April 8, 2025 • 33 mins
Manny returns to discuss the latest shifts in Australia's property market. (Melbourne might be back in the game).
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
As we know, markets shift right.
They almost feel like theyshift on a monthly basis now,
but there's opportunities thatwe weren't considering two years
ago, 12 months ago, that havestarted to come onto the horizon
, which is quite exciting.
Speaker 2 (00:14):
What are these trends ?
What you weren't considering 24months ago, what you're
considering now.
Speaker 1 (00:19):
I think so an area that we had a lot of success, in
which we invested.
We had the opportunity to putfour clients in a suburb court.
I can talk about it now becauseit's boomed.
Speaker 2 (00:31):
Manny, you have a finger on the pulse.
You know all across Australia.
What kind of tactics are youusing to help both your clients
and yourself For sure Inestablishing this is a good
investment this is the right one.
Speaker 1 (00:44):
The biggest misconception that I see is
Welcome to the Finance Show withJoe.
Speaker 3 (00:53):
He's Joe, I'm Michael and we have Manny back today.
Speaker 2 (00:57):
I am so excited to have Manny back, because Manny
has been on an adventure for thelast four months.
Manny, do you want to tell ourlisteners what's been going on
since?
I want to say November?
Speaker 1 (01:09):
Yeah, I got married at the end of November.
Woo yeah, manny.
And then, yeah, traveled theworld for almost two months it
was about seven weeks.
So I got back at the start ofFeb and right into work, right
into buying properties.
Where did you travel to?
We went to a few places.
(01:29):
So we went to Egypt, went toDubai, abu Dhabi and a little
island off the coast of Africacalled Mauritius, which Joey's
been to and he said he hated.
What about?
Speaker 3 (01:40):
you Did you like it?
Whoa, okay, no, no, no, I'mgoing to cut.
Speaker 2 (01:48):
I?
What about you?
Did you like whoa?
Okay, no, no, no, I'm gonna cut.
I didn't hate the island ofmauritius, I hated the fact that
I broke my toe and my wife mademe hike a mountain.
That's a kilometer up like thatway at like, and then the going
up isn't the hard part, it'sthe coming down on a broken toe.
Yep, okay.
And she made me rush because wehad a special breakfast.
Do you want to know what thespecial breakfast was?
What?
It was the exact same breakfastwe had had the previous two
(02:11):
days, only next to the pool.
Speaker 3 (02:14):
That sounds pretty special.
I don't know, and that's why Idon't like Mauritius.
Speaker 2 (02:17):
But the island itself .
It's actually really pretty.
Okay, I really enjoyed it.
So you highlighted something.
You've been buying property,you've been assisting a lot of
people.
Tell me, tell me, what's goingon at the moment.
Speaker 1 (02:27):
Yeah, definitely so.
As we know, markets shift rightand they almost feel like they
shift on a monthly basis now.
So there's a few areas, a fewcapital cities, a few regional
markets that we were sort ofvery heavily investing over the
last two years that I feel areno longer the right investments.
(02:48):
They're sort of at the top endof their cycle and buying now
would probably be a bit foolishbecause they've run so hard over
the last 24 months.
But there's opportunities thatwe weren't considering two years
ago, 12 months ago, that havestarted to come onto the horizon
, which is quite exciting.
Speaker 2 (03:07):
What are these trends ?
What are you seeingspecifically for what you
weren't considering 24 monthsago, what you're considering now
.
Speaker 1 (03:16):
For sure.
So the Melbourne market when wefirst started talking about
Melbourne on this podcast orVictoria in general I was a very
big fan of regional, yeah, andI was pretty much shitting on
capital city I was saying, look,it's not the right time to
invest.
Vacancy rates are too high, thedays on market are way too high
(03:39):
, people are listing theirproperties and it's taking three
months to sell it's.
It's not the right time to bebuying in Metro Melbourne.
That's changed.
Is it flipped or is it?
Look, it's not quite there yet,but it's all trending in the
right direction.
So what I mean by that?
For example, days on market.
(03:59):
When we were looking three,four months ago, some of these
suburbs had 60, 65, 70 days onmarket, meaning that you were
advertising your property tosell and it was taking 70 days
for you to get an offer acceptedon that property.
Right, this is trendingdownwards in a very fast
direction.
So instead of 70 days, we'reseeing 35 days now, which is
(04:25):
halved in terms of that meansthe demand has increased.
Speaker 2 (04:29):
Exactly so the Melbourne market.
As I understand, theyintroduced a land tax where, if
you own a property or aninvestment property that's worth
, I think, the land area $50,000or more, there's a new tax
that's on it.
Have you seen people exit andnew investors enter because they
can afford it?
Speaker 1 (04:50):
So Melbourne as a city was being scrutinised a lot
in the news.
Speaker 2 (05:00):
I scrutinised it like crazy.
I did too, I did too.
Speaker 1 (05:05):
So things like land tax being introduced obviously
is the opposite of what you wantto do when you're trying to
bring investors into the marketright, and creating hype,
creating demand, making iteasier for people to purchase
properties is what any stategovernment should be trying to
do.
Where in Victoria, they did theopposite.
(05:28):
So they introduced land taxpractically at no threshold,
unlike every other state inAustralia where you're buying a
property if you're purchasing aproperty in your personal name
there is a threshold for landtax, and once you go above that
threshold, that's when the landtax is applicable.
In Victoria, there is athreshold for land tax and once
you go above that threshold,that's when the land tax is
applicable.
In Victoria, there'spractically no threshold, which
(05:51):
means that you have to startpaying land tax from a very low
value of land ownership.
So that definitely didn't havegood publicity.
I think I do get asked thatquestion a lot from investors.
But what about land tax?
And I think every state has itspros and cons right.
(06:12):
So the easiest way that I sortof explain this to investors is
as long as we're taking thesecalculations into consideration
when we're making our choice andit still makes sense for you to
consider this market from acash flow position, then why not
?
Because in Queensland, forexample, insurances as an
average are a bit higher.
Speaker 3 (06:32):
Yeah, which never gets talked about.
It's always about the land taxin.
Melbourne Exactly.
Speaker 2 (06:36):
Well, it's also stamp duty in other states.
You know, stamp duty is a lothigher than in other states on a
percentage level compared toNew South Wales.
Speaker 3 (06:43):
But people don't bring that up.
Speaker 2 (06:45):
They only bring up, oh no, this new land tax.
This new land tax.
We've had a client of ourspurchase recently in Melbourne
CBD beautiful three-bedroom,two-bathroom apartment.
They've got a six-monthsettlement Now if you wanted to
buy a brand-new three-bedroomtwo-bedroom apartment in Sydney.
Speaker 1 (07:03):
What are you paying?
Speaker 2 (07:04):
oh, in the heart of the cbd yeah, it's double digit
millions it's it's, you'relooking at two to three million
dollars, but when you go tomelbourne cbd, this this client
of ours purchased for a milliondollars in the heart of
melbourne cbd wow, wow so mannyhas brought up several times our
episodes of the show joe Investwhere people want to live.
(07:24):
Look for where the owneroccupies are.
If you're going to purchase aproperty, look at the amenity
that's around there.
What better than Melbourne CBDat the moment?
You go to Melbourne CBD, you'reconnected via the tram, you can
get basically anywhere in thespan of 20 minutes.
It is so fast and it is soconnected and so easy to get
(07:45):
around that it's kind of sillyto think to yourself why this
market wouldn't boom for sure,especially because melbourne I
mean population wise it's nowbigger than than sydney.
Speaker 3 (07:55):
Now, right, yeah, so greater melbourne, cbd.
Speaker 2 (07:57):
Yeah, is more populous than greater sydney,
cbd however, you know new southwales as a state.
It's three times the size ofvictoria.
Yeah, but sydney itself it'scongested, it's hard to get
around.
Speaker 1 (08:11):
Okay, it's pretty, let's let's not beat around the
bush sydney's.
Speaker 2 (08:15):
Sydney's pretty good looking, as far as you know,
cities go, yeah, but melbourneitself, as far as amenity,
entertainment like thefunctionality of a culture, all
of it it's fantastic.
What I'm looking forward to andthis is just speculation,
especially when it comes topolitics and stuff I don't think
this land tax is going to lastlong.
I think it's more of a how dowe get out of the recession that
(08:38):
we created during 2020, 2021and get all that money back that
we invested into the economy,and how could we quickly do that
?
I think it's a short term thingand I think I agree with you,
matty Now is the time to startinvesting in Victoria and
Melbourne, for sure.
You know.
I think it was Warren Buffettthat said invest when people are
(09:00):
fearful and be fearful wheneveryone's investing.
How many times did we talkabout perth on this podcast?
Speaker 3 (09:06):
well, it's yeah, so many times and honestly.
Perth is is slowed down a lot,and that's why I was scared of
perth last year yeah, becauseeveryone was buying.
Speaker 2 (09:14):
Everyone was buying in perth.
You don't know what's hype,what's real, what's not, and now
we're starting to see you'rethe expert um, yeah, for sure.
Speaker 1 (09:23):
So.
So it's definitely slowing down, I guess, testament to the
important metrics that we wantto consider when we're investing
, right?
So, again, if I relate it backto surrounding yourself with
owner occupiers, regardless ofwhat the investor market is
doing, people still need a roofover their head.
So if we're buying aninvestment and we're buying in
an area that is more than 80owner occupiers, now we've seen
(09:47):
the investor market completelyleave perth.
All that hype is gone.
Yeah, yes, the demand isdecreasing, but all of the areas
that are driven by owneroccupiers are still being driven
by owner occupied.
Speaker 3 (09:58):
Okay, that makes it because we I remember we talked
in the last one of the otherepisodes that um perth limits
the amount of investors that areallowed to come in.
They have like a set.
Speaker 1 (10:07):
Yeah, that was more so with new land releases.
Oh, okay, yeah, yeah, okay Forcontrolling future supply.
Speaker 3 (10:14):
Yeah, okay, that makes sense.
Speaker 2 (10:15):
You know I've got some stats here.
So Melbourne reported a reallystrong growth in February up
0.4%.
The median dwelling value didincrease and it ended 10 months
of decline.
Speaker 1 (10:28):
Yes.
Speaker 2 (10:29):
I want to kind of pick apart two of those items.
The median dwelling valueincreased Median is not mean.
So median is what most peopleare paying and the mean is the
average.
Averages can get blown out.
Speaker 3 (10:44):
By extremes on either end of it as well.
Speaker 2 (10:46):
Yeah.
So the reason we use median isbecause what most people are
paying.
If that has increased by 0.4%,people will hear oh, 0.4%,
that's not too much.
Okay, on a $600,000 property,that means your property has
still gone up.
What $2,400?
Still?
Making money for sure thecapital worth is there and
(11:07):
that's that's 0.4.
I'm almost certain that's amonth-on-month increase it was
the.
Speaker 1 (11:14):
I think it's the last quarter yeah, last quarter that
was the core logic report.
Speaker 2 (11:17):
Yeah, this is core logic data yeah if, if your
property is increasing by youknow, let's say, 1.6 a year,
that's still a pretty damndecent investment, especially
when you're purchasing somethingworth 600 000.
Yeah.
And the reason I want tohighlight that is people will
hear oh yeah, but you bought itfor 600 000.
It only went up 1.6, but youdidn't use 600 000 to purchase
(11:39):
that property.
Yeah, you used a 5% or 10%deposit.
So let's say I invested $60,000, 10% deposit and then my return
is $2,400.
That isn't a 0.4% increase.
That's actually almost a half apercent.
Sorry, that's almost a 4%increase, if I'm correct, and
(12:02):
that's over one quarter.
Imagine you had a 16% increaseover a year.
That's a big difference andpeople need to consider that
when they're looking at thingslike rent, vesting or things
like investing in property forexample because you're not using
your money to make money.
You're using the bank's money tomake money.
(12:22):
And that's how you got to thinkas a property investor.
Yeah, leveraging credit.
Jack Henderson is actuallyreally good at this and he's got
his own podcast and he's got afantastic social footprint and
he always brings up rent vesting.
He always brings it up becausethe guy drives around in a
McLaren.
He's done extremely, extremelywell for himself.
And the reason he has done wellfor himself is because he rents
(12:44):
the property he lives in.
He hasn't bought the propertythat he lives in.
He rents the property that helives in, he preaches it and you
know, when we see these sortsof numbers, you know you might
be able to go buy a property inSydney that has fantastic
capital growth, but it mighttake a much higher deposit.
Where you can go and buy at thelow end of the market right now
(13:04):
, which is Melbourne, yeah, okay, you might be able to buy two
or three properties down thereand Melbourne's still got room
to grow because, like these,prices are still 2.5% below what
they were this time last year.
Speaker 1 (13:15):
Yeah.
Speaker 3 (13:15):
Exactly so if we're starting to see this trend go
upwards well, I think it's goingto hit its boom.
Speaker 2 (13:20):
I think it's going to hit its boom.
I think there's going to be aboom period in Victoria, and
it's because everyone else hashad their run.
It's going to be Melbourne.
It's going to be SouthAustralia this time around.
You know Adelaide.
We're starting to see some, youknow, serious runs on the board
as well.
Speaker 3 (13:40):
Which makes sense, because they didn't really have
that crazy boost that Perth didor like that Brisbane did before
Perth and all those kinds ofthings.
So it just makes sense thatit's its turn.
Do you reckon darwin's evergoing to get that boost?
No, no, I don't think so eitherdarwin.
Speaker 2 (13:51):
Darwin is very, very different.
Um, it's, and it's as much asthey want to try and pump the
economy there and as much asthey want that place to grow.
Darwin, as you know, manny hassaid look where people want to
live.
Darwin's too fucking hot forsix months of the year and then
it's really wet for the othersix months Don't get me wrong.
(14:13):
I love a good tropical season,I love a good holiday, but when
you look at areas like that tolive, it's not easy.
Speaker 1 (14:20):
The same is true for Tasmania, right.
So places like Darwin andTasmania, they have an aging
population as soon as like.
If you've grown up in Tasmania,your parents are probably
cousins.
But aside from I'm Lebanese.
Speaker 2 (14:35):
My parents are cousins anyway, skip it in.
Speaker 1 (14:41):
No.
So, all jokes aside, agingpopulation, right, because they
turn 18, 19,.
They leave, they go toMelbourne, they study, they go
to university, they establishtheir lives get work, job
opportunities.
So, obviously, who's buyingproperties?
It's the 25 to 45 age group,right Age bracket.
They're the ones who areinvesting, they're the ones who
(15:03):
are in their accumulation phase.
Speaker 3 (15:04):
Yeah know there's either starting families or they
or they, you know, have afamily and yeah, you've got to
keep that money flowing somehowmanny, you have a finger on the
pulse, you know all acrossaustralia.
Speaker 2 (15:15):
Tell us about construction at the moment.
You know what states haveconstruction aligned with their
population growth?
Because we know for a fact, newsouth wales, it's way too
expensive to build.
Yeah, yeah, I'm gonna give youperfect example.
Last night I got a contract ofsale on my desk.
It was a 1.8 million dollarcontract of sale.
The client already signed it.
(15:36):
Okay, it went to auction.
They've signed the 66w.
They're trying to get out of it.
Oh my god because they'vepurchased.
And then they ran theirfeasibility and they saw it was
too expensive to build a duplex.
And then they looked at childcare senate options for this
area.
That's too expensive, theywon't get any yield on it.
So they are trying theirhardest to get out of purchasing
(15:57):
this block of land becauseconstruction is too expensive in
new south wales.
But can you provide commentaryon the other states for For sure
?
Speaker 1 (16:04):
So we're still nowhere near building enough
homes to keep up with the demandright.
So that's across the country Interms of what's happening at a
micro level.
So construction in Queenslandis quite fast, pretty affordable
, depending on the spec level ofwhat you're building.
(16:27):
So if you're going to build,you know like a home for
yourself to live in and you'regoing to up spec it and you know
, with all of the fancy features, a bit more custom, yeah, the
custom build.
Obviously prices are going tobe a little bit higher because
you're fully customizing it, butas an average the build
timeframes are quite quick.
So from an investor, obviouslyyou know InvestorMate, we
(16:49):
specialize with helpinginvestors, so I'm just going to
speak about that opposed to sortof custom builds.
No, that's fine Do what you gotto do, man For sure.
Speaker 2 (16:56):
Throw your cheap plugs in here and there.
If you need a mortgage to helpwith an investment, it's simple,
right there, buddy, do what yougot to do.
Matty, do what you got to do.
Speaker 1 (17:06):
But look from the investment build standpoint.
You can build a home in six toseven months from slab down,
which is crazy fast.
Speaker 3 (17:16):
That is really fast.
Speaker 1 (17:18):
Slabs down.
Your property is being handedover in seven months.
Speaker 2 (17:22):
I'm just thinking about New South Wales and just
the time it takes to build.
Two years, yeah, our time frameis 24 months at the moment,
yeah, um, and six to sevenmonths.
Queensland, that's just, oh,it's a fantasy yeah, south south
australia.
Speaker 1 (17:38):
You're looking at 10 to 12 months perth.
You're looking at 14 months.
Okay, um, and that's kind ofwhat I expected.
Speaker 3 (17:42):
Yeah, melbourne, melbourne's pretty quick
melbourne seven to eight months.
Speaker 1 (17:44):
Perth.
You're looking at 14 months, sothat's kind of what I expected.
Melbourne's pretty quick.
Melbourne's seven to eightmonths as well, from slab down.
So all those timeframes that Ijust quoted are from when the
slab is finished.
So yeah, if I was an investorwanting to build a property, I
would not be building in Perth.
I would be pretty skepticalabout building in Adelaide,
where I see the value is partsof Brisbane, and definitely in
(18:07):
Melbourne.
Speaker 2 (18:08):
Do you think Brisbane is benefiting from the Olympics
coming up in 2032?
Speaker 1 (18:14):
They've been riding that way for the last two years.
Everyone talks about theOlympics, the Olympics.
I think they're going tobenefit from the amount of
infrastructure spent to lead upto the Olympics.
Speaker 3 (18:26):
Yeah, because there's like a lot of trams and trains
and stuff.
Speaker 1 (18:28):
Underground bus tunnels, like it's crazy in
terms of the infrastructure,really Underground bus tunnels.
Yeah, one thing that they'redoing really, really well is
they're actually spreading outtheir stadiums.
So if you know, brisbane,toowoomba's like their
Wollongong equivalent,toowoomba's, about an hour and
10 minutes from Brisbane City,but they are building stadiums
in Toowoomba.
(18:49):
So imagine we hosted, when wedid in the year 2000, the Sydney
Olympics, but we had stadiumsin Wollongong.
We built Sydney Olympic Park, awhole suburb, newington, just
like, completely rushed it justfor the Olympicslympics.
All the stadiums were rightthere.
So you put sydney on the map,you put sydney olympic park on
(19:11):
the on the international stage.
I think brisbane's doing itright yeah, I mean sydney
olympic park.
Speaker 3 (19:17):
Right now it's like you're not really making money
there from residentials oranything like that.
It's a bit of it's a bit ofpain in the ass to get to and
from.
Like you've got that onestation on one line?
Yeah, and it's also like I'mpretty sure it's the only
station on that line Back andforth from Lidcombe.
Speaker 1 (19:31):
That's it, yeah.
Speaker 2 (19:33):
So I went to.
I got invited by Westpac lastyear to go watch the Canterbury
Bulldogs semifinal.
Speaker 1 (19:39):
Okay.
Speaker 2 (19:41):
It wasn't even.
No, it wasn't, it was aquarterfinal um this.
This wasn't even a grand finalmatch.
And to get to and from lidcombe, I think it took 40 minutes to
get onto a train yeah, becausethere's only so many trains that
they can allow.
So imagine, if it was today'sday olympics the amount of
(20:02):
traffic congestion, the amountof residential apartments that
have gone up in that area.
Speaker 1 (20:05):
Yeah, it is near impossible to get in and out of,
especially when there'sentertainment on I live in
strathfield, which is it shouldbe an eight minute drive from
sydney olympic park.
I was having dinner at afriend's house.
Um, they live like right in theheart of olympic park during um
the taylor swift tour oh my godand God, and it took me an hour
(20:26):
and 30 minutes to get home.
Eight minutes and it's an eightminute drive.
An hour and 30 minutes.
Speaker 3 (20:33):
So yeah, I think Brisbane's doing it right.
Honestly, that should neverhappen.
Speaker 2 (20:38):
So what areas have you seen, brisbane-wise?
Speaker 1 (20:41):
Yeah, so look anywhere really within a
45-minute drive of the CBD, Ithink is a great opportunity.
I'm sort of biased and I reallylike the northern part of
Brisbane.
When you sort of look at theterrain and the topography of
that region, it's verylandlocked up north of Brisbane
where when you go down towardsLogan and sort of down south
(21:04):
west of Brisbane CBD there's anabundance of land.
Speaker 3 (21:08):
Okay, and is that up north?
Is that like prone to floodingor anything like that in that
section?
Speaker 1 (21:16):
There are flood zones but obviously, if you're
working with a buyer's agent oryou have the right tools to
understand if your property orthe prospective property that
you're looking for is within aflood zone or bushfire risk,
then you can sort of make yourdecision um yeah, so.
Speaker 2 (21:31):
So 45 minutes north of brisbane, would you call that
regional, or is that stillmetropolitan?
Speaker 1 (21:36):
yeah, still metropolitan brisbane um yeah
yeah, yeah, to put it intoperspective, to give the viewers
actual suburbs that they canresearch, the furthest I'd
probably look is Moorayfield,which is about a 50-minute drive
, relatively close to the water.
So on the other side of thehighway there's suburbs, premium
(21:58):
suburbs, burpengary East, whichStocklands has a beautiful
estate there You're looking atsort of $950 as a total price
now, which is quite expensive,but again owner-occupied demand
is driving.
Speaker 2 (22:13):
That Are these $950 house and land packages, or are
we looking at $950 ready-builtturnkey?
Speaker 1 (22:19):
Oh yeah, so to clarify, house and land packages
and ready-built homes are inthe same same sort of market
price um, what?
Speaker 2 (22:28):
what's the mix?
Are we looking at three betters, four betters for better homes,
really so serious homes thatpeople could live in for 950k
yeah?
Speaker 1 (22:35):
That's actually, oh, when you compare it to Sydney's
median house price.
Speaker 3 (22:40):
That's what I'm thinking, because you said it
was expensive and I'm likethat's kind of good.
Speaker 1 (22:45):
It's expensive in comparison to, you know,
relative to other pockets ofBrisbane.
So I guess one thing thatexcites me when we're sort of
understanding different suburbsto invest in I probably wouldn't
buy a $900,000 property as aninvestment because what you're
going to be renting thatproperty out for is not really
going to meet the minimum yieldthat we need to consider.
So I think the sweet spot isprobably around $800,000.
(23:07):
But when we look at urbansprawl, there's suburbs
surrounding Burpengary East thatare much more affordable, even
in some cases closer to the CBD,that you can purchase
properties between $750,000 to$800,000.
Speaker 2 (23:22):
So I wanted to highlight something that you
mentioned it's near the water.
Yeah, how far are we saying youknow what's near the water when
you're talking about thesesuburbs?
Speaker 1 (23:31):
For sure.
So I believe Morayfield to thebeach would probably be a 15
minute drive.
Wow and burp and gary east islike a carrying bar to cronulla
beach.
Speaker 2 (23:41):
Wow, um, for 950k yeah, I'm just thinking about
carrying by trying to buy ahouse there, four bedroom, brand
new, built for 950 000.
It's impossible I think themost recent one I did was a 2.1
million dollar one.
Um, and it's just the price.
It's chalk and cheese.
Yeah, we understand thedifference.
I think the most recent one Idid was a $2.1 million one
Double the price.
It's chalk and cheese.
We understand the differencebetween Sydney and Brisbane but
(24:02):
it's still cheap.
Speaker 3 (24:02):
The mathematical difference.
Speaker 2 (24:05):
That means their cost per acquisition for each lot of
land is a lot cheaper than whatit would be in Sydney, because
that's where a lot of thebuilding costs come from.
It's the acquisition of theland, materials and trades and
labor that's going to lot of thebuilding costs come from.
It's the acquisition of theland.
You know materials and tradesand labour that's going to cost.
You know, almost uniform allacross the country 100%.
But it's the actual, it's theextras, it's the land, it's the
(24:25):
holding costs, it's you know howmuch does it actually stack up?
And I think that's why we havea construction problem in New
South Wales compared to placeslike Brisbane, problem in New
South Wales compared to placeslike Brisbane.
Are we seeing a lot ofinternationals move to these
areas or are we looking at, youknow, retirees, 60 plus.
You know your average mum anddad.
They built their super up andthey go.
You know, I want to livesomewhere warm.
Speaker 1 (24:46):
It's.
I think COVID was whereQueensland really benefited from
that interstate migration.
So people leaving Sydney andMelbourne because of the price
points at the time and theycould have afford to purchase in
Brisbane for a bit cheaper, abit closer to the city, nicer
lifestyle, and they were able towork from home.
(25:08):
So that really changed thelandscape.
And then Sydney Newcastle wasthe same, sydney Wollongong was
the same.
So people are sort of startingto explore areas a little bit
further away because they don'tneed to be 40 minutes from CBD
anymore.
You know what I mean.
So I don't think there's much interms of net migration
(25:29):
interstate.
So people leaving Sydney andgoing to Brisbane as much as
what it was during COVID,because prices have actually
grown quite well in Brisbanebetween you know 2020 till now.
But one thing that I think Iwanted to sort of provide some
value on and to bring it back tothe Melbourne market, one thing
that I'm a very big fan of whenwe're looking at areas to
(25:52):
invest in is one what can youbuild a home for and what is the
established market currentlydoing in terms of house prices?
So an area that we had a lot ofsuccess, in which we invested
um in feb last year, so justover 12 months ago we had the
(26:13):
opportunity to put four clientsin a suburb called.
I can talk about it now becauseit's boomed we won.
Anglevale.
So we bought in Anglevale for600, between 600 to 630,000,.
We bought house and landpackages.
Four clients are now coming tocompletion of those properties
(26:37):
and you can't buy an establishedproperty in that suburb for
less than 800,000.
Today, only 13 months later,wow, right.
So at the time, whatopportunity we saw in that
market was we were buying houseand land packages for 600 to630.
Established properties wereselling for $650 to $680.
Speaker 2 (26:57):
That's a 30% to 35% growth in a year Wow.
Speaker 1 (27:01):
The exciting part is that it was actually cheaper or
more affordable is the rightterm to use more affordable to
buy a house and land packagethan it was to buy an
established property in thatmarket.
So it's very hard to come bythose opportunities.
I'm starting to see it quitefrequently in Melbourne.
So there's suburbs 30Ks fromMelbourne CBD where you can buy
(27:25):
land and build a home for$650,000.
But if you were to buy anestablished, already completed
property in that same suburbyou'd be paying $50,000 more
already completed property inthat same suburb, you'd be
paying 50 grand more.
Speaker 2 (27:42):
So, Manny, I want to ask you what kind of tactics are
you using when purchasinginterstate?
Speaker 1 (27:46):
What are?
Speaker 2 (27:46):
the three key drivers to help both your clients and
yourself in establishing.
This is a good investment.
This is the right buy.
Speaker 1 (27:54):
Definitely the biggest misconception that I see
is when people come to sort ofspeak to us.
They think just because theirneighbor or their friend has
bought in a specific area, thatmeans that they can buy in that
area or it makes sense for themto buy in that area.
So what I mean by that is whereI'm at in my personal journey
of investment.
The next property for me is notthe right property for Joey.
(28:16):
The right property for Joey isnot the right property for Liam,
for example.
What I mean by that is youcan't take an overarching
approach with investment.
Speaker 3 (28:27):
Yeah, everyone's financial situation is
completely different and theirportfolios are different.
What they can afford isdifferent.
Yeah, exactly.
Speaker 1 (28:33):
So there's a personalized element to it.
When we sit down with clientsand we sort of help build out
their strategy.
Um, one thing that we look atis what's the maximum purchase
price that they need to consider, based on their borrowing
capacity.
Let's say they can buy up to avalue of 700 000.
Yeah, that gives them plenty ofoptions, okay, but what we
(28:55):
start to do to actually narrowdown on suburbs that will work
for for the client isunderstanding what is the yield
in that particular location andwhere does the yield need to be
for the cash flow to becomfortable for that specific
client to hold?
Speaker 2 (29:09):
yeah, so what are the considerations when looking at
the yield, because buyers needto understand that it's not
uniform across all of australia.
You know what are the differentcosts that you'll help analyze
yes is there a funding tablethat you provide that highlights
this is your cost, this is yourstamp duty?
Provide us a little bit ofdetail.
(29:31):
You know, when people look at abuying state, what are the key
metrics that they need to belooking at.
Speaker 1 (29:37):
For sure.
So when it comes to cash flow ona property, we do a very
comprehensive calculation.
So we first look at again themaximum purchase price that that
client can consider If we'reopen to multiple states,
understanding in each state whatthe stamp duty is going to be,
understanding whether they'reusing equity from another
(29:58):
property to purchase or whetherthey're actually putting a
deposit.
That's a very important factorbecause if you're putting a 5%,
a 10%, a 20% deposit, that isgoing to make a difference to
what the end result looks like,right?
So if you're using equity,you're effectively borrowing
100% of the value of theproperty plus stamp duty and
legal fees, which means that thecash flow is not going to be as
(30:19):
pretty.
So sort of breaking that downand looking at the stamp duty,
looking at the cost of thingslike land tax, if applicable,
council rates, water rates,landlord insurance,
understanding what the averageyield is in that particular
location insurance,understanding what the average
yield is in that particularlocation, and then sort of
(30:39):
breaking it down all the waydown to actual tax benefits of
having that investment property,specific to how that, how much
that client is earning.
So by presenting our clientswith that breakdown we can very
quickly see whether thatstrategy is actually suitable
for them or not.
If it's not, then to be honestwith it, doesn't matter how good
that investment is, it's notthe right investment for them,
(31:02):
yeah.
Speaker 2 (31:03):
Manny, we've spent 40 minutes on this podcast.
You've got a wealth ofknowledge.
What I can say is buyers aren'tgoing to benefit just from a
from a 40-minute podcast youhave an event coming up, don't
you?
Yeah we do, and I think youhave it with well, you just said
we with it's simple finance canyou tell us a little bit?
(31:27):
About this event definitely so.
Speaker 1 (31:29):
Hashtag shameless plug.
Yeah, so the event is calledready, set by yep, and I'm very
excited for the event.
It's going to be myself, josephfrom it's Simple, and we're
having Peter Ishak from Ishak'sConveyancing.
So a wealth of knowledgebetween us all.
What I'm planning to talk aboutis the fundamentals that we
(31:50):
need to consider when we'reinvesting.
So what are the eight metrics?
The main eight metrics that weneed to look for when buying an
investment property, all the waydown to infrastructure supply
and demand, demographics, theaffluence of people that are
living in the area, thepopulation growth, the
infrastructure.
Spend really educating theattendees of the event on how to
(32:15):
actually buy the bestinvestment property and what to
look for, as well as the toolsto implement to actually have
the confidence to purchase.
Speaker 3 (32:25):
Okay, so when and where is this event?
Speaker 2 (32:26):
I want to go, so it's going to be a Strathfield Golf
Club.
It's on Thursday, april 10th.
You know, manny speaking, I'mspeaking, ishak Kavadzian is
speaking.
I'm going to highlight just theplain simple thing you want
money.
This is how we're going to getyou money.
All right, people try and overcomplicate property and they try
and over complicate finance.
What we try and do is break itdown so for the average
(32:49):
individual I'm not going to sayschmo, but so the average
individual can seriously benefitfrom property and be able to
build wealth from it.
I hear multiple people all thetime oh, it just sounds too
difficult.
Everything is.
It's so hard, you know, that'swhy you need an investor, mate,
and that's why you need somebodyto make it simple for you.
Speaker 3 (33:07):
so you know we can be able.
It's almost as if you guys keepit simple it's.
Speaker 2 (33:13):
It's what we're going to be doing, so I'm really
excited for this event.
You know, manny, thank you somuch for coming on to this
episode.
It's always a pleasure.
We got so much out of you today.
I believe we're going to get somuch more out of you on april
10th and for anyone that needshelp with purchasing an
investment you can go towwwinvestormatecomau and if you
need help with financing thatinvestment, you can go to
(33:34):
wwwitsimatecomau, and if youneed help with financing that
investment, you can go towwwitsimplecomau.
As always, manny, thank you forcoming on.
Thank you, that's Michael.
I'm Joe.
Thanks for listening.
As we know, markets shift right.
They almost feel like theyshift on a monthly basis now,
but there's opportunities thatwe weren't considering two years
ago, 12 months ago, that havestarted to come onto the horizon
, which is quite exciting.
Speaker 2 (00:14):
What are these trends ?
What you weren't considering 24months ago, what you're
considering now.
Speaker 1 (00:19):
I think so an area that we had a lot of success, in
which we invested.
We had the opportunity to putfour clients in a suburb court.
I can talk about it now becauseit's boomed.
Speaker 2 (00:31):
Manny, you have a finger on the pulse.
You know all across Australia.
What kind of tactics are youusing to help both your clients
and yourself For sure Inestablishing this is a good
investment this is the right one.
Speaker 1 (00:44):
The biggest misconception that I see is
Welcome to the Finance Show withJoe.
Speaker 3 (00:53):
He's Joe, I'm Michael and we have Manny back today.
Speaker 2 (00:57):
I am so excited to have Manny back, because Manny
has been on an adventure for thelast four months.
Manny, do you want to tell ourlisteners what's been going on
since?
I want to say November?
Speaker 1 (01:09):
Yeah, I got married at the end of November.
Woo yeah, manny.
And then, yeah, traveled theworld for almost two months it
was about seven weeks.
So I got back at the start ofFeb and right into work, right
into buying properties.
Where did you travel to?
We went to a few places.
(01:29):
So we went to Egypt, went toDubai, abu Dhabi and a little
island off the coast of Africacalled Mauritius, which Joey's
been to and he said he hated.
What about?
Speaker 3 (01:40):
you Did you like it?
Whoa, okay, no, no, no, I'mgoing to cut.
Speaker 2 (01:48):
I?
What about you?
Did you like whoa?
Okay, no, no, no, I'm gonna cut.
I didn't hate the island ofmauritius, I hated the fact that
I broke my toe and my wife mademe hike a mountain.
That's a kilometer up like thatway at like, and then the going
up isn't the hard part, it'sthe coming down on a broken toe.
Yep, okay.
And she made me rush because wehad a special breakfast.
Do you want to know what thespecial breakfast was?
What?
It was the exact same breakfastwe had had the previous two
(02:11):
days, only next to the pool.
Speaker 3 (02:14):
That sounds pretty special.
I don't know, and that's why Idon't like Mauritius.
Speaker 2 (02:17):
But the island itself .
It's actually really pretty.
Okay, I really enjoyed it.
So you highlighted something.
You've been buying property,you've been assisting a lot of
people.
Tell me, tell me, what's goingon at the moment.
Speaker 1 (02:27):
Yeah, definitely so.
As we know, markets shift rightand they almost feel like they
shift on a monthly basis now.
So there's a few areas, a fewcapital cities, a few regional
markets that we were sort ofvery heavily investing over the
last two years that I feel areno longer the right investments.
(02:48):
They're sort of at the top endof their cycle and buying now
would probably be a bit foolishbecause they've run so hard over
the last 24 months.
But there's opportunities thatwe weren't considering two years
ago, 12 months ago, that havestarted to come onto the horizon
, which is quite exciting.
Speaker 2 (03:07):
What are these trends ?
What are you seeingspecifically for what you
weren't considering 24 monthsago, what you're considering now
.
Speaker 1 (03:16):
For sure.
So the Melbourne market when wefirst started talking about
Melbourne on this podcast orVictoria in general I was a very
big fan of regional, yeah, andI was pretty much shitting on
capital city I was saying, look,it's not the right time to
invest.
Vacancy rates are too high, thedays on market are way too high
(03:39):
, people are listing theirproperties and it's taking three
months to sell it's.
It's not the right time to bebuying in Metro Melbourne.
That's changed.
Is it flipped or is it?
Look, it's not quite there yet,but it's all trending in the
right direction.
So what I mean by that?
For example, days on market.
(03:59):
When we were looking three,four months ago, some of these
suburbs had 60, 65, 70 days onmarket, meaning that you were
advertising your property tosell and it was taking 70 days
for you to get an offer acceptedon that property.
Right, this is trendingdownwards in a very fast
direction.
So instead of 70 days, we'reseeing 35 days now, which is
(04:25):
halved in terms of that meansthe demand has increased.
Speaker 2 (04:29):
Exactly so the Melbourne market.
As I understand, theyintroduced a land tax where, if
you own a property or aninvestment property that's worth
, I think, the land area $50,000or more, there's a new tax
that's on it.
Have you seen people exit andnew investors enter because they
can afford it?
Speaker 1 (04:50):
So Melbourne as a city was being scrutinised a lot
in the news.
Speaker 2 (05:00):
I scrutinised it like crazy.
I did too, I did too.
Speaker 1 (05:05):
So things like land tax being introduced obviously
is the opposite of what you wantto do when you're trying to
bring investors into the marketright, and creating hype,
creating demand, making iteasier for people to purchase
properties is what any stategovernment should be trying to
do.
Where in Victoria, they did theopposite.
(05:28):
So they introduced land taxpractically at no threshold,
unlike every other state inAustralia where you're buying a
property if you're purchasing aproperty in your personal name
there is a threshold for landtax, and once you go above that
threshold, that's when the landtax is applicable.
In Victoria, there is athreshold for land tax and once
you go above that threshold,that's when the land tax is
applicable.
In Victoria, there'spractically no threshold, which
(05:51):
means that you have to startpaying land tax from a very low
value of land ownership.
So that definitely didn't havegood publicity.
I think I do get asked thatquestion a lot from investors.
But what about land tax?
And I think every state has itspros and cons right.
(06:12):
So the easiest way that I sortof explain this to investors is
as long as we're taking thesecalculations into consideration
when we're making our choice andit still makes sense for you to
consider this market from acash flow position, then why not
?
Because in Queensland, forexample, insurances as an
average are a bit higher.
Speaker 3 (06:32):
Yeah, which never gets talked about.
It's always about the land taxin.
Melbourne Exactly.
Speaker 2 (06:36):
Well, it's also stamp duty in other states.
You know, stamp duty is a lothigher than in other states on a
percentage level compared toNew South Wales.
Speaker 3 (06:43):
But people don't bring that up.
Speaker 2 (06:45):
They only bring up, oh no, this new land tax.
This new land tax.
We've had a client of ourspurchase recently in Melbourne
CBD beautiful three-bedroom,two-bathroom apartment.
They've got a six-monthsettlement Now if you wanted to
buy a brand-new three-bedroomtwo-bedroom apartment in Sydney.
Speaker 1 (07:03):
What are you paying?
Speaker 2 (07:04):
oh, in the heart of the cbd yeah, it's double digit
millions it's it's, you'relooking at two to three million
dollars, but when you go tomelbourne cbd, this this client
of ours purchased for a milliondollars in the heart of
melbourne cbd wow, wow so mannyhas brought up several times our
episodes of the show joe Investwhere people want to live.
(07:24):
Look for where the owneroccupies are.
If you're going to purchase aproperty, look at the amenity
that's around there.
What better than Melbourne CBDat the moment?
You go to Melbourne CBD, you'reconnected via the tram, you can
get basically anywhere in thespan of 20 minutes.
It is so fast and it is soconnected and so easy to get
(07:45):
around that it's kind of sillyto think to yourself why this
market wouldn't boom for sure,especially because melbourne I
mean population wise it's nowbigger than than sydney.
Speaker 3 (07:55):
Now, right, yeah, so greater melbourne, cbd.
Speaker 2 (07:57):
Yeah, is more populous than greater sydney,
cbd however, you know new southwales as a state.
It's three times the size ofvictoria.
Yeah, but sydney itself it'scongested, it's hard to get
around.
Speaker 1 (08:11):
Okay, it's pretty, let's let's not beat around the
bush sydney's.
Speaker 2 (08:15):
Sydney's pretty good looking, as far as you know,
cities go, yeah, but melbourneitself, as far as amenity,
entertainment like thefunctionality of a culture, all
of it it's fantastic.
What I'm looking forward to andthis is just speculation,
especially when it comes topolitics and stuff I don't think
this land tax is going to lastlong.
I think it's more of a how dowe get out of the recession that
(08:38):
we created during 2020, 2021and get all that money back that
we invested into the economy,and how could we quickly do that
?
I think it's a short term thingand I think I agree with you,
matty Now is the time to startinvesting in Victoria and
Melbourne, for sure.
You know.
I think it was Warren Buffettthat said invest when people are
(09:00):
fearful and be fearful wheneveryone's investing.
How many times did we talkabout perth on this podcast?
Speaker 3 (09:06):
well, it's yeah, so many times and honestly.
Perth is is slowed down a lot,and that's why I was scared of
perth last year yeah, becauseeveryone was buying.
Speaker 2 (09:14):
Everyone was buying in perth.
You don't know what's hype,what's real, what's not, and now
we're starting to see you'rethe expert um, yeah, for sure.
Speaker 1 (09:23):
So.
So it's definitely slowing down, I guess, testament to the
important metrics that we wantto consider when we're investing
, right?
So, again, if I relate it backto surrounding yourself with
owner occupiers, regardless ofwhat the investor market is
doing, people still need a roofover their head.
So if we're buying aninvestment and we're buying in
an area that is more than 80owner occupiers, now we've seen
(09:47):
the investor market completelyleave perth.
All that hype is gone.
Yeah, yes, the demand isdecreasing, but all of the areas
that are driven by owneroccupiers are still being driven
by owner occupied.
Speaker 3 (09:58):
Okay, that makes it because we I remember we talked
in the last one of the otherepisodes that um perth limits
the amount of investors that areallowed to come in.
They have like a set.
Speaker 1 (10:07):
Yeah, that was more so with new land releases.
Oh, okay, yeah, yeah, okay Forcontrolling future supply.
Speaker 3 (10:14):
Yeah, okay, that makes sense.
Speaker 2 (10:15):
You know I've got some stats here.
So Melbourne reported a reallystrong growth in February up
0.4%.
The median dwelling value didincrease and it ended 10 months
of decline.
Speaker 1 (10:28):
Yes.
Speaker 2 (10:29):
I want to kind of pick apart two of those items.
The median dwelling valueincreased Median is not mean.
So median is what most peopleare paying and the mean is the
average.
Averages can get blown out.
Speaker 3 (10:44):
By extremes on either end of it as well.
Speaker 2 (10:46):
Yeah.
So the reason we use median isbecause what most people are
paying.
If that has increased by 0.4%,people will hear oh, 0.4%,
that's not too much.
Okay, on a $600,000 property,that means your property has
still gone up.
What $2,400?
Still?
Making money for sure thecapital worth is there and
(11:07):
that's that's 0.4.
I'm almost certain that's amonth-on-month increase it was
the.
Speaker 1 (11:14):
I think it's the last quarter yeah, last quarter that
was the core logic report.
Speaker 2 (11:17):
Yeah, this is core logic data yeah if, if your
property is increasing by youknow, let's say, 1.6 a year,
that's still a pretty damndecent investment, especially
when you're purchasing somethingworth 600 000.
Yeah.
And the reason I want tohighlight that is people will
hear oh yeah, but you bought itfor 600 000.
It only went up 1.6, but youdidn't use 600 000 to purchase
(11:39):
that property.
Yeah, you used a 5% or 10%deposit.
So let's say I invested $60,000, 10% deposit and then my return
is $2,400.
That isn't a 0.4% increase.
That's actually almost a half apercent.
Sorry, that's almost a 4%increase, if I'm correct, and
(12:02):
that's over one quarter.
Imagine you had a 16% increaseover a year.
That's a big difference andpeople need to consider that
when they're looking at thingslike rent, vesting or things
like investing in property forexample because you're not using
your money to make money.
You're using the bank's money tomake money.
(12:22):
And that's how you got to thinkas a property investor.
Yeah, leveraging credit.
Jack Henderson is actuallyreally good at this and he's got
his own podcast and he's got afantastic social footprint and
he always brings up rent vesting.
He always brings it up becausethe guy drives around in a
McLaren.
He's done extremely, extremelywell for himself.
And the reason he has done wellfor himself is because he rents
(12:44):
the property he lives in.
He hasn't bought the propertythat he lives in.
He rents the property that helives in, he preaches it and you
know, when we see these sortsof numbers, you know you might
be able to go buy a property inSydney that has fantastic
capital growth, but it mighttake a much higher deposit.
Where you can go and buy at thelow end of the market right now
(13:04):
, which is Melbourne, yeah, okay, you might be able to buy two
or three properties down thereand Melbourne's still got room
to grow because, like these,prices are still 2.5% below what
they were this time last year.
Speaker 1 (13:15):
Yeah.
Speaker 3 (13:15):
Exactly so if we're starting to see this trend go
upwards well, I think it's goingto hit its boom.
Speaker 2 (13:20):
I think it's going to hit its boom.
I think there's going to be aboom period in Victoria, and
it's because everyone else hashad their run.
It's going to be Melbourne.
It's going to be SouthAustralia this time around.
You know Adelaide.
We're starting to see some, youknow, serious runs on the board
as well.
Speaker 3 (13:40):
Which makes sense, because they didn't really have
that crazy boost that Perth didor like that Brisbane did before
Perth and all those kinds ofthings.
So it just makes sense thatit's its turn.
Do you reckon darwin's evergoing to get that boost?
No, no, I don't think so eitherdarwin.
Speaker 2 (13:51):
Darwin is very, very different.
Um, it's, and it's as much asthey want to try and pump the
economy there and as much asthey want that place to grow.
Darwin, as you know, manny hassaid look where people want to
live.
Darwin's too fucking hot forsix months of the year and then
it's really wet for the othersix months Don't get me wrong.
(14:13):
I love a good tropical season,I love a good holiday, but when
you look at areas like that tolive, it's not easy.
Speaker 1 (14:20):
The same is true for Tasmania, right.
So places like Darwin andTasmania, they have an aging
population as soon as like.
If you've grown up in Tasmania,your parents are probably
cousins.
But aside from I'm Lebanese.
Speaker 2 (14:35):
My parents are cousins anyway, skip it in.
Speaker 1 (14:41):
No.
So, all jokes aside, agingpopulation, right, because they
turn 18, 19,.
They leave, they go toMelbourne, they study, they go
to university, they establishtheir lives get work, job
opportunities.
So, obviously, who's buyingproperties?
It's the 25 to 45 age group,right Age bracket.
They're the ones who areinvesting, they're the ones who
(15:03):
are in their accumulation phase.
Speaker 3 (15:04):
Yeah know there's either starting families or they
or they, you know, have afamily and yeah, you've got to
keep that money flowing somehowmanny, you have a finger on the
pulse, you know all acrossaustralia.
Speaker 2 (15:15):
Tell us about construction at the moment.
You know what states haveconstruction aligned with their
population growth?
Because we know for a fact, newsouth wales, it's way too
expensive to build.
Yeah, yeah, I'm gonna give youperfect example.
Last night I got a contract ofsale on my desk.
It was a 1.8 million dollarcontract of sale.
The client already signed it.
(15:36):
Okay, it went to auction.
They've signed the 66w.
They're trying to get out of it.
Oh my god because they'vepurchased.
And then they ran theirfeasibility and they saw it was
too expensive to build a duplex.
And then they looked at childcare senate options for this
area.
That's too expensive, theywon't get any yield on it.
So they are trying theirhardest to get out of purchasing
(15:57):
this block of land becauseconstruction is too expensive in
new south wales.
But can you provide commentaryon the other states for For sure
?
Speaker 1 (16:04):
So we're still nowhere near building enough
homes to keep up with the demandright.
So that's across the country Interms of what's happening at a
micro level.
So construction in Queenslandis quite fast, pretty affordable
, depending on the spec level ofwhat you're building.
(16:27):
So if you're going to build,you know like a home for
yourself to live in and you'regoing to up spec it and you know
, with all of the fancy features, a bit more custom, yeah, the
custom build.
Obviously prices are going tobe a little bit higher because
you're fully customizing it, butas an average the build
timeframes are quite quick.
So from an investor, obviouslyyou know InvestorMate, we
(16:49):
specialize with helpinginvestors, so I'm just going to
speak about that opposed to sortof custom builds.
No, that's fine Do what you gotto do, man For sure.
Speaker 2 (16:56):
Throw your cheap plugs in here and there.
If you need a mortgage to helpwith an investment, it's simple,
right there, buddy, do what yougot to do.
Matty, do what you got to do.
Speaker 1 (17:06):
But look from the investment build standpoint.
You can build a home in six toseven months from slab down,
which is crazy fast.
Speaker 3 (17:16):
That is really fast.
Speaker 1 (17:18):
Slabs down.
Your property is being handedover in seven months.
Speaker 2 (17:22):
I'm just thinking about New South Wales and just
the time it takes to build.
Two years, yeah, our time frameis 24 months at the moment,
yeah, um, and six to sevenmonths.
Queensland, that's just, oh,it's a fantasy yeah, south south
australia.
Speaker 1 (17:38):
You're looking at 10 to 12 months perth.
You're looking at 14 months.
Okay, um, and that's kind ofwhat I expected.
Speaker 3 (17:42):
Yeah, melbourne, melbourne's pretty quick
melbourne seven to eight months.
Speaker 1 (17:44):
Perth.
You're looking at 14 months, sothat's kind of what I expected.
Melbourne's pretty quick.
Melbourne's seven to eightmonths as well, from slab down.
So all those timeframes that Ijust quoted are from when the
slab is finished.
So yeah, if I was an investorwanting to build a property, I
would not be building in Perth.
I would be pretty skepticalabout building in Adelaide,
where I see the value is partsof Brisbane, and definitely in
(18:07):
Melbourne.
Speaker 2 (18:08):
Do you think Brisbane is benefiting from the Olympics
coming up in 2032?
Speaker 1 (18:14):
They've been riding that way for the last two years.
Everyone talks about theOlympics, the Olympics.
I think they're going tobenefit from the amount of
infrastructure spent to lead upto the Olympics.
Speaker 3 (18:26):
Yeah, because there's like a lot of trams and trains
and stuff.
Speaker 1 (18:28):
Underground bus tunnels, like it's crazy in
terms of the infrastructure,really Underground bus tunnels.
Yeah, one thing that they'redoing really, really well is
they're actually spreading outtheir stadiums.
So if you know, brisbane,toowoomba's like their
Wollongong equivalent,toowoomba's, about an hour and
10 minutes from Brisbane City,but they are building stadiums
in Toowoomba.
(18:49):
So imagine we hosted, when wedid in the year 2000, the Sydney
Olympics, but we had stadiumsin Wollongong.
We built Sydney Olympic Park, awhole suburb, newington, just
like, completely rushed it justfor the Olympicslympics.
All the stadiums were rightthere.
So you put sydney on the map,you put sydney olympic park on
(19:11):
the on the international stage.
I think brisbane's doing itright yeah, I mean sydney
olympic park.
Speaker 3 (19:17):
Right now it's like you're not really making money
there from residentials oranything like that.
It's a bit of it's a bit ofpain in the ass to get to and
from.
Like you've got that onestation on one line?
Yeah, and it's also like I'mpretty sure it's the only
station on that line Back andforth from Lidcombe.
Speaker 1 (19:31):
That's it, yeah.
Speaker 2 (19:33):
So I went to.
I got invited by Westpac lastyear to go watch the Canterbury
Bulldogs semifinal.
Speaker 1 (19:39):
Okay.
Speaker 2 (19:41):
It wasn't even.
No, it wasn't, it was aquarterfinal um this.
This wasn't even a grand finalmatch.
And to get to and from lidcombe, I think it took 40 minutes to
get onto a train yeah, becausethere's only so many trains that
they can allow.
So imagine, if it was today'sday olympics the amount of
(20:02):
traffic congestion, the amountof residential apartments that
have gone up in that area.
Speaker 1 (20:05):
Yeah, it is near impossible to get in and out of,
especially when there'sentertainment on I live in
strathfield, which is it shouldbe an eight minute drive from
sydney olympic park.
I was having dinner at afriend's house.
Um, they live like right in theheart of olympic park during um
the taylor swift tour oh my godand God, and it took me an hour
(20:26):
and 30 minutes to get home.
Eight minutes and it's an eightminute drive.
An hour and 30 minutes.
Speaker 3 (20:33):
So yeah, I think Brisbane's doing it right.
Honestly, that should neverhappen.
Speaker 2 (20:38):
So what areas have you seen, brisbane-wise?
Speaker 1 (20:41):
Yeah, so look anywhere really within a
45-minute drive of the CBD, Ithink is a great opportunity.
I'm sort of biased and I reallylike the northern part of
Brisbane.
When you sort of look at theterrain and the topography of
that region, it's verylandlocked up north of Brisbane
where when you go down towardsLogan and sort of down south
(21:04):
west of Brisbane CBD there's anabundance of land.
Speaker 3 (21:08):
Okay, and is that up north?
Is that like prone to floodingor anything like that in that
section?
Speaker 1 (21:16):
There are flood zones but obviously, if you're
working with a buyer's agent oryou have the right tools to
understand if your property orthe prospective property that
you're looking for is within aflood zone or bushfire risk,
then you can sort of make yourdecision um yeah, so.
Speaker 2 (21:31):
So 45 minutes north of brisbane, would you call that
regional, or is that stillmetropolitan?
Speaker 1 (21:36):
yeah, still metropolitan brisbane um yeah
yeah, yeah, to put it intoperspective, to give the viewers
actual suburbs that they canresearch, the furthest I'd
probably look is Moorayfield,which is about a 50-minute drive
, relatively close to the water.
So on the other side of thehighway there's suburbs, premium
(21:58):
suburbs, burpengary East, whichStocklands has a beautiful
estate there You're looking atsort of $950 as a total price
now, which is quite expensive,but again owner-occupied demand
is driving.
Speaker 2 (22:13):
That Are these $950 house and land packages, or are
we looking at $950 ready-builtturnkey?
Speaker 1 (22:19):
Oh yeah, so to clarify, house and land packages
and ready-built homes are inthe same same sort of market
price um, what?
Speaker 2 (22:28):
what's the mix?
Are we looking at three betters, four betters for better homes,
really so serious homes thatpeople could live in for 950k
yeah?
Speaker 1 (22:35):
That's actually, oh, when you compare it to Sydney's
median house price.
Speaker 3 (22:40):
That's what I'm thinking, because you said it
was expensive and I'm likethat's kind of good.
Speaker 1 (22:45):
It's expensive in comparison to, you know,
relative to other pockets ofBrisbane.
So I guess one thing thatexcites me when we're sort of
understanding different suburbsto invest in I probably wouldn't
buy a $900,000 property as aninvestment because what you're
going to be renting thatproperty out for is not really
going to meet the minimum yieldthat we need to consider.
So I think the sweet spot isprobably around $800,000.
(23:07):
But when we look at urbansprawl, there's suburbs
surrounding Burpengary East thatare much more affordable, even
in some cases closer to the CBD,that you can purchase
properties between $750,000 to$800,000.
Speaker 2 (23:22):
So I wanted to highlight something that you
mentioned it's near the water.
Yeah, how far are we saying youknow what's near the water when
you're talking about thesesuburbs?
Speaker 1 (23:31):
For sure.
So I believe Morayfield to thebeach would probably be a 15
minute drive.
Wow and burp and gary east islike a carrying bar to cronulla
beach.
Speaker 2 (23:41):
Wow, um, for 950k yeah, I'm just thinking about
carrying by trying to buy ahouse there, four bedroom, brand
new, built for 950 000.
It's impossible I think themost recent one I did was a 2.1
million dollar one.
Um, and it's just the price.
It's chalk and cheese.
Yeah, we understand thedifference.
I think the most recent one Idid was a $2.1 million one
Double the price.
It's chalk and cheese.
We understand the differencebetween Sydney and Brisbane but
(24:02):
it's still cheap.
Speaker 3 (24:02):
The mathematical difference.
Speaker 2 (24:05):
That means their cost per acquisition for each lot of
land is a lot cheaper than whatit would be in Sydney, because
that's where a lot of thebuilding costs come from.
It's the acquisition of theland, materials and trades and
labor that's going to lot of thebuilding costs come from.
It's the acquisition of theland.
You know materials and tradesand labour that's going to cost.
You know, almost uniform allacross the country 100%.
But it's the actual, it's theextras, it's the land, it's the
(24:25):
holding costs, it's you know howmuch does it actually stack up?
And I think that's why we havea construction problem in New
South Wales compared to placeslike Brisbane, problem in New
South Wales compared to placeslike Brisbane.
Are we seeing a lot ofinternationals move to these
areas or are we looking at, youknow, retirees, 60 plus.
You know your average mum anddad.
They built their super up andthey go.
You know, I want to livesomewhere warm.
Speaker 1 (24:46):
It's.
I think COVID was whereQueensland really benefited from
that interstate migration.
So people leaving Sydney andMelbourne because of the price
points at the time and theycould have afford to purchase in
Brisbane for a bit cheaper, abit closer to the city, nicer
lifestyle, and they were able towork from home.
(25:08):
So that really changed thelandscape.
And then Sydney Newcastle wasthe same, sydney Wollongong was
the same.
So people are sort of startingto explore areas a little bit
further away because they don'tneed to be 40 minutes from CBD
anymore.
You know what I mean.
So I don't think there's much interms of net migration
(25:29):
interstate.
So people leaving Sydney andgoing to Brisbane as much as
what it was during COVID,because prices have actually
grown quite well in Brisbanebetween you know 2020 till now.
But one thing that I think Iwanted to sort of provide some
value on and to bring it back tothe Melbourne market, one thing
that I'm a very big fan of whenwe're looking at areas to
(25:52):
invest in is one what can youbuild a home for and what is the
established market currentlydoing in terms of house prices?
So an area that we had a lot ofsuccess, in which we invested
um in feb last year, so justover 12 months ago we had the
(26:13):
opportunity to put four clientsin a suburb called.
I can talk about it now becauseit's boomed we won.
Anglevale.
So we bought in Anglevale for600, between 600 to 630,000,.
We bought house and landpackages.
Four clients are now coming tocompletion of those properties
(26:37):
and you can't buy an establishedproperty in that suburb for
less than 800,000.
Today, only 13 months later,wow, right.
So at the time, whatopportunity we saw in that
market was we were buying houseand land packages for 600 to630.
Established properties wereselling for $650 to $680.
Speaker 2 (26:57):
That's a 30% to 35% growth in a year Wow.
Speaker 1 (27:01):
The exciting part is that it was actually cheaper or
more affordable is the rightterm to use more affordable to
buy a house and land packagethan it was to buy an
established property in thatmarket.
So it's very hard to come bythose opportunities.
I'm starting to see it quitefrequently in Melbourne.
So there's suburbs 30Ks fromMelbourne CBD where you can buy
(27:25):
land and build a home for$650,000.
But if you were to buy anestablished, already completed
property in that same suburbyou'd be paying $50,000 more
already completed property inthat same suburb, you'd be
paying 50 grand more.
Speaker 2 (27:42):
So, Manny, I want to ask you what kind of tactics are
you using when purchasinginterstate?
Speaker 1 (27:46):
What are?
Speaker 2 (27:46):
the three key drivers to help both your clients and
yourself in establishing.
This is a good investment.
This is the right buy.
Speaker 1 (27:54):
Definitely the biggest misconception that I see
is when people come to sort ofspeak to us.
They think just because theirneighbor or their friend has
bought in a specific area, thatmeans that they can buy in that
area or it makes sense for themto buy in that area.
So what I mean by that is whereI'm at in my personal journey
of investment.
The next property for me is notthe right property for Joey.
(28:16):
The right property for Joey isnot the right property for Liam,
for example.
What I mean by that is youcan't take an overarching
approach with investment.
Speaker 3 (28:27):
Yeah, everyone's financial situation is
completely different and theirportfolios are different.
What they can afford isdifferent.
Yeah, exactly.
Speaker 1 (28:33):
So there's a personalized element to it.
When we sit down with clientsand we sort of help build out
their strategy.
Um, one thing that we look atis what's the maximum purchase
price that they need to consider, based on their borrowing
capacity.
Let's say they can buy up to avalue of 700 000.
Yeah, that gives them plenty ofoptions, okay, but what we
(28:55):
start to do to actually narrowdown on suburbs that will work
for for the client isunderstanding what is the yield
in that particular location andwhere does the yield need to be
for the cash flow to becomfortable for that specific
client to hold?
Speaker 2 (29:09):
yeah, so what are the considerations when looking at
the yield, because buyers needto understand that it's not
uniform across all of australia.
You know what are the differentcosts that you'll help analyze
yes is there a funding tablethat you provide that highlights
this is your cost, this is yourstamp duty?
Provide us a little bit ofdetail.
(29:31):
You know, when people look at abuying state, what are the key
metrics that they need to belooking at.
Speaker 1 (29:37):
For sure.
So when it comes to cash flow ona property, we do a very
comprehensive calculation.
So we first look at again themaximum purchase price that that
client can consider If we'reopen to multiple states,
understanding in each state whatthe stamp duty is going to be,
understanding whether they'reusing equity from another
(29:58):
property to purchase or whetherthey're actually putting a
deposit.
That's a very important factorbecause if you're putting a 5%,
a 10%, a 20% deposit, that isgoing to make a difference to
what the end result looks like,right?
So if you're using equity,you're effectively borrowing
100% of the value of theproperty plus stamp duty and
legal fees, which means that thecash flow is not going to be as
(30:19):
pretty.
So sort of breaking that downand looking at the stamp duty,
looking at the cost of thingslike land tax, if applicable,
council rates, water rates,landlord insurance,
understanding what the averageyield is in that particular
location insurance,understanding what the average
yield is in that particularlocation, and then sort of
(30:39):
breaking it down all the waydown to actual tax benefits of
having that investment property,specific to how that, how much
that client is earning.
So by presenting our clientswith that breakdown we can very
quickly see whether thatstrategy is actually suitable
for them or not.
If it's not, then to be honestwith it, doesn't matter how good
that investment is, it's notthe right investment for them,
(31:02):
yeah.
Speaker 2 (31:03):
Manny, we've spent 40 minutes on this podcast.
You've got a wealth ofknowledge.
What I can say is buyers aren'tgoing to benefit just from a
from a 40-minute podcast youhave an event coming up, don't
you?
Yeah we do, and I think youhave it with well, you just said
we with it's simple finance canyou tell us a little bit?
(31:27):
About this event definitely so.
Speaker 1 (31:29):
Hashtag shameless plug.
Yeah, so the event is calledready, set by yep, and I'm very
excited for the event.
It's going to be myself, josephfrom it's Simple, and we're
having Peter Ishak from Ishak'sConveyancing.
So a wealth of knowledgebetween us all.
What I'm planning to talk aboutis the fundamentals that we
(31:50):
need to consider when we'reinvesting.
So what are the eight metrics?
The main eight metrics that weneed to look for when buying an
investment property, all the waydown to infrastructure supply
and demand, demographics, theaffluence of people that are
living in the area, thepopulation growth, the
infrastructure.
Spend really educating theattendees of the event on how to
(32:15):
actually buy the bestinvestment property and what to
look for, as well as the toolsto implement to actually have
the confidence to purchase.
Speaker 3 (32:25):
Okay, so when and where is this event?
Speaker 2 (32:26):
I want to go, so it's going to be a Strathfield Golf
Club.
It's on Thursday, april 10th.
You know, manny speaking, I'mspeaking, ishak Kavadzian is
speaking.
I'm going to highlight just theplain simple thing you want
money.
This is how we're going to getyou money.
All right, people try and overcomplicate property and they try
and over complicate finance.
What we try and do is break itdown so for the average
(32:49):
individual I'm not going to sayschmo, but so the average
individual can seriously benefitfrom property and be able to
build wealth from it.
I hear multiple people all thetime oh, it just sounds too
difficult.
Everything is.
It's so hard, you know, that'swhy you need an investor, mate,
and that's why you need somebodyto make it simple for you.
Speaker 3 (33:07):
so you know we can be able.
It's almost as if you guys keepit simple it's.
Speaker 2 (33:13):
It's what we're going to be doing, so I'm really
excited for this event.
You know, manny, thank you somuch for coming on to this
episode.
It's always a pleasure.
We got so much out of you today.
I believe we're going to get somuch more out of you on april
10th and for anyone that needshelp with purchasing an
investment you can go towwwinvestormatecomau and if you
need help with financing thatinvestment, you can go to
(33:34):
wwwitsimatecomau, and if youneed help with financing that
investment, you can go towwwitsimplecomau.
As always, manny, thank you forcoming on.
Thank you, that's Michael.
I'm Joe.
Thanks for listening.
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