Property Hub - Investment Insights & Inspiration - Realty Talk - New Management Style Shapes Opportunity

Episode Date: May 25, 2024

There are 2 schools of thought in the property management area.  One is a need for specialisation by having your property managed within a team environment and secondly that your point of contact should be with one person only.  So, do you value the quality of the communication or the importance of a deeper skill level of the manager/managers.  You might have heard the phrase “a man is not a plan’ when it comes to a single woman's concern about financial security.  We look at ways to bridge the property investment gender gap in what is a male dominated industry. Subscribe for free to Realty Talk on the Property Hub channel, join our community and get more insights here: https://linktr.ee/propertyhubau 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.See omnystudio.com/listener for privacy information.

Welcome to this week's RealtyTools show. There are two schools of thought in the property management area. One is that there's a need for specialisation by having your property managed within a team environment, which means that you're likely to be talking to several people in that team about your property. And the second point is that your point of contact should be with one person only, And that means that that one person will need to be across every aspect of the management of your property. There are obvious benefits to both. But the question we pose in today's show with David Woolfel from the National Property Management Institute is,

do you value the quality of the communication or the importance of a deeper skill level of the manager or managers? say, a niche area of the overall management. Well, David talks about the bigger and broader opportunity that this presents for property managers, and it might even give you a bit of a better insight the next time you need to engage someone to manage your property. Now, you might have heard of that phrase, a man is not a plan. Well, that can be applied when it comes to a single woman's concern about financial security. Karen Lachita Pell speaks to us about bridging the property investment gender gap

in what is a very male-dominated industry. Hey, before we start, we want to thank our supporters and content partners, Realty.com.au, BMT Tax Depreciation, Know How Property Finance, Get Rare Property and Apiro Marketing. And if this is in fact your first time with us, I want to wish you a big welcome. And you're going to find us on all podcast players

and through the Southern Cross Oz Stereo Network. If you like the show, and we certainly hope that you do, you can really help us by hitting that subscribe button. That way you can help us continue to bring you the best guests every week. Don't forget too, you can join the conversation anytime on Facebook at the Property Hub Collective. We'll be back in just a moment

as Bushy kicks off this week's show. Property deductions can save you thousands of dollars each year. To make sure you maximise deductions, you need to work with the most experienced quantity surveyor in the country. BMT Tax Depreciation is the leading specialist in the industry.

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. Realty Talk and your host, Bushy Martin. While the age of narrow specialisation has deepened the expertise of skilled niche professionals who focus purely on their piece of the service jigsaw,

there's a danger that this singular focus results in experts losing the ability to see the forest for the trees, with increased risk of important things falling through the cracks for both themselves and their clients. And nowhere is this more important than the world of property management, where property managers enjoy the longest intimate relationship with you as an investor, landlord, and your property. So given the pivotal trusted relationship of property managers, is there a bigger and broader opportunity here for smart investment managers to better enable and add value to you and other landlords? And if so, what does this look like? Well, to discuss this as part of our continuing property management feature series, we're

joined by leading property management trainer and consultant, David Woolford, the driving force behind the National Property Management Institute. So welcome back to Realty Talk, David. Thanks for having me again, Bushy. Great to see you again. Now, a great topic, this one. So, again, I think just to set the scene, can you shed some more light on the traditional role

and responsibilities of good property managers? Yep, certainly, Bushy. Traditionally, property managers have been seen as the people that you go to to find a tenant. So it's seen as being probably the first step in the process, finding a tenant, and hopefully all they need to do from then on is collect the rent. Unfortunately, though, they do have to look at some other areas

of the relationship with the renters and the landlords, such as ensuring the rent gets collected if there's an issue and arranging things like maintenance. So if there's a problem, they're the in-between person dealing with the tenant, the owner and tradespeople, dealing with any kind of problems as they arise. If there's difficulty with renters paying their rent, if the renters are causing damage to the property,

they've got to be able to deal with that and also answer some questions from rental providers when they've got concerns. So traditionally, that's probably what property management has been seen as. Yeah, very good call. And I think it's fair to say that given the increasing legislative requirement around property management,

anyone who will be foolish enough to think they can handle that situation themselves without a professional on their team is taking a massive risk. But given that traditional role and that very important role at the centre of things as far as that goes in terms of protecting the landlord's interests, what other areas do you believe property managers should be more aware of and why in order to add further value

to their relationship with their rental provider landlord clients? Well, property managers or business development managers who are the ones that go out and get the new business, but really in a lot of cases they're the only point of contact a lot of mum and dad investors have had they they wake up and more than think let's buy a house for an investment they haven't looked at financial planners and accountants and so we need to be aware as a property management community things such as ownership structure you know is it a 50 50 ownership or a 75 25 99 1 or a self-managed super fund or a trust what's the best area there that or what what you know

we should know these things we can't give advice on it we're not licensed to but we need to know it so as we can refer um property owners onto the right people to make sure they're getting the most financial benefit out of it that also gets accompanied by loan structure principal and interest interest only fixed rate variable rate a bit of a mixture moving down to depreciation and the benefits of depreciation and if they're looking at buying a new house or at home for investment do they want to get home depreciation is their aim to reduce the tax or after they are they after an income understanding depreciation gives can give a huge financial benefit as far as their tax reduction goes yeah and the other thing that we should be looking at referring off

to somebody else is the importance of bills and power of attorney. If a property is owned by a couple but it's only in one person's name, what happens if that person ends up in hospital and unable to deal with the property and the property management? The other partner needs to have a power of attorney to be able to deal with it. Otherwise, they can't access that money or do anything with that property.

So really, really important in my opinion that property managers, they can't give advice, but they've got to have a really good understanding so as they can determine if that client needs to be referred to someone appropriate and give them advice. Yeah, well said. And let's face it, property is definitely an elite team sport and it's really important to start with the Indian mind and have the right players and the right team at the right time

to get the best result. And there's no better place to direct that traffic than a property manager given they're pretty much the go-to person for a lot of, particularly first-time investors, but as they go through. So given that context and the sort of broad opportunity there to offer a total solution to investors and rental providers, what, if anything, are the limits on any of this and why is this broader orchestra-leading,

holistic traffic-directing role important, do you think? the main issue that prevents um prevents an overall service or lowers stops the overall service i guess is that property managers aren't licensed to give financial advice and those areas that we spoke on one's legal advice but the other three are financial advice we really can't be getting into advising on that we need to understand it but we need to have the relationships with whether they be financial planners or accountants who can, under the ASIC guidelines and the ASIC laws, give the right advice to those people.

They'll dig deeper into their personal financial circumstances and they'll be able to say what's best for their situation, which as property managers, one, we're not trained to. Two, most property managers don't have the time to go digging deep into a financial circumstance as well. Yeah, well said. And I think the benefit there is that with property managers who have a sort of a, they touch all points of the compass on this exercise to some degree, can ensure that things don't fall through the cracks. Because I've seen some specialists who just focus on their bit and what they don't realise is that it might be a benefit for what they're doing, but might have a flow on effect to another component.

So a finance broker might be suggesting something that's at odds with the accountant, who might be at odds with the buyer's agent, who might be at odds with the quantity surveyor that's doing the depreciation and the estate planning at the end of the day, given that, you know, eventually that needs to be changed. The legal side is really important in all of that. So certainly the property manager has a key role in that. Given that opportunity, how can landlord rental providers identify property managers who are adopting this sort of broader, more holistic approach to total investment property performance? I think the rental providers need to be really focused on asking the right type of questions when they meet the property managers. More so if the property manager doesn't bring up the points, I think. I think, you know, a good property manager or business development manager will raise these issues and say, have you thought about this? But if they don't, it's asking the questions and seeing if they've at least got an understanding of what you're talking about.

I get concerned when you do talk about ownership structure and people look at me with a blank face, you know, well, they don't understand what I'm talking about. You don't need to go into a lot of detail. You don't need to learn a lot. You just need to understand that this stuff can affect people and a few bits and pieces to explain why it's something they should be getting looked at. Absolutely. Well, some of the things you've touched on, the cost benefits of depreciation of the loan structure, even if that's tweaked the right way, can have a massive impact. The ownership structure can also impact on cost and risk. So there's some pretty massive benefits there to landlords who understand that.

And property manager can be the person who can point them in that direction. So, look, again, I want to really thank you for drawing our attention to the need for property managers to better serve their landlord investors by adopting this broader total solutions focus, David. And we encourage anyone who'd like to find out more to contact you at Wolfall & Stone or the National Property Management Institute by clicking the links in the show notes. So thanks again for sharing your generous time on Realty Talk today, David. 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.

Know How 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 This is Realty Talk powered by realty.com.au Are you or a woman you know struggling to get ahead financially? Perhaps she's concerned about her financial future and whether she's ever going to be able to afford to buy a property to call home. Or maybe she's worried about how long she's going to fund her and how she's going to actually fund her retirement. Or maybe she's nearing retirement

and worrying about that she'll have to go back to work or keep working until the day she drops or learn to survive on toast and two-minute noodles as her income potentially drops off the cliff when she tries to stop work. She may be your sister, your daughter, mother, auntie, mother-in-law, grandmother, cousin, work colleague, or a close female friend. Chances are you personally know a number of these women, even if you're not aware of their personal situation. Because unfortunately, the gender pay gap and maternity leave, alongside increasing rates of divorce and separation mean that one in three women stop work with no retirement savings at all, and those that do manage to save often end up with less than half the retirement funds of we mere males. And with

half of all marriages ending in divorce, and many women remaining the primary caregivers for their children, there are increasing numbers of women sadly winding up homeless after a relationship breakdown or in their twilight years because they just haven't been able to buy a home of their own or create their own financial independence. Now, these are shocking stats in this day and age. So what can you or other caring females do about it? Well, yep, you guessed it, get invested in property. But this is easier said than done in a male-dominated and male-oriented industry. So where do women go to find property buying and investment knowledge and support that's better suited to their caring way in the world well up until recently pretty much nowhere but

now a buyers agent has initiated a national buyers advocacy that's exclusively for women by women and the founder of appropriately named invest her karen lachetta pearl joins us now to reveal the details so welcome to the property hubs realty talk karen thank you bushy thank you for having me and those stats are indeed alarming so i i'm this is why i'm here so i'm glad to be here thank you. Absolutely well I guess to kick things off then Karen and to expand on my opening comments can you give us a bit of a sense of the gender disparity in property investment between genders in Australia? Yeah absolutely so I mean to start off perhaps on a more positive note we do know that overall dwellings and that includes owner-occupier homes 68% are owned

by females versus 67% owned by males. I did not know that. So that's certainly a positive note. In terms of investment properties, Bushy, we see that sort of slight shift. So where we have 14% of males own at least one investment property versus 12% of females that own investment properties. so what that tells us is that as females we see the value of property we see the importance of

having property but we're not tapping into that equity so we don't we're not perhaps looking longer term about how we can really maximize property to our advantage there are some you know indeed alarming stats as you sort of touched on in your introduction around specific sort of groups of women so certainly those boomers so you know we know that after a divorce or separation only 34 percent of women actually go on to buy a property in their own name within five years after that it goes up to 44 percent within 10 years so when you see stats like that we're starting to understand why women over the age of 55 are now the fastest growing group of people who are now homeless in Australia and I recently saw a stat that said 700 women

will sleep in their car tonight in Brisbane alone so for me that's quite shocking and that's from a a really great charity called the forgotten women and it's a housing initiative for women over 55 and i recommend everyone have a look at this charity one for obvious reasons to support it but also for women who are considering property if i can't convince you to get into property today i think you know these women who are real life cases of you know they once had it all so to speak they've come out and they're now they're living in their car so yeah i think that that's just a really valuable um lesson to to be to be learned from from women who have gone through it themselves absolutely agree well dig into it a little bit more than karen what what unique hurdles and

challenges do women encounter in real estate investment as opposed to men yeah i mean the obvious being raising enough capital for the deposit um or servicing the loan again those women coming out of divorce who have had you know career breaks and don't necessarily have the full time jobs to to service the loans um you know again we can talk about the gender pay gap we know that that can is is still an issue for us um taking career breaks to raise children or look after elderly family because again that sort of is is you know leads into the female responsibility um be that right or wrong um and obviously child care child care so expensive it gives very little incentive for a lot of women to go back to work in that short term because they're effectively

only paying for their for their child care rates um but i think will she for me what i personally think is that there's three key things hurdles that women really um are struggling with when it comes to property investing and i think that's uh our emotion and confidence but it all comes from the grassroots of education so if we have the right education if we're teaching females if we're and you know there's information available widely but perhaps we're not um approaching it in a way that is interesting enough for females or that is you know resonates with females if we can educate them more about all of you know finances investments how to get involved then i think that will then give us as as a group it will give us confidence it will give us um you know educated

decisions and we'll go on to hopefully grow investments yeah very good points well and you probably touched on this a little bit already then but why is it that many women who actually have the financial ability to invest in property often don't proceed yeah and as i said definitely we're talking about emotion confidence and that all comes from our education about you know finances and investment as a whole so i guess you know we wouldn't you wouldn't be comfortable in making an educated decision if you don't have the right knowledge and as they say knowledge is cower and that's something that we need to provide more for women and give them a better understanding I think there's what we see particularly with women is that there's this false sense of security with cash.

Women like to hold on to cash because they don't believe that to them that represents security. But where we can teach them more about, you know, tapping into equity and leverage and inflation. And we talk about all these points, we can start to really paint a picture for them how keeping, you know, $100,000 in your bank is not actually going to be a safe and secure long-term option for you. So I think it comes down to really going back to basics. And I say that in the most respectful way because everyone is, you know, an expert in their own field. but let's talk about the simple things like how to tap into our equity like inflation by doing so we're then you know educating women on how they can utilize their money and make their money work for them um yeah yeah well said i guess you know my good wife and i have been active

investors in property for a long time and the way she's looked at it is given the sort of natural nurturing ability that that females come with she treats our properties as as children and you've got to nurture them you've got to look after them they grow exponentially over time so if you start to present things in a language that that people connect with then then they're going to have more interest they're going to get more engaged and then they're going to see the opportunity and and sort of make the steps necessary so i so i love that i guess within that whole context then how can all this be improved and overcome and and what are you personally now doing about it then carol yeah well as you mentioned women are wired differently we respond differently that's why

there's different marketing techniques for everyone but it's the same way when we start to talk to our clients we want to be talking first and foremost educating them so that they feel comfortable we want them to feel like there's no silly questions that anything can be brought forward to the table and we can answer those questions it's perhaps a slower approach but it's about creating long-term relationships and building confidence in that you know female to be able to then you know execute and make a decision we have clients that have you know come to us we had one client for example who came to us in October last year and she's almost there but not quite ready and we've nurtured her through the process and we're educating her and she asks

asks questions and we continue to you know be able to give her that support while she's on her savings plan so it's definitely more of a long-term relationship we're not transactional we don't say here go here's a box of chocolates thanks very much and um good luck on your journey uh we we hold their hand through the process even if they're not just ready just yet um and then afterwards that continues so we we continue to do appraisals um for them and their property so yeah it's very much holding their hand being a part of the journey with them and also just as i mentioned educating them along the way no question is a silly question and we want them to feel comfortable in in coming to us and asking for for our help where we where they need it yeah

beautifully said now again you've covered off my next question pretty well already i think but in the context of invest her uh how and what are you going to do differently in the context of the special needs for women moving forward uh and i guess why why just women because there's a lot of buyers agency you say they'll look after women as well as men you're you're coming out and saying well it's we're exclusively going to be looking after women can you sort of talk to us a bit more about that yeah well obviously yes we um you know are talking to women but what we do find bushy is that we have a lot of women coming to us with their partners so which is great because that shows us that females are stepping up in terms of getting involved in their finances

getting involved in their um you know their investment strategies and generally those females that come to us are usually the spokesperson for the pair and they actually They usually sort of dominate the conversation and the questions. But I love that. I love to see that because, for me, I just think, well, you know, we're growing a whole new, you know, generation of women who are actively involved in their finances and creating wealth and feeling that security and confidence in doing so.

So, yeah, whilst we, you know, are for women, we definitely work with females and their male partners in that instance so yeah yeah well said and i'm not sure about uh how you operate but i know with the the people that we've worked with in the past if both partners aren't on board if if one's going home the other isn't then that's a that's a sure uh path to disaster because eventually it's going to become a problem uh it's really important that the the active partner whether it be the female or the male is actually taking their partner on the journey so that they're both aligned and when the opportunities

present themselves and the obstacles that often come up in property, they're better placed to then tackle those together and get the right outcome rather than one knee jerk and throw their hands up in the air while the other one tries to struggle through. So, look, I really want to thank you for coming on board today, Karen, to open our eyes and ears to this gender-centric initiative that you've created and for those listening and watching that want to explore the opportunity more

we suggest they reach out to you at investherproperty.com.au that's invest the h-e-r property.com.au by clicking the link in the show notes and we thank you again for joining us on the show today karen all right thank you bushy are you curious about harnessing your super for property investment? Propel your future with the enlightening online seminar, The Ultimate Masterclass to Self-Managed Superfund Property Mastery. Reserve your spot now at getrare.com.au forward slash SMSF. Spearheaded by Rasty from independent buyers agency GetRare Properties, this masterclass unravel strategic property investment using your self-managed superannuation fund you know it's not just about learning it's about transforming your financial future through education so embrace this

opportunity to enrich your investing acumen enroll now in the free master class and begin a journey that marries insight with action leading to a financially empowered tomorrow unlock bonus content now as a premium subscriber and that brings us to the end of this week's show make sure you don't miss a single episode of this show realty talk or bushy's get invested podcast both delivered to you each week and you can do that by subscribing to the property hub now on your favorite podcast player or wherever you are listening to or watching the show that's The Property Hub. Subscribe now. Also, too, you can join the conversation anytime on Facebook at The Property Hub Collective. Before I go, I just want to say a big thanks to our supporters

and content partners, Realty.com.au, BMT, Tax Depreciation, Know How Property Finance, Get Rare Property, and Apiro Marketing. I'm Kevin Turner, and on behalf of Bushy and the Property Hub team, we look forward to seeing you again next week. Thank you.