The Property Planner, Buyer and Professor

Formerly known as The Property Planner, Buyer and Professor, we've rebranded to The Property Trio. Our listeners who have subscribed to our show don't need to do a thing. Each week's episode will keep landing in your feed.

Got a question for the trio? https://zfmz.com/uLtjhyBskV96PYeJfal

Show notes: https://propertyplanning.com.au/the-property-professors-memoirs-part-3-ep-199/

This is arguably one of the trio's favourite set of episodes. Taking a trip down memory lane was not only a thrilling chat for Pete, but a wonderful way to share some very important learnings with our listeners.

Following on from last week's episode 1 where Pete got started on his property journey in 1984, this week's episode introduces listeners to Pete's learnings as he embarked on value-adding to his investments.

In the last of these three special episodes, Cate hosts this episode and looks into the various ways that Pete's skillset and experience have enabled him to achieve success and to have choice as he approaches semi-retirement. Episode Three hinges on Pete's growing expertise in relation to subdivision and building.

"Two equilateral triangles make a square"... Listen in to find out how Pete optimised two sites for development.

Cate also reflected with Pete about his growing national brand and his achievements over the years. 

Pete appeared in almost every API magazine, contributed to journalist articles, authored two books; firstly in 2008 and then in 2013, he's continued his studies, maintained his passion in property as an active investor, and in 2013 Pete had what he describes as a 'landmark year'. His Masters of Urban Regional Planning study commenced, he was teaching full time, he managed authoring his book and he was training for a marathon. No small feat indeed.

"Knowledge is power in many different fields, and it's no different when it's in property."

Pete's saga about his daughter bidding for him while he was holidaying in Melbourne. While sitting outside a fashion shop waiting for his wife, he trawled the internet on his phone. Recognising a poor listing on the internet that had previously been incorrectly uploaded, Pete set himself the challenge and geared up for an auction (with his daughter's help) in a tiny space of time. It's a wonderful story! Tune in to hear why this particular property caught Pete's eye.

Another great project that Pete shares with our listeners relates to a quadrilateral shaped block that one of his students identified, and in fact it's one of his favourite developments. Pete built the townhouses and holds them to this day, retaining them as a key piece of his retirement plan.

"You don't need to be a genius to do well in property. You just need to know a bit more than the last person".

The trio ponder the properties they've sold, the losses they've averted and the reasons why they sold at the time. Pete's sensible words of wisdom shine through as he reminds listeners that sometimes we make decisions that were the right decisions to make *at the time*.

To sign off the episode, Pete happily sits in the hot seat and answers Cate and Dave's questions. From his best performer, to his tips for success, this episode can't be missed.

And... our gold nuggets!

Pete Koulizos, the Property Professor's Gold Nugget: "Surround yourself with like-minded people to help you on your property journey."

David Johnston, the Property Planner's Gold Nugget: Dave asked Pete a fantastic, burning question that he wanted to bring to light for the listeners; was Pete's property journey the right journey for *him*?

Cate Bakos, the Property Buyer's Gold Nugget: Pete's success can be attributed to his passion, continuous learning and his willingness to take action, but a significant ingredient that Pete had on his side was all about time. He got started early.

Got a question for the trio? https://zfmz.com/uLtjhyBskV96PYeJfal

Show notes: https://propertyplanning.com.au/the-property-professors-memoirs-part-2-ep-198/

This is arguably one of the trio's favourite set of episodes.  Taking a trip down memory lane was not only a thrilling chat for Pete, but a wonderful way to share some very important learnings with our listeners. Following on from last week's episode 1 where Pete got started on his property journey in 1984, this week's episode introduces listeners to Pete's learnings as he embarked on value-adding to his investments.

Episode 1 - Getting Started. It starts back in 1984 when Pete and his wife purchased their first home in High Street, Ardrossan (SA) and spans the the purchase of their first upgrader home, as well as some early value adds and long-term investments that Pete embarked on.

Episode 2 - Property Speculation. Pete branched into purchasing value add properties and wised up to other ways that investors can value add, other than gaining a DA.

Episode 3 - Property Development and Construction. Pete started building and retaining properties in this particular investment phase.

In Episode Two, Dave delves into Pete's 'mid-journey' property acquisitions and upgrades. One of Pete's interesting achievements involved subdivision activity without building activity. In 2001, and by the time his young family were old enough to travel abroad, Pete proudly took his wife and two eldest to Greece to celebrate some of their property investing achievements. Interestingly, Pete's motivation to avoid building stemmed from a sloping block representing too many challenges for him to tackle. But block after block, Pete perfected adding value through planning approvals, although he notes that it was easier twenty years ago than it is now. 

Why did Pete decide to sell his holiday house though? He offers a great explanation... 

Pete's children's sporting commitments, friends, and weekend plans got in the way of he and his family being able to enjoy their holiday house. The trio have discussed holiday houses at length over past episodes, but this real-life example from our very own Property Professor sheds light on the viability of the holiday house ideal for this family. 

Pete and Dave discussed debt, home renovations, personal priorities and the need to put family needs before investment desires at times. Pete's authentic personality shines through in this episode. "I'm a big believer in that your home is your castle."  ....."there's no point in having a fantastic place that somebody else is living in and renting, and then you're living in a not-so-nice place." 

From value-adds via clever planning insights, Pete's winning formula as his property knowledge grew became a feather in his cap and a very effective way to grow his wealth. His salient advise is peppered throughout this exciting episode, and yet another piece of advice from Pete rings true. 

"Most approvals do not last forever". 

Pete reminds us about recessions, the GST introduction, the GFC, first home buyer grants and all of the eternal drivers that influenced the vibrant market conditions of the late 1990's and early 2000's. It's a gripping episode, and one the trio enjoyed.

And... our Gold Nuggets!

Pete Koulizos, the 'Property Professor's Gold Nugget: "Property booms are wonderful things." Pete's tip sits outside of  timing markets, but he reminds listeners that owning property during a boom period is powerful for any investor's portfolio. 

Cate Bakos, the 'Property Buyer's Gold Nugget: Cate reminds investors not to take town planning advice from an agent. Independent advice is paramount.  "Property purchases are BUYER BEWARE."

Got a question for the trio? https://zfmz.com/uLtjhyBskV96PYeJfal

Show notes: https://propertyplanning.com.au/the-property-professors-memoirs-part-1-ep-197/

This is arguably one of the trio's favourite set of episodes.  Taking a trip down memory lane was not only a thrilling chat for Pete, but a wonderful way to share some very important learnings with our listeners.

Pete has rigorously segmented his property purchase history into three components as follows;

Episode 1 - Getting Started. It starts back in 1984 when Pete and his wife purchased their first home in High Street, Ardrossan (SA) and spans the the purchase of their first upgrader home, as well as some early value adds and long-term investments that Pete embarked on.

Episode 2 - Property Speculation. Pete branched into purchasing value add properties and wised up to other ways that investors can value add, other than gaining a DA.

Episode 3 - Property Development and Construction. Pete started building and retaining properties in this particular investment phase.

For Episode One, Cate delves into Pete's early days and asks all kinds of questions about his early influencers, his savings regime and some of the significant differences that he faced as a first home buyer back in 1984 compared to today's new starters on the property ladder. Interestingly, Pete's driving force to purchase a transportable home Ardrossan related to a sensible look at the cost of ownership versus the cost of renting, particularly in a country town. 

How did Pete fare with his negotiating ability with his first home? Tune in to find out what his bonus inclusions were!

The growth of Ardrossan was reasonable back in the 80's and it equipped Pete and Mrs K to be able to leap frog into an upgrader home in Torrensville, Adelaide with their firstborn child in 1991.

Cate asked Pete about how much his father helped and taught him with his property knowledge. "It was all leant by osmosis", was his telling response. But tackling how to explain investing and debt to his parents was a different type of challenge. Like many young investors, Pete had to be cognisant of his parent's fears and concerns about his appetite for risk and wealth creation.

Why does Pete pay full price for a property? He offers a great explanation... The trio chat about Pete's early investment property experiences, including;- managing cashflow,- his aversion to battle-axe blocks,- mistakes he made,- investing with business partners,- enabling a viable project with a clever JV idea, and- interest rate pressure and other financial challenges. 

Pete also talks about a block of flats that he secured some forty years ago that are still in the family (...and it's a great story!)  Cate probes Pete about his rationale for selling some outstanding performers and his answers are particularly grounded. Pete is generous, humble and an absolute wealth of knowledge in this gripping first episode in this special trilogy.

And... our Gold Nuggets:

Pete Koulizos, the 'Property Professor's Gold Nugget: "Buying and holding is the best strategy to make money in property, but it's not the only strategy." 

David Johnston, the 'Property Planner's Gold Nugget: Dave notes that having a longer term plan, taking some risks and making firm decisions can enable investors to retire wealthy. They don't have to make many decisions, they just need to make good decisions.

Got a question for the trio? https://zfmz.com/uLtjhyBskV96PYeJfal

Show notes: https://propertyplanning.com.au/when-property-and-money-decisions-upset-relationships-part-2-ep-196/

Dave's market update is a special one - he has been in the mortgage industry for over twenty years and his mortgage intel is always exciting. One lender has re-introduced negative gearing into their serviceability calculator. This essentially means that "shading" on rental incomes enables heightened borrowing capacity for investors. While it's just one lender... these situations often mean more will follow.

Cate's market update relates to civil and infrastructure works. From a planning point of view, home owners and investors should be mindful of the impact of these works. From compulsory acquisition to road widening to zoning changes, buyers should look into these changes and consider the impact to their purchasing plans.

Following on from Episode 194, the trio uncover the common triggers for upgrader/family home buyer discord.

From provisioning cashflow to enable parents to stay at home with young children to managing thoughtful discussions about retirement plans, Dave sheds light on the benefit of having buffers and a strategy to navigate some of these often-treacherous waters.

Dave, Cate and Pete discuss some of the other tricky aspects, including;

- identifying the need for living in a show-home vs enjoying a simpler life
- debt comfort level misalignment
- investing vs nesting
- location preference disharmony

Cate reminds the listeners that having a mutually shared spot on the Venn diagram is essential to overcome couple's different preferences and clashing risk profiles.

Dave raises an interesting point about the relationship between financial focus and personality traits. Not all people are financially literate and many have to be taught about the difference between good debt/bad debt, and the merit of having financial goals.

What are some of the triggers for investor couples when it comes to upsetting a relationship?

Pete uses a great example to illustrate the importance of remaining unemotional and pragmatic decision when it comes to investment property selection. And his two 'fundamentals' questions highlight just how pragmatic the Property Professor's approach is: "Is it in a good location, and does it have a good land component?" To support Pete's philosophy, Cate's favourite saying for her investor clients is; "You don't have to love it, in fact you don't even have to like it, but I want you to be proud of it."  This extends to those who also confuse investment with holiday homes and future use potential.

Sacrificing family home dreams is another common source of upset, as is impatience.  Dave's example about the kids who were offered one marshmellow immediately, versus those who were rewarded with two marshmellows if they could wait for five minutes had the trio chuckling. Property investing really is a long game and it does require sacrifices at the start.

The trio also chat about misalignment of preferences for asset classes, and bad previous experiences with property investing tarnishing enthusiasm.

Cate Bakos, the Property Buyer's Gold Nugget: Cate shares some good tips based on personal experience. To get yourself in the best position to present to a financial advisor, Cate recommends couples take the time to understand each other's positions on wealth creation and debt aversion, and she encourages couples to be prepared to talk to each other about their sensitivities.

David Johnston, the 'Property Planner's Gold Nugget: Dave notes that the crucial conversations are the hardest ones to have, but to push past the discomfort, remain open-minded, and to chat consistently is critical for couples who want to be on the same page.

Got a question for the trio? https://zfmz.com/uLtjhyBskV96PYeJfal

Show notes: https://propertyplanning.com.au/when-property-and-money-decisions-upset-relationships-part-1-ep-194/

The trio make a bitter-sweet announcement at the beginning of the show. Pete is leaving the podcast to enjoy his semi-retirement, and while Dave and Cate are excited for Pete, they are pretty sad to be saying goodbye to Pete. He's not leaving quite yet - they have the 200th episode coming up in April and they have a special three-part series with Pete coming up.

They also share they will be announcing Pete’s replacement in the coming weeks…..stay tuned!

In this week’s episode, Dave, Cate and Pete cover some of their best tips for navigating tough property decisions as a couple, particularly when risk profiles, preferred locations and priorities for home versus investment differ.

1. What are some of the triggers for first home buyers when it comes to potentially upsetting a relationship?

From separate savings to differing salaries, parental support and pre-nuptial agreements, the trio canvas some of these sensitivities. Pete talks about some of his experiences with these situations and Dave points out that it's not uncommon for couples to have different feelings and views about things and shares some interesting examples for you to be aware of.

2. How do couples broach pre-nuptial agreements or substantial cash contributions?

Dave's experience with past clients precipitate some great questions that first home buyer couples can discuss at the onset of their journey, and he also shares a great podcast with our listeners that tackles pre-nuptial agreements.

3. What do you do if your partner enjoys 'living in the moment' financially more than you?

Cate mentions a reasonably common issue that sometimes creates tension in first home buyer relationships; a different approach to saving and spending. YOLO, (you only live once) is a fun way to look at life, but it has it's place. Unfortunately YOLO doesn't have such a great place when it falls within a dedicated first-home savings regime.

In addition to investment appetites and debt aversion, many couples face differences of opinion when it comes to location. Proximity to work, family, friends, schools and community can sometimes clash.

4. What is a common trigger than can be avoided?

Dave notes that a significant stressor relates to the overall plan; home or investment. Plenty of couples and individuals blur the lines or lose track of the primary reason for a purchase. Whether it be a stepping stone property or a fully-fledged home, a future-use investment or a rent-vest approach, so many start the process without thoroughly canvasing what they should be focusing on.

The trio talk about their various approaches to 'getting two people on the same page'. Cate refers to Venn Diagrams and the shaded, overlapping part. Dave discusses the need for a firm plan well before specific locations and dwelling types are up for consideration.

Approaching cashflow, cash buffers and deposits is an important part of the pre-planning and Dave sheds light on some of the clever questions couples can answer together before embarking on the property criteria phase.

Gold Nuggets

Cate Bakos, the 'Property Buyer's Gold Nugget: Cate shares some good tips for first home buyers who are navigating the process with parental input, (solicited and unsolicited) in their ear. Ultimately it's an important decision that is made by the couple, not parents.

David Johnston, the 'Property Planner's Gold Nugget: Dave encourages property buyers to plan early. It's all about investing more time in the planning up-front, as opposed to during the search phase.

In this week’s episode, Dave, Cate and Pete take you through their 2023 predictions, but they also review their 2022 forecasts. Tune in to find out...

1. What will the market do? It seems the trio were optimistic in their predictions for 2023, but Cate did add a little disclaimer stating "providing no shocks to the market". It appears that imminent interest rate rises were not easily predicted by the trio at the start of 2022.

2. Capital city top performers - Pete's predictions for capital city performers landed closest to the pin, however Dave did have some interesting insights into Melbourne and Perth's growth and the impact of COVID on each city.

3. Regional locations - Pete tipped that regional cities within a reasonable distance of the capital city would continue to outperform, while Cate pointed out the risk for holiday house and coastal market buyers as the heat comes out of the COVID escape locations.

4. Investor numbers - Funnily enough, the trio's mention of APRA restrictions or regulator intervention underpinned their reservations about investor participation in 2022.  

5. Government intervention in the property market - Pete and Cate did not see interest rate increases coming, but Dave did think that APRIL would step in to restrict lending to some degree. As Pete points out though, there didn't need to be any intervention. The RBA took care of that issue for us! 

6. Developers and building - Our trio got a lot of these predictions right.  Into 2023, Cate thinks that private builders will start to free up and Pete supports a slow recovery as the supply chain woes subside. Dave is still fearful for building activity due to materials costs remaining high and trade labour shortages.

7. Interest rates -  what do the trio think will happen this year? Pete thinks that the cash rate will be slightly lower at end-2023 than it is today, and Cate broadly agrees, but predicts some different increase increments to Pete's. Dave feels our rate at year end will be the same as today's. Time will tell!...

8. Rents and vacancy rates - The trio each saw some difficult writing on the wall as stock tightened in 2022. Dave feels the vacancy rates will remain static (historically low) while Cate feels things will get much worse for renters into 2023.

9. Sales volumes - Pete felt that sales volumes would remain high, and Cate's prediction was not correct at all. Surprisingly for the trio, vendor listing and selling activity was lower than previous years. In hindsight this is easily explained by sentiment dropping in response to rapidly increasing interest rates.

10. Risks which could impact the market - This time, Cate did get some of her past predictions correct, and it was Dave who predicted that Russia could invade Ukraine.

11. Inflation - Dave identified rising inflation in his prediction, and the trio pondered the inflation outlook for 2023. Listen in to hear what they each predict for 2023.

Cate Bakos, the 'Property Buyer's Gold Nugget: Buyers who are prepared to bid at auction will have favourable conditions because many are anxious. about bidding unconditionally, and are sitting it out. 

David Johnston, the 'Property Planner's Gold Nugget: Dave believes that 2023 is going to prove to be a great time to buy and current market conditions will represent the low water mark.

Show notes here: https://propertyplanning.com.au/2022-review-and-2023-predictions-what-did-we-get-right-and-what-did-we-not-predict-ep-189/

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/

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:

Market update

1. Beware of changing borrowing capacity when on the property hunt
With monthly cash rate increases, borrowing capacity has been slowly dwindling as lenders update their affordability calculators. However, the ‘Household Expenditure Measure’, a measurement for scrutinising living expenses, is also increasing to reflect the higher cost of living due to inflation. For those who are hoping to purchase at the limit of their borrowing capacity, it is imperative that you are checking in with your strategic mortgage broker to confirm affordability before you sign any contracts.

2. Shared equity scheme for Victorian’s announced
The Labor party in Victoria have announced a shared equity scheme to help buyers get into the market. Interestingly, it is not limited to first time buyers. The scheme allows for purchases in metro Melbourne and Geelong up to $950,000 and up to $600,000 in regional Victoria, with the government assisting in purchasing up to 25% of the property. But take note, they will also expect 25% of the gain when you sell! We recommend to those who are interested to understand all of the requirements and fine print.

3. Auction clearances indicate further green shoots
The latest auction clearance rates show some positive signs, which for the third week in a row have been holding steady above 60%. With volumes continuing to rise and the recent rate increase representingonly 25 bps, the market is showing resilience with buyers trickling back in.

Our best advice from our own journeys

1. Reflecting on our own purchasing journeys, what is our most solid-gold nugget of wisdom that we’ve gained and feel compelled to share with others?
The trio share the most important lesson they’ve learnt from buying and investing in property. Although Cate, Dave and Pete have followed vastly different paths on their property journey, the advice is very similar – get a foot in the property door as early as you can and hold on to property as long as you can. The trio discuss the circumstances and key events that led them towards this realisation.

2. What surprised the trio about the simplicity of their retrospective gold nugget?
Get in early and hold as long as you can. Simple, right? Whilst it might seem obvious now, there are many circumstances across a lifetime that can challenge this simple proposition and test your nerves. The trio share hot tips on how to keep it simple and stick to your guns. Action and patience is key!

3. What positive role models did the trio learn from in their earlier years?
The trio discuss the investors that they consulted and learnt from at the start of their property journeys. The key is to mix with people who have had success, ask questions, absorb the lessons and work out what is the right strategy for you.

4. Has the evolution of market conditions, lending conditions and social pressures changed how this gold nugget could work in today’s climate?
The trio look in the rear view mirror at the property landscape, how it was back then vs how it is now. Does the change in market, lending and social conditions change the advice? Tune in to find out.

Visit the show notes - https://propertyplanning.com.au/the-best-advice-from-our-own-journeys-ep-177/

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:

Market updates

1. Correlating listings and property prices – watch this space

The Property Professor shares research that he will be conducting on the relationship between listings and property prices. From a supply and demand perspective, whenthere is an increase in listings for sale, there should be a corresponding drop in prices. Are listing numbersa leading indicator? We’ll be watching keenly for the results in January

2. The market picks up – more green shoots emerge

The Property Buyer shares her experience on the ground, hitting the pavement and talking to real estate agents. What can be seen is an increase in late spring listings, buyers attending inspections and competition levels in general. With the 0.25% increase in rates, somebuyers have decided that the slow down in the rate of increase may signal a turning point.

3. Clouds on the horizon? US rate movement

The Property Planner shares news from the world economy, where inflation in the US continues to grow, with many expecting the US to raise the cash rate by 70 bps. This could potentiallybe bad news as other nations try to stay inline with US rate movements to ensure their currencies don’t weaken against the US dollar. Here’s hoping that Australia can hold the line on 25 bps increases, as Australia’s economy is much more sensitive to rate increases due to the majority of variable rate loans.

Amenities

1. How far is "walking distance?"

There is no hard and fast rule and it differs from person to person. But when assessing the quality of a location, some boundaries and measurements need to be put in place. The trio discuss the ideal walking time and distance for amenities.

2. Walk score – what is it and how to use it

Walk score is a great resource to measure the walkability of an address. You simply type in the property address and get a score out of 100. Points are awarded based on distance to amenities in various categories such as dining, shopping, errands, parks, schools and more. Visit our show notes for the link to this free resource.

3. The amenities that you don’t want to be too close to

While being close to some amenities can be really valuable, there are others that you want to be a reasonable distance away from. The trio discuss which amenities to distance from and by how much.

4. What to target as an investor – don’t let personal preference get in the way

Valuing amenities can be a very subjective task, as each person has their own personal preferences. For some, a school nearby can be a useful amenity and for others, it can be a nuisance. It’s important to target properties near amenities that at least 8 out of 10 people will be happy with.

5. Which amenities are most important to the trio, personally and from a professional perspective?

Cate, Dave and Pete share the amenities that they value the most from a lifestyle and professional perspective.

6. Which amenities are the most important in the cities around Australia?

The trio discuss the critical amenities to target in Adelaide, Melbourne and Sydney. Knowing your market is important, as desire for access to an amenity can vary from city to city. It is also imperative to think about the target tenant and what they would desire from a location.

Visit the show notes: https://propertyplanning.com.au/amenities-which-are-important/

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 Property market falls decelerate over September
For the first month, the rate of price decline has decelerated, which may be an early sign that the market has passed through the worst of monthly falls. Other early indicators are auction clearance rates picking up and stock levels remaining low. With the RBA putting the breaks on rate increases, the trio discuss what’s likely on the horizon.

2 Peak to trough decline
The current peak to trough decline nationally sits at -4.8% since the peak of April 2022. The trio discuss the peak to trough falls for the capital cities and state regions. Note that regional WA is still below it’s peak 14 years ago, a good reminder to be sceptical of property spruikers and do your research prior to entering any investment decisions.

3 Brisbane land tax has been repealed, but has the damage already been done?
Rents for houses in Brisbane are up 14% over the year and vacancy rates are sitting at a low of 0.7%. On a positive move, the land tax proposal was scrapped, (thanks to our friends at PIPA, PICA and REIQ). However, Brisbane has already sustained some pain, with many investors selling up or in the throws of doing so.

4 Where is the big picture on housing?
The trio discuss government and regulator decisions that have made it harder for landlords and investors. Without the big picture of understanding and deciding what is an appropriate mix of ownership between owner occupiers and investors, and how many investors should be private investors, the approach to housing reform is like throwing darts blindfolded. In positive news, the rate of increase in rents was the lowest it’s been in 10 months, which signals that rental growth is tapering.

5 Listings languish
Spring is typically the time of the year that an increase in stock occurs, but the level of listings has actually dropped and is close to the 5 year average. With interest rates on the rise and prices declining, vendors are holding off thinking that now is not a good time to sell. Hobart and Canberra are bucking the trend, with listings at 71% and 41% higher than this time last year. The trio discuss what this means for value growth and dive into distressed listings.

6 House price expectations turns around
In an interesting turn of events, the house price expectations index has ticked over 100, after dropping below 100 for the first time since September 2020 last month. Victoria and Western Australia are most positive, with readings of 108 and 106 respectively. This should improve further due to the RBA slowing down cash rate rises and is another positive green shoot in the month of September.

7 Investors continue to bow out while first home buyers jump in
Over the month of August, investor lending fell by 4.8%, while owner occupiers remained resilient. First home buyers increased by 7%. Personal loans also increased by 9.5%, which is a concern that people are funding something that they don’t have the money for. David shares what bond markets are saying about where the cash rate is likely to end up too.

8 Unemployment remains steady
The trio discuss the unemployment rate and what is on the horizon with new migrants and the scrapping of mandatory isolation for Covid-19.

Visit the show notes: https://propertyplanning.com.au/market-update-sep-2022-green-shoots-emerging-price-falls-decelerate-auction-clearances-up-consumer-sentiment-improves-solving-housing-policy-and-more-ep-175/

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. Listener questions

This episode is dedicated to answering questions we’ve received from our listeners. If you’ve got a burning question that you’d like to ask the trio, submit your question online here. (AML to add in the link)

2. Can I access the First Home Owner Grant if my partner has already accessed government assistance?

My question is, if I'm buying a property on my own but am living with my partner who has bought a property and received the First Home Buyer Assistance Scheme (transfer duty reduction) already, can I also still qualify for a first home owner grant myself?

3. How do partners and de facto relationships impact eligibility requirements?

The trio discuss the Victorian SRO criteria for receiving the First Home Owners Grant and how partners must be disclosed on applications, even if they will not be on the property title. But what if your finances are separate, can a government still find out? Tune in for the answer

4. Is there a way you can get around it?

The trio discuss a potential pathway to explore in order to receive the grant. However, take note! It’s best to run the scenario by the SRO or a professional for their advice and don’t forget to get it in writing.

5. Is now a good time to subdivide and build our dream home?

We owned a unit in Thornbury and purchased an entry point house in Reservoir during the pandemic. The block is 536m2 and we are looking at subdividing the block and building a 3br townhouse at the back to live in as our family home (2 young daughters). I would like to explore whether the next 12 months would be a good time to commence the planning and building process for the back town house or whether the current climate with building materials and inflation mean it’s a bad time to subdivide and build?

6. As with any major decision, ensure that you are thinking about the longer-term

In true Property Planner style, David poses some key questions to our listeners about their long-term lifestyle plans and understanding how a subdivision and family home fits into the overall plan. “How long will this home meet your lifestyle needs? “, “Are you sure you will be happy living in the back property for 5 to 10 years if that is required from a financial standpoint? “, and “Will you enjoy living next to your tenants?“ are just to name a few questions to ask.

7. What are your thoughts on Point Cook as a location?

I'm curious about the neighbourhood Point Cook in Melbourne. It seems to have plenty of amenity and has been suggested as a future 2nd CBD hub for Melbourne in some articles I came across. I also think it's great that it's one of the most multicultural neighbourhoods in Australia. What are your thoughts on it as a neighbourhood to live in. Are there any areas you find better than others?

8. Investment and lifestyle analysis for Point Cook

If our listener loves Point Cook as a home and community, then that’s enough reason to purchase a home there. However, Cate shares some key points for Point Cook which could make it a problematic investment.

Visit the show notes - https://propertyplanning.com.au/listener-questions-bought-off-the-plan-my-situation-rates-the-market-is-worse-i-need-the-fhog-but-moved-in-with-my-partner-help-is-it-a-good-time-to-subdivide-suburb-analysis-and-mo/

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 stop work and live off our portfolio before we reach preservation age?

This case study follows the journey of Craig and Jane, podcast listeners in their mid-forties who submitted their scenario to the team to unpeel via the Property Planning platform. They have already made some fantastic decisions on their investment journey, such as almost fully paying off their home, and purchasing three investment properties. They were wondering whether they would be able to scale back work or stop completely in 8 years time, which is 7 years before reaching preservation age and live off their passive rental income before they can access their superannuation. Or would they need to sell a property to live comfortably?

2. Their portfolio and goals

The property trio discuss Craig and Jane’s goals and their investment portfolio that they’ve worked hard to build - consisting of 4 properties, super and shares. Ideally they would like to be earning $100,000 passive income from their investment properties, to have enough room in the budget for annual family holidays with their two (currently teenage) kids.

3. Modelling the scenarios

Four scenarios were modelled for Craig and Jane which is how many each Property Planning platform allows per user, to illustrate their varying options and provide contrasting pathways forward. The trio sink their teeth into the financial outcomes, how scaling back at different ages, working less hours, selling or holding and other factors impact the ultimate financial outcomes in to their retirement years.

4. The power of mortgage strategy

The trio highlight the importance of mortgage strategy, as demonstrated in the modelling. A simple change shaves 7 years off of reaching passive income of $100,000 from property. Tune in to find out how.

5. Should I work longer, scale back sooner but work more days, or just stop all together and everything in between?

The trio discuss how various pathways for the couples timeframe and amount of working hours can make a significant difference to your bottom line, retirement age, or flexibility age for when you start to scale back your working hours. Learn how these tweaks inside of the Property Planning software can help inform and educate your decisions rather than flying blindly! The surprise twist to make a significant positive change to this exciting, real life case study might surprise our listeners.

Visit the show notes - https://propertyplanning.com.au/property-planning-case-study-6-listener-scenario-on-the-property-planning-platform-can-we-retire-in-8-years-live-off-our-portfolio-until-we-hit-preservation-age-ep-173/

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:

Market update

1. How the different sectors of the market react to price movements

Pete shares with you how the most expensive, middle and lowest sectors of the market in both capitals and regional centres react to market movements. Check out our show notes for an interesting graph that shows it all.

2. The lure of off-markets

Cate shares a conversation that she had with an agent who is very experienced about her take on off-market properties. While 95% of them are disappointing, there is the odd gem to be found. Tune in to find out how you can capitalise on these opportunities. n.

3. The Property Planner updates his predictions for the next RBA rate movement

Due to further inflationary developments in the US, money markets have changed their predictions for the next rate increase to be 50 basis points, rather than 25.

The top 7 things that buyers get wrong – Part 2

#3. Mixing emotion with pragmatism when it comes to investing

The trio discuss some of the biggest mistakes that can lead you astray when you listen to your heart instead of your head when investing. What are the causes of emotional decision making and how can you detach yourself to make pragmatic decisions? Tune in to find out.

#4. Low ball offers and a quest for a bargain (instead of a quality property)

One of the critical mistakes is chasing the property bargain unicorn. The reality is that if a property is heavily discounted, there are some issues that the purchaser has to deal with.

#5. Being impatient with time

The trio discuss why property is a get rich slow scheme and the errors that buyers fall into when they start to feel impatience creeping in.

#6. Counting cents instead of dollars

When does scrimping and saving lead to mistakes? The trio discuss the items that you should dig into your wallet to address.

#7. DIY’ing the things that you shouldn’t

Renovations are tricky to get right and some work even requires permits and certificates. Before you role up your sleeves and get out the paint brush, take a listen to the things that potentially you should be getting a professional to do.

Visit the show notes - https://propertyplanning.com.au/the-top-7-things-property-buyers-get-wrong-part-2-ep-172/

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:

Market update

1. Rate of decline speeds up in most capitals

Over the month of August, the rate of decline has increased, while in a surprise move, Melbourne’s decline has slowed. Shockingly, Brisbane has jumped from –0.8% in July to –1.8% in August. No doubt due to proposed changes to land tax, flooding and the previous heat in the market. The trio discuss the trough to peak for the capitals and what’s likely to happen next.

2. Rental market - Brisbane land tax is likely to make the rental situation worse

The trio canvas the proposed changes to land tax in Queensland which will likely cause more than a few investors to abandon the Queensland property market and sell up to first home owners, hence intensifying the rental shortage. The greatest risk is that other states will jump onboard and aggregate land tax.

3. The outlook for vacancy rates

Supply remains limited for rentals, with the tap of overseas migration just starting to be turned on. With new dwelling constructions starting to fall, the outlook is fairly grim, particularly given the Australian Government has increased the target figure for new arrivals.

4. Listings to increase over spring

Supply of stock on the market is set to increase, with covid in the rear-view mirror and spring time on our doorstep. Old (180 day+) listing numbers have started to climb, showing that buyer FOMO and desperation have calmed. Total listings are tracking above the 5-year average, a sign that vendors want to sell before the market drops further. The trio discuss how listings and monthly growth our closely interrelated.

5. Consumer sentiment

The house price expectations index has dropped for the first time below 100 as consumer sentiment overall takes a hit. Victoria remains the most pessimistic, with a 17.7% drop over August from 99 to 81.6. The trio discuss what this could mean for inflation.

6. Finance continues to fall over July

Lending activity continues to slow and mostly investors and business construction has been impacted. The bond yield spiked after the US Federal Reserve Chairman spoke and indicated that the US will do whatever it takes to curb inflation. However, expectations have settled again at 3.1% for the cash rate and we are on our way to hit a 3% cash rate towards the end of the year.

7. Victoria leads the unemployment decline but wages are not taking flight

Unemployment drops again to 3.40%, while Victoria leads the pack with the lowest unemployment on record at 3.10%. With the low level of unemployment, it is interesting that wages are not skyrocketing. The trio discuss the delicate tight rope walk of increasing wages, as wage growth must stay under control to tame inflation. Wages should increase, but not at the same rate.

Visit the show notes - https://propertyplanning.com.au/market-update-aug-22-why-spring-may-provide-the-best-buying-window-of-the-cycle-why-brisbanes-decline-increased-dramatically-melbournes-slowed-despite-leading-negative-s/

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:

Market update

1. Is the RBA oversteering the inflation ship?

The RBA yet again ups the cash rate by another 50 bps, but how effective will it be at tackling inflation when non-discretionary items continue to increase in price. While interest rates don’t have a direct correlation to property prices consumer sentiment certainly does and it’s a scary time for many, now that the cash rate is over 2% above it’s lowest point. Dave shares some learnings from our first cash rate cycle in a decade.

The 7 things buyers get wrong

1. What are the tell-tale signs of insufficient planning?

Cate shares with our listeners the alarm bells that ring when insufficient planning is in the air. Are you short-cutting your plans?

2. What is an appropriate amount of planning time a buyer should invest in their search?

Buckle up, it’s not going to be a walk in the park (if you do it properly). The trio discuss the time and energy that goes into a property search. Think about how much time goes into planning a wedding or a holiday and the relative cost compared with purchasing a house.

3. What are the consequences of insufficient planning?

The trio dive into some of the worst outcomes that can arise from failing to plan.

4. What are the big ticket issues with overconfidence in your ability to renovate

TV is partly to blame, renovations look so simple when you’re comfortable on the couch with a glass of wine. But don’t be fooled, it is not easy. The trio discuss the reluctance to pay for services like painting that you feel like you could do yourself. But, in the end, it may be worth the cost.

5. What happens when renovations go wrong, what are the options?

The trio discuss how to plan for renovations to ensure the funds don’t run out in the middle of the project and what happens when the renovation pool runs dry.

Visit the show notes - https://propertyplanning.com.au/the-top-7-things-property-buyers-get-wrong-part-1-ep-170/

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:

Market update

1. US not slowing down with rate rises

In the US, the Fed Chairman spoke with some strong words about not making the same mistakes as in the 70’s, with taming inflation and will go as hard as they need to with rate increases. There was some talk bubbling that the US will slow down with rate rises, but that’s been sidelined and the share markets have responded. Other Western nations tend to follow the US fed, so there could be more pain ahead in terms of rate rises than markets had expected in the last month or two.

2. Auction volumes – Melbourne

As we come close to the grand final public holiday, auction volumes are tending to slow down as vendors don’t like to sell on the long-weekend. Activity is expected to ramp up and get hefty in October. But watch this space, we may be in for a super Saturday on the 17th of September.

3. All major capitals are heading in the same direction (down)

Looking at day on day change, all capitals are now on the downward swing. But this is normal for the property market. Looking back over the last 30 years, ups and downs are par for the course.

Houses vs units

1. Regional areas vs capital cities

Generally speaking, houses have outperformed units and capital cities have outperformed regional loctions. However this is not the end of the story. Capital cities suffer from greater fluctuation in prices. Which is an important reminder not to get too caught up in the short term. Will regional houses catch up with capital city units? Watch this space

2. Houses vs unit growth in our capital cities from March 2002 to December 2021

Which cities have been the winners and which city bucks the trend of houses outperforming units? Why is unit growth extremely low in Brisbane and Canberra? The trio sink their teeth into the data.

3. How have the Property Professor’s top suburbs performed?

Peter revisits the suburbs that he tipped to be top performers. Which ones have outpaced the growth of their city and how have units fared compared with houses?

Visit the show notes - https://propertyplanning.com.au/houses-vs-units-capital-growth-performance-in-capital-cities-and-regions-over-the-last-20-years-and-which-locations-have-units-outperformed-houses-and-why-ep-169/

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:

Market update

1. A warning to investors intending a demolition

For those investors who are looking at run-down properties with plans for a future development, it is important to consider the minimum standard of living legislation. If you purposefully purchase a home that needs a lot of work to make it liveable for tenants, you may be over capitalising when the long-term intention is to put a bull-dozer through it.

2. Smoke signals from China

Unlike the rest of the world, China has just reduced interest rates to try and stimulate the economy. This is due to some prevalent risks building in the Chinese economy, such as developers going under, Chinese citizens who have refused to pay mortgages because their property has not yet been built and further covid lockdowns. This will have a big impact on Australia and the rest of the world economy. To top it off, China is heading towards their next election... watch this space.

Listener questions

1. To buy or not to buy? Properties with a history of murder

I’ve recently came across with a property which has history of murder. 2017. As I keep hearing property is about numbers. And the numbers are good as less buyers want it. My question is would you buy this kind of property where they have “dark history” which will eventually fade in the long run? Any Thoughts on this?

2. What kind of asset mix is best for boosting serviceability & why this may not be the first question to answer

Love the podcast! Thank you for taking the time out of your busy lives and putting the show together. My question is related to financing property acquisition. Capital growth is the holy grail for property investing but it is only one side of the equation. Serviceability is the other. If you can’t service your debt, all the equity from capital growth is inaccessible. What kind of residential property asset mix should an PAYG investor consider in their property planning to boost serviceability to continue their investment journey? Does a happy intersection of capital growth and rental yield exist?

3. How will the changes to QLD land tax impact investors?

What do you think will be the effect of the new changes to Qld land tax. Effectively, you will now be penalised on your Qld land tax if you own properties outside Qld. My own calculation due to my extensive holdings in all states is that this has a horrendous impact on large investors. I now will consider selling some Qld properties. I believe it will have flow on effects, where there will be less investors in Queensland, and rents will rise even more dramatically again (lower vacancy rates). how long do you think it will take for this impact to flow through and the Queensland government will be forced to look at this? The unintended consequences, I believe will be severe.

Visit the show notes - https://propertyplanning.com.au/listener-questions-property-with-a-dark-history-to-buy-or-not-to-buy-what-kind-of-asset-mix-is-best-for-boosting-serviceability-why-this-may-not-be-the-first-question-to-answer-and-more/

https://propertyplanning.com.au/propertyplannerbuyerprofessor/

In this week's episode Dave, Cate and Pete take you through:

Market update

1. How to keep an open mind when it comes to shortlisted properties

Cate shares with our listeners her hot tips for shortlisting properties to inspect. The favourites at the top of your list may not be the ones that make the short list. It is critical to see the properties in person.

2. Government opens the gates on overseas migration

Pete shares that the government’s reported figures for overseas migration to Australia are about to increase significantly. This will likely put a pricing floor under the property market, as all the new entrants will need a place to live, putting pressure on rents also. Those who can obtain permanent residency quickly will be looking to buy. Watch this space...

3. Some exciting news from the Property Planning Australia team – introducing the Property Planning software tool

Property Planning Australia have thrown away the excels and word documents and now have the ability to provide a tool we can put into the hands of our clients and other Property, Mortgage and Financial professionals. The tool allows you to model up to 4 different Property Plan pathways factoring in all your existing cash flow, income, expenses and future goals right through to retirement, then measure the financial outcomes against your goals. For our listeners who would like to be able to build their own Property Plan with the support and guidance of a property or financial specialist and then be able to then take the reins to tweak or update your plan ongoing, we encourage you to reach out to Property Planning Australia via our website enquiry page.

Case study

1. The conundrum

This case study follows the journey of Nick and Rachel, who wanted assistance determining their property pathway and how best to use the cash from the business they have just sold. They wanted to purchase an investment property right away but also want to spend around $400,000 on renovations to evolve their home into one they can enjoy and that will meet their needs in the long-term.

2. Introducing Nick and Rachel

David shares Nick and Rachel’s key circumstances and of course, their lifestyle and property goals which are driving their decision. Nick and Rachel are a couple in their early 30’s, with two young children, living in one of Australia’s major capital cities. The recent sale of a business has presented some exciting options, and they also expect to receive an inheritance in of around $1,000,000 in around another 10 years which they want to factor into their long-term plan. Finally, they both enjoy working, but they also want to create further flexibility for themselves so they can scale back their employment to 4 and 3 days per week well before retirement.

3. Modelling the scenarios

Three scenarios were modelled for Nick and Rachel, to provide clarity on their key questions. When do they purchase their investment property? What should the strategy be in terms of price point and location? When could they complete the renovations on their home? Can they achieve their retirement income goals of $100,000 passive income through property? Can they scale back work earlier? The trio unpack the scenarios.

4. So, what did they choose to do (and what was the compromise)?

Tune in to find out which scenario Nick and Rachel went for. Were they successful and what was the compromise?

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 latest home value index results

The housing market is now in its third month of decline, nationally dropping by 1.3%, which is comparable to the onset of the GFC in 2008 and downturn in the early 1980s. Sydney is now showing the sharpest value falls in almost 30 years, while Brisbane moves into negative territory for the first time since August 2020.

2. Median values are not all what they seem

David shares some interesting facts about capital city housing markets, which means that listeners should be cautious when looking at median dwelling values between capital cities. It’s much more reliable to look at the median value for houses and units separately, but even then, the data can be skewed. The trio explain why.

3. Rental markets remain extremely tight

Historically, capital growth and rental growth would stay relatively aligned. However, the property boom in 2021 has meant that capital growth has significantly outstripped rental growth and is now going through a period of correction. Rents are likely to continue to run for some period of time, while our property values are still exhibiting a decrease, which in turn, is increasing rental yields.

4. Distressed listings on the rise

Vendors in distress have increased in seven out of eight states over July. Over the year, the biggest change can be seen in Hobart with a 50% increase in distressed listings, however they are rising from a very low base.

5. Consumer sentiment continues to dive, but is now the best time to buy a dwelling?

The trio discuss the latest consumer sentiment data, which as expected is reducing towards 100 for ‘house price expectations’ and is expected to go below 100 in the next month or so. However, the time to buy a dwelling index is showing the early signs of an upswing as home values become more affordable.

6. Lending falls at the fastest rate since May 2020

Total lending fell by 4.4% over June, with first home buyers taking the biggest hit, declining by 10%, the largest decline in 3.5 years. Owner occupiers remained the most resilient, falling by only 3.3%. In other news, certain banks have lowered their 3 and 4 year fixed offerings, as bond yields have peaked and now show a decline, indicating that the expectations for where the equilibrium cash rate will sit has reduced.

7. Unemployment reduces again

The jobless rate has reduced to 3.5%, as businesses desperately look for new employees. There is a growing push to enable retirees to return to work without impacting their pension entitlements to alleviate the pressure ... watch this space. Turning the tap on for immigration is also expected to have an impact. In June, the largest amount of student visa applications ever on record was processed.

8. Are we done with 0.5% monthly rate increases?

As the cash rate moves towards 2%, we’d hope that as the rate reaches closer to equilibrium, the RBA will slow down on the magnitude of rate increases so as not to over-steer. The trio are hopeful that the we’ve had the last 50 basis point increase, but only time will tell. David shares the news from New Zealand, which was the first nation to increase the cash rate in October 2021 and NZ’s cash rate currently sits at 2.50%

Visit the show notes - https://propertyplanning.com.au/market-update-july-22-are-we-entering-into-the-best-buying-conditions-in-this-cycle-have-we-seen-the-last-0-5-rate-increase-why-rents-are-playing-catch-up-how-median-values-can-be-distort/