSF basics and who you can turn to for advice. 2. How does property fit in the picture? Your SMSF can invest in a number of asset classes, including residential or commercial property, provided that the asset meets your documented 'investment strategy'. Business owners and those short on cash flow, may find it particularly appealing as a way to invest in property. The trio explain why. 3. What attracts people to invest via an SMSF? Managing your own super gives you a higher degree of control over your investment strategy than you would otherwise have if your super was in a managed investment fund. But don't be fooled, it takes a village to run a 'self'-managed super fund. 4. SMSF game changers The trio explain how the SMSF landscape has changed over time, including the advent of instalment warrant arrangements, which changed the playing field completely in the SMSF space. 5. How does SMSF lending stack up? The Property Planner outlines the critical differences between SMSF loans and regular residential mortgages. Do you feel comfortable risking the farm with a personal guarantee? 6. SMSF property restrictions you need to be aware of The Property Buyer and Planner explain the key restrictions that relate to your SMSF investment strategy and how your freedom in asset selection could be impacted. 7. The risks behind purchasing a property in an SMSF Like the boxing day sales, the unfortunate reality is that whenever a new market opens up, the spruikers are the first to run in and elbow their way to a sale. The SMSF market is no different and many mums and dads have fallen prey to dodgy investments and underperforming assets sold to them under the guise of an 'investment strategy'. An SMSF may be a great strategy for you, if you're getting your advice from an independent expert who is tailoring a strategy specifically for you. 8. Can you hear the alarm bells ringing? The Property Planner and Buyer share the tell-tale signs that a bad SMSF decision is about to be made. 9. Setting up and running an SMSF, have you got what it takes? So, you want to manage your own super fund? The Property Planner outlines what goes into setting up and maintaining an SMSF. Do you have the time and the cash flow to take on this responsibility? 10. And of course, our "gold nuggets"! Visit the show notes: https://propertyplanning.com.au/self-managed-super-funds-smsf-in-australia-pros-and-cons/

https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's ep#68 of the Property Planner, Buyer and Professor Podcast, the team discuss "Off the market properties - everything you need to know", as Dave, Cate and Pete take you through: 1. What are off-markets? In a nutshell, off-market properties are properties that are up for sale without public advertising or marketing. 2. The difference between off-markets and pre-markets Don't get sucked into the real estate agent's 'pre-market' vortex. A genuine 'off market' is not the same as a 'pre-market'. The Property Buyer explains the difference. 3. Why would a vendor choose to sell off-market? The trio discuss the different motivations behind a vendor's decision to sell their property 'off-market'. 4. How do you find off-market opportunities? Anyone can be privy to an off-market opportunity, but if the property is not publicly advertised, how do you know about it? The Property Buyer shares her tips on how to put your best foot forward with real estate agents and get in the know. 5. The importance of rapid decision making Off-market opportunities are often time sensitive and require quick and decisive action on the part of purchasers. If a good off-market opportunity lands in your lap, now is not the time to equivocate! The Property Planner and Buyer explain the methods used to make decisions fast. 6. Are all off-markets good opportunities? A critical mistake is thinking that all off-markets are great opportunities. This is not true. All off-markets are not the holy grail. The Property Buyer shares how to spot the genuine opportunities from the time-wasters. 7. Off-market discounting Many purchasers incorrectly believe that an off-market sale is an opportunity to get a discount on a property. But the reality for most off-market's is that you need to be prepared to pay what the property is worth. 8. And of course, our "gold nuggets"! Visit the show notes - https://propertyplanning.com.au/off-the-market-properties-everything-you-need-to-know/

In this week's market update #17 of the Property Planner, Buyer and Professor Podcast, the team gaze into the crystal ball to make their "2021 predictions: capital cities, regions, first home buyers, investors, construction and why property values will continue to surge", Dave, Cate and Pete take you through: 1. Why the market will rise in 2021 The trio explain the key factors at play that will continue to drive property prices up throughout the year. 2. The risks to our economy and property prices They outline possible events and market forces that could dampen the economy and property prices, however we believe the factors stimulating the economy and property prices will outweigh any bumps in the road. 3. A detour into rental markets Although vacancy rates have increased for Sydney and Melbourne, there are particular properties that are outperforming, with rentals being snapped up quickly and above the asking price. The Property Professor explains why. 4. Predictions for regional activity Regions have been the top performers for 2020, but will this growth continue in 2021? The Property Buyer makes predictions on what we can expect to see in regional markets. 5. Capital cities - who will come out on top? The trio agree that all capital cities will see value increases over 2021, but have differing opinions on which capital city will be leading the pack at the end of the year. They explain the drivers putting upward pressure on prices for each capital city. 6. Building industry set to take off With the government throwing money towards the construction of new homes through the HomeBuilder and first-time buyer incentives, we expect that tradies and builders will be flat chat and turning away work in 2021. The desire of many Australian families to add a room or extend their home will further exacerbate this trade shortage issue. This will be a key driver for our economic recovery. 7. The outlook for apartments Apartments and office spaces have been the hardest hit investments during the global pandemic, particularly high density apartments in the Melbourne and Sydney CBD. We predict that penthouses and 3-bedroom apartments will recover quickly and exhibit growth, while bedsits and 1-bedroom apartments will continue to languish. 8. Investors to return with a vengeance 2021 is primed with conditions ripe for investors to make a comeback. Debt affordability is the best since 2001, we have the greatest level of savings on record, interest rates are at all-time lows and anticipated relaxation of lending rules to occur in March, all creating the perfect storm of investors to launch back into action. 9. Abolition of stamp duty The Property Planner makes a long-term prediction, that if the transition away from stamp duty goes well for NSW in 2021, other states will follow suit. 10. Runaway prices and APRA intervention With investors predicted to return to the market in droves, housing affordabilty will become an issue in the media towards the middle of the year, the government will chime in and APRA will intervene with measures to cool down the market towards late 2021 or 2022. 11. And of course, our "gold nuggets"! Visit the show notes - https://propertyplanning.com.au/property-predictions-for-2021/

https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's market update #16 of the Property Planner, Buyer and Professor Podcast, the team discussed "Who were the property outperformers, the under-achievers and why the market remained resilient", as Dave, Cate and Pete broached: 1. 2020, the year of the first home buyer First home buyers have been entering the market in droves and hitting record numbers in 2020, taking advantage of the many incentives available. First home buyer activity has also propped up the construction industry, which certainly helped the economy. But when will investors return to the market? The trio share their insights. 2. The outlook for interest rates Not only are interest rates the lowest they've ever been, but fixed rates are also lower than the standard variable rate. What times we live in! The Property Planner explains why fixed rates have dropped so far, how long we can expect interest rates to stay low and potential future issues that may arise due to a sustained low rate climate. 3. What economic cliff? The levers that the government can pull to prop up the economy and support during downturns are many and varied, and we haven't seen any sign of the dreaded 'economic cliff' trumpeted by doomsayers. Let this be a lesson to the naysayers! 4. Houses v units How did houses fare compared with units? It comes as no surprise that units, and particularly small apartments, were the hardest hit during 2020. Downturns often reinforce the weaker areas of the market place and this has played out in 2020. 5. The great renovation We've lived through the renovation boom and our houses are growing to be the biggest in the world. We are truly the lucky country, but how structural will this change be once people start heading back to the office a couple of times a week? 6. Regional locations - capital growth and sales volumes Regional locations have been the star of 2020, outperforming capital cities in both capital growth and sales volumes with some stellar numbers. But will regional locations remain at the front of the pack in 2021? The Property Planner and Buyer make their predictions. 7. Why did the property market remain resilient? Overall, national property prices increased by 3% throughout the year and the trio share their insights on the key factors that kept the property market chugging along through 2020, driving the quickest recovery we've seen in a property downturn over recent decades. 8. And of course, our 'gold nuggets'! Visit the show notes - https://propertyplanning.com.au/market-update-16-2020-thats-a-wrap/

https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode #67 of the Property Planner, Buyer and Professor Podcast, the team share some of their insights, experiences and best tips for our listeners when it comes to setting goals. In line with the first week of 2021, this podcast is well-timed according to our trio, as they each see a heightened degree of property investor goal-setting and planning activity at this time of year. But not all goals turn into successful outcomes and in this episode the trio explore why, and more importantly, the fundamental goal setting behaviour that can make all the difference between dreams and outcomes. Goal setting fundamentals 1. Why is goal setting important? Cate asks the Property Planner, (Dave) to share his approach that he uses to enable his clients to achieve their property plan goals, from property goals, investing goals, lifestyle goals, to the 'flexibility stage of life goals.' Pete sheds light on why people set goals, (particularly in January), and why so many people's goals don't come to fruition. 2. You can only manage what you can measure Dave uncovers the professional approach he guides his clients on when creating goals, setting measurable targets and avoiding procrastination. He shares an interesting psychological study where a study focused on a group of students who were split into two groups; those who visualised the outcome of the goals, and those who visualised the process required to achieve the goals. Visualising the required steps is an integral part of successful goal setting. 3. Creating an action plan and holding yourself accountable Setting goals is the vehicle that will drive you to your destination. Dave talks about the adoption of a timeframe map; when, where and how you'll apply the behaviour. 4. Five core reasons why people set goals Pete shares these five core reasons that he has incorporated into his university property investment course; •retire earlier •retire richer •earn extra money from time to time •work part-time •give up your day job Some can be set in tandem, but ultimately these various reasons for setting goals will determine what you buy, where you buy, and when you buy. Pete also offers some great insights for listeners who are keen to retire richer. 5. Keeping it simple (and avoid goal competition) Dave speaks candidly about one of his preferred authors, and a great lesson he's picked up from Jim Collins, (Good to Great, Built to Last). The importance of setting three clear goals; "If you have more than three priorities, you have no priorities", and he also encourages people to consider three things they should stop doing. 6. Set your goals for the now and hold yourself accountable Dave cites Steven Covey (Seven Effective Habits); "Schedule your priorities daily, don't prioritise your schedule". The way that Dave describes a stepped model is as follows; •What's your "some-day" goal •What's your five-year goal that will help you reach your "some-day" goal? •What's your one-year goal that will help you reach your five-year goal? •What's your monthly goal that will help you reach your one-year goal? •What's your weekly goal that will help you reach your monthly goal? •What's your daily goal that will help you reach your weekly goal? The planning fallacy is something that can...

https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode #66 of the Property Planner, Buyer and Professor Podcast, the team discuss "Holiday homes - delirium or dream?", as Dave, Cate and Pete take you through: 1. Lifestyle, investment or hybrid - what is a holiday house? The trio share whether you should be looking at your holiday home as a lifestyle property, a money-maker or a mix between the two. They shed light on the compromises involved when opting for the hybrid scenario, and the key considerations that investors need to acknowledge if they want to purchase with eyes wide open. 2. The opportunity cost of holiday homes Holiday homes are typically in locations that do not exhibit long-term outperformance in capital growth and your use of the home will limit the rent you receive and the tax advantages. Compounding this, your borrowing capacity will be significantly reduced, limiting your investment opportunities for wealth creation. Considering how your retirement goals will be impacted if you purchase a holiday home instead of a pure investment is critical to ensure you make the right decision for your today, and your tomorrow. 3. The tax implications and limitations for holiday homes The trio explain the tax implications of leasing out your holiday home, whether it be a long-term, traditional residential lease, a short stay Airbnb arrangement or an ad hoc approach. 4. The perils of purchasing a holiday house with friends or family Purchasing a holiday house with your mates or siblings may seem like a great idea at the time, but the reality of managing the property can be the cause of strains on the relationship. In addition to a usage roster and the clean-up and provisions protocols, co-owners also need to consider how joint ownership arrangements can change and evolve. The trio talk about the importance of an out-clause and rules around equity access before signing on the dotted line. 5. Maximising rents on a holiday home There are differing management fees and service costs that must be factored in, depending on whether your property will be leased 'hotel style' like an Airbnb or for longer-term stays. From appointing cleaners to sourcing breakfast provisions, to linen changing and beyond, the trio discuss the various ways that holiday house investors can maximise their profits over a holiday period. 6. When should you buy a holiday home Although cash flow, long-term investment and ongoing maintenance are critical factors to consider, the memories and traditions that you'll create with family are priceless, as is the respite from the day-to-day grind of a professional career or running a family. So, when is a good time to consider purchasing a holiday home, and how do you create a cost-benefit analysis when some measurements are non-financial? 7. What's in store for 2021? 2020 has seen some holiday locations take capital growth by storm. But will the tree and sea change trend continue or has the capital growth boat for holiday locations already sailed? The trio reveal their predictions for 2021. Visit the show notes - https://propertyplanning.com.au/holiday-houses-delirium-or-dream/

https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode #65 of the Property Planner, Buyer and Professor Podcast, the team discuss "How to combat your naysayers and make successful property decisions", as Dave, Cate and Pete take you through: Weekly market insights 1. Demand for holiday homes increases Fears of another outbreak, combined with additional household savings following lockdown have driven a large proportion of buyers to consider a holiday house purchase. But is this the right strategy for you? We think this warrants a full episode, so stay tuned for next week's podcast as the Property Planner, Buyer and Professor tackle holiday homes. 2. Sunshine Beach wins the 2020 crown for capital growth CoreLogic figures released last week have revealed Sunshine Beach had the largest capital growth return of 2020 with values rising by a whopping 27.6%. No doubt the capital cities of Melbourne and Sydney have been channelling money into these locations as beautiful holiday hotspots. It will be interesting to see whether long-term performance will result for investors. 3. Unemployment forecasts have improved Banks and economists have revised their unemployment predictions, with most agreeing we won't even reach 8% unemployment, a vast improvement from the previous forecast of 11%. Commonwealth Bank economists have announced that they expect the unemployment rate has already peaked and we won't go any higher than where it is right now. Combatting the naysayers 1. Why are some people naysayers? 2020 was the year the naysayers and in the end, the sky didn't fall. The trio explain the drivers that turn people into naysayers. 2. When is a naysayer doing this out of care? Parents are great at spotting the risks their children may be opening themselves up to. That doesn't just disappear when the kids reach adulthood. We explain how to manage the people that care about you the most. 3. When should you listen to your 'old folks'? You'll be laughing all the way to the bank with the money management tips you can mine from your parents and grandparents. 4. What has a naysayer cost you in the past? The Property Buyer shares the opportunities she's lost from listening to those near and dear. 5. How to get past the naysayers The best way to combat the naysayers, is to understand the 'why' behind the opinion and make up your own mind. This means doing your research and asking your independent experts great questions. 6. What role did the media play during our recent downturn? Interestingly, the media's focus on trumpeting the worst-case scenario may have actually mitigated the impact to the property market. The trio explain how. 7. How are predictions shaping up now? The sun has come out on the property doomsayers, with many now predicting growth of around 10% in 2021. However, the clouds are still hanging over Melbourne, with predictions that Melbourne will see the lowest growth next year. But we think this is overly pessimistic. 8. And of course, our 'gold nuggets'! Visit the show notes - https://propertyplanning.com.au/how-to-combat-your-naysayers-and-make-successful-property-decisions/

https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode #64 of the Property Planner, Buyer and Professor Podcast, the team discuss "Property v Shares - How to strike the right balance in your investment portfolio, which investment strategy is superior, how to get started and should it actually be property AND shares?", as Dave, Cate and Pete discuss: Weekly market insights 1. Australian bonds in negative yield territory For the first time ever, Australian bonds have been purchased at a negative rate last week, with an average yield of 0.01% and buyer's who bid most aggressively receiving a yield of minus 0.01%. 2. Landlords and tenants in limbo as VCAT unable to settle interstate disputes The Court of Appeal has ruled that property disputes in Victoria involving landlords who are residents of other states are not within VCAT's jurisdiction. This means that neither the tenant or the landlord can apply to have a tenancy dispute managed in VCAT. We expect this unsatisfactory state of affairs will be dealt with and rectified by the Government shortly. 3. Savings spike the highest since the 70's One silver lining of the coronavirus pandemic is that many Australian's are saving more money than ever. The last time we saw a spike in savings this high was in the early 70's where fuel was being rationed. Increased savings will add fuel to the property fire for many borrowers whose borrowing capacity is contingent on their deposit size. Property v Shares 1. Share investment lessons from the property experts The Property Planner, Buyer and Professor share their first-hand experiences and lessons learnt the hard way from their first foray into shares. 2. What does an investor need to do to be purchase-ready? It's a lot easier to get your foot onto the share market ladder, than the property ladder. With the ability to invest a few $100 in the share market and low transaction costs to purchase and sell, the trio share with you what you need to do to get purchase-ready. 3. Leverage and borrowing funds to invest One key difference between property and shares is bank policy in providing funding, which typically allows for lower loan to value ratios of 50-70% for margin loans. Whereas home buyers can seek loans of up to 95% to purchase a property. This is because of the perceived risk and volatility in the share market and relative stability of the property market. This also means that the value of the investment that you can purchase with your initial capital is greater, and this leveraging bolsters net capital growth, which translates to more opportunity to invest and leverage in the future. 4. Share trading v share investing The trio explain the differences between share trading and share investing, and if you're not a share market expert, why share investing is likely the right strategy for you. 5. How mortgage strategy applies to shares The good news is that the same principle of mortgage strategy apply to share investing as property investing. The Property Planner, Buyer and Professor outline the key strategies to implement. 6. Market volatility While there is certainly more risk in the share market, there is also more gains to be had when leveraging is not considered. The value of shares can increase by 10 times their original amount and some companies just seem to take off. In contrast, outperformers in property see typically 10% or more capital growth in a year. However, it seems with shares that as quickly as they go up, they can come back down. We highlight th...

https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode #63 of the Property Planner, Buyer and Professor Podcast, the team discuss "Setting yourself up to purchase with confidence and why getting your pre-approval in place is more critical than ever", as Dave, Cate and Pete discuss: Weekly market insights 1. Economic wins driving our recovery Australian Bureau of Statistics data released last week reveals why property values have been taking off since October as the economic & property upturn continues at record pace. ASX 200 gained over 10 per cent in November, (a whopping return of 120% when annualised) and is in the top 10 of monthly returns recorded over the last 40 years. Car sales turned positive for the first time in 2.5 years, with 10,000 cars sold and Iron Ore exports hit a record $13.5 billion, already $13.2 billion ahead of the average, a significant boost to the government's revenue, offsetting some of the stimulus and much of China's tariffs in other areas. 2. Property values on the rise over November Dwelling values rose across every capital city, as Melbourne joins the market rebound. The national index increased by 0.8% over November or 9.6% annualised, double the 0.4% growth recorded for October. Darwin and Canberra were the strongest performers, increasing by 1.9% or a whopping 22% when annualised. Regional areas have been the stand outs with a total return of combined capital growth and rental return of over 10.6% over the last 12 months. Banks and economists re-evaluated their projections to be somewhere between 5 and 9% growth for 2021, but we thing that these could be on the conservative side. 3. Holiday hotspots Whilst Melbourne recorded an increase of 0.7% over November, the Mornington Peninsula broke Vic records with a massive 2.2% capital growth for the month. This location has seen strong capital growth since the gates opened and the extensive lockdowns driving the great lifestyle re-evaluation have made the Peninsula an even more attractive place to purchase. 4. Aussies officially out of recession Treasurer Josh Frydenberg announced officially last week that Australia is out of recession. The property market is leading the recovery - as increased values flows into increased confidence and consumer spending. Compared to the recession in the 1990's where unemployment reached 11%, we're looking at revised forecasts of under 8%. Getting your pre-approval in place 1. The current state of the market The Property Planner and Buyer shed light on the flood of enquiries and high levels of interest from prospective purchasers looking to get their ducks in a row to make their next property decision. 2. What's driving the flurry of activity? Affordability is the best it's ever been, interest rates are at an all-time low (and will stay that way for a few years according to RBA Governor Philip Lowe), existing properties have held their value and started to increase, which gives people the confidence to take that next step. 3. How long will it take to get a pre-approval? Trying to get a pre-approval has been difficult since Covid started, banks have had their challenges with an influx of queries from customers looking for repayment pauses, assessment criteria has been stricter than ever before, with new rules implemented for checking (and re-checking) income. The time to have a pre-approval assessed has blown out to 20-30 days with some of the major banks, plus it's worth noting that pre-approvals are the second-class citizen of the finance world. The upshot - it's critical to act now and act...