Property Hub - Investment Insights & Inspiration - Get Invested: The Property Professor Peter Koulizos on housing affordability & the future of property

Episode Date: February 19, 2021

‘The Property Professor’ Peter Koulizos joins Get Invested to talk about the truth of housing affordability in Australia, and much more.  Peter is no stranger to the podcast, if you want to hear his full history and back story, check out Episode 41. To refresh your memory on his impressive property credentials, Peter is currently the Program Director and lecturer for the Master of Property degree at The University of Adelaide and has been teaching in real estate and investment for over 20 years. He is also: - The Chair of the Property Investment Professionals of Australia (PIPA) - A property investor, walking his talk owning and developing several properties  - A researcher of property markets around the nation, looking for the best suburbs to invest in each capital city  - An author, publishing his first book “The Property Professor’s Top Australian Suburbs” in 2008, co-authoring his second book “Property v Shares” in 2013 and his third book is currently in the making  - A podcast host on the weekly show ‘The Property Planner, Buyer and Professor’ Peter has the rare ability to combine the theory of property investment with the practicalities to teach you how to make money from investing in property, whether you’re buying, selling, renting, renovating or developing property. And given the rare window of opportunity that we are currently experiencing in property in Australia at the moment, this timely and engaging discussion answers all of your key questions including: - What we’ve learned from COVID and what should we be doing about it? And how will this affect property values and markets long term? - We get his predictions on what will happen in property in 2021 and beyond - Along with his predictions on regional activity and capital city forecasts – in terms of who will come out on top and why - He covers what are the key risks to our economy and property that we need to be aware of - What are the biggest mistakes that people make around property and how can you avoid them? - What impact will the proposed changes to lending law legislation that are likely to be instituted in March 2021 have on property? - Is the building industry likely to continue to take off post HomeBuilder and the stimulus initiatives? - What is the outlook for apartments and commercial property? - What are the details of the changes and options for stamp duty in NSW, Victoria and elsewhere, and what this will mean for property in the short, medium and long term? - And as already alluded to, what are his current thoughts on housing affordability?  Peter often runs very hands on property development courses in Adelaide if you are interested in joining him and/or getting a copy of his upcoming book, and he’s about to open his own buyers agency in Adelaide so if you’re interested, feel free to check him out further on his LinkedIn profile where you can get all of his contact details. In the meantime, enjoy this lively, engaging and always entertaining discussion with Peter Koulizos. Get Invested is the podcast dedicated to time poor professionals who want to work less and live more. Join Bushy Martin, one of Australia’s top 10 property specialists, as he and his influential guests share know-how on the ways investing in property can unlock the life you always dreamed about and secure your financial future. Remember to subscribe on your favourite podcast player, and if you're enjoying the show please leave us a review. Find out more about Get Invested here https://bushymartin.com.au/get-invested-podcast/  Want to connect with Bushy? Get in touch here https://bushymartin.com.au/contact/  This show is produced by Apiro Media - http://apiropodcasts.comSee omnystudio.com/listener for privacy information.

Bushy, I break down the ability to buy a house and own a house into two. One is housing attainability, which is the ability to save a deposit, and the other one is housing affordability, which is the ability to continue to maintain to pay the mortgage. Yes. Now, I'm contrary to most property academics, most many property commentators. If we just look at housing affordability, that is the ability to pay off a mortgage,

it is actually easier today than it was, say, back in 1990. Welcome to the Get Invested podcast, where we share great conversations with experts from all walks of life to uncover their secret know-how and where they invest their time, their skills, and their money, and the benefits that this has created. you see the truth is that everyone invests every minute every day we're investing our time our skills our energy and our money in something some of us are investing consciously some unconsciously sometimes for good sometimes for bad sometimes for no impact get invested will help you to start living by design not by default i'm going to help you to make it happen not let

it happen. You'll hear the top tips on how you can live with conscious intent so that you can live more, work less, and leave a living legacy by investing now. Listen to the show to discover the top tips on how to get started, make the most of your investment journey, and ultimately to be living your dream, not someone else's. More episodes can be found on iTunes or at bushymartin.com.au forward slash GetInvested. Thanks for listening, and now let's get invested. Hi Freedom Fighters Is housing unaffordable? Is it less affordable now than what it's been in the past?

Is it getting worse? And why do I ask? Because with house prices already growing in good areas around the country there's already mainstream media talk about housing becoming unaffordable again and calls for governments to step in and reintroduce measures that will put the handbrake on property demand and property prices like they tried to a few years ago. But is this justified?

Well, in my view and the learned view of today's guest, the answer is no. Housing affordability has become a convenient political football where everyone seems to jump on the bandwagon and where everyone is an expert and everyone has the answer. from changing housing supply to changing lease terms, stamp duty, capital gains tax, lands tax, negative gearing, zoning, loan policy, you name it. But it's a dynamic, multifaceted issue,

where isolated, reactive and ill-conceived interventions for the few are likely to have unknown, unintended and far-reaching consequences for the many. At last count, approximately 55% of the wealth of Australian families is held in their home. And first home buyers trying to get in on the property ladder represent approximately 15% of home buyers. So against this backdrop, the housing affordability debate appears to have the smell of the tail wagging the dog. now there's no question that home ownership and or property investment ownership can be the difference between a decent retirement and one where you need government assistance given the historic performance of property values over time so getting onto the property ladder is an important

first step but are we treating the symptoms rather than the cause and are we considering the right questions. So let me ask the question again. Do we really have a housing affordability issue? My response, in the style of my son, he'd say, yeah, nah. It's a question of affordability or is it accessibility? Because these are two very different things. Yes, I can see that in some areas we have a house purchase accessibility issue in isolated, highly sought after locations. But no, this is not across the board. And in these locations, it's not an affordability crisis, but an access and expectation challenge. It just happens that these locations are also where all the decision makers and the media live, in Sydney and Melbourne.

Now we live in the best country in the world and the best locations come at a price because, understandably, everyone wants to live there So the issue in these lifestyle meccas particularly for first home buyers is the savings deposit hurdle But even the savings deposit dilemma is being reduced with some banks that our know-how breaking team deals with

offering home loans that only require 5% deposits Alongside a raft of first home buyers grants, you can access the super, the stamp duty waivers and concessions, and other deposit incentives like the current home builder grant that's still available. And depending on which state and region you're looking to secure a property, this can add up to in excess of $50,000 of deposit assistance, providing of course you can demonstrate 3-5% of the purchase price in genuine savings and or rental history outside of the grants. Now, as opposed to affordability, what I call accessibility is what today's guest refers to as attainability.

So listen out for his great insights on this during our enlightening discussion today. And in relation to housing affordability, let's have a closer look at the facts rather than the fiction. And when I talk about affordability, I'm not talking about the ability to buy a property, but the ability to afford to service your home loan or pay the rent ongoing. Unfortunately, many commentators only compare the ratio of our incomes versus property prices over time, and this is supposed to be the measure of housing affordability. But in my view, this is way too simplistic

and it's missing the most and more appropriate ingredients that better identify the true underlying housing affordability position. and today's regular guest, the property professor, Peter Kolesos, has done some great work on this in his capacity as the chair of the Property Investment Professionals of Australia, or PIPA. His work reveals that a more accurate indication of ongoing housing affordability is the percentage of your wages that goes towards your home loan repayments.

Now, this includes assessment of your current income, the prevailing home loan interest rates at the time and your access to credit and your borrowing capacity which has actually been improving in recent times and is likely to improve significantly in coming months when lending laws are relaxed post 1st of March 2021. Now in recent times there's been many claims that housing is unaffordable and becoming increasingly less affordable.

While this might appear the case when you just look at the rise in property values against the rise in total incomes over time, let's see how it shapes up using Peter's more accurate affordability assessment based on the proportion of your income that you use to make home loan repayments. Now using these measures, Peter has compared relative housing affordability since 1990 and the results are very revealing. Based on the current average wage of $68,000 a year

and an average home loan size of $500,000 using a standard variable home rate of 3.5%, which is actually very conservative and a lot higher than the actual rates in the high 1% and low 2% that you can easily achieve via our know-how finance broking team. The percentage of your wages that go to loan repayments has the following history of trajectory. way back in 1990 families were devoting 48.1% of their income to home loan repayments

that's nearly half of their income by 2012 it dropped slightly to 47.5% in 2018 it was down to 40.9% and last year in 2020 it was down to 39.7% This indicates that in the last 30 years, housing affordability has actually improved significantly in that you're currently devoting nearly 10% less of your income to home loan repayments. So is housing becoming less affordable, and do we have a housing affordability crisis? Not according to the property professor's research. But in my humble opinion, all of this affordability debate belies our real underlying issue, our growing entitled expectations.

In our instant iPhone everything world, we're constantly bombarded with misleading images of everyone living the dream and enjoying the biggest, the best, the latest and the greatest. From gadgets to games, clothes to cars and holidays, everything is at our fingertips. We expect and are used to getting everything right now. Just buy now with no money down and pay later. Again, today's guest Peter Kolesos wrote a great article published by News Corp a few years ago that illustrates our current expectations and spending habits in relation to the housing affordability debate, where he describes a typical dinner time discussion

between a father and his daughter. And I'm going to repeat it here. The daughter starts, What's for dinner, Dad? And Dad replies, Yeah, roast lamb and veggies. How was your day today? The daughter says,

We went to some house inspections. And Dad says, Ah, did you find anything you liked? The daughter says, yes, but housing is so expensive and unaffordable. Dad says, hang on, being expensive and unaffordable are two very different things. I agree that housing is expensive, it costs a lot of money to buy, but I don't agree that it's unaffordable. The daughter says, what? Are you crazy?

Dad says, just listen for a minute. When your mum and I bought our first house 30 years ago, I was on a beginner's salary of just $12,000. And the daughter says, what? How could you live off that? And Dad says, well, things were cheaper back then. When we bought our first house, the medium house price in Adelaide was only $60,000.

The daughter says, $60,000 is impossible, Dad, even for way back then. And Dad says, believe me, it was possible. However, interest rates were 17.5%. It was a high interest rate and on top of that, if you wanted to borrow money, you needed a 25% deposit. And the daughter says, but today interest rates are only 4.5%. And sideline here, remembering that this is five years ago and average home loan rates are now down in the high ones to low 2%. And dad says, correct.

With interest rates at 4.5%, housing is not as unaffordable as you might think. Today, a beginner's teacher's salary, like I was on, is now $50,000. And the medium house price in Adelaide is now $400,000. And you can buy a house with a 5% deposit. The daughter says, so what's your point? Well, Dad says, 30 years ago, the deposit was equivalent of 15 months' salary. The daughter says, well, how did you work that out? Dad says, well, 25% of the $60,000 is $15,000.

I earned $12,000 over 12 months, so $15,000 was a 15-month salary. Today, I only need a 5% deposit for a $400,000 house, which equals $20,000. This is the equivalent of only about five months of today's salary. Daughter goes, yeah, go on. and dad says well 30 years ago the annual interest rate on the mortgagery payment equated to $7,875 or 17.5% of $45,000 which was the equivalent of about eight months salary back then. Today the annual interest rate payment for a mortgage is $17,000 which is about four months salary and the daughter goes dad i can see your point but there's just way too much math going on

here in 30 words or less can you please tell me why housing is not unaffordable today and dad says yeah easily 30 years ago you needed 15 months salary for the deposit and the annual interest was eight months salary today you only need five months salary for the deposit and the annual interest is four months' salary. In other words, today you need less of your income to pay for housing. And the daughter says, hmm, well, why does it seem so hard for me and my friends to buy a house? Dad says, you need to save some money. The daughter says, but I do, Dad. Dad says, yeah, to go overseas and out with your friends. The daughter says, come on dad I've got some money in the bank dad says I'm sure you have anyway enough of that let's

have some dessert the daughter says oh I can't stay for dessert and dad says why where are you off to the daughter says I'm going out with my friends because we're planning our next trip to Bali and dad rightly replies you don't say now I'll let you work out who the dad in this story really is. Now it's important for me to stress at this point that in my opinion our growing expectations is not an age thing but an attitude thing. As a result of our instant iPhone means I own addiction, our patience, persistence and saving muscles have withered away from lack of use. But anything worth having comes at a cost, either a small cost now or a much larger cost later. As Oprah has been famous for saying, you can have it all, just not all at once.

So do we expect it, or do we have to earn it? We've all created a world where we believe we can do anything and have everything, but some of us have forgotten to learn the most important part, if we've worked for it. It's the difference between expecting it and earning it. How does an Olympic athlete win a gold medal? Yes, they start by expecting it. But they earn it through personal sacrifice, relentless dedication and discipline. There's no escaping it. We all have to do the time and do the work. And we only really value and respect things that we've worked for. This was the best lesson my good father Bushy Senior ever taught me. When I was nearly finished high school, when all my mates were getting cars

from their parents, and I desperately wanted my first car, Dad said to me, son, you can have any car you want, just as soon as you've earned enough and saved enough to pay for it yourself. Everything worthwhile comes at a price. And this means that it's what I call a matter of lifestyle versus loan style. So housing affordability comes down to a question of lifestyle versus loan style. If you want the dream home in the dream location now, we need to compromise on lifestyle.

If you want the Taj Mahal immediately, you may have to get used to living on baked beans, two middle noodles and the odd can of dog food as you're sitting in front of the telly watching endless reruns of Friends because that's all the lifestyle you'll be able to afford. Or you can choose to enjoy a better lifestyle now by securing a lesser starter home further away.

But there's also another issue at play here. Along with the instant everything now is the common perception that living the dream means owning the best house in the best suburb. but what if we separate access from ownership many first-time buyers are starting to realize the benefits of renting in the area of choice at a fraction of the mortgage cost to enjoy lifestyle while owning investment rental property in upcoming areas that they can afford and by doing that they have the best of both worlds rent festers access lifestyle while

owning assets. This is exactly how my wife Sonia and I managed to get ahead when we started again with absolutely nothing to our names 25 years ago. We rented a small townhouse close to Adelaide City in our work and we used our limited savings and capacity to invest in a three bedroom one bathroom home with a double garage in what was at the time the coastal retirement village of Dingar Beach, which was over an hour south of Adelaide at the time, and we paid the princely sum of $84,000 for it. Interestingly, we still own that rental property, which was recently valued at over half a million dollars. And rent-festing isn't just a housing beginner strategy, it's also a great sunset strategy for those of you approaching your golden years,

and one that Sonia and I intend to adopt. We've set ourselves up so that our passive income portfolio across property, shares and business will fund our lifestyle and free us up so that we can travel around the world enjoying awesome locations for two to three months at a time living very cheaply in a combination of rentals, Airbnbs along with house sitting, house mining and house swapping escapes.

this is in contrast to many retirees who've got all of their wealth tied up in the home but very little money to survive on they're asset rich but they're cash poor sadly many hard-working aussie couples have blindly and unquestionably followed the old and dangerous myth like the pie popper pie popper leading the entranced mice plague over the cliff to drown of just paying off the home loan and putting their money into super I think this is the biggest reason that according to the latest ABS stats, over 73% of retirees over the age of 65 are trying to survive on an average of just $15,300 a year, which is only $295 a week. This is why I'm on a mission to make sure that this isn't going to be you, by helping you to live by design and to get invested. But I digress.

you just need to access lifestyle while investing in income producing assets you don't try to combine them you simply separate where you live and rent from where you buy and invest now let's close this affordability discussion with another question should we be looking to change everything to cater for the political politically correct squeaky wheel minority. First home buyers represent one in seven property purchasers. So should we be turning housing policy on its head to cater for the few by meddling with a market that could potentially have significant impacts

on the many? Or should the few learn to suck it up, lower their short term expectations, live within their means and start saving and become rent festers or learn to live with a bit less for a little while so they can get started. For those with the courage, the discipline, patience and persistence, it will be one of their greatest life lessons. And these are the very qualities that perfectly describe today's returning guest, the property professor, Petty Kalesos.

Peter is fast becoming one of our regular property commentators here on Get Invested. And if you want to hear his full story and his back story, check out episode 41. To refresh your memories on his impressive property credentials Peter is currently the Programme Director and Lecturer for the Master of Property degree at the University of Adelaide and he's been teaching in real estate and property investment

for over 20 years He's also the Chair of the Property Investment Professionals of Australia or PIPA of which I'm also a proud member and a strong supporter of their mission of representing qualified independent property professionals and getting rid of the white-shoe spruikers in the property game. And in walking his own talk, Peter personally develops and invests in property and he currently owns several properties himself.

Peter researches property markets around the nation, looking for the best suburbs to invest in in each capital city. In 2008, he published his first book, The Property Professor's Top Australian Suburbs. In 2013, he co-authored his second book, Property vs. Shares. And his third book is currently in the making. We chat about what it's about during today's episode, so make sure you keep an ear out for that. He also appears weekly on his podcast, The Property Planner, Buyer and Professor. Peter has the rare ability to combine the theory of property investment with the practicalities

to teach you how to make money from investing in property, whether you're buying, selling, renting, renovating or developing property. and given the rare window of opportunity that we're currently experiencing in property in Australia at the moment today's timely and engaging discussion answers all of your key questions including what we've learned from COVID and what we should be doing about it how has it affected our thinking and actions and how will this impact on how we live and where we live moving forward and how will this affect property values and markets long term we get his predictions on what will happen in property in 2021 and beyond, along with his predictions

on regional activity and capital city forecasts in terms of who will come out on top and why. He covers what are the key risks to our economy and property that we need to be aware of, what are the biggest mistakes that people make around property and how can you avoid them, what impact will proposed changes to landing law legislation that are likely to Institute in March have on property? And is the building industry likely to continue to take off post-home builder and the other stimulus initiatives? We look at what's the outlook for apartments and commercial property. And he discusses what are the details of the changes and options for stamp duty in New South Wales, Victoria and elsewhere, and what this will

mean for property in the short, medium and long term. And, as already alluded to, what are his current thoughts on housing affordability? Peter often runs very hands-on property development courses in Adelaide. If you're interested in joining him and or getting a copy of his upcoming book, and he's about to open his own buyers agency in Adelaide, so if you're interested in any of this, feel free to check him out further on his LinkedIn profile where you can get all of his contact details.

In the meantime, enjoy this lively, engaging and always entertaining discussion with Peter Kalesos. Hi, Freedom Fighters. Now, we're in the midst of a rare window of opportunity where it's quite uncommon for all the property planners to align. So it's very timely and quite opportune to chat again with one of Australia's preeminent experts on all things property and a great fellow Adelaidean, the property professor, Peter Kolesos.

So great to have you back on the show. So welcome and let's get invested again, Peter. How are you, Bushy? I'm very good, mate. I'm very good. Very pleased to be enjoying our wonderful state and the best-kept secret in the country, I believe. I agree. Weather's pretty good. We dealt with COVID-19 very, very well. And from a property perspective, as you say, the planets are aligning. They are. So I'm quite keen to dig into that in quite some detail today with you,

just so that we can really open the eyes and the ears of the listeners to the opportunity that we're on the cusp of enjoying. But for those that haven't listened to the past episode and who have been living under a rock and don't know who you are, mate, can I get you to give us a very brief refresher on who you are, what you do and why you do what you do? Yeah, sure. So work-wise, I'm the Program Director for the Master of Property

at the University of Adelaide. I've been teaching in property and or investment for about 25 years. I've written a couple of books, one called Top Australian Suburbs, the other one called Property Versus Shares, and there's a third one coming out about mid-year, all based on small-scale residential property development. uh four kids lovely wife enjoy bike riding going to the gym love being outdoors that's about me in a nutshell i think bushing that sounds pretty good mate uh and my ears

picked up with a third book peter so uh we'll make sure that um uh when the time's right uh i'll let the listeners know where they can get their hands on on a copy mate so looking forward thanks mate greatly appreciated awesome now uh i guess what i'd like to go straight into because ultimately what everyone's trying to do whatever their endeavor is to achieve a level of sustainable success and you have someone who has got irons in a number of fires what what how do you define sustainable success and how are you going about achieving it mate so for me sustainable success is the opportunity to if we're looking at money forgetting about the personal side but if we're just looking at finances it's just the ability to have a continual stream of income and it might

vary from time to time especially if you have residential property or if you've got you know shares and you're expecting dividends or through maybe property development or property and uh renovation so if you've got a formula that you can repeat um i think that's a great first step to sustainable financial success yes very well summed up there mate and i and i think the two key words uh there that you mentioned are one a formula so that you're following rules that you know that are going to work and have been proven and it's therefore repeatable so you can continue to keep doing it so um there's some very wise words there but how are you going about achieving all of that yeah look i've i've been interested in real estate probably since i was born because

dad was a real estate agent actually he wasn't a real estate agent when i was born i think he became one when i was about 10 years old but anyway i've been interested in real estate for a long time so even even without wanting to or realizing a lot of that property knowledge soaked in through the process of osmosis um but that you know that's that's all well and good but you're only getting one person's perspective uh i've got a three postgraduate degrees all related to property and town planning so i think i have i have enough knowledge so i've got the theory i put the theory into practice myself and also help other people do it but to be able to do that you need to have the willpower it's one thing to know a lot but it's another thing to have

to have the risk appetite to put your money on the table to either you know do something in property or shares or some other investment um i think that's important knowledge and the ability to put stuff into action very good point there mate there's uh you and i have probably rubbed shoulders with a lot of people who know the ins and outs of everything in property but have never actually turned aside or or got a key in their hands for a property so uh it is taking the risk and there's always going to be risks uh the bigger the risk uh often the better reward if it's set up the right way but it's actually having that that self-discipline willpower that you're speaking about to actually take the action and i guess what i don't know about your thoughts on this but

i often see would-be investors who are looking for the perfect deal so everything has to be in alignment and you know better than i those don't exist no it's a matter of getting most of them in in line and accepting that you're better off getting something going and let letting time do a lot of the heavy lifting for you rather than waiting forever and never actually getting off the starting line. What's your thoughts on that? Yeah, mate, it's a bit like waiting for the perfect partner. I mean, I know I'm married to a beautiful woman

and I'm sure you are too, but, you know, we all have our faults, you know, and you're right with property. Like, I have yet to find the perfect property because the one thing that's unique about property is it's just that, it's unique. There is no one property exactly the same as any other if even if we're looking at a group of apartments that look identical if we look at their location especially in 3d they are not in the same location some have different perspectives as in they face

different ways they might be on different levels so yeah please don't waste your time looking for the absolutely perfect investment get yourself educated and then get yourself invested yeah Yeah, great and very wise words there, mate. And I often smile quietly about this when the press likes to refer to it as the property market because they talk to them as if properties are all the same and you make the perfect comment. If you compare the share market with the property market

where the share market is effectively a perfect market because everyone's operating on the same information at exactly the same time, And every property in every street and every suburb and every location is different from every other property. So that creates its best opportunity because... That's right. And the other aspect, Bushy, that provides us with an opportunity

is unlike the share market where, in theory, every player is an investor and they're just worried about the money, in property, three-quarters of people are buying that property as a home. So they're not really interested in the investment numbers. So there are opportunities for investors to understand what an owner-occupier is looking for and to then capitalise on that. Totally. I often say investors just need to slipstream on the emotion of the homebuyers. Correct.

Because a lot of them will pay a lot more money for something that you and I wouldn't, but because they have to have it, then that can drive values. And if we're aware of that, then we can mimic that and show it. Yeah, you know, simple things that don't cost a lot of money, for example, like a double garage can add so much value to a property, whereas if you just look at the numbers, you think, oh, well, single garage to double garage only cost me an extra $2,000, but it can add an extra $20,000 or $30,000. So from an investment point of view, it may not sound logical,

but again, most property, 75% of property is generally bought on emotion as a home. So, Pete, that's one of the big differences between the stock market and the property market is who the players are. Yeah, totally. Absolutely. 100% agree. Now, let's jump into what's happening in the marketplace at the moment because, let's face it, the whole world has experienced a pretty interesting year last year with the contagion.

But with all of those sort of situations, there's always some great opportunities and possibilities that flow out of that. I would love to get your initial thoughts on what have we learned from what happened last year and what should we be doing about it if we're interested in property? Right, so what I did here is a number of property developers land banked during that time, so they obviously had a lot of guts. A lot of us were panicking as to what was going to happen because even though we've had recessions before, we'd never experienced a pandemic and with many people locked down.

And so it was mainly the more experienced developers, they could see that, yes, we were going to come out the other side. So if they could have the opportunity to buy something relatively cheap because somebody might have panicked and wanted to sell quickly and cash out. So they put themselves in a very good position because straight after that we had the government announce HomeBuilder. Yeah. So and what HomeBuilder has created is a shortage of land.

You know, you try and find a block of land is near impossible because everybody is climbing over themselves to buy that or to sign up for the land. Originally it was before the 31st of December because that was the greatest incentive, but now it's to the 31st of March. So developers did very well so far as that is concerned. Very surprisingly bushy, and this surprised me, landlords also did very well.

I was a little bit worried at the beginning because I know international students are a large part of the rental market and so we weren't going to get any extra international students coming. So I thought, well, there's going to be a little bit less demand and with travel virtually stopped, I thought, well, all of those people that have Airbnbs, they're going to put them onto the rental market. So we've got increased supply, decreased demand.

Well, rents only have one way to go and that's down. But it is just phenomenal. I'm not sure how your investment properties are going, Bushy, But every time one's come up for renewal, we are getting a significant increase in rent because it's not so much that there is a huge demand and it's more that there is a limited supply. So the holiday stuff is virtually back to normal. But what's happening, Bushy, is typically out of 10 houses, seven and a half, let's call it seven, are owner-occupied and three are rentals. Yep. So out of those 10, though, they're all being bought by owner-occupiers,

in particular first-home buyers. So there's three less rental properties. You multiply that by 1,000, 10,000, 100,000, and that's a significant dip into the rental supply. So what we're seeing here is we might have the same amount of people looking for rental properties, but there's just a lot less rental properties to pick from. So there's only one way for rents to go, and that's up.

Yeah, spot on. And that's exactly what we've experienced with ours too, by the way. So it's interesting, and this is, I continuously make this point, but the difference between what's actually happening on the ground and what likes to be reported in the press, unfortunately, are generally two different things. Yeah. And the sort of fear-mongering,

they've sort of switched from fear to greed now in terms of they're now talking about it getting out of control, so they've gone from one extreme to the other. But it's really important to get your hands dirty with what's actually happening on the ground, both in terms of the rental demand and similarly in terms of the purchase demand. Anecdotally, we're seeing exactly the same thing happen

in relation to property. Yeah, shortage of supply. Exactly, and that's the old 101 economics. It's all about demand and supply. That's right. Price is a function of demand and supply. it's pretty simple it is pretty simple but uh so are there any other lessons that come out of that in terms of uh how we live and how and where we're likely to live moving forward that you're seeing

that are going to be sustainable trends yeah so uh soon after COVID-19 our regional markets experienced a huge demand for rental properties because as soon as the boss said well you know you can work from home well home doesn't have to be near work anymore so places like Brisbane huge demand for rental properties on the Sunshine Coast in Melbourne huge demand for properties on the surf coast or the Mornington Peninsula now you put you used a very good word there sustainable so let's say these people moved out in April May last year and let's say they signed 12-month leases yeah it'll be interesting to see if this April and May if they renew those leases or whether they'd come back to the city because, you know,

admittedly working from home was a novelty, nice little novelty. But even for me, Bushy, I just wanted to get out of the house. I wanted to talk to people, talk with my colleagues here at uni, talk to the students, not just on Zoom but actually, you know, face-to-face. So I actually enjoy being out and about, the ability to walk from the uni and go down and get a coffee or go for a walk around the river or whatever it might be.

So I think you asked me whether it's sustainable or not. I would prefer to answer that maybe mid-year to see what happens with the rentals because to shift your place of rent is not that hard. No. Right? But to sell up and shift out, that's a very different story. And I haven't seen a lot of people moving out and shifting permanently to the regional areas, certainly not as many as renters.

But I think one thing that will change, Bushy, is more likely than not people are going to have at least one, if not two, dedicated studies in their house because working from home is going to be a long-term trend that stays with us. And so far as commercial property is concerned, co-working spaces are going to become very very popular these are a little bit like serviced offices where you might have lots of different company using many different offices within the

one building but they might share a boardroom in the photocopier in the kitchen facilities i think i know globally that is a trend co-working especially for entrepreneurs the ability to to work in amongst other start-ups. So I think for commercial property, we're going to see a very big change from traditional office buildings to more co-working offices. Yeah, I think you've summed it up. And my read of this, and I'd love your thoughts on this as well,

is that the area that's going to suffer the most in terms of property generally, as a consequence of what's happened, are the CBDs of our major cities. So we're seeing an impact on the commercial property in terms of the need for as much permanent rental and those sort of flexible hot desking arrangements through co-working, I think you're absolutely right, are going to become flavor of the month because it'll be a good mix between partly working from home and partly being in a communal space because we're social animals. But I think the apartment glut, and we talk about two-tier markets, the apartment values and the apartment rentals are a very different story to the residential values and rental demands. I'd love your thoughts on that subject too, if I can. Yeah, well, look, we were quite lucky last year in that when COVID-19 really hit us, which was mid-March, the academic year had already started.

So many international students were already here. Some of them were still at home celebrating the Lunar New Year, but most of them were here. But there, Bushy, there is, I know, because that's where I work at uni, there is going to be a huge change this year because we haven't allowed any new international students to come in. Now, interestingly, enrolments aren't down that much because at the moment they're happy to learn online.

Okay. All right? But you've got in South Australia alone thousands, in Australia tens of thousands of international students not here, firstly not renting property, secondly not spending their money to eat, not spending their money to recreate or entertain themselves. And in Victoria, in South Australia, international education is our biggest export. So even though the unis might suffer much through enrolment fees, the knock-on effect is going to be huge. And many, many international students rent CBD apartments. Why? Because many of our university campuses are in the CBD. Yeah, exactly right.

Yeah, no, that's very wise words there, mate. Let's start jumping into the future in a bit more detail then. What are your predictions on what's likely to happen to property, particularly in the next 12 months, and then perhaps your thoughts on beyond there? Well, Bushy, you and I were chatting before we started recording, so far as Adelaide is concerned. We haven't seen the market this good since the early 2000s, and the early 2000s were very good, not just for Adelaide, but for many capital cities. And it's very similar. It's interesting how history repeats itself. so 2001 was a was as a result especially in adelaide and south australia of the recession

in the 90s and the state bank collapse yeah right so we had a long period of nothing happening here economically and property wise yeah and then we had government stimulus back in the mid-2000s because they introduced the gst on the 1st of july a lot of things stopped in particular and in particular property and, more specifically, the construction industry. So first home buyer grants came out and then they doubled if you were building. And then in Victoria, for example, they increased it again if you were building regionally. So you see the similarity here, Bushy?

Absolutely. We've had a recession, government stimulus, here we go again. So I think we're going to do very, very well. Most people think that recessions are no good for property prices, but I think I spoke about it on a previous show of yours, mate, that I looked at the last, in the 1970s recession, 80s recession, 90s recession and the GFC and property prices were solid and in some cases they went up exceptionally,

but they were for other reasons other than obviously being in a recession and the same is going to happen here one reason is a lack of supply some people are still worried when you when you are worried you are less likely to sell your home because it's better to stay where you are rather than have the back look at your finances and maybe they're suggesting that you need to do something that you're not not prepared to do or you can't do so people are just sitting on their eggs at the moment they're not selling their properties which means they're there is less stock about. Again, simple economics 101, limited supply,

even if demand is the same, price is going up. And I have seen some phenomenal photos and videos of lineups of people waiting to get into open inspections. I know we have COVID-19 restrictions, I understand that, but the amount of people at open inspections, the amount of people at auctions is just absolutely phenomenal. So this will continue, excuse me, this will continue for this year and into 2022, but it's not going to be equal all around Australia.

I think, unfortunately, Melbourne is going to have a hard time, mainly because they went into a second severe lockdown. Yeah. and Sydney also because Victoria and New South Wales are heavily dependent on interstate migration, overseas migration, overseas tourism, international students. Well, we're not moving from state to state as much. Certainly there's nobody coming over, well, hardly anyone coming over here

to settle hardly anyone coming over here to holiday and we've got no international students yeah so those two markets are going to be impacted greatly which is going to have a flow-on effect to sydney and melbourne property prices and property rents but i think that the cities to do well will be adelaide and perth in particular yep um i this is assuming that the current lockdown in Perth is only going to be short, and by the time your podcast airs, hopefully it'll be all over. Yes. But, you know, there's been a lot of panic about the Chinese

not buying our wine and our barley and our crayfish, but, jeez, they're going nuts on our iron ore. Yes. And that is, you know, that is helping the Western Australian market hugely, which is having a large flow-on effect for property, and in particular the rental market. But rents are going through the roof because, again, demand and supply. Vacancy rates are almost nil.

Just phenomenal. Absolutely. And it's been a long time coming. And as we know, WA generally is very heavily reliant on the resources sector. But as you say, the only place China can get the quantity of iron ore they need and will be for at least the next four years, even if they decide to try and open up their own reserves, Perth is extremely well placed to position for it and we're certainly assisting a number of investors to secure properties over there as we speak.

And the key word there, Bushy, is quality iron ore. You can get iron ore from many other places, but for some reason the quality of the iron ore in Western Australia is so good that they can command a premium price. And even if somebody finds a huge deposit of iron ore tomorrow, it doesn't mean they can start digging it out tomorrow. Exactly. And processing it, you know, it takes years for that to happen.

So Perth and Western Australia have set themselves up very well. Where do you think Queensland sits in the mix then, Peter? Yeah, I'm a little bit uncertain about Queensland. One, because it depends so much on tourism. Like we have a son that lives in Queensland and we want to go and see him. But the issue is, one, we might have an outbreak here or Queensland might have an outbreak, which means we can't go. And that's not so bad.

The problem I have is similar to the one that my eldest daughter had when she came back from Brisbane. She happened to be in Brisbane on the 2nd of January. And anyone that was in Brisbane on the 2nd of January had to go and get tested and had to self-isolate until they got their results. Why? I can't afford to do that, you know, because I'm the, in inverted commas, the boss of the property program here at uni.

It would be a bit irresponsible if I went over and got caught out somehow and either got stuck in Brisbane or I came here and I had to get stuck. So I think, and that's just one person, right? But there are many, many other people who are thinking along similar lines. So what they're doing is they're holidaying in their own backyard. So there'll be plenty of Queenslanders holidaying in Queensland, but there certainly won't be any overseas people holidaying in Queensland, and there won't be

as many interstate people holidaying in Queensland. So I think, to answer your original question, Bushy, I think Queensland will be in the top half of the performers, but I think right at the bottom of the list will be Melbourne and not far behind will be Sydney. Yeah, agreed. And I think the only contrary view on Queensland is, and again, this is anecdotal, but we're seeing a lot of people who, to escape the perceived imprisonment that a lot suffered in Victoria and to some degree Sydney, we're seeing a fairly strong push for people to move to the lifestyle, well, the perceived lifestyle benefits of Queensland, particularly in South East. I've actually heard that as well. But, again, I'm not sure if that's a temporary move through renting

or that's going to be a permanent move. So we need to wait and see. But Brisbane's a bit like Adelaide where we really haven't done much since 2007. And so there has been a lot of underlying demand that has been wanting to breach the surface, and it has. Yeah, agreed. The outlier continues to be Tasmania to some degree. I'd love your thoughts on the Apple Isle because I thought Hobart had run its race.

You know, the old 15-year cycle, I thought it had its gross spurt and then it would settle down. But last year certainly was contrary to that. And maybe that was a bit of escapism again driven by the fears around COVID. But what's your thoughts around Tasmania? Yeah, look, Hobart and Tasmania had a really good upswing of the property cycle back in 2017, 18 and 19. So just from a property cycle perspective, I don't think that that can be sustained or continued by continuing to increase. But if we have, like we said before, people migrating from Victoria in particular to settle in Tasmania, then yes, maybe Hobart will have another second kicker. Because you're right, it did perform quite well.

Hobart had an almost 7% increase in property prices year on year, which put it up near the top of the performers. Not as good as Darwin, which had 11.5%, and Canberra, which was 8.5%, but it still performed quite well. So we'll have to watch and see what happens there. And you mentioned the Territory. Having lived and worked in the Territory,

for many years, know that part of the world pretty well, but the almost misleading thing about the Chertree is it's coming off such a small base and a low base that it doesn't take much of an increase to appear in percentage terms to be quite large, and because it doesn't have that critical mass, there's a lot more volatility around what happens up in that neck of the woods.

What's your thoughts around that? Yeah, look, it had 15% increase year on year, Darwin did, which is just phenomenal. But you're right, it is coming off a very, very low base because I think property prices in Darwin are still below where they were 10 years ago. They are. Yeah, spot on. Absolutely spot on. Yeah, no, absolutely dead right there. But something I would love to delve on, and you touched on this earlier, the fact that properties historically have generally performed pretty well during and quite resilient during recessionary times.

About the only time that we see property values affected is when, because I believe a big driver of demand and supply is access to credit. Now, we're about to see potentially a fairly significant, what might appear subtle, but in my mind a very significant change that's likely to come into effect on the 1st of March with some legislation changes relaxing the lending laws that shifts the onus from the banks proving someone can pay a loan to the borrowers doing it, which in a perfect world is exactly where it should be. My guess is that, and it'll take a few months for the policy changes to filter through, but it's likely that there'll be greater access to credit and greater access to more credit, which traditionally tends to put demand pressures on and we see property values rise. What's your read of the impact that that's likely to have? Yeah, look, I agree 100%. I think the two factors that have a big impact on property is the availability of credit and also consumer and to a lesser extent business confidence.

Yeah. If money is available and people can borrow that money relatively easily, then all goes well not just for the property market but for the whole economy. And so for the first time, if we look at Australian consumer confidence, for the first time in eight years, we're over 110. So 100, if we're at 100, that means there's just as many people that think the economy is going to go well as people think that the economy is going to tank. but here we are at 110 which means that there are more people that think the economy is going to go well than the than the economy is going to tank and like i said before that's the first time in

seven or eight years that we have hit 110 so that's got to tell you something that's a good combination i wasn't aware of uh what the current consumer confidence was and you make a very good point there's no point having access to money if no one's uh too scared to go and grab it so you're absolutely spot on there and uh given that quite a few people have war chests as well i heard a figure quoted the other day that uh there's about 70 million uh 70 billion dollars sitting in people's bank accounts as a result of not being able to travel for their overseas holidays which which is prime for investment in other things so where you put those combinations together, good equity and good buying capacity and property starting to shape up as a pretty

good model. And if you overlay that with some of the shenanigans that you're hearing around the herd driving equity prices through the game shop fiasco and similar things will happen elsewhere, the volatility that's going to occur in that sector will make property look pretty attractive, I believe. I agree. I agree, mate. Yeah.

Now, mate, Todd, just before we touch on a couple of other things, we've talked about COVID. We've talked about the international borders as risks that will have an impact on the economy and indirectly on property. Are there any other key risks that you think that we need to be looking at that might have an impact moving forward? Look, COVID-19 is the biggest one, but now the vaccine is being rolled out. well, not Australia yet, but the short experience we've had with the rollout of the vaccine overseas seems like it's going pretty well. So it looks pretty smooth sailing, but the only unknown is our trade, which we've mentioned before, the trade with China.

Yeah. Because they're our biggest supplier of international students. Yeah. Right? Yeah. And we talked about the fact that, you know, they put a tariff on our grain, on our wine, on our crayfish. So that is going to have some impact. How great we will see.

I was just reading an article before I came on, Bushy, and it says, Australian figures released today showed Australian wine exports for the 12 months to December were $2.89 billion, down from $2.99 billion in the year to September 30. In 20 words or less, we've dropped about $100 million in three months, which is just a 5% difference, but that's over a whole year. So we're not comparing quarters, we're comparing. So, you know, five, that's not a huge difference.

And the other thing is, you know, it's not only Chinese people that drink wine, obviously. All right, so if they're going to buy their wine from somewhere else, wherever that somewhere else is, they're not exporting to the countries that they're used to. So there are opportunities there. All right, you know, we may not get as good a price or sell as much, but it's not like the end of the world and there are no other markets

to sell our wine or our crayfish or our grain to other than China. Yeah, make a very good point there, mate. Absolutely agree. If you're taking a long-term view, which is the way you and I operate, then it's just a matter of reshuffling the deck and looking at where the opportunities are and being slightly biased, but knowing how good our wine is when you compare it with other parts of the world.

The Chinese might think they're going to get the same thing from somewhere else but i think the taste buds will will tell them the story long term mate very good uh but i'd love to switch into uh some of the legislative changes that we're starting to see occurring uh you know it goes hand in hand with the flow on from covid there's the housing affordability issue that's been floating around for quite some years now but i'm very encouraged to see the New South Wales Government have the confidence to at least be giving property purchasers an option around either paying all the stamp duty up front

or sort of virtually amortising it effectively as a land tax for the life of the property. And Victoria's also introduced some sort of temporary reductions in stamp duty. What's your read of, you know, what these changes may do to property generally, both in terms of the short, medium and long-term view? Yeah, so ACT was the pioneer here

because they were already well underway with the transition from stamp duty to an annual land tax or land levy. Yep. And New South Wales, which is our biggest state, the most popular state, as you rightly say, is looking to do the same thing. That's certainly going to help

because, Bushy, I break down the ability to buy a house and own a house into two. One is housing attainability, which is the ability to save a deposit, and the other one is housing affordability, which is the ability to continue to maintain to pay the mortgage. Yes. Now, I'm contrary to most property academics, most many property commentators.

If we just look at housing affordability, That is the ability to pay off a mortgage. It is actually easier today than it was, say, back in 1990. No question. And the main reason is because interest rates are so low. That is the main reason. So I think it's unfair to compare housing affordability and only contrast income and house prices.

One of the reasons we invest in property is because property goes up at a greater rate than inflation. So what, of course, you are going to see in most places around the world, property prices growing faster than wages. But if we were only paying outright cash to buy a house, then I would say, well, we don't need to consider the mortgage component. But, you know, 99.9% of us have to take out a mortgage

to buy a property. so therefore the interest rate plays a critical role in how affordable housing is so in my opinion if we if we look at housing affordability as the capacity to pay your mortgage you're much better off today than you were in the past but where people are worse off is the ability to save a deposit to buy the house so i'm not going to guess how old you are bushy but i reckon you and i are a similar era yep we are yep now we had you may remember like we couldn't buy a place with a five percent deposit no it needs to be a 20 to 25 deposit yeah but our home owner grants were relatively much more generous back in the 80s than they were today see back in the 80s we

could get up to five thousand dollars yeah right now you fast track 40 years and it's 15 000 it's only gone up three times when property prices have gone up much more than that and so have many other goods and services yeah so it's i understand that it might be harder for young people to save a deposit to get into the housing market but so far as a mortgage is concerned if you do your numbers you will see that your mortgage repayment including principal and interest in most cases is less than the rent that you would pay. Absolutely right and the other very important point that you make there I think and I 100% agree with you even as an investor you don't have to work too hard to create a positive cash flow property now as a result of the cost of money

being so low so the affordability issue and i and i it's like talking to my brother when i talk to you peter agree exactly with your thoughts around what true affordability is but and i love your term attainability because the biggest hurdle to get people into property whether it be owner occupied or investor is the size of the deposit and it's it's the money you can't borrow against that's the biggest hurdle. So stamp duty varies around the country, but it's anywhere between 4% to 6%. On top of the purchase price,

well, that's a big lump of deposit that people have got to find. Now, if governments are waking up to the smarts of getting that money over longer term rather than a big lump, then it's doing two things. It's reducing that hurdle, but it's also potentially encouraging more property turnover because if it's not such a big impact to get in and get out, the turnover costs are lower,

then it's likely to create a little bit more flexibility in that. So ultimately, I think it's going to be good all round. What are your thoughts on that? Yeah, look, you know, I agree. The one thing that worries me about being easier to buy and sell is we might get speculators back in the market and we can see what speculators do to the stock market. um one of the things that stops people from buying property and speculating on it like maybe

renovating and then selling is the huge cost to get in and out now i don't i don't necessarily agree with that because again you and i might remember bushy when the gst came in wasn't stamp duty supposed to go out that's right that's exactly right and it's still here so So, look, I think it would be great if stamp duty was minimised for first-home buyers at least because the hardest property to buy is your first one. Whether you're an owner, occupier or investor, the hardest property to buy is the first one.

So give people a break, especially those looking to buy their first home, so far as stamp duty is concerned, and then that will make it a lot easier for people to get into the property ownership market and off the rental wheel. Yeah, yeah, very wise words as usual. Mate, around the property scenario, any final thoughts and words on what the long-term trajectory is and the impact that it's going to have on economy and lifestyles

as we move forward? Yeah, look, I think we can forget about, in this very low inflation and interest rate environment, we can forget about property prices doubling every 10 years yeah it'll be more like doubling every 15 years yep um and i think if you were looking to buy a property to make a profit a short-term profit in particular which we all should have bought last year but you know we're all geniuses in hindsight but you're better off buying this year because i can guarantee you next year, property prices will be higher than they are this year

and in some places, they will be significantly higher. Yeah, yeah, 100% agree and great to hear someone else saying exactly the same thing, mate. That's very good thoughts. Now, I'm going to sort of switch lanes a little bit back into something a little bit more personal, but I call it the bushfire round, which are five very quick questions that I'd like to get you

to share your words of wisdom on. Mate, what's your favourite quote and why? The value in real estate is in the land. Yeah. You make your money because when you buy a property, which is made up of two components, land and building, it's the land that appreciates in value because the building depreciates in value.

As it gets older, it is worth less. Yeah, brilliantly said. Back on the book front, the top book you'd recommend and why, let's talk a little bit on that subject about your new book that's coming out. What's it called and when can they get their hands on it? And then apart from Your Words of Wisdom, any other book you suggest the readers get their hands on? That's a very good question.

What is the book title? I'm not sure yet, Bushy, because I'm actually writing the book with Margaret Lomas. Do you know Margaret? I do. Well, Margaret's doing a little development down in Christie's Beach, a South Australian beachside suburb. And so she's documenting it like a diary.

And then I'm coming in adding so-called expert tips on what went well, what didn't go so well, and tips for people that want to get in. So we haven't, even though we've almost finished the book, we haven't come up with the title yet, but it should be out mid-year. Yep. um but um the top of the best book that i have read and would highly recommend is a book called making money made simple by noel whittaker yes absolutely noel has written many many great money books noel is based in brisbane i had the great pleasure of i've met noel a few

times he's a wonderful man he's over 70 and he's still going strong but it's exactly like the book title making money made simple he he explains it in simple terms he's got another one called making retirement made simple which i need to buy soon i think bushy um you me both but you know he have a look at a lot of his books and he's got books for young ones too not just for us oldies but he's got books for kids too haven't he's a great author he's an awesome author i've got a number of his books on the shelf behind me as we speak, and one of them actually talks about the tax treatment of investment properties. So investors that are listening, he's written a brilliant book that breaks it down into

very simple and easy to understand terms, but really gives you the juice on exactly how you need to be structuring things to look after yourself and improve that affordability piece as an investor. Great thoughts there. This question is a bit left field, but most Australians still believe they pay too much tax. What's the top legal thing that you've done to minimise the tax you pay, Peter? Setting up family trusts. They're not as good now with land tax, but with many other aspects of income tax.

And the fact that I also have four kids where I can distribute income has worked very well for me. Yeah, brilliant. Now, back on the investment topic, what's both the worst and the best piece of investment advice that you've ever received? The best would be to buy property. Obviously, the right type of property in the right street in the right suburb. the worst piece of advice I received was to buy some speculative stocks which are worth

much much less than what I paid for them but I still hold on to them because I like many humans I don't want to realise a loss or admit that I made a loss so one day they'll go up probably never but you never that's not to say that the stock market

is a bad place to be in but I just took my so called advice from the wrong person good call Final exercises back on the sort of habits and rituals that you adopt on an almost daily basis. So what's one of those that you believe has contributed most to your success today? I'm always keen to improve my knowledge, Pushy.

So whether it's reading a short article, even enrolling in a course. You know, like I teach property at university, but it doesn't mean that I know absolutely everything about every aspect of property. So I'm keen to know more, and the property environment is changing. You know, back when my dad made some good money in property, the market was very different.

Property prices used to go up significantly every year. We had a huge amount of overseas migrants coming to settle in Australia, but that doesn't happen anymore. People are less likely today to want to want or own their own home as it was in the past. So basically, I'm keen to educate myself. Yeah, and I think emphasizing one of the key points there, to keep educating yourself because it's not static.

That's the dynamics. A lot more learning. Yeah, exactly, and that's the exciting piece for me. If I haven't learned something every day, then I'm wondering what I've done wrong. So love your thoughts around that. Mate, final question, and it's a big question. if I gave you a microphone that spiked to every single one

of the 7.7 billion people that are currently alive in the world and I gave you one minute to talk, what would you say? Well, it won't take me a minute to say it, but basically the theme is be good to others, be good to yourself. Treat others as you would like to be treated, but also be good to yourself, eat the right things, exercise, is try and have good relationships with your family and your friends. Be good to others, be good to yourself.

Yeah, love it, mate. It's timeless advice, but it's amazing how many people don't do that. So very good thoughts there. Mate, I know that you've got a great new property development course coming up. Let's talk a little bit about that for those listeners that can see the merit in getting involved in that space. Sure. So I only just decided to do it on the weekend because the planning system here

in South Australia is changing, so I see some good opportunities. But the property development workshop, it's not a university course. There's no test assignments or exams, but it's there to help teach people how to make money from small-scale residential development. So buying a property and building two or three or four on it, that's what it's all about. And I try and keep it very practical. So a significant part of the first day is a field trip.

So we go out and have a look at either potential development sites or sites that have been developed, and we look at what makes a good development site, what doesn't make a good development site, what you have to be careful of, you know, significant trees, regulated trees, where's the stobie pole, where are the overhead lines, is there a slope, do we need retaining walls? And it's not just me.

So we have town planning experts, finance, accountants, builders. So we try and cover the whole gamut and it runs for just over 20 hours, over two days and two weeknights. I've run them before when I used to work at TAFE and they were very popular there and I can see that the market is really hot now, that it's also an opportune time to not only to educate people how to make money, but I think more importantly, Bushy, how to educate them not to lose money. Because if you lose money in property development, mate, you're losing a lot of money.

Big money. Exactly right. And you've got an architectural background and project management background. So you've seen when things go wrong. Absolutely. And it can happen very easily. So the risk management side of that equation is absolutely imperative. And I love the fact that you're getting your hands dirty getting out there and assessing sites and looking at the real nitty-gritty things that what might appear to be small things that you don't think of when you're looking at it on paper.

But if you're out there on site and that's Dobie Pyle and we're going to look at those crossovers and, you know, where's that easement and what impact does that have and is the actual boundary on the fence on the boundary or is it not? All of those things can have a massive impact on the end result. So for those listeners who have an interest in property development, particularly the small-scale residential stuff, which is, you know, if you're going to get into it, then I'd crawl before you run. And spending some time with you and other experts in that space to get a full knowledge of it before they step out

would be absolutely a fundamental first step, mate. So, look, always enjoy your input. So I'm going to get you back on again when it suits you to do a deeper dive on property development, given your expertise in that area and my interest in that as well. So I really appreciate you generously giving to the Get Invested audience again, Peter, and look forward to talking to you again soon. Pleasure. In the meantime, Bushy, if people want, I'm not very good with the IT,

but I do have a YouTube channel where I have actually documented on video my last development that I did at Port Nalunga South where we interview a lot of the major players like the accountant and the architect and the building designer and the builder and so on. So if people just want to get an overview of what it's all about, they can have a look at that. So if they Google Pete Kalesos or the property professor, I'm sure they will find it.

brilliant great suggestion and again it's a it's a hands-on exercise with someone who has the overall knowledge that can pull that whole thing together so we're very appreciative of your generosity again mate and looking forward to continuing to talk to you keep up the great work with the property investment professionals of australia uh you know always like to say that if you're going to get involved in property make sure that you're talking to uh someone who's on board with Pippa so that there's a level of independence. That's right, mate. We need qualified people.

Absolutely. So make sure you're asking that question of anyone that's in your property team. But in the meantime, mate, thanks again, and I'll look forward to talking to you again soon. Thank you very much, Bushy. Always a pleasure to chat. Thanks, Peter. Well, Freedom Fighters, how good was that?

To get a summary of all this investment gold in the show notes, just email me on hello at khgroup.com.au. It's H-E-L-L-O at khgroup.com.au. Or check us out at www.bushymartin.com.au forward slash Get Invested. I look forward to joining you next week for another episode of the Get Invested podcast. So thanks for listening. And as always, dream as if you live forever and live as if you die tomorrow. Thank you.