WEBVTT - Secrets of buying your first home 0:00:12.640 --> 0:00:15.480 Hello, and welcome to The Australian's Money Puzzle podcast. I'm 0:00:15.560 --> 0:00:18.800 James Kirby, the Wealth editor at the Australian. Welcome aboard everybody, 0:00:18.840 --> 0:00:22.959 It's Tuesday. We're talking property and one of our regular 0:00:23.040 --> 0:00:26.200 guests on the show with me today, Jared McCabe of Wakelan, 0:00:26.239 --> 0:00:29.480 will be here in the studio with me. We've got 0:00:29.480 --> 0:00:31.320 a lot on our plates. We wanted to talk to you, 0:00:31.360 --> 0:00:34.120 particularly about buying a first home anywhere in the country. 0:00:34.159 --> 0:00:36.480 If you had a buyer's advocate standing besides you would 0:00:36.520 --> 0:00:38.640 not that be nice. Whether you're a first home buyer 0:00:38.720 --> 0:00:40.680 or any type of buyer, it would be nice. What 0:00:40.680 --> 0:00:43.680 would they say, especially on first homes, What particular guidance 0:00:43.680 --> 0:00:46.720 would they give. We had a big response on the 0:00:46.760 --> 0:00:50.640 shows about land tax, hardly a surprise new tax basically 0:00:50.640 --> 0:00:53.520 coming through the system on property around the country. Victoria 0:00:53.800 --> 0:00:56.200 leading the way on that one, but you noticed in 0:00:56.240 --> 0:00:59.360 the new Southwest budget last week they came in on 0:00:59.480 --> 0:01:02.000 land tak as well, and the land tax costs will 0:01:02.000 --> 0:01:06.200 go up across the state there and also interesting response 0:01:06.280 --> 0:01:10.080 from a lot of listeners about whether on the basis 0:01:10.080 --> 0:01:12.600 that the land tax has driven Victoria into something of 0:01:12.680 --> 0:01:15.760 a slowdown for sure, whether Victoria and Melbourne in particular 0:01:16.000 --> 0:01:18.440 is a bargain in this market, lots to talk about. 0:01:19.360 --> 0:01:23.160 Hello there, Jared James, how you of wake and thank 0:01:23.160 --> 0:01:24.200 you for coming in I problems? 0:01:24.200 --> 0:01:24.959 Thanks for having me again. 0:01:25.240 --> 0:01:28.040 Jared, you might know as a buyer's advocate on the street, 0:01:28.200 --> 0:01:30.720 on the ground and has his own podcast as well 0:01:30.720 --> 0:01:34.480 and is a very articulate member of the advocate community. 0:01:34.480 --> 0:01:37.600 You might say so, just on what we've promised. First 0:01:37.640 --> 0:01:40.000 of all, at the top about if you were buying 0:01:40.000 --> 0:01:42.360 a first home as opposed to an investment property, there's 0:01:42.360 --> 0:01:45.360 probably particular things there. First home buyers probably don't use you, 0:01:45.400 --> 0:01:46.919 do they use advocates very oyd. 0:01:46.840 --> 0:01:47.280 No, they do. 0:01:47.440 --> 0:01:50.400 Look sometimes they are very cost conscious, which is understandable 0:01:50.400 --> 0:01:52.480 because budgets are very restrictive and you've got to take 0:01:52.480 --> 0:01:54.880 into account a lot of things. But we do certainly 0:01:54.880 --> 0:01:57.240 work with first time by its Sometimes it's with parents 0:01:57.240 --> 0:01:59.680 wanting to assist and making sure that they're getting guidance 0:01:59.720 --> 0:02:01.520 to make the right decision. But we do find that 0:02:01.520 --> 0:02:03.920 we do work with first times. It's not probably a 0:02:04.000 --> 0:02:07.280 regular stream, but there are advocates around who that's what 0:02:07.320 --> 0:02:10.000 they pitch at too, that they will work pretty much 0:02:10.040 --> 0:02:11.280 solely with first home buyers. 0:02:11.360 --> 0:02:13.840 I know they're different than see an investor. 0:02:13.520 --> 0:02:16.040 Not necessarily, I mean, well, the buyer is. I mean, 0:02:16.080 --> 0:02:18.480 the advocate is still looking for the same sorts of things, 0:02:18.480 --> 0:02:20.239 but the buyer is different and you need to have 0:02:20.280 --> 0:02:22.920 a different mentality as well. I think from a first 0:02:22.919 --> 0:02:25.160 home buyers perspective, one of the key things to do 0:02:25.240 --> 0:02:28.480 is make sure you've got the support mechanisms around you 0:02:28.560 --> 0:02:31.760 before you really get too far down the track. And 0:02:31.760 --> 0:02:34.800 what I mean by that is mortgage brokers or person 0:02:34.840 --> 0:02:36.720 at the bank, whoever you're dealing with in that space, 0:02:37.200 --> 0:02:39.200 a solicitor or a conveyancer, to make sure that your 0:02:39.200 --> 0:02:42.000 contracts can get reviewed in a timely manner. If it's 0:02:42.040 --> 0:02:44.000 a property that's going to need a building inspection done, 0:02:44.040 --> 0:02:45.960 make sure you know that they're going so you. 0:02:46.040 --> 0:02:48.639 In a position to for the and to be able. 0:02:48.400 --> 0:02:51.200 To respond quickly, because depending upon where you are and 0:02:51.200 --> 0:02:53.560 the type of property that you're looking at auctions, you 0:02:53.560 --> 0:02:55.360 can quite often have a bit of a timeline that 0:02:55.400 --> 0:02:58.239 you work can work towards. But with a private sale, 0:02:58.320 --> 0:03:00.760 things can move very quickly, and if you're not ready 0:03:00.760 --> 0:03:04.160 to submit an offer, or don't know any terms that 0:03:04.200 --> 0:03:07.600 you may need to put forward with that offer. Then 0:03:07.720 --> 0:03:09.480 you can get caught off guard quite quickly. 0:03:09.639 --> 0:03:12.919 Does everyone get a building expection these days? It's not no, no, 0:03:13.160 --> 0:03:14.880 they don't know it's optional. It is. 0:03:14.960 --> 0:03:16.200 It's absolutely it's optional. 0:03:16.240 --> 0:03:17.840 I mean, and depending on the type of property that 0:03:17.840 --> 0:03:21.040 you're looking at, we tend to find apartments, some of 0:03:21.080 --> 0:03:23.640 the oldest style ones. It's worth doing. Sometimes you can 0:03:23.680 --> 0:03:25.839 find that a building inspection with an apartment can only 0:03:25.880 --> 0:03:28.520 tell you so much. Yes, and without them being able 0:03:28.600 --> 0:03:30.680 to take plaster and things off the walls, which not 0:03:30.720 --> 0:03:32.200 many things are going to allow you to do it. 0:03:32.960 --> 0:03:35.240 It doesn't it's not necessarily all that beneficial. But if 0:03:35.240 --> 0:03:37.560 you're looking at a period home, for instance, you'd be 0:03:37.600 --> 0:03:38.080 mad not to. 0:03:38.440 --> 0:03:40.839 Yeah, Or if you knew nothing about building correct, don't 0:03:41.040 --> 0:03:44.840 like me, But well, buying a house many years ago, 0:03:45.320 --> 0:03:47.760 we use a building inspectory. He came out to it 0:03:47.840 --> 0:03:51.600 was one of those old fashioned outside standalone Donnie's the 0:03:51.680 --> 0:03:54.920 head of timber door, and he came through the roof. 0:03:54.960 --> 0:03:57.120 He came through the roof and somehow landed on his 0:03:57.160 --> 0:04:00.360 feet and wasn't turreted, never mentioned anything and complained anything 0:04:01.920 --> 0:04:04.040 when I think about it, the things that happen when 0:04:04.080 --> 0:04:05.720 you buy an old police but that's what a lot 0:04:05.760 --> 0:04:07.760 of people they used to do. At least a part. 0:04:07.800 --> 0:04:11.520 We're told that a lot of buyers are shy for 0:04:11.520 --> 0:04:14.680 a variety of reasons, including the three D shortage of 0:04:14.760 --> 0:04:17.760 going near period homes. But just so on that issue, 0:04:17.760 --> 0:04:21.320 then those principles if you like about buying a first holm, 0:04:21.400 --> 0:04:24.200 if you're an advocate and you are helping someone, are 0:04:24.240 --> 0:04:25.560 they the same in every stage? 0:04:25.680 --> 0:04:27.840 They vary from state to state. I mean, the principles 0:04:27.880 --> 0:04:28.480 around what. 0:04:28.520 --> 0:04:31.280 Will be included and what you should do are the same, 0:04:31.680 --> 0:04:34.159 but there's different things that will be included at different 0:04:34.200 --> 0:04:37.440 stages too. So for instance, if you are in Victoria 0:04:37.440 --> 0:04:39.559 where and you're buying somewhere within the ten to fifteen 0:04:39.600 --> 0:04:41.760 kilometer rats of the city, there's a good chance that 0:04:41.760 --> 0:04:44.120 it could well be an auction. Therefore you need to 0:04:44.120 --> 0:04:47.120 get your building inspection done prior to bidding at that auction. 0:04:47.200 --> 0:04:49.839 Whereas if you go to a regional area or you 0:04:49.960 --> 0:04:53.080 go to perhaps Adelaide, Brisbane, where yes they do auctions, 0:04:53.080 --> 0:04:56.200 but there's also a larger percentage of private sale, then 0:04:56.400 --> 0:04:58.040 you may need to you may be able to submit 0:04:58.080 --> 0:05:01.400 an offer subject to that building and pestings. And there's 0:05:01.440 --> 0:05:04.239 different things that are included within contracts as well around 0:05:04.480 --> 0:05:07.880 owners corporation certificates or minutes from previous AGM. So some 0:05:07.960 --> 0:05:10.440 states require that to be included with the vendor statement. 0:05:10.520 --> 0:05:12.479 Others require the buyer to do the research on that 0:05:12.520 --> 0:05:13.560 side of things themselves. 0:05:13.560 --> 0:05:17.440 Okay, favorite discression around it all. Still, that's what you're. 0:05:17.279 --> 0:05:19.480 There for, and that's what as you said, that's where 0:05:19.520 --> 0:05:21.640 you need to do your due diligence so that you 0:05:21.680 --> 0:05:24.400 know what's required so that when you are ready to 0:05:24.440 --> 0:05:28.520 go and to start searching seriously, that you're prepared. 0:05:28.960 --> 0:05:31.000 We did have, as I mentioned, a lot of people 0:05:31.040 --> 0:05:35.479 were interested in the shill where we talked about whether 0:05:35.560 --> 0:05:38.440 Melbourne was a bargain at the moment relative to the 0:05:38.480 --> 0:05:42.159 other states, and certainly in terms of price increases. It's 0:05:42.440 --> 0:05:45.000 way behind the piece, isn't it. And you're on the 0:05:45.040 --> 0:05:48.080 ground here. Is there a sense that there's it's a 0:05:48.080 --> 0:05:48.640 good time. 0:05:48.480 --> 0:05:51.080 To buy in certain Fieler I mean, there's a lot 0:05:51.080 --> 0:05:53.640 of it depends on who you are as a buyer. 0:05:53.680 --> 0:05:56.480 There's a lot of negativity around investors at the moment 0:05:56.640 --> 0:05:59.400 with exactly as you said, the talk of the discussions 0:05:59.400 --> 0:06:01.400 around land, but there's been a number of other changes. 0:06:01.480 --> 0:06:06.400 Is also further changes proposed around requirements on landlords as 0:06:06.400 --> 0:06:07.040 to what they. 0:06:06.920 --> 0:06:09.760 Need to do to comply. 0:06:09.279 --> 0:06:13.240 Perspective propons, isn't it, And there was an introduction in 0:06:13.279 --> 0:06:16.599 about two years ago, and they're discussing further around insulation 0:06:16.720 --> 0:06:18.480 and air conditioning requirements and those. 0:06:18.320 --> 0:06:19.240 Sorts of things as well. 0:06:19.360 --> 0:06:23.200 So investors in Victoria feel as though it's almost death 0:06:23.240 --> 0:06:25.120 by a thousand cuts. And then when you look and 0:06:25.160 --> 0:06:28.320 see that the growth patterns haven't been as strong in 0:06:28.360 --> 0:06:30.520 the past five to seven years is what they perhaps 0:06:30.600 --> 0:06:33.360 have been in other states, they're starting to look at well, 0:06:33.600 --> 0:06:35.719 is this property worth continuing to hold or should I 0:06:35.720 --> 0:06:37.400 look at alternative investment strategies? 0:06:37.400 --> 0:06:39.320 Should I look at investing in other states? 0:06:39.720 --> 0:06:42.760 So that's part of the reason why the market hasn't 0:06:42.839 --> 0:06:45.960 kicked along. But I think that is another reason why 0:06:46.160 --> 0:06:49.440 when the market does move, Victoria Melbourne particularly is going 0:06:49.480 --> 0:06:52.159 to look quite good in terms of its value for money. 0:06:52.279 --> 0:06:54.560 Yeah. Right, And if you're a first HomeBuyer, obviously you 0:06:54.600 --> 0:06:58.440 want to buy anyway. Are there just I'm always say 0:06:58.440 --> 0:07:00.400 of going too little good because you have a nation 0:07:00.440 --> 0:07:04.520 of models, but quickly either parts of the city you 0:07:04.600 --> 0:07:08.120 think are rape for the first time buyer. 0:07:08.520 --> 0:07:10.680 Well, there's always I mean, first home buyers need to 0:07:10.680 --> 0:07:13.520 look at what they want to because there'll be lifestyle requirements, 0:07:13.520 --> 0:07:16.280 and that's I guess where we differentiate between what you're 0:07:16.320 --> 0:07:18.960 looking for from a personal perspective versus what an investor 0:07:19.040 --> 0:07:20.600 might look for from the bowth point of view. But 0:07:20.600 --> 0:07:22.160 the other thing to always keep in mind as a 0:07:22.200 --> 0:07:25.520 first home buyer is that this is highly unlikely to 0:07:25.520 --> 0:07:27.720 be a property that will be used as a stepping stone. 0:07:27.760 --> 0:07:30.240 It's not going most likely not going to be your 0:07:30.240 --> 0:07:33.200 forever home. So if you get too caught up in 0:07:33.240 --> 0:07:35.920 what might and what I might want right now, you 0:07:36.000 --> 0:07:38.680 may forego other attributes that enable you to take. 0:07:38.560 --> 0:07:39.520 Those steps up the ladder. 0:07:39.560 --> 0:07:41.960 The problem we are able to going forward, So there's almost 0:07:42.320 --> 0:07:44.840 sometimes with a first time buyer, it's a good thing 0:07:44.880 --> 0:07:47.360 to have almost a bit of an investor's mindset, so 0:07:47.440 --> 0:07:50.240 that you are looking at properties that potentially can build 0:07:50.280 --> 0:07:51.320 you some equities. 0:07:51.080 --> 0:07:53.000 Because the stats would say you're going to live there 0:07:53.000 --> 0:07:54.200 for five years. 0:07:53.960 --> 0:07:55.800 Then something in that sort of range. 0:07:55.880 --> 0:07:58.320 Yeah, I mean, ideally from an investor's perspective, you be 0:07:58.360 --> 0:08:01.040 holding property for ten plus years. But if you can 0:08:01.080 --> 0:08:03.200 get a property that as a first home buyer, that 0:08:03.240 --> 0:08:05.840 can build equity because it's got some good growth, but 0:08:06.000 --> 0:08:09.160 also potentially there's ways that you could add value yourself 0:08:09.240 --> 0:08:12.200 to build equity too, then that's going to help you 0:08:12.280 --> 0:08:14.520 to improve your financial position to be able to take 0:08:14.560 --> 0:08:16.920 steps up that property ladder, which is what first home 0:08:16.960 --> 0:08:17.600 buyers want to do. 0:08:17.840 --> 0:08:21.520 Okay, and either price of talent, I think there's opportunities. 0:08:21.560 --> 0:08:24.640 I think the oldest style apartment market's been held back 0:08:24.640 --> 0:08:27.480 in Melbourne for a long period of time, and that's 0:08:27.560 --> 0:08:30.520 more than just COVID. That's been an extensive period. So 0:08:30.560 --> 0:08:32.440 I think there's value to be had in those sorts 0:08:32.440 --> 0:08:35.079 of areas. I think villa units are a good option 0:08:35.200 --> 0:08:38.400 too from a first home buyers perspective, some of the 0:08:38.400 --> 0:08:40.959 middle ring suburbs of Melbourne that have still got really 0:08:40.960 --> 0:08:42.440 good public transport. 0:08:42.000 --> 0:08:45.120 Linkages and you get for the price of an average house, 0:08:45.160 --> 0:08:48.240 you're getting there is a thing about units enough fashionable 0:08:48.320 --> 0:08:52.199 right there. You're talking about the single story clinker sixty 0:08:52.280 --> 0:08:54.320 down the side. Did you get a little garden? You 0:08:54.320 --> 0:08:56.439 get a garage? You get a home basity. 0:08:56.760 --> 0:08:59.000 There's a good link component to those sorts of properties too, 0:08:59.080 --> 0:09:01.400 as opposed to say apartment where you perhaps don't have 0:09:01.480 --> 0:09:03.840 that outdoor space, but with the villa unit you've got 0:09:03.880 --> 0:09:06.760 that little courtyard. Most likely, if you've got the right ones, 0:09:06.760 --> 0:09:08.880 you've got a lock up garage. You've probably got a 0:09:09.000 --> 0:09:11.079 nice entry hallway with rooms leading off, so it's got 0:09:11.080 --> 0:09:13.760 a small house type field. And then if you're in 0:09:13.800 --> 0:09:16.680 a good, quiet residential street that's got good access to 0:09:16.720 --> 0:09:20.840 the local amenities, then if you did choose to upgrade 0:09:20.880 --> 0:09:23.360 at some point, but you're in a strong enough financial position, 0:09:23.360 --> 0:09:25.320 then it may well be a good property to retain 0:09:25.360 --> 0:09:27.959 as an investment and continue to build that way too. 0:09:28.080 --> 0:09:30.440 Oh right, yeah, except you could probably can't do much 0:09:30.480 --> 0:09:30.760 with them. 0:09:30.960 --> 0:09:34.640 The developments, there's limitations, but as land values continue to increase, 0:09:34.880 --> 0:09:37.280 then we're seeing more and more, probably not so much 0:09:37.280 --> 0:09:39.319 in the middle ring suburbs, more in the inner suburbs 0:09:39.720 --> 0:09:42.600 where particularly with some of the older style apartments, developers 0:09:42.600 --> 0:09:45.520 are now coming in because the land value is outstripping 0:09:45.720 --> 0:09:48.760 the value of the improvements. So the sum of the 0:09:48.800 --> 0:09:51.280 parts is actually not as great as the whole, and 0:09:51.320 --> 0:09:54.040 so the developer comes in and says, well, your unit, 0:09:54.320 --> 0:09:56.640 your apartment might only be worth five hundred thousand dollars 0:09:56.679 --> 0:09:58.280 on its own, but if I can get this whole 0:09:58.320 --> 0:10:01.440 parcel of land apartment to me, if I can get them, 0:10:01.440 --> 0:10:02.640 what is worth seven to fifty. 0:10:02.800 --> 0:10:04.040 Yeah, and so we are. 0:10:04.320 --> 0:10:07.079 We've been expecting this. If you speak to my mentor, 0:10:07.200 --> 0:10:10.640 Richard Wakelan, he's been saying this for thirty plus years, 0:10:11.080 --> 0:10:13.080 that this is going to happen, and now he's starting 0:10:13.080 --> 0:10:13.240 to it. 0:10:13.720 --> 0:10:14.640 Yeah, and it's coming through. 0:10:14.880 --> 0:10:16.959 Tell me that did all the cities have those? It 0:10:17.000 --> 0:10:18.760 seems to me they do. Do all the cities have those? 0:10:18.760 --> 0:10:20.760 As Biller units you call them. They were built in 0:10:20.800 --> 0:10:23.160 the what seventies through eighties. 0:10:22.880 --> 0:10:24.839 Sixties, sixties, seventies, nineties. 0:10:24.840 --> 0:10:27.040 I mean there's even some that are nineteen thirties down 0:10:27.080 --> 0:10:28.480 bayside Ellwood sort of way. 0:10:28.480 --> 0:10:29.319 You can see some of the. 0:10:29.280 --> 0:10:31.880 Binger story six six, as you said, drive it down 0:10:31.880 --> 0:10:32.200 the middle. 0:10:32.200 --> 0:10:35.520 Mostly it's sixties and seventies, some in the fifties, but 0:10:35.559 --> 0:10:36.800 mostly sixties and seventies. 0:10:36.800 --> 0:10:37.480 Okay, yeah, so's. 0:10:37.800 --> 0:10:40.480 They can be as small as two or three to 0:10:40.559 --> 0:10:43.559 as big as eighteen to twenty, depending upon the size 0:10:43.600 --> 0:10:44.440 of the parcel of plane. 0:10:44.640 --> 0:10:46.760 It's really interesting you say that, and I've always thought 0:10:46.800 --> 0:10:47.880 the same teen but they are. 0:10:47.840 --> 0:10:49.559 Not cool, they're enough. 0:10:51.000 --> 0:10:52.880 It's hard to move from here. Yeah, it's hard to 0:10:52.880 --> 0:10:55.880 move from you know, you're a fashionable part of town. 0:10:55.960 --> 0:10:57.920 You might be in in the middle of Sydney or 0:10:57.920 --> 0:10:59.960 Melbourne in some fashionable suburb and then you should tell 0:11:00.040 --> 0:11:05.360 your friends we've bought a villa units. But I think 0:11:05.360 --> 0:11:07.800 you're onto something there. Okay, we want to take a 0:11:07.800 --> 0:11:26.480 short break and we'll be back in a moment. Hello, 0:11:26.559 --> 0:11:29.680 Welcome back to the Money Puzzle podcast. I'm James Kirby 0:11:29.679 --> 0:11:31.960 talking to Jared McCabe, regular. 0:11:31.760 --> 0:11:32.240 On the show. 0:11:32.440 --> 0:11:36.160 We're talking property around the nation, investment first home buyers, 0:11:36.320 --> 0:11:39.880 guidance from a buyer's advocate. There for you, the greatly 0:11:40.120 --> 0:11:46.360 underestimated appeal financially of the villa unit. Yes that's six 0:11:46.440 --> 0:11:48.920 units with with the six bins outside you pass on 0:11:48.960 --> 0:11:53.040 Monday morning. Not fashionable. But but we're talking land value 0:11:53.200 --> 0:11:56.880 smack in the middle of the major cities and definitely undervalued. 0:11:57.320 --> 0:11:59.120 And you get a lot for you, as you're saying 0:11:59.120 --> 0:12:01.240 getting bank for your book, you actually get this, get 0:12:01.360 --> 0:12:04.480 a lot. Yeah, very interesting. Now I wanted to ask 0:12:04.520 --> 0:12:06.199 you one other thing before we go to this. We've 0:12:06.200 --> 0:12:09.840 got some great questions, but just a quick one. Mortgage 0:12:09.840 --> 0:12:12.680 broker has become very powerful. Yes, they actually the majority 0:12:12.679 --> 0:12:16.040 of mortgages in Australia are now sold through mortgage brokers, 0:12:16.040 --> 0:12:19.240 though though the bank's process and the bank's mortgages, the 0:12:19.280 --> 0:12:22.880 majority are so by mortgage brokers. They grew from nothing 0:12:23.040 --> 0:12:25.360 once upon a time John Simon's AUSSI home runs and 0:12:25.360 --> 0:12:27.640 they took over the market. Basically, it's suit of the banks. 0:12:27.920 --> 0:12:30.720 Something big happening this year. Come my Bank, the biggest 0:12:30.720 --> 0:12:35.120 bank in the market, the nation's biggest lender, has a 0:12:35.160 --> 0:12:38.880 plan to pull it back in house and kind of 0:12:38.880 --> 0:12:42.080 cut the brokers out. What difference would it make if 0:12:42.120 --> 0:12:44.080 the brokers started to thin out? 0:12:44.880 --> 0:12:47.920 Look, I think from a boyer's perspective, or if you're 0:12:47.920 --> 0:12:50.880 doing refinancing that sort of thing, people will always be 0:12:51.160 --> 0:12:52.200 financially conscious. 0:12:52.240 --> 0:12:54.400 So if there's a wise and means to. 0:12:54.360 --> 0:12:56.200 Be able to save money, there are going to be 0:12:56.320 --> 0:12:58.720 that's going to be a big consideration. But I think 0:12:58.760 --> 0:13:01.840 the other thing that probably hasn't necessarily been discussed quite 0:13:01.880 --> 0:13:04.959 as much is that the personal contact that you can 0:13:05.000 --> 0:13:07.560 get from mortgage broker, I think is really important. And 0:13:07.600 --> 0:13:10.440 the personal attention, whereas you can and you will more 0:13:10.480 --> 0:13:12.600 often than not be dealing with the same person every 0:13:12.600 --> 0:13:14.680 time be able to sit down with you and so 0:13:14.800 --> 0:13:18.360 you know you'll as a personal connection, they know your circumstances, 0:13:18.720 --> 0:13:21.480 whereas quite often with the bank, you'll pick up the 0:13:21.480 --> 0:13:23.080 phone and it'll be a different person that you'll speak 0:13:23.120 --> 0:13:26.520 to every time. So it depends on what you're prioritizing 0:13:26.559 --> 0:13:29.160 to as a client as to whether or not that 0:13:29.760 --> 0:13:32.800 financial side of things is absolutely key. And perhaps for 0:13:32.840 --> 0:13:35.480 a first time buy that might be really important, but 0:13:35.600 --> 0:13:40.000 for others where the personal contact the understanding is vital, 0:13:40.640 --> 0:13:43.000 and I'd probably put myself into that category. I would 0:13:43.080 --> 0:13:45.800 rather have that connection then have to deal with a 0:13:45.840 --> 0:13:48.160 different person to explain my circumstances every time. 0:13:48.240 --> 0:13:50.360 Yeah, and if anyone dould enough to remember, that's what 0:13:50.400 --> 0:13:52.360 it used to be like to ring every bank. You 0:13:52.400 --> 0:13:54.440 want to find out what three banks mortgagris were? Are 0:13:54.480 --> 0:13:56.840 you to ring the three of them? And as Jared says, 0:13:57.360 --> 0:13:59.800 that different person every time. Ohky, I just thought i'd 0:13:59.800 --> 0:14:01.480 bring up with you or I have some really good 0:14:01.559 --> 0:14:03.400 questions I wanted to try and di buye them up. 0:14:03.600 --> 0:14:06.320 So what I'm gonna do is the first two are 0:14:06.400 --> 0:14:09.600 on land tax because just to cover offer listeners in 0:14:09.640 --> 0:14:14.840 case you've missed this, in Victoria, they pulled the threshold 0:14:15.400 --> 0:14:19.200 for paying land tax down to fifty from three hundred. 0:14:19.200 --> 0:14:21.840 So everyone is in the net. Everyone's actually getting their 0:14:21.840 --> 0:14:24.200 bills these few weeks, and they are aghast, of course, 0:14:24.200 --> 0:14:26.240 because they've never got this bill before out of the blue. 0:14:26.600 --> 0:14:28.520 But it's been a way for the Victoria state government, 0:14:28.520 --> 0:14:32.680 which is in deep debt, to find money in the market, 0:14:33.080 --> 0:14:35.840 and there is in parallel with that they have then 0:14:35.920 --> 0:14:38.040 catch up on social housing, which they have to do, 0:14:38.600 --> 0:14:41.120 but in this case, unfortunately, they seem to have mapped 0:14:41.160 --> 0:14:45.120 the sort of price of it straight onto property industry alone. 0:14:46.000 --> 0:14:49.840 Controversial move. Victorian prices have been the softest in the 0:14:49.960 --> 0:14:53.320 nation since they did it. Victorian investors as a percentage 0:14:53.360 --> 0:14:57.400 of buyers in Victoria are only thirty forty percent in 0:14:57.480 --> 0:15:01.320 other states. But interestingly, last week in the new South 0:15:01.320 --> 0:15:05.680 Wales budget they copied Victoria and they have not increased 0:15:05.720 --> 0:15:08.240 the land taxter or whatever, but they've changed just like 0:15:08.320 --> 0:15:10.720 Victoria did. They They've moved. They're playing games with the 0:15:10.800 --> 0:15:13.200 thresholds where they won't index them, so more people will 0:15:13.240 --> 0:15:16.600 be caught every year. People are aware of this now 0:15:16.640 --> 0:15:19.640 that there's basically whether it's coordinated or not doesn't matter. 0:15:19.800 --> 0:15:23.720 The states are driving more taxes and revenues out of 0:15:23.720 --> 0:15:27.440 the property sector to the two big ones already unleashed, 0:15:27.480 --> 0:15:29.520 and we'd see what Queensland has to do. So here's 0:15:29.520 --> 0:15:32.880 the first question from Sally. I'm a long time listening 0:15:32.880 --> 0:15:35.680 to the show. Thank you for the podcast on New 0:15:35.720 --> 0:15:39.080 South Wales tax changes. There was a fair bit of 0:15:39.120 --> 0:15:41.640 discussion how this would effect investors. I'd like to hear 0:15:41.680 --> 0:15:44.960 your view on how it might affect other groups, such 0:15:44.960 --> 0:15:48.720 as first home buyers. The land tax threshold, by the way, 0:15:48.760 --> 0:15:53.560 in Sydney is a million dollars in Victoria's fifty thousands. 0:15:53.840 --> 0:15:57.280 I mean that's extraordinary, isn't it. Anyway, she says, given 0:15:57.320 --> 0:16:00.600 the threasholders a million dollars one point seven five to 0:16:01.480 --> 0:16:03.920 I would think this would drive up people's interest choice 0:16:03.960 --> 0:16:09.040 properties with low land values. Well, yes, Sally, I know 0:16:09.200 --> 0:16:17.720 this is advice of course, any information, yes, but in reality. 0:16:14.840 --> 0:16:15.680 For investors too. 0:16:15.760 --> 0:16:17.840 So for first it's not going to be payable for 0:16:17.880 --> 0:16:20.520 those that are using the properties their principal place of residents. 0:16:20.600 --> 0:16:20.800 Yeah. 0:16:20.880 --> 0:16:23.120 Yeah, but what it may do is that you may 0:16:23.200 --> 0:16:27.280 find that investors start to look at properties where the 0:16:27.400 --> 0:16:31.360 land component is worth below that get to avoid this. 0:16:31.760 --> 0:16:34.040 So what it may do and what may be worth 0:16:34.040 --> 0:16:35.800 considering if you're in a fortunate enough position to be 0:16:35.880 --> 0:16:39.000 able to afford that bracket, is that as an unoccupier, 0:16:39.320 --> 0:16:41.640 you may be getting good value for money by looking 0:16:41.680 --> 0:16:44.040 at properties that have got land values in excess of 0:16:44.080 --> 0:16:46.680 the threshold because there's less competition in. 0:16:46.640 --> 0:16:49.640 That run, because people are just trying to steer under it. 0:16:49.720 --> 0:16:52.400 So we saw that in reverse a number of years 0:16:52.440 --> 0:16:55.160 ago in around the first home buyas grant when it 0:16:55.200 --> 0:16:59.280 was focused on around six hundred thousand dollars and at 0:16:59.320 --> 0:17:02.280 one stage there it was a flat. Anything in excess 0:17:02.320 --> 0:17:06.320 of six hundred thousand dollars, the grant was void. Yeah, 0:17:06.359 --> 0:17:09.240 below six hundred thousand there was discounts. 0:17:08.720 --> 0:17:11.080 So there was great competition and that up to six under. 0:17:11.359 --> 0:17:14.040 As soon as the price went over six hundred thousand, 0:17:15.320 --> 0:17:17.200 they would just drop out. And I remember going to 0:17:17.240 --> 0:17:20.240 an auction a number of years ago for an apartment 0:17:20.400 --> 0:17:23.000 in North Carlton, and I had an investor client looking 0:17:23.000 --> 0:17:26.480 at that property and we had a budget of six 0:17:26.520 --> 0:17:29.600 hundred and ten thousand as a limit, and I paid 0:17:29.600 --> 0:17:31.879 six hundred and one and it was I watched all 0:17:31.880 --> 0:17:34.639 of these first time buys fight as soon as it 0:17:34.680 --> 0:17:35.840 hit the six hundred. 0:17:35.720 --> 0:17:37.800 They all just stopped still. I put six o one 0:17:37.840 --> 0:17:38.439 in an that was it. 0:17:38.680 --> 0:17:41.439 And so there's elements of similarity with that, obviously for 0:17:41.480 --> 0:17:45.240 differing reasons, and it's not a hard and fast limit, 0:17:45.280 --> 0:17:48.280 particularly with the indexation, but that's something that you may 0:17:48.359 --> 0:17:51.200 start to see in New South Wales. That could be 0:17:51.359 --> 0:17:56.199 something that plays out given that the low threshold in Victoria. 0:17:55.560 --> 0:17:57.760 Everyone it doesn't matter, but you could play around the 0:17:57.760 --> 0:18:00.680 Sydney one, which is one million and tventy five thousand 0:18:00.720 --> 0:18:02.520 dollars for what it's worth before an investor has to 0:18:02.560 --> 0:18:06.040 pay antax on the property. It's interesting. It just shows 0:18:06.080 --> 0:18:08.320 you that if you pick up on these changes in 0:18:08.359 --> 0:18:10.919 the market, if you know that, you can really have 0:18:10.960 --> 0:18:12.880 an advantage that you were talking about. If you're at 0:18:12.880 --> 0:18:14.760 an auction and you know that nobody wants to pay 0:18:14.760 --> 0:18:17.400 more than six hundred thousands, you get it for six 0:18:17.440 --> 0:18:19.159 hundred and one. Really good story. It really kind of 0:18:19.160 --> 0:18:22.440 captures what we're talking about. Okay, Pete. Having listened to 0:18:22.480 --> 0:18:25.160 your podcast on NANTAX, I am struck by how complex 0:18:25.200 --> 0:18:29.400