July 2, 2025 • 32 mins
Looking to grow wealth through property but can't afford your own backyard? JP Gabriel, founder of Investr buyer's agency, reveals to Joe and Michael his powerful strategies for navigating Australia's challenging property landscape.
JP shares his personal journey from tech professional at LinkedIn to successful property investor, building a portfolio across three states. He tackles head-on the biggest conundrum facing potential buyers today: "I want to buy my own home, but I'm either scraping the bottom of the barrel or I can't even buy something I really want to live in."
JP explains his investment philosophy: "Capital growth is the game, but cashflow keeps you playing it." He draws brilliant parallels between property investment and stock market strategies, asking why young investors chase growth in tech stocks but often prioritise yield in property.
For those weighing interstate investments, JP offers data-backed insights on the Queensland versus Victoria debate. After "nine years of growth in a four-year period" in Southeast Queensland, he believes Melbourne now presents compelling opportunities as the only state where housing affordability has actually improved.
Whether you're a first-time investor or looking to expand your portfolio, we're providing the strategic clarity needed to make confident property decisions in today's complex market.
Follow us for more property news and mortgage advice!
▸Website - https://itssimple.com.au
▸Instagram - https://www.instagram.com/itssimplefinance/
▸Facebook - https://www.facebook.com/itssimplefinance/
▸LinkedIn - https://www.linkedin.com/company/itssimple/
DISCLAIMER This podcast contains general financial information only. That means the information does not take into account your objectives, financial situation, or needs. Because of that, you should consider if the information is appropriate to you and your needs before acting on it.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
the biggest conundrum that they have is I want to buy
my own home, but I'm eitherscraping the bottom of the
barrel or I can't even buysomething I really actually want
to live in A lot of people inSydney.
Speaker 2 (00:11):
they face the same pain point that you just brought
up with they can't buy theirown backyard anymore.
Speaker 1 (00:17):
Capital growth is the game, but cashflow keeps you
playing it.
Very rarely will you findpeople our age buying stocks
like CBA, BHP, Rio Tinto.
Why?
Because they are dividend yieldstock.
But there is a very strongreason why everyone our age are
in the accumulation phase arebuying Google, Amazon, Tesla.
(00:37):
Interesting why?
Because they want to buy in at10 and sell out at 20.
And that is capital growth.
So why would people treat theway they invest in property
differently, the way they investin the share market.
Speaker 2 (00:46):
Mount drew has outpaced cash okay by 20 since
2020.
There was a mansion that soldin mount drew it for 2.3 million
dollars.
It's starting to become amarket where, if you take
advantage of the land, you willaccelerate your wealth quickly
(01:07):
Queensland or Victoria right now.
Speaker 1 (01:09):
It's a million dollar question how long have we got?
Speaker 3 (01:11):
Okay, so Welcome to the Finance Show with Joe.
He's Joe, I'm Michael and wehave a very special guest today.
Jp, how are you going?
Thanks for having me, guys.
Speaker 1 (01:23):
Thanks for having me.
He's definitely special guesttoday.
Jp, how are you going?
Thanks for having me guys.
Thanks for having me.
He's definitely special, he'sspecial.
Speaker 2 (01:27):
I'm extremely excited to bring JP on, because JP and
I have been collaboratingrecently and just discussing how
we could work together.
He's got a very similarpersonality to myself, which you
guys are about to get to know,but on top of that he works in a
new buyer's agency.
You guys have been around forabout 18 months now, am I
(01:48):
correct?
Yeah, that's right.
Speaker 1 (01:49):
So just I was just saying, before I incorporated
the business in February of lastyear, my background before that
was actually working in tech.
So I worked at LinkedIn forfive years, some other tech
startups and stuff, and thenpeople often go.
You know well, how did you getinto that?
I bought my first investmentproperty back in what 2018, I
(02:10):
think it was and you know I hada good year at work and I
thought, oh, you know, I shouldprobably do something with this
and I've got.
You know, my cousin who's abuilder, other cousin who's an
architect, his wife's a townplanner.
People around You're not Arabat all are you.
Speaker 2 (02:21):
It has to be from West Australia, yeah it has to
be With that network.
Speaker 1 (02:24):
Yeah.
So since then I built up aportfolio, you know, across
Queensland, New South Wales andVictoria, and I'm super
passionate about anything andeverything investing.
So, yeah, my business is calledInvestor.
Speaker 3 (02:35):
How you nailed the name Investor, or simply
dropping an O, is incredible.
Speaker 1 (02:40):
I have no idea.
I mean, I think the namingconvention I really like.
I think because I come fromtech.
Naturally they love putting theR at the end of something you
know.
Tech, company with sipper withan R?
I don't know.
Drink tech, I don't know.
You get my point, but the factthat I'm now the domain.
I have no idea how I did that,but I just got lucky.
Speaker 2 (03:02):
Same happened with me with it's Simple.
I had people ask me.
They're like itsimplecomau wasavailable.
I'm like yeah.
That's great, I'm like I'mgenuinely surprised about that,
so it's great to hear how youstarted off.
The business is called Investor.
Speaker 1 (03:14):
Yes.
Speaker 2 (03:14):
You're focusing on investment.
Speaker 1 (03:16):
I only work with investors.
Speaker 2 (03:18):
When did you recognize that was your niche?
Speaker 1 (03:20):
Yeah, okay, when I talk about my business, I talk
about myself.
How humble of me.
And that's because I believe,as a small operation, with just
me and one or two other kind ofsupport staff, the business is
built around me and people'strust in me as a person and
people hopefully trusting meenough to be doing the work for
them to achieve the results.
(03:41):
So, to come back to yourquestion, when did I decide that
was my niche?
I am an investor at heart.
I achieve the results.
So, sorry, to come back to yourquestion, you know when did I
decide that was my niche?
I am an investor at heart, likeyou know, and….
Speaker 2 (03:48):
I am the niche Exactly.
Sorry, we're full Stallonethere.
Judge Dredd 97.
Speaker 3 (03:55):
He's got the headphones.
Speaker 2 (03:56):
He's like Jesus, all blokes go on death.
Speaker 1 (04:01):
Yeah, so I'm an investor, right.
So I said to myself okay, theonly way that I can serve people
is in the way that I know best,and what I know best is
property investing right.
And I made it my business toread the blogs, to listen to the
podcast, to read the books.
The first book I ever read thatwas actually given to me by a
friend of mine.
It's called my Four-Year-OldProperty Investor, by Cam
(04:24):
McClellan, and it's written fromthe perspective of this guy,
Cam McClellan.
He actually has his own buyer'sagency, I think it's called
OpenCorp Plug OpenCorp.
Speaker 2 (04:32):
Everyone's got a buyer's agency.
These days.
Speaker 1 (04:37):
That's right.
A lot of Egyptians, apparentlyI.
It's written from theperspective of a father
explaining property investing tohis four-year-old daughter.
Speaker 3 (04:44):
Oh, so it's like an.
Explain it like a five.
The subreddit.
Speaker 1 (04:47):
Exactly, and you know , it was kind of like this whole
Pandora's box.
I'm like, wow, there's suchdepth to this topic and to this
world, and yeah, so that's kindof how I started my journey.
Then I bought my first propertyand, you know, at the time, you
time, I bought a duplex sitebecause I want to buy a duplex
site.
That's what everyone wants todo.
Speaker 3 (05:05):
Don't worry about it, I'm building them soon.
Speaker 1 (05:08):
I made it my business to understand investing from
the ground up.
I bought my first investmentproperty in my own backyard in
Greystains, because that's whatyou do when you just say, okay,
I'll buy my own backyard.
That's what I'm most familiarwith.
Speaker 2 (05:18):
They say dupees everywhere.
Speaker 1 (05:29):
And that's the thing.
Speaker 3 (05:29):
I haven't even developed it, I'm just sitting
on it, but it's yeah, good block, or what have you, and it's
funny, I um the year I bought it.
Speaker 1 (05:32):
Uh, I found an article.
My dad had sent me an articlefrom 2018 saying sydney worst
property downturn in.
However many years trying to,like you know, basically scare
me off.
Speaker 3 (05:37):
Yeah, yeah, yeah, it was just funny, like so pull the
trigger.
Speaker 1 (05:40):
And then I went back to my broker and I'm like, oh my
god, that was so much fun.
And I remember I signed thecontract physically, not the
docusign yeah, I don't know why.
it wasn't even that long ago,like seven years ago, um, and
signed the contract gray sandshops, and I remember how
deflated I felt and I was like,wow, like I can't believe that's
over.
Like I loved it, I loved thewhole process of it and went
back to my broker and he told meget fucked.
Like you got no money and youhave no equity, so go away.
(06:03):
Then 12 months later I wentback to market I was like, oh
cool, I've got $650,000.
What am I going to do?
Can't buy in Sydney.
Then I started exploring theconcept of investing interstate
Brisbane, ended up buyingsomething there.
That's how the whole investingthing and the interstate
portfolios built out.
It was just out of necessity.
Speaker 2 (06:29):
I couldn't afford to buy in my own backyard anymore,
so I had to.
I was forced to look elsewhere.
You know so a lot of um, a lotof people in sydney and in our
personal inner circles.
They face the same common painpoint that you just brought up
with they can't buy their ownbackyard anymore.
What are the most common painpoints that you're seeing?
Speaker 1 (06:39):
so I'd say the most common one, or the, I'd say, the
biggest conundrum that theyhave is I want to buy my own
home to live in.
And you would hear this all thetime.
Right, I want to buy my home tolive in, but I'm either
scraping the bottom of thebarrel or I can't even buy
something I really actually wantto live in.
So should I buy?
Should I scrape in in Sydneyand buy something I don't want
(07:00):
to live in, or should I justconsider buying an investment?
Right?
So people are at that rentvesting crossroads.
I would say that's the biggestconundrum and you would see it
just as much.
Speaker 2 (07:10):
I actually had a rant and I disagreed heavily with
rent vesting for a period oftime, but unfortunately, due to
the lack of supply in Sydney andSydney being the largest
economic hub of Australia, wedon't have enough supply here.
So we need people to considerrent vesting, because that's the
fastest way to grow equity andnot rely on cash savings to be
(07:34):
able to purchase a property.
Speaker 1 (07:35):
Yeah, and you really nailed it there, right?
Because let's just say thatsomeone decided that they were
going to spend their $650,000 or$700,000 in Sydney, decided
that they were going to spendtheir 650 or 700 in Sydney.
The problem with those assetsis number one.
Usually, if you're buying a 650, 700k property, that's not the
property you actually want tolive in long term.
You're just buying it to get inhere.
It's a stepping stone.
It's a stepping stone and theproblem is that stepping stone
(07:57):
is not going to give you thepace of growth that you need to
keep up with the property thatyou really want to buy.
So let's just say, the propertyyou want to buy today is worth
one and a half million dollars,but you can't afford that.
So you go great, I'm going tobuy a 700K property If that 700K
property is not in a marketwhere the supply is limited and
there is strong demand for it.
Case in point let's just say anapartment in Parramatta.
(08:21):
Not only are there a lot ofapartments in Parramatta in
Parramatta, right?
Not only are there a lot ofapartments in Parramatta, right,
but the differential betweenthe cost of a unit and the cost
of a house is not in any waydisparate.
In the same way.
It is like in Bondi, forexample, a house in Bondi will
cost you $5 million, but a unitwill cost you $1.5 million.
That's a huge difference.
Whereas in Parramatta, you candrive 10 minutes away and you
can still buy a house for 1.5,but a unit will cost you 800
(08:42):
grand.
That's not a huge difference.
So therefore, the peoplehaven't been forced into the
unit market.
Speaker 2 (08:47):
Yeah, yeah, yeah, there's an oversupply.
Speaker 1 (08:49):
Yes, there's an oversupply right.
So therein lies the problem.
If you're going and buying anunderperforming asset, you're
doing yourself a disservice whenyou want to buy that home in
the future.
I don't know if I've explainedthat well enough.
Speaker 3 (09:05):
No, no, I get it.
So basically, let's say youwanted to live in Parramatta and
you wanted to buy that unit tolive in.
That's fine, that's exactlyright.
But if you wanted to actuallygrow your capital and all that
sort of stuff, your equity not agreat idea.
Speaker 1 (09:18):
Exactly, yeah, exactly goes out the window if
you actually want to live there.
Speaker 2 (09:28):
But usually what I see is people buying subpar
properties or assets in order toget them to a place where those
assets just aren't going totake them.
So the assets that you'reassisting individuals with, they
are either capital growth orthey're cash flow positive, from
what you're telling me.
So when you're helping peopletry and buy in Sydney, but they
don't have enough equity rightnow, they don't have enough
funds you're assisting them withpurchasing an accelerated asset
(09:51):
in another location so that two, three years' time they'll have
the funds to be able topurchase in Sydney.
Speaker 1 (09:57):
That's right and, mind you, I'm agnostic as to
where I buy.
I'm not attached.
Of course I can't spread myselftoo thin, I can't be buying
everywhere at once, but I haveyou know, I make it my business
to understand where I want tobuy, based on a certain type of
brief.
So, for example, if someonecame to me one and a half
million, I would well and trulyconsider Sydney as a like a very
(10:18):
viable investment.
But they're a very viableoption.
But there are like there arethresholds, right.
If someone naturally in my head, if someone comes to me, says
I've got 700 to spend, right bydefault.
There are not many assets.
I would buy in sydney for 700grand, but if someone said to me
, oh, I mean 1.2, I'll go.
Okay, cool.
There are some apartmentmarkets that I would well and
truly buy in, like I own anapartment in ramwick that's
(10:38):
performed really well.
Right, because, again, all thedemand in that specific market
ramwick, eastern suburbs, whathave you?
Northern beaches is the sameright.
All the demand in that specificmarket Randwick, eastern
Suburbs, what have you?
Northern Beaches is the sameright.
All the demand has come out ofthe housing market into the unit
market Because it's moreaffordable, because it's
completely unaffordable Housingis completely unaffordable.
Same thing, yeah, yeah exactlybut exact same point.
But yes, I'm agnostic as towhere I'm buying, any you know
(11:02):
one of three locations any onetime, but usually the first two
are the ones that I'm spendingmost of my time on.
That's just because of thenature of top people I work with
, so usually I'm I have, youknow, an area that I'm buying in
, that is you know, sole focusis on the capital growth.
Then the second one is a balanceof the yield or the cash flow
and the growth, and then thethird is just pure and out of
(11:22):
cash flow.
But I don't have many people inthat third bucket because most
people in there you know, mostpeople that I know in my network
and people that I work with arein their 20s, 30s, early 40s
and they're still in theaccumulation, the build phase.
Speaker 2 (11:39):
You said something there that I really liked it was
in regards to the yield.
Could you just touch on thatsubject just a little bit more?
Like you have people, they'rejust trying to ensure that
they've got, you know, enoughcashflow to be able to maintain
these sorts of properties.
Speaker 1 (11:53):
Yeah.
Speaker 2 (11:53):
Could you just get into?
That a little bit.
Speaker 1 (11:55):
So one of my favorite things to say like I didn't
come up with it, there'svariations of it out there in
the market is is that and I'm afirm believer in this right
Capital growth is the game, butcash flow keeps you playing it.
Speaker 3 (12:08):
Ah, yes, I've seen that around.
Yeah, you've seen that around.
Speaker 1 (12:10):
Some people say capital growth gets you out of
the game.
Speaker 2 (12:12):
Oh, I'm using that every day now.
Wow, okay, perfect.
Speaker 1 (12:15):
And my point from that is that the whole point and
I feel really passionatelyabout this, maybe even just as
passionately about you and theLabor government potentially I
don't know if I was supposed tosay that you talk about it- all
the time.
Speaker 2 (12:30):
Why am I so blank?
No, no no.
It wasn't a negative thing.
It was more of a Laborgovernment.
Speaker 1 (12:38):
Don't say that around me.
You triggered him.
He must not be named.
Speaker 2 (12:42):
We've only got 30 minutes.
Speaker 1 (12:43):
man, you don't want me to go um yeah, so you know, I
firmly believe that capitalgrowth is the point of property
investing.
Yeah, and I'll give you a goodkind of analogy, and usually
when I say this makes it like itmakes even more sense to people
.
Right, very rarely will youfind people our age or people
that are building their assetbase.
We're not absolutely mintedgoing and and buying stocks like
(13:06):
CBA, bhp, rio Tinto, at&t,coca-cola.
Why?
Because they are dividend yieldstocks.
They pay an income.
You go and dump a milliondollars into one of those stocks
, you get a really good cashreturn, a dividend, every year,
right?
But there is a very strongreason why everyone our age are
in the accumulation phase arebuying Google, amazon, tesla.
(13:28):
Why?
Because they want to buy in at10 and sell out at 20.
And that is capital growth.
So why would people treat theway they invest in property
differently to the way theyinvest in the share market?
Correct, right?
Because the point is growth.
So, yes, yield is important.
Cash flow is important.
Because we don't want to gobroke, right, if I could buy
vacant blocks of land and sit onthem, I would do it.
(13:49):
But why I can't do it?
Because I'll, literally youneed cash flow, I need cash flow
.
So to me the point of thedwelling is just to provide an
income.
The value is in the land.
The land appreciates, thebuilding depreciates.
Speaker 3 (14:00):
Yeah.
Speaker 2 (14:00):
Just, I do want to ask you one thing.
So my first investment I'm justgoing to highlight this was an
apartment in Wilco, Athree-bedroom apartment.
It did well because it was athree-bedder I didn't buy a
two-bedder and I bought it offthe plan and great builder.
Everything was fine.
That was both cash flowpositive and it achieved I'm not
(14:21):
going to say tremendous capitalgrowth, but it achieved good
capital growth.
What we're trying to see now,or what we are seeing, is a lot
more people be under the age of30 or under the age of 40.
They're more accepting to therisk because they know the
reward on the other side of itis better off.
Is that what you're saying?
Speaker 1 (14:39):
Yeah, definitely I think that.
Look, it all comes down to whatare people comfortable with.
For example, I'll never say tosomeone you should be definitely
two or three grand out ofpocket per month on this
property, because at the end ofthe day, everyone's
circumstances are different.
So the simple question I askpeople is based on your current
expenses, what, in addition tothis, can you afford to cash
flow out of pocket?
And if the answer is nothing,jp, I need the property to be
(15:01):
neutrally geared, then that isokay.
Nothing, jp, I need theproperty to be neutrally geared,
then that is okay, as long asyou're being truthful with
yourself around what yourcomfort level is.
So you know to your point.
A lot more people are becomingmore comfortable being a little
bit out of pocket becausethey're, you know.
Speaker 2 (15:12):
The low gratification .
Speaker 1 (15:13):
They're starting to understand that, okay.
Well, the point of buying thisinvestment property, or buying
this investment in general, isthat hopefully, it will either
help me get to that family homeone day when I build equity or I
can build equity I can continueto reinvest into, you know, the
growth of the portfolio.
Right?
Because that's the beautifulthing about property is that
when we put $100,000 into theproperty market, we don't get
$100,000 in the market as wewould with shares, right you?
Speaker 2 (15:36):
get a million dollars .
You get a return on capital.
Speaker 1 (15:38):
Exactly right.
You get a return on your, youknow, a $700,000, $800,000,
$900,000 asset, which is thebeauty of property.
And then, when you addadditional properties to the
portfolio, you're not just againadding another $100,000, you're
adding another million, right?
So every time you have thissmall amount to deploy, the
bank's giving you this much,which is the beauty of leverage
and why people are now startingto go.
Okay, well, I'm not going to behell-bent on my yield or my
(16:00):
positive cash flow what have youbut I'm going to focus on, you
know, I'm going to focus on thegrowth.
And I think that there's a lotof misinformation out there
around yield and cash flow.
And look, don't get me wrong,I'm not claiming to know
everyone's situation or say thatpeople should be out of pocket,
but I think that people need toknow that.
You know, if you have twopeople and one of them has got a
neutrally geared or positivelygeared property that hasn't
(16:21):
grown in value, and you got thisguy who's got a property that's
been out of pocket 1500 bucks amonth yeah, for the same amount
of time this guy who was out ofpocket will say, oh my god,
great investment, it's doubledin value.
This guy will always come backand go oh, it was shit.
Even though it's paying itselfoff, it hasn't grown in value
like well, not shit.
But my point being is it's it'sopportunity cost?
Yeah, yeah, we only have acouple of purchases we can make.
Speaker 2 (16:43):
You and I are both very Arab At every Sunday
barbecue.
We hear it, we hear it.
We hear oh, I'm doing thisbecause and this is how much
money this person made on thissite, or this is how much money
they made on this investment inPerth or WA or Victoria or
Queensland.
So it is a Australians areproperty obsessed, but we do
(17:03):
need to be able to facilitatethat, and I feel like, as you
said, there is a lot ofmisinformation out there that
does push people in the wrongdirections.
How do you push through thatmisinformation?
How do you implement data toshow your clients?
This is the area to achievethis goal and we can recommend
(17:24):
one, two, three properties.
Speaker 1 (17:25):
Yeah, nothing I ever tell you or ask you or recommend
to you will ever be based ongut feeling.
Everything will always begrounded in data and I would say
from day one I will swear by itthat if I ever say anything to
you and you come to me and say,jp, have you got the data to
back that up?
And I will show you a graph, ametric, a chart that will speak
to the narrative as to what I'mtelling you.
Right?
(17:46):
So you know, for me, like thedata is super important, because
it truly means that I amagnostic and I'm not applying
any sort of gut feeling or thisis I feel about that market.
No, I'm literally looking atthe data to make observations.
And you know, I used to thinkand don't get me wrong this
stuff is still important, but Iused to think it still matters,
(18:06):
but not as much as I used tothink it does.
Right, infrastructure, where'sthe nearest train station, the
shopping center?
You're taking shots at me, bro.
Oh sorry, cut it out.
No, no, no, no, no.
Speaker 2 (18:17):
Look, I guess my point is no, no, no, I'm
enjoying this.
You're challenging me becausethis is my big thing.
Speaker 1 (18:21):
That stuff is important.
But I think the interestingpart of it about that is, for
example, like let's just say,let's take a simple one like a
train station or amenities orwhat have you right think about?
And I'm trying to think of anarea around here like lagana 90
owner, 90% owner occupiers, very, very strong capital growth,
very desirable area to live.
(18:42):
I don't think there's a lot ofinfrastructure in Lugano.
I don't think there's not a lotof infrastructure in Durrell,
in Kenthurst.
Speaker 3 (18:48):
No, there isn't.
From Durrell Right.
Speaker 1 (18:50):
So my point is that there's just some fallacies in
some of these beliefs.
Just some fallacies in some ofthese beliefs again, not saying
that they don't matter, they'renot important, yeah, but there
is so much more.
There is so much deep.
There's so much deeper levelsof data stock on market
percentage, inventory levels,hold periods, um affordability,
indexes for demand, umsocioeconomics, like there's a,
(19:12):
there's a, for example, there'sa socioeconomic index that's
released by the abs.
That's called the IRSAD, whichis the Index of Relative
Socioeconomic Advantage andDisadvantage.
Yes, of course I want to knowthat Melton City Council is
building a brand new hospital.
Is that going to bring a lot ofjobs to the area and a lot more
people who are going to liveclose by?
Of course, right, but my pointis there is a lot more data
(19:36):
available that speaks to evendeeper what is actually going on
in these areas.
Speaker 2 (19:41):
Time on market?
Is it investor or is it a lotmore on occupiers in the area?
Is it families?
How long are people keepingowning their dwellings?
Speaker 1 (19:51):
Exactly right Hold periods, exactly right Bang on.
Speaker 3 (19:53):
I'm curious because I had this thought.
I was having a conversationwith my dad the other day and we
were talking about propertyprices and stuff and yada, yada
the usual thing.
Young people can't get into themarket.
But he was saying why don'tthey just buy in Mount Druitt?
You can find houses there thatare $300,000, $400,000 just to
get you started.
Would you recommend somethinglike that, because I know Mount
Druitt is not exactly.
Let me stop.
So I did a video on this theother day.
Speaker 2 (20:15):
Mount Druitt has outpaced cash okay, by 20% since
2020.
What is outpaced cash?
Sorry, I don't know the growth.
So let's say you had $50,000 in2020.
Today it'd be worth $60,000because of inflation.
Oh, right, right right, mountDruitt has outpaced that by over
20%.
(20:35):
Okay, so Mount Druitt as amarket.
There are no houses for$300,000, $400,000 there anymore
.
It's all apartments.
And the median house price inMount Druitt right now and thank
you for bringing this up,because I did a video on it the
other day and I feel like agenius now is $958,000.
Yeah crazy $958,000.
(20:56):
Please show your father thatthis is the I'm not saying the
issue with your father.
Love you dad.
Speaker 1 (21:01):
But isn't that funny how, like the like, what would
have been considered and brandedone of the worst suburbs in the
country by you know it's, it'sit's just reputation.
Yeah, it's reputation like hasand I my man of mine bought
there.
He invests in property evenlong before I did.
He bought there for like 350grand.
It was worth like a millionbucks.
Speaker 2 (21:19):
I've got even better than that.
There was a mansion that soldin Mount Druitt for $2.3 million
.
Speaker 1 (21:24):
I think I saw that $2.3 million Blew my mind.
Speaker 2 (21:28):
But you look at the area, the median income level is
like $1,400 per week.
That's the median householdincome.
So you're seeing a 47% rentalrate in that location and you
think to yourself okay, thepeople that are renting there
are just going to get pushed outeven further.
You're going to have a lot moreindividuals who live in Sydney
(21:50):
at the moment.
I know my kids now.
They're going to have to lookat Mount Draw as a desirable
area in 20 years' time becausein 20 years, those the
individuals who suffersocioeconomically and don't have
the advantages that otherpeople do, they're going to get
pushed out of the market andthey are going to be pushed
towards regional towns liketomba, for example.
They might get pushed out there, or they might get pushed out
(22:13):
to another regional town like umclifton, for example, or they
might have to go to mildura.
It's, it's.
It's starting to become amarket where, if you take
advantage of the land because Ialways mention this there's
always a limited supply of land.
In sydney, we've got the beachhere, we've got the blue
mountains here, everything inbetween.
It's when to take all kind ofthing.
(22:33):
If you can take advantage ofthe land, you will accelerate
your wealth quickly.
Just take that example of mountdrewitt.
You know?
Median house price 633 in 2020,median house price now 958 or
whatever it is yeah, because I'mlooking at.
Speaker 3 (22:48):
I'm looking at the now.
So you can buy an apartment inmount drewitt for about 400 000.
That's pretty consistentthroughout and I saw there's a
few of them they call themvillas on here I don't know what
like.
I'm assuming they're liketownhouses and duplexes.
Speaker 1 (23:00):
They're around 600, might be like a granny flat,
yeah, yeah there were threebedroom things and they were.
Speaker 3 (23:05):
They're around 600 at 650 and then once you start
getting to actual houses, it'sgoing 750 plus.
Speaker 2 (23:10):
So, for example, the villa that's already been
subdivided, you can't makeimprovements on the land,
exactly yeah.
So when people say, oh, but youcould get a villa for this much
, that's fantastic, don't get mewrong.
However, you are still unableto do anything extra to your
property yeah, when you have ahouse land freehold title,
that's when you well, that's,that's the big capital growth.
Yeah, that's the big capitalgrowth and that's the stuff that
(23:31):
we started to see reallyspiking value in mount druid.
Yeah, um, we have dragged onthat topic for a little bit.
I do want to ask you Queenslandor Victoria right now it's a
million dollar question how longhave we got?
No, no, I'm good, okay.
Speaker 1 (23:46):
So I'm a huge fan of just and look again.
Property is not about timingthe market, but I'm a big fan of
understanding property cyclesand where each markets are at
and look.
The reason why that's importantfor me is because every one of
my investors well, not everysingle one, but a lot of them
have different time frames.
I sometimes get people say tome I need as much growth as I
can get in 24 months, believe itor not, and I need to sell the
(24:07):
asset like, believe it or not.
I get people like that who arelike, oh, my time horizon is two
, three years, but then for themost part, people are medium to
long term, right, but.
But it's important for me tounderstand because where I buy
for someone that's got a fiveyear, five year time horizon or
four year time horizon is verydifferent for someone that's got
10, 15 years behind them to letthe asset grow, right.
So, um, queensland or victoria.
So some context or somebackground on that, right?
(24:27):
Um?
And I actually went up to towatch um, to, to see a guy speak
.
His name is michael matusik.
He's a like a very well-knownproperty market analyst and
commentator, flew up to Brisbanefor one of his workshops and he
talked a lot about SoutheastQueensland.
But essentially what we've seenin Southeast Queensland in
particular if we're talkingabout Queensland but Southeast
Queensland, let's hone in onthat is we've seen more or less
(24:51):
nine or 10 years of growth in afour or five-year period
Astronomical.
I bought a property in Tingalpain Brisbane in 2021 for
$670,000.
I just got it revalued at $1.27million or something like that
$530,000.
In 2021, I bought it.
That's absurd.
(25:11):
Four years.
Four years, right.
So again, that alone doesn'ttell you the story.
So that data point alone on itsown does not tell us the story.
That, oh, this area is going tocap out.
But then if you go and have alook at the affordability index
for those same suburbs or thoseareas and you see, oh cool, it
was somewhat affordable,tracking up, tracking up,
tracking up Then from like 2021,it's gone like this
(25:45):
no-transcript, the demand, right.
So it was definitelyundervalued before, in the same
way that Perth was probablyundervalued, didn't do anything
for a really long time.
But now I believe and again,this is not just my opinion,
like there are othercommentators out there that
believe the same thing is that Ibelieve that South East
(26:06):
Queensland is like a bitovervalued and I'm not saying
there will be negative pricepressure, but I believe it will
just be not as strong assomewhere like Melbourne which,
for example, from 2012 to 2022,right, did doubled in value,
right, so it did 100% growth.
From 2022 until now it's downabout three to 5%.
(26:27):
Victoria was the only state inthe country where housing
affordability got better overthe last three, four years.
That's the craziest thing tothink, because all we've been
hearing about housingaffordability, housing
affordability it's been terribleright.
Victoria got better.
Not only that, but PropTrackhad released some data last year
and that's why I started buyingin Melbourne like 12 months ago
is because PropTrack also cameout with some data that said the
(26:49):
amount of new lendingcommitments in Victoria was
higher than any other state.
So above WA, queensland, NewSouth Wales, whatever the other
states are, All the rest BeforeI miss one.
Yeah, so big fan of Victoria.
I believe it's undervalued, thelong and the short of it is.
It's deviated from itslong-term growth pattern in the
short term, which is a goodthing, because then you go cool,
(27:10):
the long-term pattern is good,but the short-term is shit.
Therefore, that presents anopportunity should revert back
to its.
Speaker 3 (27:16):
Yeah, because, like it doing that, it's sort of a
sign of a healthy market, isn'tit?
Speaker 1 (27:20):
It's the sign of a market that has that naturally
will.
There is going to be pent updemand.
It just goes like this Forwhatever reason it just does so.
Speaker 2 (27:30):
Some of my wealthiest clients are from Melbourne and
the debt on their owner occupiedproperty or their principal
place of residency is so muchlower than what they have to pay
in New South Wales.
Yet they own and operatebusinesses in this state.
So we have seen a little bit ofa migration down there because
you're able to purchase housesin Hawthorne, you're able to
(27:52):
purchase houses in Toorak Veryexpensive, prestigious areas for
40% less or 50% less than whatyou can buy in New South Wales
their million-dollar ring.
So Sydney's million-dollar ring, I think, extends.
I think it's a 40-kilometerradius.
(28:13):
Yeah, it's ridiculous.
Speaker 1 (28:14):
It's basically the whole city.
Speaker 2 (28:17):
It's 45 minutes outside of Sydney and then.
Cbd and once you're 45 minutesoutside of Sydney CBD, you're
either north of Hornsby ortowards Hornsby, yeah, yeah yeah
or Penrith, theirs is only 15minutes.
Speaker 1 (28:29):
It's like 10Ks.
It's like no joke, 10ks Like.
I just bought a property, anauction for a client 430 square
meters in Pasco Vale South,which is 7 kilometers out from
the CBD Three bed, one bath for1.1 million, 7 kilometers out,
like crazy, seven Ks out Nice,in a really good pocket.
I'm crying in Sydney.
Speaker 2 (28:50):
I just hear that and I might be fake crying.
I'm excited about thatopportunity because I'm looking
at it and I'm like they're goingto have a massive
owner-occupied state, which is agood thing, because the more
owner-occupiers there are in alocation, the more people
reinvest into that area andfocus on the upkeep and focus on
(29:13):
the improvements,infrastructure and stuff like
that.
Look at Rose Bay's council,rose Bay.
You go down there.
All the streets are nice.
Speaker 1 (29:23):
Everything is pretty, the grass is mowed.
Speaker 2 (29:27):
You don't see any issues, but that's because it's
an owner-occupied area.
You don't see people.
Oh yeah, I'm going to buy aninvestment property in Rose Bay.
Here's my $1.8 million depositfor an $18 million house.
No, they want to live there,and so what we're going to see
is Victoria.
It might not look like it now,but what you're going to see is
Victoria actually improvesocioeconomically, because
(29:48):
people are going to be focusingon improving where they live.
All right, jp, you and I couldtalk for about 20 hours about
all this stuff, so I'm going toget you on again.
I need to get you on againbecause, bro, you are untapped.
Speaker 1 (30:01):
I'm going to have to like how much knowledge you got.
Stop it, I'm blushing over here.
Speaker 2 (30:04):
I've got to get in there, you know.
So a few questions, so I liketo do well, I don't like to do
this.
This is the first time I'vedone this segment.
That's good.
I borrowed this from my goodfriend, melissa, who's also a
broker.
I was on her podcast, but shedid a rapid fire question
segment and I actually love this.
So I'm going to start shootingoff some rapid fire questions
(30:25):
and you just told me the answerto it Okay, all right, you ready
?
Yes, all right, let's go,should you pay off your debt off
early.
Speaker 1 (30:30):
No, you're better off buying another investment to
pay down that debt quicker thanyou would if you were paying
your principal down.
Speaker 2 (30:35):
Fantastic Coffee or tea Coffee.
Early bird or not owl, earlybird Beach holiday or city
escape, just Favorite guiltypleasure TV show.
Speaker 1 (30:49):
Oh shit, I was just watching Severance.
I heard that's quite goodUnbelievable.
Speaker 2 (30:53):
My wife's been watching it every day I think,
oh mate, it's so good, it's thefirst couple episodes are slow,
but it's unreal.
Speaker 1 (30:59):
Favorite drink after work Ooh.
Speaker 2 (31:01):
Doesn't have to be alcohol.
Speaker 1 (31:01):
Yeah.
Speaker 3 (31:01):
I know.
Speaker 1 (31:02):
I wasn't going to be alcoholic.
I have to have my cup of teabefore bed, okay.
Speaker 2 (31:06):
And final question Pitch yourself in three emojis.
Speaker 1 (31:11):
Starry-eyed emoji Yep Banana.
I don't know why.
Speaker 2 (31:17):
It's not an eggplant, it's a banana.
Speaker 1 (31:21):
I don't know why it just came to my head.
Okay, third emoji the sidewayslaugh-crying one.
Speaker 2 (31:31):
Okay.
Speaker 1 (31:32):
You know that one Ruffle a mayo.
Speaker 3 (31:36):
In our practice round I said eggplant splash beach,
clip that, clip that.
Speaker 1 (31:43):
That's gone on socials Done.
Speaker 2 (31:46):
Anyways, guys, Thank you all so much for listening to
the Finance Show with Joe, asalways.
If you need any assistance withyour finance, whether you're
looking to refinance, whetheryou're looking to invest,
whether you're looking to tapinto some equity or you need a
debt consolidate, you cancontact us at wwwitsimplecomau.
Jp.
Throw us in your plugs.
Speaker 1 (32:08):
Yeah, thanks for having me on.
Guys Appreciate it.
I thoroughly enjoyed it.
If you want to find me,investorcomau, invest in the
letter R or you can hit me up onmy socials Investor Property on
Instagram and even on LinkedIn,jp Gabriel.
I post a lot of thought,leadership and educational
content there too.
Nice Thanks, ap Gabriel.
I post a lot of like thoughtleadership and educational
content there too.
Speaker 2 (32:26):
Nice Thanks for having me, guys, fantastic.
Thank you so much for coming onand we'll see you next time.
the biggest conundrum that they have is I want to buy
my own home, but I'm eitherscraping the bottom of the
barrel or I can't even buysomething I really actually want
to live in A lot of people inSydney.
Speaker 2 (00:11):
they face the same pain point that you just brought
up with they can't buy theirown backyard anymore.
Speaker 1 (00:17):
Capital growth is the game, but cashflow keeps you
playing it.
Very rarely will you findpeople our age buying stocks
like CBA, BHP, Rio Tinto.
Why?
Because they are dividend yieldstock.
But there is a very strongreason why everyone our age are
in the accumulation phase arebuying Google, Amazon, Tesla.
(00:37):
Interesting why?
Because they want to buy in at10 and sell out at 20.
And that is capital growth.
So why would people treat theway they invest in property
differently, the way they investin the share market.
Speaker 2 (00:46):
Mount drew has outpaced cash okay by 20 since
2020.
There was a mansion that soldin mount drew it for 2.3 million
dollars.
It's starting to become amarket where, if you take
advantage of the land, you willaccelerate your wealth quickly
(01:07):
Queensland or Victoria right now.
Speaker 1 (01:09):
It's a million dollar question how long have we got?
Speaker 3 (01:11):
Okay, so Welcome to the Finance Show with Joe.
He's Joe, I'm Michael and wehave a very special guest today.
Jp, how are you going?
Thanks for having me, guys.
Speaker 1 (01:23):
Thanks for having me.
He's definitely special guesttoday.
Jp, how are you going?
Thanks for having me guys.
Thanks for having me.
He's definitely special, he'sspecial.
Speaker 2 (01:27):
I'm extremely excited to bring JP on, because JP and
I have been collaboratingrecently and just discussing how
we could work together.
He's got a very similarpersonality to myself, which you
guys are about to get to know,but on top of that he works in a
new buyer's agency.
You guys have been around forabout 18 months now, am I
(01:48):
correct?
Yeah, that's right.
Speaker 1 (01:49):
So just I was just saying, before I incorporated
the business in February of lastyear, my background before that
was actually working in tech.
So I worked at LinkedIn forfive years, some other tech
startups and stuff, and thenpeople often go.
You know well, how did you getinto that?
I bought my first investmentproperty back in what 2018, I
(02:10):
think it was and you know I hada good year at work and I
thought, oh, you know, I shouldprobably do something with this
and I've got.
You know, my cousin who's abuilder, other cousin who's an
architect, his wife's a townplanner.
People around You're not Arabat all are you.
Speaker 2 (02:21):
It has to be from West Australia, yeah it has to
be With that network.
Speaker 1 (02:24):
Yeah.
So since then I built up aportfolio, you know, across
Queensland, New South Wales andVictoria, and I'm super
passionate about anything andeverything investing.
So, yeah, my business is calledInvestor.
Speaker 3 (02:35):
How you nailed the name Investor, or simply
dropping an O, is incredible.
Speaker 1 (02:40):
I have no idea.
I mean, I think the namingconvention I really like.
I think because I come fromtech.
Naturally they love putting theR at the end of something you
know.
Tech, company with sipper withan R?
I don't know.
Drink tech, I don't know.
You get my point, but the factthat I'm now the domain.
I have no idea how I did that,but I just got lucky.
Speaker 2 (03:02):
Same happened with me with it's Simple.
I had people ask me.
They're like itsimplecomau wasavailable.
I'm like yeah.
That's great, I'm like I'mgenuinely surprised about that,
so it's great to hear how youstarted off.
The business is called Investor.
Speaker 1 (03:14):
Yes.
Speaker 2 (03:14):
You're focusing on investment.
Speaker 1 (03:16):
I only work with investors.
Speaker 2 (03:18):
When did you recognize that was your niche?
Speaker 1 (03:20):
Yeah, okay, when I talk about my business, I talk
about myself.
How humble of me.
And that's because I believe,as a small operation, with just
me and one or two other kind ofsupport staff, the business is
built around me and people'strust in me as a person and
people hopefully trusting meenough to be doing the work for
them to achieve the results.
(03:41):
So, to come back to yourquestion, when did I decide that
was my niche?
I am an investor at heart.
I achieve the results.
So, sorry, to come back to yourquestion, you know when did I
decide that was my niche?
I am an investor at heart, likeyou know, and….
Speaker 2 (03:48):
I am the niche Exactly.
Sorry, we're full Stallonethere.
Judge Dredd 97.
Speaker 3 (03:55):
He's got the headphones.
Speaker 2 (03:56):
He's like Jesus, all blokes go on death.
Speaker 1 (04:01):
Yeah, so I'm an investor, right.
So I said to myself okay, theonly way that I can serve people
is in the way that I know best,and what I know best is
property investing right.
And I made it my business toread the blogs, to listen to the
podcast, to read the books.
The first book I ever read thatwas actually given to me by a
friend of mine.
It's called my Four-Year-OldProperty Investor, by Cam
(04:24):
McClellan, and it's written fromthe perspective of this guy,
Cam McClellan.
He actually has his own buyer'sagency, I think it's called
OpenCorp Plug OpenCorp.
Speaker 2 (04:32):
Everyone's got a buyer's agency.
These days.
Speaker 1 (04:37):
That's right.
A lot of Egyptians, apparentlyI.
It's written from theperspective of a father
explaining property investing tohis four-year-old daughter.
Speaker 3 (04:44):
Oh, so it's like an.
Explain it like a five.
The subreddit.
Speaker 1 (04:47):
Exactly, and you know , it was kind of like this whole
Pandora's box.
I'm like, wow, there's suchdepth to this topic and to this
world, and yeah, so that's kindof how I started my journey.
Then I bought my first propertyand, you know, at the time, you
time, I bought a duplex sitebecause I want to buy a duplex
site.
That's what everyone wants todo.
Speaker 3 (05:05):
Don't worry about it, I'm building them soon.
Speaker 1 (05:08):
I made it my business to understand investing from
the ground up.
I bought my first investmentproperty in my own backyard in
Greystains, because that's whatyou do when you just say, okay,
I'll buy my own backyard.
That's what I'm most familiarwith.
Speaker 2 (05:18):
They say dupees everywhere.
Speaker 1 (05:29):
And that's the thing.
Speaker 3 (05:29):
I haven't even developed it, I'm just sitting
on it, but it's yeah, good block, or what have you, and it's
funny, I um the year I bought it.
Speaker 1 (05:32):
Uh, I found an article.
My dad had sent me an articlefrom 2018 saying sydney worst
property downturn in.
However many years trying to,like you know, basically scare
me off.
Speaker 3 (05:37):
Yeah, yeah, yeah, it was just funny, like so pull the
trigger.
Speaker 1 (05:40):
And then I went back to my broker and I'm like, oh my
god, that was so much fun.
And I remember I signed thecontract physically, not the
docusign yeah, I don't know why.
it wasn't even that long ago,like seven years ago, um, and
signed the contract gray sandshops, and I remember how
deflated I felt and I was like,wow, like I can't believe that's
over.
Like I loved it, I loved thewhole process of it and went
back to my broker and he told meget fucked.
Like you got no money and youhave no equity, so go away.
(06:03):
Then 12 months later I wentback to market I was like, oh
cool, I've got $650,000.
What am I going to do?
Can't buy in Sydney.
Then I started exploring theconcept of investing interstate
Brisbane, ended up buyingsomething there.
That's how the whole investingthing and the interstate
portfolios built out.
It was just out of necessity.
Speaker 2 (06:29):
I couldn't afford to buy in my own backyard anymore,
so I had to.
I was forced to look elsewhere.
You know so a lot of um, a lotof people in sydney and in our
personal inner circles.
They face the same common painpoint that you just brought up
with they can't buy their ownbackyard anymore.
What are the most common painpoints that you're seeing?
Speaker 1 (06:39):
so I'd say the most common one, or the, I'd say, the
biggest conundrum that theyhave is I want to buy my own
home to live in.
And you would hear this all thetime.
Right, I want to buy my home tolive in, but I'm either
scraping the bottom of thebarrel or I can't even buy
something I really actually wantto live in.
So should I buy?
Should I scrape in in Sydneyand buy something I don't want
(07:00):
to live in, or should I justconsider buying an investment?
Right?
So people are at that rentvesting crossroads.
I would say that's the biggestconundrum and you would see it
just as much.
Speaker 2 (07:10):
I actually had a rant and I disagreed heavily with
rent vesting for a period oftime, but unfortunately, due to
the lack of supply in Sydney andSydney being the largest
economic hub of Australia, wedon't have enough supply here.
So we need people to considerrent vesting, because that's the
fastest way to grow equity andnot rely on cash savings to be
(07:34):
able to purchase a property.
Speaker 1 (07:35):
Yeah, and you really nailed it there, right?
Because let's just say thatsomeone decided that they were
going to spend their $650,000 or$700,000 in Sydney, decided
that they were going to spendtheir 650 or 700 in Sydney.
The problem with those assetsis number one.
Usually, if you're buying a 650, 700k property, that's not the
property you actually want tolive in long term.
You're just buying it to get inhere.
It's a stepping stone.
It's a stepping stone and theproblem is that stepping stone
(07:57):
is not going to give you thepace of growth that you need to
keep up with the property thatyou really want to buy.
So let's just say, the propertyyou want to buy today is worth
one and a half million dollars,but you can't afford that.
So you go great, I'm going tobuy a 700K property If that 700K
property is not in a marketwhere the supply is limited and
there is strong demand for it.
Case in point let's just say anapartment in Parramatta.
(08:21):
Not only are there a lot ofapartments in Parramatta in
Parramatta, right?
Not only are there a lot ofapartments in Parramatta, right,
but the differential betweenthe cost of a unit and the cost
of a house is not in any waydisparate.
In the same way.
It is like in Bondi, forexample, a house in Bondi will
cost you $5 million, but a unitwill cost you $1.5 million.
That's a huge difference.
Whereas in Parramatta, you candrive 10 minutes away and you
can still buy a house for 1.5,but a unit will cost you 800
(08:42):
grand.
That's not a huge difference.
So therefore, the peoplehaven't been forced into the
unit market.
Speaker 2 (08:47):
Yeah, yeah, yeah, there's an oversupply.
Speaker 1 (08:49):
Yes, there's an oversupply right.
So therein lies the problem.
If you're going and buying anunderperforming asset, you're
doing yourself a disservice whenyou want to buy that home in
the future.
I don't know if I've explainedthat well enough.
Speaker 3 (09:05):
No, no, I get it.
So basically, let's say youwanted to live in Parramatta and
you wanted to buy that unit tolive in.
That's fine, that's exactlyright.
But if you wanted to actuallygrow your capital and all that
sort of stuff, your equity not agreat idea.
Speaker 1 (09:18):
Exactly, yeah, exactly goes out the window if
you actually want to live there.
Speaker 2 (09:28):
But usually what I see is people buying subpar
properties or assets in order toget them to a place where those
assets just aren't going totake them.
So the assets that you'reassisting individuals with, they
are either capital growth orthey're cash flow positive, from
what you're telling me.
So when you're helping peopletry and buy in Sydney, but they
don't have enough equity rightnow, they don't have enough
funds you're assisting them withpurchasing an accelerated asset
(09:51):
in another location so that two, three years' time they'll have
the funds to be able topurchase in Sydney.
Speaker 1 (09:57):
That's right and, mind you, I'm agnostic as to
where I buy.
I'm not attached.
Of course I can't spread myselftoo thin, I can't be buying
everywhere at once, but I haveyou know, I make it my business
to understand where I want tobuy, based on a certain type of
brief.
So, for example, if someonecame to me one and a half
million, I would well and trulyconsider Sydney as a like a very
(10:18):
viable investment.
But they're a very viableoption.
But there are like there arethresholds, right.
If someone naturally in my head, if someone comes to me, says
I've got 700 to spend, right bydefault.
There are not many assets.
I would buy in sydney for 700grand, but if someone said to me
, oh, I mean 1.2, I'll go.
Okay, cool.
There are some apartmentmarkets that I would well and
truly buy in, like I own anapartment in ramwick that's
(10:38):
performed really well.
Right, because, again, all thedemand in that specific market
ramwick, eastern suburbs, whathave you?
Northern beaches is the sameright.
All the demand in that specificmarket Randwick, eastern
Suburbs, what have you?
Northern Beaches is the sameright.
All the demand has come out ofthe housing market into the unit
market Because it's moreaffordable, because it's
completely unaffordable Housingis completely unaffordable.
Same thing, yeah, yeah exactlybut exact same point.
But yes, I'm agnostic as towhere I'm buying, any you know
(11:02):
one of three locations any onetime, but usually the first two
are the ones that I'm spendingmost of my time on.
That's just because of thenature of top people I work with
, so usually I'm I have, youknow, an area that I'm buying in
, that is you know, sole focusis on the capital growth.
Then the second one is a balanceof the yield or the cash flow
and the growth, and then thethird is just pure and out of
(11:22):
cash flow.
But I don't have many people inthat third bucket because most
people in there you know, mostpeople that I know in my network
and people that I work with arein their 20s, 30s, early 40s
and they're still in theaccumulation, the build phase.
Speaker 2 (11:39):
You said something there that I really liked it was
in regards to the yield.
Could you just touch on thatsubject just a little bit more?
Like you have people, they'rejust trying to ensure that
they've got, you know, enoughcashflow to be able to maintain
these sorts of properties.
Speaker 1 (11:53):
Yeah.
Speaker 2 (11:53):
Could you just get into?
That a little bit.
Speaker 1 (11:55):
So one of my favorite things to say like I didn't
come up with it, there'svariations of it out there in
the market is is that and I'm afirm believer in this right
Capital growth is the game, butcash flow keeps you playing it.
Speaker 3 (12:08):
Ah, yes, I've seen that around.
Yeah, you've seen that around.
Speaker 1 (12:10):
Some people say capital growth gets you out of
the game.
Speaker 2 (12:12):
Oh, I'm using that every day now.
Wow, okay, perfect.
Speaker 1 (12:15):
And my point from that is that the whole point and
I feel really passionatelyabout this, maybe even just as
passionately about you and theLabor government potentially I
don't know if I was supposed tosay that you talk about it- all
the time.
Speaker 2 (12:30):
Why am I so blank?
No, no no.
It wasn't a negative thing.
It was more of a Laborgovernment.
Speaker 1 (12:38):
Don't say that around me.
You triggered him.
He must not be named.
Speaker 2 (12:42):
We've only got 30 minutes.
Speaker 1 (12:43):
man, you don't want me to go um yeah, so you know, I
firmly believe that capitalgrowth is the point of property
investing.
Yeah, and I'll give you a goodkind of analogy, and usually
when I say this makes it like itmakes even more sense to people
.
Right, very rarely will youfind people our age or people
that are building their assetbase.
We're not absolutely mintedgoing and and buying stocks like
(13:06):
CBA, bhp, rio Tinto, at&t,coca-cola.
Why?
Because they are dividend yieldstocks.
They pay an income.
You go and dump a milliondollars into one of those stocks
, you get a really good cashreturn, a dividend, every year,
right?
But there is a very strongreason why everyone our age are
in the accumulation phase arebuying Google, amazon, tesla.
(13:28):
Why?
Because they want to buy in at10 and sell out at 20.
And that is capital growth.
So why would people treat theway they invest in property
differently to the way theyinvest in the share market?
Correct, right?
Because the point is growth.
So, yes, yield is important.
Cash flow is important.
Because we don't want to gobroke, right, if I could buy
vacant blocks of land and sit onthem, I would do it.
(13:49):
But why I can't do it?
Because I'll, literally youneed cash flow, I need cash flow
.
So to me the point of thedwelling is just to provide an
income.
The value is in the land.
The land appreciates, thebuilding depreciates.
Speaker 3 (14:00):
Yeah.
Speaker 2 (14:00):
Just, I do want to ask you one thing.
So my first investment I'm justgoing to highlight this was an
apartment in Wilco, Athree-bedroom apartment.
It did well because it was athree-bedder I didn't buy a
two-bedder and I bought it offthe plan and great builder.
Everything was fine.
That was both cash flowpositive and it achieved I'm not
(14:21):
going to say tremendous capitalgrowth, but it achieved good
capital growth.
What we're trying to see now,or what we are seeing, is a lot
more people be under the age of30 or under the age of 40.
They're more accepting to therisk because they know the
reward on the other side of itis better off.
Is that what you're saying?
Speaker 1 (14:39):
Yeah, definitely I think that.
Look, it all comes down to whatare people comfortable with.
For example, I'll never say tosomeone you should be definitely
two or three grand out ofpocket per month on this
property, because at the end ofthe day, everyone's
circumstances are different.
So the simple question I askpeople is based on your current
expenses, what, in addition tothis, can you afford to cash
flow out of pocket?
And if the answer is nothing,jp, I need the property to be
(15:01):
neutrally geared, then that isokay.
Nothing, jp, I need theproperty to be neutrally geared,
then that is okay, as long asyou're being truthful with
yourself around what yourcomfort level is.
So you know to your point.
A lot more people are becomingmore comfortable being a little
bit out of pocket becausethey're, you know.
Speaker 2 (15:12):
The low gratification .
Speaker 1 (15:13):
They're starting to understand that, okay.
Well, the point of buying thisinvestment property, or buying
this investment in general, isthat hopefully, it will either
help me get to that family homeone day when I build equity or I
can build equity I can continueto reinvest into, you know, the
growth of the portfolio.
Right?
Because that's the beautifulthing about property is that
when we put $100,000 into theproperty market, we don't get
$100,000 in the market as wewould with shares, right you?
Speaker 2 (15:36):
get a million dollars .
You get a return on capital.
Speaker 1 (15:38):
Exactly right.
You get a return on your, youknow, a $700,000, $800,000,
$900,000 asset, which is thebeauty of property.
And then, when you addadditional properties to the
portfolio, you're not just againadding another $100,000, you're
adding another million, right?
So every time you have thissmall amount to deploy, the
bank's giving you this much,which is the beauty of leverage
and why people are now startingto go.
Okay, well, I'm not going to behell-bent on my yield or my
(16:00):
positive cash flow what have youbut I'm going to focus on, you
know, I'm going to focus on thegrowth.
And I think that there's a lotof misinformation out there
around yield and cash flow.
And look, don't get me wrong,I'm not claiming to know
everyone's situation or say thatpeople should be out of pocket,
but I think that people need toknow that.
You know, if you have twopeople and one of them has got a
neutrally geared or positivelygeared property that hasn't
(16:21):
grown in value, and you got thisguy who's got a property that's
been out of pocket 1500 bucks amonth yeah, for the same amount
of time this guy who was out ofpocket will say, oh my god,
great investment, it's doubledin value.
This guy will always come backand go oh, it was shit.
Even though it's paying itselfoff, it hasn't grown in value
like well, not shit.
But my point being is it's it'sopportunity cost?
Yeah, yeah, we only have acouple of purchases we can make.
Speaker 2 (16:43):
You and I are both very Arab At every Sunday
barbecue.
We hear it, we hear it.
We hear oh, I'm doing thisbecause and this is how much
money this person made on thissite, or this is how much money
they made on this investment inPerth or WA or Victoria or
Queensland.
So it is a Australians areproperty obsessed, but we do
(17:03):
need to be able to facilitatethat, and I feel like, as you
said, there is a lot ofmisinformation out there that
does push people in the wrongdirections.
How do you push through thatmisinformation?
How do you implement data toshow your clients?
This is the area to achievethis goal and we can recommend
(17:24):
one, two, three properties.
Speaker 1 (17:25):
Yeah, nothing I ever tell you or ask you or recommend
to you will ever be based ongut feeling.
Everything will always begrounded in data and I would say
from day one I will swear by itthat if I ever say anything to
you and you come to me and say,jp, have you got the data to
back that up?
And I will show you a graph, ametric, a chart that will speak
to the narrative as to what I'mtelling you.
Right?
(17:46):
So you know, for me, like thedata is super important, because
it truly means that I amagnostic and I'm not applying
any sort of gut feeling or thisis I feel about that market.
No, I'm literally looking atthe data to make observations.
And you know, I used to thinkand don't get me wrong this
stuff is still important, but Iused to think it still matters,
(18:06):
but not as much as I used tothink it does.
Right, infrastructure, where'sthe nearest train station, the
shopping center?
You're taking shots at me, bro.
Oh sorry, cut it out.
No, no, no, no, no.
Speaker 2 (18:17):
Look, I guess my point is no, no, no, I'm
enjoying this.
You're challenging me becausethis is my big thing.
Speaker 1 (18:21):
That stuff is important.
But I think the interestingpart of it about that is, for
example, like let's just say,let's take a simple one like a
train station or amenities orwhat have you right think about?
And I'm trying to think of anarea around here like lagana 90
owner, 90% owner occupiers, very, very strong capital growth,
very desirable area to live.
(18:42):
I don't think there's a lot ofinfrastructure in Lugano.
I don't think there's not a lotof infrastructure in Durrell,
in Kenthurst.
Speaker 3 (18:48):
No, there isn't.
From Durrell Right.
Speaker 1 (18:50):
So my point is that there's just some fallacies in
some of these beliefs.
Just some fallacies in some ofthese beliefs again, not saying
that they don't matter, they'renot important, yeah, but there
is so much more.
There is so much deep.
There's so much deeper levelsof data stock on market
percentage, inventory levels,hold periods, um affordability,
indexes for demand, umsocioeconomics, like there's a,
(19:12):
there's a, for example, there'sa socioeconomic index that's
released by the abs.
That's called the IRSAD, whichis the Index of Relative
Socioeconomic Advantage andDisadvantage.
Yes, of course I want to knowthat Melton City Council is
building a brand new hospital.
Is that going to bring a lot ofjobs to the area and a lot more
people who are going to liveclose by?
Of course, right, but my pointis there is a lot more data
(19:36):
available that speaks to evendeeper what is actually going on
in these areas.
Speaker 2 (19:41):
Time on market?
Is it investor or is it a lotmore on occupiers in the area?
Is it families?
How long are people keepingowning their dwellings?
Speaker 1 (19:51):
Exactly right Hold periods, exactly right Bang on.
Speaker 3 (19:53):
I'm curious because I had this thought.
I was having a conversationwith my dad the other day and we
were talking about propertyprices and stuff and yada, yada
the usual thing.
Young people can't get into themarket.
But he was saying why don'tthey just buy in Mount Druitt?
You can find houses there thatare $300,000, $400,000 just to
get you started.
Would you recommend somethinglike that, because I know Mount
Druitt is not exactly.
Let me stop.
So I did a video on this theother day.
Speaker 2 (20:15):
Mount Druitt has outpaced cash okay, by 20% since
2020.
What is outpaced cash?
Sorry, I don't know the growth.
So let's say you had $50,000 in2020.
Today it'd be worth $60,000because of inflation.
Oh, right, right right, mountDruitt has outpaced that by over
20%.
(20:35):
Okay, so Mount Druitt as amarket.
There are no houses for$300,000, $400,000 there anymore
.
It's all apartments.
And the median house price inMount Druitt right now and thank
you for bringing this up,because I did a video on it the
other day and I feel like agenius now is $958,000.
Yeah crazy $958,000.
(20:56):
Please show your father thatthis is the I'm not saying the
issue with your father.
Love you dad.
Speaker 1 (21:01):
But isn't that funny how, like the like, what would
have been considered and brandedone of the worst suburbs in the
country by you know it's, it'sit's just reputation.
Yeah, it's reputation like hasand I my man of mine bought
there.
He invests in property evenlong before I did.
He bought there for like 350grand.
It was worth like a millionbucks.
Speaker 2 (21:19):
I've got even better than that.
There was a mansion that soldin Mount Druitt for $2.3 million
.
Speaker 1 (21:24):
I think I saw that $2.3 million Blew my mind.
Speaker 2 (21:28):
But you look at the area, the median income level is
like $1,400 per week.
That's the median householdincome.
So you're seeing a 47% rentalrate in that location and you
think to yourself okay, thepeople that are renting there
are just going to get pushed outeven further.
You're going to have a lot moreindividuals who live in Sydney
(21:50):
at the moment.
I know my kids now.
They're going to have to lookat Mount Draw as a desirable
area in 20 years' time becausein 20 years, those the
individuals who suffersocioeconomically and don't have
the advantages that otherpeople do, they're going to get
pushed out of the market andthey are going to be pushed
towards regional towns liketomba, for example.
They might get pushed out there, or they might get pushed out
(22:13):
to another regional town like umclifton, for example, or they
might have to go to mildura.
It's, it's.
It's starting to become amarket where, if you take
advantage of the land because Ialways mention this there's
always a limited supply of land.
In sydney, we've got the beachhere, we've got the blue
mountains here, everything inbetween.
It's when to take all kind ofthing.
(22:33):
If you can take advantage ofthe land, you will accelerate
your wealth quickly.
Just take that example of mountdrewitt.
You know?
Median house price 633 in 2020,median house price now 958 or
whatever it is yeah, because I'mlooking at.
Speaker 3 (22:48):
I'm looking at the now.
So you can buy an apartment inmount drewitt for about 400 000.
That's pretty consistentthroughout and I saw there's a
few of them they call themvillas on here I don't know what
like.
I'm assuming they're liketownhouses and duplexes.
Speaker 1 (23:00):
They're around 600, might be like a granny flat,
yeah, yeah there were threebedroom things and they were.
Speaker 3 (23:05):
They're around 600 at 650 and then once you start
getting to actual houses, it'sgoing 750 plus.
Speaker 2 (23:10):
So, for example, the villa that's already been
subdivided, you can't makeimprovements on the land,
exactly yeah.
So when people say, oh, but youcould get a villa for this much
, that's fantastic, don't get mewrong.
However, you are still unableto do anything extra to your
property yeah, when you have ahouse land freehold title,
that's when you well, that's,that's the big capital growth.
Yeah, that's the big capitalgrowth and that's the stuff that
(23:31):
we started to see reallyspiking value in mount druid.
Yeah, um, we have dragged onthat topic for a little bit.
I do want to ask you Queenslandor Victoria right now it's a
million dollar question how longhave we got?
No, no, I'm good, okay.
Speaker 1 (23:46):
So I'm a huge fan of just and look again.
Property is not about timingthe market, but I'm a big fan of
understanding property cyclesand where each markets are at
and look.
The reason why that's importantfor me is because every one of
my investors well, not everysingle one, but a lot of them
have different time frames.
I sometimes get people say tome I need as much growth as I
can get in 24 months, believe itor not, and I need to sell the
(24:07):
asset like, believe it or not.
I get people like that who arelike, oh, my time horizon is two
, three years, but then for themost part, people are medium to
long term, right, but.
But it's important for me tounderstand because where I buy
for someone that's got a fiveyear, five year time horizon or
four year time horizon is verydifferent for someone that's got
10, 15 years behind them to letthe asset grow, right.
So, um, queensland or victoria.
So some context or somebackground on that, right?
(24:27):
Um?
And I actually went up to towatch um, to, to see a guy speak
.
His name is michael matusik.
He's a like a very well-knownproperty market analyst and
commentator, flew up to Brisbanefor one of his workshops and he
talked a lot about SoutheastQueensland.
But essentially what we've seenin Southeast Queensland in
particular if we're talkingabout Queensland but Southeast
Queensland, let's hone in onthat is we've seen more or less
(24:51):
nine or 10 years of growth in afour or five-year period
Astronomical.
I bought a property in Tingalpain Brisbane in 2021 for
$670,000.
I just got it revalued at $1.27million or something like that
$530,000.
In 2021, I bought it.
That's absurd.
(25:11):
Four years.
Four years, right.
So again, that alone doesn'ttell you the story.
So that data point alone on itsown does not tell us the story.
That, oh, this area is going tocap out.
But then if you go and have alook at the affordability index
for those same suburbs or thoseareas and you see, oh cool, it
was somewhat affordable,tracking up, tracking up,
tracking up Then from like 2021,it's gone like this
(25:45):
no-transcript, the demand, right.
So it was definitelyundervalued before, in the same
way that Perth was probablyundervalued, didn't do anything
for a really long time.
But now I believe and again,this is not just my opinion,
like there are othercommentators out there that
believe the same thing is that Ibelieve that South East
(26:06):
Queensland is like a bitovervalued and I'm not saying
there will be negative pricepressure, but I believe it will
just be not as strong assomewhere like Melbourne which,
for example, from 2012 to 2022,right, did doubled in value,
right, so it did 100% growth.
From 2022 until now it's downabout three to 5%.
(26:27):
Victoria was the only state inthe country where housing
affordability got better overthe last three, four years.
That's the craziest thing tothink, because all we've been
hearing about housingaffordability, housing
affordability it's been terribleright.
Victoria got better.
Not only that, but PropTrackhad released some data last year
and that's why I started buyingin Melbourne like 12 months ago
is because PropTrack also cameout with some data that said the
(26:49):
amount of new lendingcommitments in Victoria was
higher than any other state.
So above WA, queensland, NewSouth Wales, whatever the other
states are, All the rest BeforeI miss one.
Yeah, so big fan of Victoria.
I believe it's undervalued, thelong and the short of it is.
It's deviated from itslong-term growth pattern in the
short term, which is a goodthing, because then you go cool,
(27:10):
the long-term pattern is good,but the short-term is shit.
Therefore, that presents anopportunity should revert back
to its.
Speaker 3 (27:16):
Yeah, because, like it doing that, it's sort of a
sign of a healthy market, isn'tit?
Speaker 1 (27:20):
It's the sign of a market that has that naturally
will.
There is going to be pent updemand.
It just goes like this Forwhatever reason it just does so.
Speaker 2 (27:30):
Some of my wealthiest clients are from Melbourne and
the debt on their owner occupiedproperty or their principal
place of residency is so muchlower than what they have to pay
in New South Wales.
Yet they own and operatebusinesses in this state.
So we have seen a little bit ofa migration down there because
you're able to purchase housesin Hawthorne, you're able to
(27:52):
purchase houses in Toorak Veryexpensive, prestigious areas for
40% less or 50% less than whatyou can buy in New South Wales
their million-dollar ring.
So Sydney's million-dollar ring, I think, extends.
I think it's a 40-kilometerradius.
(28:13):
Yeah, it's ridiculous.
Speaker 1 (28:14):
It's basically the whole city.
Speaker 2 (28:17):
It's 45 minutes outside of Sydney and then.
Cbd and once you're 45 minutesoutside of Sydney CBD, you're
either north of Hornsby ortowards Hornsby, yeah, yeah yeah
or Penrith, theirs is only 15minutes.
Speaker 1 (28:29):
It's like 10Ks.
It's like no joke, 10ks Like.
I just bought a property, anauction for a client 430 square
meters in Pasco Vale South,which is 7 kilometers out from
the CBD Three bed, one bath for1.1 million, 7 kilometers out,
like crazy, seven Ks out Nice,in a really good pocket.
I'm crying in Sydney.
Speaker 2 (28:50):
I just hear that and I might be fake crying.
I'm excited about thatopportunity because I'm looking
at it and I'm like they're goingto have a massive
owner-occupied state, which is agood thing, because the more
owner-occupiers there are in alocation, the more people
reinvest into that area andfocus on the upkeep and focus on
(29:13):
the improvements,infrastructure and stuff like
that.
Look at Rose Bay's council,rose Bay.
You go down there.
All the streets are nice.
Speaker 1 (29:23):
Everything is pretty, the grass is mowed.
Speaker 2 (29:27):
You don't see any issues, but that's because it's
an owner-occupied area.
You don't see people.
Oh yeah, I'm going to buy aninvestment property in Rose Bay.
Here's my $1.8 million depositfor an $18 million house.
No, they want to live there,and so what we're going to see
is Victoria.
It might not look like it now,but what you're going to see is
Victoria actually improvesocioeconomically, because
(29:48):
people are going to be focusingon improving where they live.
All right, jp, you and I couldtalk for about 20 hours about
all this stuff, so I'm going toget you on again.
I need to get you on againbecause, bro, you are untapped.
Speaker 1 (30:01):
I'm going to have to like how much knowledge you got.
Stop it, I'm blushing over here.
Speaker 2 (30:04):
I've got to get in there, you know.
So a few questions, so I liketo do well, I don't like to do
this.
This is the first time I'vedone this segment.
That's good.
I borrowed this from my goodfriend, melissa, who's also a
broker.
I was on her podcast, but shedid a rapid fire question
segment and I actually love this.
So I'm going to start shootingoff some rapid fire questions
(30:25):
and you just told me the answerto it Okay, all right, you ready
?
Yes, all right, let's go,should you pay off your debt off
early.
Speaker 1 (30:30):
No, you're better off buying another investment to
pay down that debt quicker thanyou would if you were paying
your principal down.
Speaker 2 (30:35):
Fantastic Coffee or tea Coffee.
Early bird or not owl, earlybird Beach holiday or city
escape, just Favorite guiltypleasure TV show.
Speaker 1 (30:49):
Oh shit, I was just watching Severance.
I heard that's quite goodUnbelievable.
Speaker 2 (30:53):
My wife's been watching it every day I think,
oh mate, it's so good, it's thefirst couple episodes are slow,
but it's unreal.
Speaker 1 (30:59):
Favorite drink after work Ooh.
Speaker 2 (31:01):
Doesn't have to be alcohol.
Speaker 1 (31:01):
Yeah.
Speaker 3 (31:01):
I know.
Speaker 1 (31:02):
I wasn't going to be alcoholic.
I have to have my cup of teabefore bed, okay.
Speaker 2 (31:06):
And final question Pitch yourself in three emojis.
Speaker 1 (31:11):
Starry-eyed emoji Yep Banana.
I don't know why.
Speaker 2 (31:17):
It's not an eggplant, it's a banana.
Speaker 1 (31:21):
I don't know why it just came to my head.
Okay, third emoji the sidewayslaugh-crying one.
Speaker 2 (31:31):
Okay.
Speaker 1 (31:32):
You know that one Ruffle a mayo.
Speaker 3 (31:36):
In our practice round I said eggplant splash beach,
clip that, clip that.
Speaker 1 (31:43):
That's gone on socials Done.
Speaker 2 (31:46):
Anyways, guys, Thank you all so much for listening to
the Finance Show with Joe, asalways.
If you need any assistance withyour finance, whether you're
looking to refinance, whetheryou're looking to invest,
whether you're looking to tapinto some equity or you need a
debt consolidate, you cancontact us at wwwitsimplecomau.
Jp.
Throw us in your plugs.
Speaker 1 (32:08):
Yeah, thanks for having me on.
Guys Appreciate it.
I thoroughly enjoyed it.
If you want to find me,investorcomau, invest in the
letter R or you can hit me up onmy socials Investor Property on
Instagram and even on LinkedIn,jp Gabriel.
I post a lot of thought,leadership and educational
content there too.
Nice Thanks, ap Gabriel.
I post a lot of like thoughtleadership and educational
content there too.
Speaker 2 (32:26):
Nice Thanks for having me, guys, fantastic.
Thank you so much for coming onand we'll see you next time.
Popular Podcasts
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.
24/7 News: The Latest
The latest news in 4 minutes updated every hour, every day.
Crime Junkie
Does hearing about a true crime case always leave you scouring the internet for the truth behind the story? Dive into your next mystery with Crime Junkie. Every Monday, join your host Ashley Flowers as she unravels all the details of infamous and underreported true crime cases with her best friend Brit Prawat. From cold cases to missing persons and heroes in our community who seek justice, Crime Junkie is your destination for theories and stories you won’t hear anywhere else. Whether you're a seasoned true crime enthusiast or new to the genre, you'll find yourself on the edge of your seat awaiting a new episode every Monday. If you can never get enough true crime... Congratulations, you’ve found your people. Follow to join a community of Crime Junkies! Crime Junkie is presented by audiochuck Media Company.