Property Hub - Investment Insights & Inspiration - Realty Talk: Burbs Boomerang + Deposit Hurdle + Keep your PM close

Episode Date: April 30, 2022

Since the advent of covid, there’s been a lot of talk about the exodus from our cities to lifestyle locations and the rise of the regions. But is this sustainable, will there be a post-pandemic boomerang back to the burbs, and is the rise of the regions all that it’s been cracked up to be? Jane Slack-Smith from Your Property Success joins us to balance the conversation. The recent surge in property values across the country means the runaway train of housing accessibility is getting further beyond reach so to discuss an innovative solution to the growing deposit hurdle, we’re joined by the CEO of Coposit Chris Ferris in part 1 of a 2 part Realty Talk feature. And to round out the show, our host Bushy Martin continues our special property management series by outlining the remaining key principles and rules of thumb you need to know, in order to select a great property manager. RealtyTalk is your trusted voice in property investment and Australia’s most popular online property show.  RealtyTalk is brought to you by Realty, Australia’s leading search and social property distribution platform that helps investors like you beat the crowd, giving you the earliest access to property opportunities, listings, and insights. Check out Realty. RealtyTalk is hosted by top property investment expert, author, and founder of KnowHow Property, Bushy Martin. Find out how Bushy’s KnowHow team helps investors unlock freedom with finance and property here, and check out Bushy’s podcast Get Invested.  RealtyTalk is supported by BMT, a company that helps property investors save thousands of dollars each year by maximizing tax deductions from investment properties. Find out more.See omnystudio.com/listener for privacy information.

Welcome to Realty Talk, the show that brings together the country's most authoritative and respected property experts. Follow us on all the socials and subscribe for updates and exclusive offers. Realty Talk is powered by realty.com.au, connecting buyers, sellers and agents differently. Greetings and welcome to this week's 499th Realty Talk Show. I'm Bushy Martin from KnowHow Property Finance and we've got another great show for you this week. Since the advent of COVID there's been a lot of talk about the exodus from our cities to lifestyle locations and the rise of the regions with property value growth in regional hubs of between 20 to 30 percent in the last 12

months outstripping the capitals. But is this sustainable? Will there be a post-pandemic boomerang back to the burbs, and is the rise of the regions all that it's been cracked up to be? Jane Slack-Smith from Your Property Success joins us to balance the conversation. The recent surge in property values across the country also means the runaway training of housing accessibility is getting further beyond reach. So to discuss an innovative solution to the growing deposit hurdle, we're joined by the CEO of Coposite, Chris Ferris, in part one of a two-part Realty Talk feature. And to round out the show, I continue our special property management series by outlining the remaining key principles and rules of thumb that you need to know to select

a great property manager. And before we get into it, make sure you don't miss another episode of Realty Talk by signing up on the realty.com.au homepage so that you get every show in your inbox every week. And I'll even throw in a free copy of my award-winning book, Get Invested, for taking the time and making the effort. We've got a lot to share, so let's get on with the show. Hi and welcome. Now, since the advent of COVID, there's been a lot of talk about the exodus from our cities to lifestyle locations and the rise of the regions with property value growth in regional hubs of over 20 to 30 percent in the last 12 months and that's outstripping the capitals. But is this sustainable? Will there be a post-pandemic boomerang effect back to the burbs

and is the rise of the regions all that it's been cracked up to be? To balance the conversation we're joined by a fellow country girl who's become a highly respected property market commentator, educator author awarded mortgage broker and founder of your property success jane slacksmith so welcome back to realty talk jane thanks bushy i'm really looking forward to the chat and it's been a long time coming for us to get together and and share all things property so i can't believe that we've never actually connected so so likewise yeah i'm really excited about the chat today so so let's getting into it as i've already mentioned in recent times we've been hearing a lot about the race to the region and as a country girl from Dubbo you must have some allegiance there so

have you been on this sprinter? Oh look you know I'm more of a stayer than a sprinter I have to be honest and you know when I look to invest I'm always looking for that 10-year kind of horizon so for me it's that long-term perspective and you know when we entered this unique period in 2020 I remember sitting back and just looking at it going, you know, no one's really been through anything like this before. And we're not sure if what we're seeing now is going to be something that goes on for a long period of time, or if it's a two, three, four year type of anomaly that we can recover from. And so being a student, and I guess being an engineer and a researcher and doing data research for the last 20 years in the Australian property market, I'm always looking

at what's happened historically and then applying human behavior to what could potentially happen in the future and I was just I was in two minds and come March 2020 you know my mentoring students etc I just said like let's just hang back and watch because this is something that's really unusual we haven't navigated this before and by September I was convinced that things were different but I just couldn't believe that you know this rise of the regions would be something that would be sustainable. Yeah, interesting. Well, if you're more of a stayer then,

can you sort of just give us a brief outline of your basic investing philosophy? Yeah, absolutely. Well, you know, I essentially, I'm a bit of a scaredy cat when it comes to investing. You know, Effie from Money Magazine used to call me the meat and potatoes person when she needed something

and was a little bit boring to add to the two different sides of a property argument. And that's because I guess, you know, my background is an explosives engineer in the mining industry so everything was about risk assessments and when I was in my late 20s and thought you know I'm going to have to do something better with my money I really wanted to be able to have a plan a b and c and so for me it was you know when I was when I look at property investing I'm looking at well what has done well in the past and what have actually been the drivers I don't want to just say you know it's done well in the

past let's just assume it's going to be good in the future and so I'm looking at the drivers of what what drives a market and what drives the market is you know people where people want to live and they want to live in in an area where you know they have the resources to sustain the lifestyle that they want they want to be able to commute to where they have to commute to be it family be it work be it entertainment or be it lifestyle exercise and you know when I was kind of looking at those things and looking at the regions, I just had these doubts that it was sustainable. And obviously, you know, we've had 20 plus percent growth in the regions and in the city. And I look at the regions and go 20 percent growth on $400,000 property, 20 percent growth on

an $800,000 property, which one's going to get me a head further. So, you know, I'm always looking at the numbers and the underlying information and what the effect is. But, you know, my The Trident strategy that I came back up with nearly 20 years ago really addresses that scare the cat approach that I have to investing, which is how can I make money if I really stuff one up? I've got two other ways to make money. So the first was understanding the market with so much knowledge that you can actually negotiate well a property below market.

Now, in a fast moving market, obviously very difficult. and second add value in the meantime by adding you know equity out of thin air such as you know renovation it was my strategy and the third strategy is buying in a proven growth area or an area that has pricing pressure on it that will get us the growth and you know that's that's really you know served me well served you know tens of thousands of my students well but when I'm looking at the regions and having lived in a lot of country towns especially working in the mines you know i i was subject to that city girl you know country girl went to the city city girl came back to the country and they used to say to you you know um you'll be a local when you've got

a grandparent in the graveyard and there was that kind of you know um the new kids to town and so i started thinking about well who are the people who have the i guess the economic foundations to be able to choose to move to an area and still have their jobs and usually you know people who don't need to meet around the water cooler to see the boss and say remember me for the for the promotion but those that are really set in their careers you know they're typically 45 to 55 years old and what does that person look like well that person is usually someone who's quite established in their job but they've got teenagers now are we going to move you know, from the, you know, eastern suburbs, Sydney, you know, private school GPS potential

to, you know, Lithgow local high school, lovely local high school, I have spoken there many times on careers nights, but, you know, you know, are they going to do that and sacrifice their children's, you know, what could be perceived high school experience? And then that same age group, which is me you know i'm 51 i've got parents that are aging you know they're the boomers are starting to to move on and i think i saw a statistic recently it's like 1.9 million people are going to plan to downsize in the next five years they're going to move to their you know uh an area that has really good medical facilities they're going to move to an area where they can um live and engage in a community quite easily and you know people like me want to be near our parents and I

think COVID's kind of taught us that as well so we've kind of got this this dynamic where it's cheap to move to the regions and we can because from the work from home phenomenon but then on the other hand you know you've got the you know like me you know a 40 year old mother turning up at the at the preschool with 22 year old mothers turn out preschool I'm not going to be making my best friends there forever you know so there's that community as well and when i apply not just the statistics but the behavioral analysis of how as humans we we interact and think and engage with our family and our community that rise of the regions and i think we're seeing it now pull back a bit is is really something that i believe was had its time and they're still going to be depending

on the affordability, I guess, recommendations that come out of Canberra, there potentially could be some more affordability pushes that put people in the regions. But the regions that have grown are actually the satellite cities of the capitals. They're the lifestyle, commutable areas. We're not talking about Dubbo. No.

So I think that the rise of regions, they've had a bit of a play. Five people or five families leave Melbourne and no one really notices and five people turn up and shepherd and it's five families turn up there that's a big deal so i think that it's um it was something to watch and potentially for those who are a lot more gambling than i am would play the short-term market on that one but i think it was a bit of a sprint that we may not see last the distance yeah interesting i know you make a very good point around the relationship magnetic pull uh that that uh sort of binds us together so it'll be interesting to see now we tip in another 200 odd thousand possible new immigrants coming into

the country as the international borders reopen where do you see the growth opportunities in the future if it's not the regions and and how do they flesh out as you see it yeah look i mean i'm just so excited about you know the borders being open again and and just just the fundamentals of economics you know you look at the uk you look at the us you look at new zealand you look at their inflation rates you look at them pushing their interest rates up and then you look at australia you look at the war in europe and you look at australia and you know we you know we've been a bit of a nanny state but we've been really safe and secure through this economically and to some degree you know through our health um uh handling as well through this entire pandemic and so

i think there's going to be a lot of the safety and security of australia being very very attractive and I look at the overseas web watches and they're looking where they're looking at buying in Australia and I you know look at those kind of dynamics and during you know 2020 you know when I was kind of trying to read the market I was looking at how long after shutdowns to the Chinese, Italian, UK, US market respond in the property market and that's why I was so confident and I'm pushing the go for my clients in September. But, you know, I look at this 200,000 people and I'm just really excited.

You look at the market. We had no new people for two years and the market went up by 20%. Exactly. No one's really come here yet and our rents are up 15% to 20%. I've just put rent up from $560 a week to $680 a week in a little place.

So we're getting these amazing dynamics without the population. Throw the population in And I just think that it's really exciting. One of the things that I do do, because I love looking at information from so many different sources to try to correlate what's really happening, is that I've started interviewing immigration lawyers. Yep. And I've spoken and I have employed quite a few Colombians and South Americans over the last five years. And I'm speaking to them and their communities and immigration lawyers from there and from India as well.

And what I didn't realise, naively, is that to get permanent residency is based on a kind of a scorecard. And you get more numbers for doing different things. And one of the things is moving to the regions. You get more points for moving to the regions. And guess where a region is? Adelaide. Yes. So what I've seen really interestingly is some of the South American community that I know here in Melbourne who have, you know, settled here in Australia, have been at university here, have now moved to Adelaide just to kind of get a quick path to their PR.

And just speaking to a couple of the immigration lawyers around Sydney, you know, Blue Mountains is considered regional. Canberra is regional. yes i think when we start talking regional there's where we're thinking regional which is you know broken hill and then there's where the government is giving people points for regional so i'm really quite i think that's why we're starting to see adelaide do so well and it's probably potentially why canberra is going to perform um as well but you know sydney and melbourne is where most people come to it's where the jobs are and you know i think there's a lot to be said that you know Melbourne's probably off now by about four years

than predicted to be the biggest capital city in Australia. But people are going to go to, you know, where they know. And I think, you know, we're just going to see just an incredible market. Totally agree. Exciting times ahead, I think, Jane. So I really want to thank you for these very balanced insights. And thanks again for joining us on the show today.

Absolute pleasure. Thank you, Jane. Well, there you have it. Only time will tell what the real long-term sustainable future is for the regions as we emerge from the clutches of COVID. And if you'd like to know more about Jane, feel free to reach out to her at janeslakesmith.com.au or yourpropertysuccess.com.au. You're watching Realty Talk, your go-to place for all things property. Successful property investment is a game of finance. Do you have the right team

and the right game plan? Realty Talk is brought to you by Know How Property. More than mortgage brokers bushy martin and his team of investment architects set you up with a sustainable strategy structured to lower your costs tax risk and stress while increasing your capacity for growth know how has helped over 1900 homeowners and investors secure more than 800 million dollars in property wealth. So get set to live more, work less and live your legacy. Want to know how to invest in your freedom? Visit knowhowproperty.com.au. Hi and welcome. Now I've been saying for some time now that we don't actually have a housing affordability issue in Australia. We actually have a housing accessibility problem. So what do I mean by

accessibility? Well, it's the significant initial deposit hurdle that's actually preventing hard working Aussies from getting on the property ladder, which is very different from loan repayment affordability. And with the recent surge in property values of somewhere between 20 to 30% across the country over the last 12 to 18 months, the runaway train of housing accessibility is getting further beyond reach as required deposits continue to grow. For example, over the last 12 months, the national median value of dwellings has increased by over $135,000 from roughly $604,000 up to $739,000, according to CoreLogic, which equates to price increases of over $2,500 a week during this time. Now, while we haven't seen property growth like this for over 30 years,

and it's certainly not going to continue at this pace, this means that a property buyer has needed to increase their savings deposit contribution on average from $108,000 a year ago up to $133,000 now based on a 90% loan. Now that's a $25,000 deposit increase in just a year. So what can property buyers do to bridge this widening deposit accessibility gap? Well, historically and unfortunately, very little up until now that is. A new innovative startup is set to help solve this growing problem for buyers looking to build a home. And Chris Ferris, the CEO of industry Disruptor Co-Posit, now joins us for a special two-part feature that discusses the details. So welcome to Realty Talk, Chris.

Thank you very much. Thank you for having me. Chris, I'm really excited about what you bring to the table. So to sort of set the scene, what problems are you currently seeing in the marketplace? Yeah, look, I think the introduction that you've made is a really good point for us to start at. I think we've seen a lot of the issues and we see in the media, the headlines that talk about housing affordability.

yes that is definitely an issue but we believe before you can even consider whether you can afford a property you need to actually break down that very first barrier which is the deposit and the upfront costs and that is something that people are losing the dream of actually having home ownership because they cannot save for that first home deposit which is a massive problem in the Australian market and this is where you know we got to a point where you can either sit down and accept that or try and disrupt the market to help people get into the market. And this is what we've been able to do at CoPosit by breaking down that deposit barrier and using time periods that haven't been used before in a more economical and smart way to help people get into the market

faster and achieve their home ownership goals in a much faster manner. Yeah, okay. So how does this affect the current generation of home buyers as you see it then, Chris? Look, importantly, we're hoping to buck the trends of previous home ownership generations. I mean, from the 1940s, the census data suggests that there has been no generation that has been able to beat the previous generation in home ownerships. Now, again, that's for us, that's not acceptable. We can't accept that as a position. I think the stats are, you know, since the 1940s, home ownership rates between 24 and 29 year olds was 58% back in 1940. Today, that's currently at 38% as at 2016 data. I would expect, you know, as at 2021 or 2020 data, that's going to go down

even further, which is just something that is a massive problem. And we need to do something to buck this trend. We believe at Coposite, we can help to buck that trend by fast tracking home ownership goals in a very affordable manner. Yeah, well, that opens the door for you to tell us how does Coposite actually help solve the problem then? so our main purpose or our main mission is to help people provide and provide a pathway to help people achieve their home ownership goals faster how do we do that what we do is instead of you know if you're looking to purchase a million dollar property instead of needing that hundred grand up front to secure that property you can now exchange on a ten thousand dollar deposit

and pay your the balance of your deposit in weekly installments whilst the project is being built on the construction so it works for off the plan anything with a lead time house and land packages when the land is being registered but basically we're shifting that that thought where you need a 10 deposit up front to secure your property generally that money sits in a trust account or does nothing until the construction of the project is completed and then you settle on your property what we're saying is we can use this construction period to help you break down that deposit barrier and actually secure the property while saving for your deposit at the same time i think a lot of the issues have come into the into play where people see a target and

they start saving for their deposit but they haven't actually secured something by the time they get to their deposit target two or three years down the track there may be one or two or sometimes three property cycles in that time and the goalposts just keep moving further and further backwards this is a massive problem that we need to try and address yeah i love it so uh so just to summarize what you're saying there is my i understand that for a ten thousand dollar deposit you're effectively securing a new build property and then between that time and the time the property settles which can be anywhere from nine months through to two years roughly you've got the opportunity then to secure the balance and I guess what I like about that is

there's a lot of potential property buyers that have you know reasonably sizable deposit but it's still not enough to get there what this enables you to do is lock in today's price and then have the capacity through the construction period to put the rest away and then settle on the property when it's complete. Absolutely. That's exactly the case. And I think the important mechanism there is that they're securing the property in today's market, and then they're paying for the balance of the deposit in tomorrow's market effectively. And that's how we've been able to help people get in. And that's what we're seeing. You talked earlier about property prices increasing 20 or 30% in the last 12 or 18 months alone. So does the deposit target. Now people just

physically can't save that fast so by securing that property at the beginning you're solving the biggest issue which is the moving goalposts and that's been the historical issue is the moving goalposts we're saying lock in your goalposts today and then you can pay your deposit off and work towards that goal and it can be up to two and sometimes the bigger project can be even three or three and a half years you know so you've got plenty of time to actually save for your deposit. Yeah, love it. Well, can you sort of put some color around that by giving us some examples of co-posit active in the marketplace, please, Chris? Yeah, sure. So we officially launched our business in October of last year. But before that, we did a pilot project, which was here in Seven

Hills in New South Wales. And that was a project of 97 apartments. Now we sold 92 apartments within the first four months. Now all those parties are looking to complete their payments in May of this year. So that's a really exciting point for us. And some of the stories that have come out of that is people were not able to physically get into the market beforehand. When we look at the data of the 92 buyers, we've looked into that data, the whole subset, and there were 22% of the buyers, and we decided to do a 10% deposit. Now, when we broke that down further, 78% decided to do a composite, which for us was massive because it suggested to us in the market that this is really needed. Now, when we looked at the 78% further, what we saw was 23% had actually told us we would

not have been able to purchase if it wasn't for composite. So we've effectively created a whole new market that didn't exist before. They're anywhere along that journey. They may be two years into their saving journeys, have 40 or 50,000, but they need a 70,000 deposit. Currently, we view those purchases as they're not they're not buyers which to me is it's wrong they actually can get to that point but they just need a different mechanism or a different system and that's what composite that is the pathway that we talk about that it is a different way to get in while still securing your property in today's market yeah i love it it's certainly going to up up and open the opportunity base so i look at this is really exciting initiative chris and i

want to thank you for taking the time to share with us today and we look forward to continuing the conversation in future episodes. Excellent. Thank you very much. Thank you for having me. Thanks, Chris. Well, there you have it. If you or someone you know is struggling to save enough deposit to secure new build property as values continue to increase, reach out to Chris and his team at coposite.com.au. Stay with us for more here on Realty Talk. greetings and welcome this week we continue our special focus on the critical importance of property management to your investment success as i've said a number of times before the devil's in the detail when it comes to property manager selection and it's an entire

integrated suite of things that makes the difference from structure to support to systems right down to individual skill and experience. Last week, we uncovered that you need to focus on dedicated specialist property management businesses who operate on a portfolio basis, as opposed to property management teams attached to real estate sales offices that operate under a pod task structure. So check that out if you haven't done so already, as these are big rocks in property manager selection. Today, we'll continue by unpacking the other key property management principles and the rules of thumb that you need to be aware of. So the next major guiding principle revolves around the proximity of the property manager's office to your property. When

we owned our property management business, we would only manage properties within 20 minutes drive of the office. Why is this important? Because if your property manager is spending a lot of time in their car driving miles between properties, then they're not spending as much time actually managing your property. Likewise, if the property manager isn't local to your property, then urgent call-outs to attend the tenant issues can be troublesome and often delayed. And the property manager may not have an intimate knowledge of the area close to your property in terms of access to good local tradespeople, et cetera. Now, since the advent of COVID and a bigger reliance on property managers potentially working remotely from home, you just need to

ascertain who is actually managing your property and how close do they actually live and work to your investment property. So having your property manager close to your property also supports the use of local trades and services, building loyalty and offer getting better rates, ease of accessing the property at any time, be that an impromptu show through for a prospective tenant through to an emergency property need as they did just a stone's throw away. The next consideration relates to the number of properties under management. As a rule of thumb, a good property manager working in a portfolio system looking after properties within 20 minutes of their location can safely manage somewhere between 80 up to about 120 properties and still provide a good

consistent quality service. Beyond this, they're generally spread too thin. Other important considerations include the property manager's leasing approach in terms of how and where your properties advertised and whether they take professional photos, use drone footage and prepare 3D virtual tools of your property to display the property at its best and attract the largest pool of quality tenants. Find out who and when are open viewings for tenants conducted so that you can access the frequency. Also get clear on what their tenant application process, reference and employment checking and turnaround times are as it's often the quick or the dead when it comes to securing good tenants.

Tenant applications usually need to be processed in one to two business days. However, this is subject to tenant references responding in a timely manner. You also need to ensure that they provide you with full copies of tenant applications, reference and employment checks, and that their recommendations are in writing,

not just verbally over the phone. You also need to be across how many similar properties they have listed and the average vacancy days of properties on the market until the lease start date. For good property management officers, this is generally no more than 14 up to a maximum of 21 days, although this can be location and season specific

depending on the time of the year and the status of the market. It's super important to note here though that when you ask an agent what is the average days on market, they'll normally give you the number of days they advertise the property, but it's important to emphasise that you need to know from the first day of advertising to the actual day that the tenant moves in. Also confirm what's their percentage of rent arrears,

which is a fancy way of finding out how many of their tenants are late in paying their rent. A great property management office will be less than 1% and it definitely needs to be below 5% as anything above this is a warning sign that you're likely to have to wait to get your rental payment, which could play havoc with your cashflow

if you're relying on this to make your loan repayments on the property. You also need to know what, if any, property management software platform they use to improve efficiency, communication and workflow. Most reputable property management agencies will utilise one of the following

five industry-specific software platforms. They are REST, Console, PropertyMe, PropertyTree and AIA or Inspect Real Estate. Having said that, there are actually a plethora of software options around

so it's important to focus on the property management software functionality because the right software should do the following five key things. Firstly, increase efficiency. This enables a property manager to manage the property, not administer the paperwork. So think automated tasks, reminders, daily resetting of rent, etc. Secondly, it should automate workflow which ensures important property management activities aren't forgotten. So think timely rent payments and maintenance being attended to in a timely manner. Thirdly, the system should create clever communication, things like automated emails, letters and SMS messages for time-pertinent tasks like lease expiries, overdue rent and reminders to authorise maintenance. Fourthly, the platform

should manage trust account monies, which produces accurate monthly statements showing income and costs and produces an annual statement for your accountant, which further reduces your accounting costs. And finally, the software should be cloud-based, providing a balance of being able to work from the home office or the workplace. You also need to know how often they conduct routine property inspections during the tenancy and how do they document and then communicate this to you. The regularity of inspections is now actually dictated by the relevant residential tenancy legislation in each state, which is currently every six months at the most in Victoria, three months in New South Wales and Queensland, and can be up to once every four

weeks in South Australia. But wherever possible, it's good to have routine inspections every three to four months, as a lot can happen to the condition of the property beyond this if it's left too long. The next area that you need clarification on is the officer's approach to maintenance responses and quotes. This is the biggest bugbear for tenants, so software automation and reminders are key to progress maintenance. Most states have legislation around when a maintenance item needs to be actioned and or remedied. Immediate needs like plumbing leaks, electrical safety issues and security related matters, for example key locks not working, need to be fixed within one business day, while less urgent needs in the same area need to be

addressed within seven days. With bigger ticket items like replacement of air conditioning, require quotes and then lead time so this could be 14 to 30 days maximum or minimum and if you're an existing or potential investor you need to know that tenants can apply for rent compensation for the weeks they're not and without a service that they're actually paying for. By way of example a tribunal may deem that $20 per week for a dishwasher that isn't working is fair rent compensation, while an air conditioner in the tropics might get $50 a week. All of this is subject to tribunal determination, unless your property manager is able to reach a mutual agreement on what was and what the actual weekly compensation value needs to be.

Now, I could go into much more detail on this and many more considerations, but these are the key aspects to watch out for at the office level. And if you aren't getting immediate and find out answers to these questions, then this is a red flag that they aren't on top of their business and you need to be very wary about engaging them. Next, you need to drill down to find out the details about who will actually be managing your property. Who are they? How long have they been a property manager? And how long have they been managing properties in this particular office? Longevity and stability are the key here. So anything less than six months is a major worry and anything over two years in the office is preferred.

And it's an extra bonus if your property manager is also a property investor and landlord themselves as they're actually going to have skin in the game and they can emphasise with what's important to you as one of their landlords. And finally, you need to consider value versus cost. Your focus shouldn't be about rate. You need to focus on reliability.

Now, don't get caught up in arguing the toss between a really good property manager who charges you an 11% fee versus an average operator who charges a standard 6% to 8.8%. In most cases, the difference between the two amounts is only about the cost of a cup of coffee a week. And if you're prepared to put your most valuable asset at risk for this amount, you probably shouldn't be investing in property at all. So this is your whirlwind Reader's Digest summary of what it takes to identify a great property manager. To sum up the perfect property manager profile, the property manager who is actually managing your property will be a property investor themselves, who's been managing

properties for the office for more than two years and has been in the industry for over three years minimum. They operate on an end-to-end portfolio basis, managing no more than 120 properties all within 20 minutes of their office location, supported by a proprietary cloud-based property management software system like rest console or property tree with three to four documented routines inspections a year property leasing is handled separately by a dedicated leasing manager they operate in an office that has less than five percent rent arrears tenant applications are processed within 24 hours and the average vacancy days is the maximum of 14 from advertising through to tenant occupation and the office is a dedicated and specialist property management

business that excludes property sales. Next week, we'll conclude our property management series by drilling down into the questions that you actually need to ask in order to separate the sheep from the goats when it comes to selecting your property manager. And for more deep dives on the importance of all things property management, look out for my recent conversations on both Realty Talk and our Get Invested podcast with Dennis Youssef from Inspired Growth Training, along with Lauren Robertson from Rental Results and Jamie Billiwell of the Co-Property Group. That's more food for thought. Have a great week. Remember to always get invested in your future and I look forward to sharing with you again soon. Property depreciation is the natural wear and tear

of a building and its assets. Property investors can claim depreciation as a tax deduction each financial year. Depreciation is a non-cash deduction. This means you don't need to spend any money in order to claim it. On average, BMT tax depreciation fined residential investors almost $9,000 in first full financial year deductions. Call BMT on 1300 728 726 today for an obligation free quote. Well, that brings us to the end of our 499th show in the run up to our 500th special episode of Realty Talk next week. Another big thanks to our guest, Jane Slakesmith and Chris Ferris. And to make sure you don't miss an episode of Australia's longest running and most popular online property show, subscribe to Realty Talk Now on Apple

Podcasts, Google Podcasts, Spotify, YouTube, or wherever you listen. And make sure that you sign up on the realty.com.au homepage to get a free copy of my book, Get Invested, so that you get every episode in your inbox every week. And while you're there, make sure that you check out one of Australia's most extensive range of properties for sale from over 7,000 agents nationally. Thanks again to realty.com.au and BMT Tax Depreciation for their ongoing support. I'm Bushy Martin from Know How Property Finance, and I look forward to seeing you again next week. Miss something in this week's show or want to catch up on past shows? Do it anytime at realty.com.au, where we connect buyers, sellers and agents differently.

Thank you.