Property Hub - Investment Insights & Inspiration - Realty Talk: Fudget Budget + Not So Hot Spots

Episode Date: May 19, 2023

By the time everyone is calling a location a hotspot, it's already too late and the area is likely to be shifting into the not-spot zone.   John Lindeman joins Bushy with ways to help you find areas with growth potential before the growth actually occurs?   Do you want to feel inspired…to feel that you matter…to feel that what you do matters…and to be happy?  The answer lies in succeeding on your own terms. Leadership coach Nicole Davidson believes you are capable of more than you know.  Hear her message in today's show. The latest Federal Budget has provided an opportunity for the government to allocate funding to address our growing housing crisis. But has it?   Bushy and Rasti Viabhav discuss what the Federal Budget actually means to property and investors.  One of Australia’s top buyers agents and property negotiators explains how to spot a top negotiator.  Knowing this could save you thousands of dollars. RealtyTalk is part of the Property Hub podcast channel, your home for property investment insights, inspiration, and stories from Australia’s top property experts, investors, leaders, and analysts. Subscribe now to get every RealtyTalk episode delivered to you each week for free, and also get full access to Get Invested, the leading podcast for Australians who want to unlock their full ‘self, health, and wealth’ potential and get inspired by the stories of investors, founders, and entrepreneurs. Subscribe to RealtyTalk on the Property Hub channel: Apple Podcasts | Spotify | Google Podcasts | Email Property Hub is a collaboration between Bushy Martin from KnowHow Property, Kevin Turner from Realty, Andrew Montesi from Apiro Marketing and Apiro Media, and Australia’s largest independent podcast network DM Media. Business and partnership enquiries: [e-mail] 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. Welcome to the Realty Talk Show, your property hub's trusted voice for property investment insights, inspirational stories from Australia's top property experts, leaders and analysts. I'm Bushy Martin from KnowHow Property Finance, and we've got some great insights to share with you again this week. To kick things off, Rusty Vibehave from Get Rear Buyers Agents unpacks what the federal

budget means for property and investors, and what more needs to be done. Nicole Davidson from Growth to Success then joins us to inspire you to achieve your version of happiness by succeeding on your own terms. Leading property market analyst John Lindemann then joins us to find areas with property growth potential before the growth actually occurs by revealing his unique slingshot effect. So you can't afford to miss that. And to top off the show, my co-host Kevin Turner concludes our special series on the art of negotiation. negotiation and this week he talks to buyers agent kate bagos about the key attributes of a top negotiator and how you can pick the best one to help you get the best price and before we get

underway make sure you hit the subscribe button now wherever you're listening to or watching the show to ensure that we continue to attract the industry's best of the best so you can enjoy cutting edge property information and if you'd like a free copy of my award-winning book get invested make sure you also sign up on the realty.com.au homepage we've got some great gold to share so let's get underway 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. KnowHow has helped over 1,900 homeowners and investors secure more than $800 million 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. Now when it comes to property investment, it seems like everyone's trying to find the next hotspot by digging to discover gold nuggets before the rush starts. The sad reality is that by the time everyone is generally calling a location a hotspot, it's already too late and the area is likely to be shifting into the not-spot zone. So how can you tap into tips and tricks that will help you to find areas with growth potential before the growth actually occurs? Well, this is where today's guest, John Lindeman, comes to your rescue. As a long-term proven performer, as a highly respected property market analyst, John and his innovative property market research team at Property Power Partners has uncovered a way for you to easily find areas that have growth potential even while prices are falling, which he calls the slingshot effect.

And he's going to unpack it for you now. So welcome back to the show, John. Hi, Bushy, and hello, everyone. It's great to be here again. Awesome. Now, you've got us all intrigued with the slingshot effect. so can you tell us what it is what is the slingshot effect well it's um and i've got a slingshot here to show you exactly what a slingshot is in case you you didn't know but have you ever

noticed that when you fire a slingshot you've got and i'm sorry if i'm bumping the mic there but you've got to pull the payload down in order to shoot it up and this is exactly how the housing market works sometimes not all the time but right now is one of those times and it's when demand suddenly starts to increase by demand and people race in and start buying properties and what happens is that it's all the low-hanging fruit the bargain price properties that get sold first you know people have been waiting for years maybe to sell a property and suddenly the buyers come along they're happy to get rid of them so what happens is that prices actually go down just like with the slingshot um and it's because all those lower priced properties get sold first and that

it's a function of what we know is the median price and what that means is the median price is the middle point of all sales so when the property data people collect the sales they pick the middle one in price that's the median so if more lower priced properties suddenly get sold the median actually falls and so it's like the payload getting pulled down in the slingshot but it's only while those bargains are there and then of course prices start shooting up. So I guess looking from the outside in if we're seeing the medium price dropping down over a period of time but we're seeing the number of sales and the sales activity increasing that that's the sort of indicator that we're keeping an eye on? That's exactly what it is and you can

do that at a suburb level or you can do it at the in a whole of Australia level for example in 2020 interest rates you know fell rapidly and then they reached record lows but housing prices didn't actually start to go up until 2021 and the reason for that was there was all this excess stock which was being soaked up and so prices just sat there but when all those low price properties were gone what happened we had a housing market boom so you can see how that occurs nationally but you can also pick it as you say Bushy look at the number of sales in an area and when those sales start increasing dramatically but the median price drops you know what's happening there is that the low-hanging fruit the bargain price properties are all getting snapped up yeah I love it so you've

given us a really good indication then on when the slingshot effect occurs so I'd love to get your thoughts on where the slingshot effect is occurring right now if you can please John It's about to occur, I think, in a lot of areas around Australia as confidence returns to the market. So, you know, that's one of the reasons that we're doing this topic now is because it's the right time to use this strategy. It wouldn't be right, you know, in the middle of a boom, for example. But it's great now.

And to give you an example of one suburb where I've picked this up, and that is Rockley, which is an inner Brisbane suburb. It's about 10km from the CBD. It's where the Brisbane markets are. So most people in Brisbane would know Rockley. Now, what I noticed there was that since October, the median house price in Rockley has dropped by $100,000. It's only $450,000.

Can you believe that? It's unbelievable. Yet the number of sales has doubled since last October from 30 to 60. And then how do you know this is the slingshot effect? Well, the number of listings has also dropped dramatically. And when I last time I checked, which was this morning, there was only a few of those bargain priced properties left you know so depending on when this goes to air if you have a quick look and there's still a few left we'll grab one because

those are going to go up dramatically in price but that's how it works because it's the the low-hanging fruit that gets picked first yeah i love it it's so it's such a a really good insight but uh based on you know sort of information if we're looking at a local level most people can actually start to get their heads around so really timely insight there john and uh really want to thank you for coming on to share that with us and and for joining us again on the show today look it's been a pleasure and as i said all you have to look for those three indicators the falling median price the number of sales increasing which you know normally doesn't happen and double check to make sure that the number of listings that is properties listed for sale is going down if all

you get all those three occurring that's the slingshot effect at work i love it really good example at the perfect time john uh so there we have it uh you've just heard another great example of the fact that you need to be very careful about where you get your property information based on hard data not on soft opinions so if you're looking for the right data and interpretation to help you make much better informed property decisions just go to lindermanreports.com.au where you'll find a large range of property prediction reports, including the latest report that's coming up soon, Sleeper's Set to Boom report.

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They've completed over 700,000 tax deduction schedules for residential investment and commercial properties Australia-wide. BMT guarantee to find double your fee in the first full financial year deductions. Call BMT on 1300 728 726 today for an obligation free quote. Do you want to feel inspired? To feel that you matter? To feel that what you do matters? and of course to be happy. Well you've come to the right place and at the right time because

the answer to all of these questions lie in succeeding on your own terms. But what does succeeding on your own terms actually mean? Well today's special guest Nicole Davidson believes you're capable of much more than you know and she knows that deep down you know it too. As a self-leadership coach, Nicole and her Growth to Success team specialise in helping you and other property professionals to become the best of who you are, so you can succeed on your own terms. And today, she's going to whet our appetite on how you can do this. So, welcome back to Realty Talk, Nicole. Thanks a lot for having me, Bushy. Thanks, Nicole. Well, it's a great subject to get into.

Everyone talks about succeeding on your own terms, but from where you sit, what does it actually take to succeed on your own terms? First of all, I'd say it takes giving yourself permission that you're allowed to do it. We live in a very conditioned society. We've grown up being told what's right, what's wrong, what's appropriate, what's inappropriate. and so we find ourselves moving through life coming from a place of having to fit ourselves into other people's ideas about what success is and there's that saying you know there's no point in climbing the ladder of success if it's leaning against the wrong wall and life's too short so

the first thing is about giving yourself permission to do it and then it takes a bit of introspection to actually figure out what it does mean to you because we're not taught to we're not taught to do that we're taught to look outside of ourselves we're taught to go with the flow we're taught to not make a fuss we're taught taught to fit in and this world doesn't need us to fit in it needs us to stand out so giving yourself permission and really asking yourself what's important to you why it's important and just be willing to go against the grain and having the courage to do it. Yeah, 100% agree.

It's really getting clear and comfortable with who you are and where you want to be. So how do you do it on your own terms then when there's so many external pressures then, Nicole? The first thing, as I said, I think it's about making a decision and the pain pushes until the vision pulls. So we can either wait until something dire happens in our life, or we can actually sit there and say, you know what, this can be the first day of the rest of my life, and

I'm going to do it the way I want to do it. And in this externally focused world that throws uncertainty at us all the time, we need to go within and find that certainty. and when we go within and find that certainty that's where we find our resourcefulness that's we find our inspiration and that's where we find our courage and there's that old saying you know better to die on your feet than to live on your knees i totally think that's about what succeeding on your own terms is doing yeah it's really well said i've often said if you're really clear on where you're heading and how you want to live that becomes both a magnet and a compass

be magnetic in terms of you'll do whatever it takes to make that happen and encompass in the context that then every decision you're making day-to-day is about is it taking me closer to where i want to be or further away so we're taking the time to do that introspective look and and have a look between the ears rather than externally is something that very few of us do unfortunately Nicole but like you I can encourage everyone to actually take some time and do that so let's look at the flip side then what's the cost of not doing it on your own terms I think that's evident in our world we've got ridiculous cases of depression anxiety overwhelm frustration it's laid bare and I genuinely believe that's because that so many of us aren't coming from that place within

that knows what's right for us so we're going into situations from a place of disempowerment we're going into situations from a place of lack and scarcity so why wouldn't we be anxious and why wouldn't we be depressed when we feel like there's no hope and so the thing is about focusing on what we can control yes extremely well said and and eliminating the old should that's so many of us that feel that we should do this and we should do that and we're thinking about what we need to be doing uh to be accepted by other people in the the insta world that we we now live in the show world yeah exactly right so but well sort of drilling into that a little bit then how do you know when you are doing it right you feel alive and that's basically the baseline and challenges

can come your way but you welcome those challenges because you think you know what i get to choose here i think it's when we feel like we have no choice that we feel like we're hemmed in we're locked down we're trapped and so you know when you're doing it right when you feel alive when you can you might not necessarily be able to see the future but you know that there's something there so i think you rely a lot more on your intuition and you tap into that a lot more yeah and you start to trust a lot more it's very hard to trust when you're scared from a place from a disempowering scared i differentiate fear in terms of there's that fear that um you know i'm going to die or that fear that's going to cause us harm between as opposed to that fear where we

know that we have to do something because we're going to grow and we need to step into it and we need to lean into it and they're two very different types of fear and when you can start to differentiate between those two types of fear then you start going the way the cave you fear to enter contains the treasure you seek yeah but my favorite one isn't it it is and so when you can lean into that and when you can lean into that fear but you know it's coming from a place of energy it's coming from a place of excitement even though there's fear there and so when you can start taking those little forks in the road that we are up against in every moment and you start taking those forks the road towards the light then that's where you know you're living and that's where i believe that

we really want to be totally agree totally agree and i again fully encourage everyone watching and listening to uh deal with fear and do it anyway because it's about getting uh comfortable with being uncomfortable to a certain degree and challenging yourself to step beyond your own self-imposed boundaries quite often uh to to really start to to feel alive and that excitement that comes with doing new things and heading in the direction that you ultimately want to head in so well look uh again i really want to thank you for opening your eyes to the latent opportunities that within us all nicole and thanks again for joining us on the show today thanks for having me well as you can hear succeeding on your own terms is about unleashing your energy building your

capacity and creating the conditions for everyone to be successful. So if you're serious about helping yourself and your team to truly succeed on your own terms, then reach out to Nicole at growthtosuccess.com.au. You're watching the Property Hub's 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 KnowHow 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. KnowHow has helped over 1,900 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 in the midst of our national housing shortage and constrained new supply affordability challenges and a growing rental crisis that are probably inappropriately and quite inaccurately being blamed on so-called imaginary greedy investors, as our immigrant population goes into surge material, the announcement of the latest federal budget has provided an opportunity for the government to allocate funding to address our growing housing crisis. But has it? Has it done the right thing in the right areas to start addressing and assisting in alleviating worsening

property conditions in a lot of parts of the country? Well, to unpack what the federal budget actually means to property and investors. We're joined by leading national buyers agent Rusty Vaibhav from GetRare Property. So welcome back to the show, Rusty. Thank you, Simon Bushy. Thanks for this opportunity. Yeah, and I'd say the annual exercise is always a bit of fun and games around the budget, and there's been a lot of media around housing issues, as I sort of just mentioned in the entry. But to sort of kick things off, Rusty, can you give us a bit of a rundown of what are the key budget changes from a housing perspective? Sure. Before I get into it, just really

quickly this is the budget that we actually seen a surplus a surplus that we have seen after 15 years i mean yes it is 4.2 billion dollars which is pretty good but then it's soon going to be in a deficit of about 13.9 billion dollars in 23 24 and then beyond you know uh in tune of 35 billion dollars so we really need to be mindful of the perspective here that yes it's a positive surplus a budget then it's going to go again in the deficit so what we have seen is that there has been a like first of all there has been a good recognition by the federal budget this time that housing is a key component of the current cost of living pressures which is being faced by those within households federal budget has sought to address these housing cost pressures with a range

of small but carefully targeted support what we have seen in this budget is that we have seen immediate commonwealth rental assistance which has increased to over 1 million low-income renters Second, there's widely eligibility criteria for 50,000 first home buyer guarantee in place. And then we have seen more funding for NHFIC, which is National Housing Financing Investment Committee, loans to build 7,000 social and community housing dwellings. And then tax incentive for private sector built-to-rent projects, which could add up about 150,000 rental dwellings over the next decade. So there are quite a few handful over there um but in my in any way i'm happy to talk through one one at a time uh there could be could

have been a lot more that we should really see from this budget yeah okay well i i sort of like your take on these measures and how you would write these initiatives in housing improvement terms if you can give us your thoughts on that sure let's go dig one at a time so for example there's an increase to commonwealth rent assistance now let's really talk about it's already an ongoing measure um it's available to australians on pensions and benefits including job seeker the family family tax benefit and parenting payment this budget has delivered funding to increase this maximum rate of the commonwealth rent assistance payment by 15 in bid to help ease pressure on low-income renters now this total cost of government of

this increase will be about 2.7 billion dollars well next five years from 22 23. now this will be given to over one million dollar one million cr recipients that will benefit from this from first july 2023 yeah but if you really look at the quantum for the individual recipient getting money it's only maximum 31 dollars per fortnight now this is by the way the largest in what we have seen over the last 30 years so it's really meaningful from the budget point of view but 31 dollars per fortnight then we have really seen the rents have gone too far ahead uh you know it's not like it's long falling behind sorting rental prices what we have seen well i heard a figure rusty uh quoted just recently through a research house that the

medium and average rental increase over the last 12 months has been about 113 dollars a fortnight so if we're throwing 31 dollars at 113 there's a pretty big gap exactly right exactly right so it really looks meaningful that has been 15 increase but for someone who's receiving it it's it's peanuts so again this is certainly something in the right direction but it's only just stretching the edges of it yeah the issue that we're having yeah we have seen the expansion of the first home buyer guarantee now the the conditions are challenging for first-time buyers for whom the most significant hurdle for the home ownership is the deposit burden now it's already been going there now instead of coming with a typical deposit of 20 percent the first home guarantee scheme

allows us an eligible applicant to buy with just five percent of deposit with the government guaranteeing the remaining 15 percent without the need of lmi which is lenders mortgage insurance this has already been going on now what this budget saw is the expansion of the scheme so instead of 35 000 places in the year it hasn't been increased to 50 000. yep the government also extended the eligibility criteria for the first home buyer guarantee earlier it was it was just included to you know defective partners or couples but now it will be including any joint home buyers from a range of household and family members as well as the permanent residents and former homeowners who have not owned a home for last 10 years earlier it was very rigid criteria so

eligibility criteria has expanded also the number of grants from 35 000 to 50 000. again you know it's a good increase good step in the direction i would think that certainly uh it's helping making the home buying a more affordable for extra 15 000 but the quantum of what we're really talking about is again just touching the surface here yeah again i've heard uh figures quoted on average is about 120 odd thousand first-time buyers each and every year if you look by the long-term average so an extra 15 000 towards it's probably not going to make a massive difference unfortunately exactly right and there's another measure uh which is probably i like it to an extent relative to what we have seen so far is um the build to rent investors

now what it means is that it's really suddenly we all know we're in rental crisis we consider it is as low as one percent and then seven increasing considerably now in order to tackle the supply issue government has given better incentive for the builder or developer to come up with the build to rent projects. What they have done is they have just encouraged in a way from the taxation point of view, or the way the accounting has been done, what they've done is instead of typical 2.5% depreciation rate, they've increased it to 4% per year for eligible new build to rent projects. So basically it makes it easy for any developer to think about their rate of return because now the depreciation is instead of typical 40 years, it's happening

over 25 years as in like from 2.5% to 4.4% deposition schedule rate. And what they also have done is like they've reduced the withholding tax rate from 30% to 15% for the eligible fund payments from managed investment trusts to foreign residents on income from newly constructed residential built-in properties. So effectively what they're saying is that they are encouraging even foreign investors to come and build this company and you know and go for the withholding again it makes it easy for them to invest in projects like that so this is certainly great these text concession will apply to builder rent projects consisting of 50 or more apartments or dwellings made available for rent to

the general public so the beneficiary is the general public who's kind of a who's struggling to find the right property um again it really is a question of supply and demand when there's there's a huge demand building up, if you can tackle the supply side, things probably will be all right, according to economics 101. So you know, like all this affordability criteria that we have been talking about so far, it's only going to make a demand bigger. But it doesn't mean that it's actually slowing down the price point. If there's more demand building up, the

price will go up again. And that will actually again catapult the whole issue of affordability. Exactly. What do you really like is, sorry, go on. No, no, yeah, go on. Yep. Now all I'm saying is that the more we tackle the whole housing issue from the supply side, that's more sustainable, that's more, you know, that is more of a solution that we look at it because we are not here to just solve the problem for the short term, you're kind of actually aggravating by doing and you

know, making it easy for someone to rent or build. I mean, build is good by the way, sorry, rental, you know, making it easy for them to buy the property. Yeah, the 5% deposit. Yes, there's a guarantee of 15%. The demand will build up, price will go further. And then the price that the the family was looking at might actually go up eventually over time. Yeah, it's sort of a by taking a reactive approach like this and only doing a little bit what they're actually doing, as you

say is upping the demand without sorting out the supply side so it's actually putting more pressure on on potentially on rents and housing prices so it's a little bit counter counterproductive in in that that context uh what what could the budget have focused more on do you think in the context of what we've been talking about yeah which if you don't mind there's one more um thing that actually government did this was more of a social uh community housing that the government came up Yeah. If I touch base on that very quickly as well. Yeah, sure.

Yeah. So government actually also announced an extra $2 billion to lower the cost of construction of social and affordable dwellings, which was pretty good. People who can't afford homes, what they said is instead of, you know, with the budget that they had as an H F I C, they had an initial budget of 5.5 billion. They've changed it to 7.5 and that's $2 billion over the next five years. What it allows is actually, I mean, if you look really at the numbers, it is only allowing to support an additional 7 000 new social and community housing

again with the numbers we are talking about you know in hundreds and thousands uh seven thousand seven thousand is again just scratching the surface dropping the backup yep so these were the pretty good measure in the right direction in a way i mean understanding that it's still maybe a short term but again the quantum is not that enough and again we have really seen the light that it's surplus for a while but again getting into deficit there was a right balance that you know the budget um has to really tackle into as well yeah it's spot on so flying back into the exercise what what do you think the budget could have focused more on than in the context of everything we've been talking about yeah so again it really goes back to the economics 101

um that first of all we really understand need to understand what's really the drivers of supply and demand yeah now we are certainly seeing a huge demand happening yeah the immigration is resuming back so because of the pandemic there was a slowdown in the net immigration not going back again um we be so that's certainly the change in the population which is increasing but then also what you're seeing is there is a demand for smaller household yeah and what it means is that even if we keep the population consistent there's still a huge need of the household because earlier for example we were like the last time that we saw the average was about 2.6 members per household but now people are going more nuclear they are having their own holiday home people are realizing

that work from home culture or other have you know remote home as well for me to holiday from the beach side so there's a need for the same population to have multiple dwellings for themselves so what we are saying is the average household count per family or the per dwelling is actually decreasing um even if it's a 10 decrease it actually means 10 increase in the demand spot on so that is happening on one side and then if you look at the supply pressure which is a huge one here we have limited availability of land it's yes australia is a huge country as you and i know but developable land as released by the government that yes we can go and do some projects here or even the propensity of an australian to live close to the heart of their

workplace or to their to the community it's only handful of cities that we really want to live in so so it's not really so much so about the land supply but it's more of a developable land where people like to live in so it's really limited in the sense that the councils are not really releasing land for development there's always a pressure from the community to you know there's always a position typically saying that they're always opposing some development they feel as a general nature that we try to oppose any change so that's really happening but then the construction costs are going up significantly yeah about 40 percent is uh numbers i've heard about 40 increases in building costs uh over the last 12 months or more yeah so it's actually coming down

a bit like yes at the peak it was about 40 like if you look at the cost of timber and whatnot but now it's more of a challenge the supply chain as well um so it is probably coming to i guess it's coming back normal but it's still a long way to go but then the labor cost is also going up yeah yes we have a huge immigrants coming in this country but the kind of regulations that we have it's not really like anyone can just go and become a big player so we need to have a focus a lot more on the education side of things having that productivity around it that the supply can build up very i mean on the sidelines as well yeah so yes on one side we are talking about population increase and here we are talking about a labor shortage so things around productivity things

around education around it the job fund as well like we are pretty lucky country that we have unemployment rate of about 3.5 percent yes it will come down to maybe also come up to maybe 4.2 4.3 you know 4.5 which is still very good number very very good number yeah so the challenge is that okay how do we tackle this thing like we are still i guess our employment rate is very good um but then how do we manage this construction cost and what we really see is that cost is more around the inefficiencies around the i guess red tape or call it as a texas on the whole building side of things or even just the stamp duty for that example um there's quite a few tech stations that are going in um which is making the supply side very limited if you see what really is going on in the

newspapers as well like lots of construction companies developers are actually going burst yeah so when we really need that growth coming in we really need the supply uh we are actually under pressure that when we see the building approvals they have been declining and sharply about 40 down though or nearly 50 down in some areas so we we've got this massive increase in demand and we've got this shrinking supply exercise it certainly feels a little bit like there's been a bit of an opportunity missed uh from the budget perspective in those terms but uh just to wrap it up then uh rusty uh what should property owners buyers and investors be doing and acting on from here yeah so understanding that the supply and demand we are in the shortage of properties the

people who are looking to move in the properties they are happy to pay more rent then we also see that the inflation is actually towards a higher end and it will certainly come down ease it uh eventually so if we first of all we should be thinking about property investing as a long-term investment it should never be considered as if like what's really happening the last quarter this quarter or next year it should be more around okay are we good to hold this property for next 10 15 20 years yeah so when we see from that perspective from that lens of long-term investment the long-term trends should be studied yeah and what we are seeing is this supply issue or and is not going to go away very quickly the demand will continue to go from here even the report

itself in the budget is we are talking about there's a deficit of 106 000 homes by 2027. yeah now sometimes it's not really about the quantum it's about the marginal shortage and the marginal supply yeah and that tells me that it's going to be consistently short-aged that means there are more people fighting for the same property yeah now what it means is that when you combined for the long term yes the inflation is going up yes we had a very good you know 11 heights recently but again that's very nominal when it comes to the average for the long term this is not too far from where we are but if you look at the trend maybe for the next six months the inflation pressure might ease out or at least the interest rate might not go further up so it

means we are pretty close to the plateau and it will only become it becomes easy eventually uh for people to hold especially when the rents are rising yeah the holding costs are low and we are buying for the long term for the capital growth yeah it certainly makes sense for the savvy investors to reconsider what's really going on look from the lens of the long-term perspective and where i see you know it's not every property is the same you know as a proposition and that's where one should be doing due diligence on the same factors because it's not one homogeneous market it's a heterogeneous market if you can go by and look at the the dynamics of supply and demand of a particular neighborhood and then study it and then make a call you and i know that huge

number of people have made money through property investing irrespective of what is the flavor what is the sentiment yeah i would actually on the way further make a point that when sentiment is low it actually means it's a buyer's market absolutely and that's where we should be taking benefit of low competition among the buyers and whenever there's a good opportunity in the good area we should go and reconsider our numbers but again we have to be very mindful of the risks we are taking because the challenge that sometimes people have is that they over leverage without really thinking about their what-if scenarios or what if you know this might happen what happens to their life or you know their income stream so as long as we are aware of

the risk we are taking it's certainly worth considering opportunity to take benefit of this uh supply demand inequality that we are seeing today totally agree and i think the the other points that you and i have spoken about before that are key in this when you're taking that long-term view is focus on quality over over low price make sure you're investing in your education and of course making sure you surround yourself with a an a team of independent professionals who can cover each and every element of the exercise. So, well, mate, really appreciate you coming back on the show today to really unpack the budget for us and what it means.

And thanks for your very timely interpretation of that. And thanks for joining us on the show today. My pleasure. Thank you so much. Thank you, Rusty. Well, as you've just heard, while the latest budget measures are a small step in the right direction, on the large part, they appear to be token measures that are playing with the edges of the symptoms

rather than really addressing the central housing supply side issue, which is actually the cause. And this is at the heart of most of our property issues, and this has actually been brewing for decades. So the Teflon days of short-term reactive hands-off finger-pointing by all levels of government and imaginary private sector villains really needs to stop. And the public sector needs to step up, take responsibility,

and address housing supply through long-term proactive policy and provision. rather than the blame game aimed at individual hard-working mum and dad investors who just aren't in a position to shoulder this tremendous burden. Stay with us for more here on your Property Hub's Realty Talk, your trusted voice for all things property. As one of Australia's most outstanding buyers agents, Kate Bakos has a wealth of knowledge and experience

when it comes to helping families secure their dream home or the perfect property to add to an investment portfolio. So who better to talk to about successful negotiation than Kate Bakos? And this time, I talked to Kate about the key attributes of a top negotiator and how you can pick the best one to help you get the best price. That's coming up next. 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 find residential investors almost $9,000 in first full financial year deductions. Call BMT on 1300 728 726 today for an obligation free quote. Oh, this is going to be a tough one for our guest Kate Bakos in this series. We're talking about top negotiation tips but now i'm going to ask kate you know what what are the traits of a top negotiator kate have you thought about this i mean what are the skills that you are constantly honing up and really the reason i'm asking this is because someone who's looking at engaging a buyer's agent they'll want to know they're getting a good one so what should they be

looking for wow it is a good question there's quite a few attributes so let me talk about what i think is the most important one and that's patience you can't lose your nerve you can't get angry you've actually got to be considered and strategic the whole way through so i'm out of it already there's no room for being irrational you've actually and you can't let it get personal either so if i'm ever a little bit more feisty or a little bit firm with an agent during a negotiation it's absolutely measured it's not an emotional outburst and the next one is you need to very well equipped with with information and that is really your comparable sales analysis you have to know your values because if you want to get into an argument with an agent about defending

your offer versus their asking price you've got to be able to point to some data and be really compelling i think the next one is understanding people so we've talked about asking lots of questions you have to you know ask questions shut up make sure you've got all of all of the information that you need to make a balanced decision another one is is not being lazy you absolutely have to be hard working because some negotiations will brew into the night and beyond midnight and if you're not on things can change sentiment can change I remember when I first started as a cadet years ago in a sailing office and my my boss at the time lovely guy just said to me always strike while the iron's hot and that's because there's momentum there if you put

something on ice or if you think i'll come back to it tomorrow people can change their mind or you know just get a little bit less excited about something so you need to move quickly and i think a really important one is you have to be personable if you if you're struggling to get along with people you're negotiating with it makes for a tougher negotiation so while you can get in a ring and wear your boxing gloves if you respect the person and it's not unpleasant you can get a great outcome. Talking about the third one the third point you made there was talking about asking questions and showing interest I think and I think this goes a long way to building that relationship between you and the buyer's agent to start with you know if the

buyer's agent's not asking you questions about you your lifestyle your family they're really only going to be ticking off you know how many bedrooms you want how many car parks you want and so on so all of those all that stuff is meaningless unless you understand how those features are going to be used because quite often kate i've had people come to me and say i want a three-bedroom house and two bathrooms and they end up buying a unit you know two-bedroom unit with one bathroom it's because you know and the agent or the buyer's agent hasn't really listened and tried to make an assessment based on what they've learned is that fair comment very fair whenever we talk to clients about a new brief you know there's there's four essential elements and you've got to work out the

hierarchy so first is price and preferred budget or absolute limit the next one is the land size next one's location and then the last one's a style size of the dwelling or condition of the dwelling and if you work out very clearly what you feel their hierarchy is you can pivot on some of the other things i mean if their hierarchy is i must be in this particular postcode it's no good showing them stuff outside of that postcode but you might show them some different dwelling types or different land sizes so you're right you do need to know your client and beyond knowing what they're looking for what they want as a product you also need to get to know how they like to be communicated with and how they think they deal with high pressure situations because when you're

negotiating if you've got someone that's crumbling or someone that absolutely needs to talk to their partner before giving you an instruction or someone that is likely to get jittery or very nervous anxious you've got to be able to equip them for what's ahead and support them accordingly you don't want to be ringing someone with gentle updates and striking them if they're ambivalent and they're busy at work you have to get to know your client okay every buyer's agent in australia should watch what you just said because that's the best little bit of a buyer's agent training i've ever heard so thank you so much it's wonderful always great talking to kate bakos she's a very talented lady and she is our go-to person we're talking about negotiation how to work

with buyers agents and so on we're going to wrap this series up with our final question of kate and that is um how actually you touched on this one earlier in the series and i think that is where you asked in the negotiation process what's the motivation of the seller and you know it's one small question but it's one question a lot of people don't ask because a lot of people don't think they have the right to ask it so that's what i'm going to ask you when you come back how do you ask it do you ask it and how important is it kate bakos will be back with us again in uh in our next episode we'll look forward to seeing you then thanks kate can't wait see you soon and that's a wrap for this week's show another big thanks to our guests rusty bipath nicole davidson john

linderman and kate bakos and before we go make sure you don't miss another episode of your trusted voice for all things property by subscribing to the property hub on your favorite podcast player now where you'll also enjoy the get invested podcast delivered to you each and every week thanks again to realty.com.au bmt tax depreciation apiro marketing dm media and southern cross austereo for all of their ongoing support i'm bushy martin from know how property finance and along with kevin turner and the entire property hub realty talk team please remember that a wise person does at once what a fool does does at last they both do the same things just at different times that's food for thought and we 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