1 00:00:09,880 --> 00:00:13,160 Speaker 1: Hello, and welcome to The Australian's Money Puzzle podcast. I'm 2 00:00:13,240 --> 00:00:17,159 Speaker 1: James Kirby. Welcome aboard everybody. Are you one of the 3 00:00:17,239 --> 00:00:21,480 Speaker 1: investors behind the surge and investor borrowing? It's running at 4 00:00:21,520 --> 00:00:25,160 Speaker 1: its quickest pace in a decade. I want to examine 5 00:00:25,200 --> 00:00:29,880 Speaker 1: a few things today. My guest firmly believes now that 6 00:00:30,080 --> 00:00:34,480 Speaker 1: interstate investing is the norm now, which is interesting. She's 7 00:00:34,520 --> 00:00:38,600 Speaker 1: a bit skeptical about the not so much skeptical, but suspicious. 8 00:00:38,600 --> 00:00:43,159 Speaker 1: Maybe that lift in investor activity conceals perhaps quite a 9 00:00:43,240 --> 00:00:46,440 Speaker 1: number of rent investors. Okay, that's sort of subset, if 10 00:00:46,479 --> 00:00:50,400 Speaker 1: you like, of people who wouldn't necessarily afford investment property, 11 00:00:50,440 --> 00:00:53,920 Speaker 1: but their first property becomes an investment property, which they 12 00:00:53,920 --> 00:00:56,600 Speaker 1: hope then allows them to buy the house they want 13 00:00:56,680 --> 00:00:58,520 Speaker 1: to buy. We've had Stuart Ween to talk about that 14 00:00:58,600 --> 00:01:01,240 Speaker 1: on the show before. She's also got something to say 15 00:01:01,280 --> 00:01:07,360 Speaker 1: about the new and fairly controversial dictat from the ATO 16 00:01:07,560 --> 00:01:10,760 Speaker 1: on holiday homes which wait to hear this, Wait you 17 00:01:10,800 --> 00:01:12,520 Speaker 1: hear this. If you haven't heard this already, wait to 18 00:01:12,560 --> 00:01:17,520 Speaker 1: hear this. Unless you conform to the letter on some 19 00:01:17,920 --> 00:01:23,160 Speaker 1: new draft rulings of the ATO, they will dictate when 20 00:01:23,240 --> 00:01:27,959 Speaker 1: you can rent out the property and you must, you 21 00:01:28,000 --> 00:01:32,200 Speaker 1: will be compelled mandatory to rent the property at certain 22 00:01:32,240 --> 00:01:36,880 Speaker 1: weekends Easter, Christmas, whatever is the big weekend in your 23 00:01:37,000 --> 00:01:39,880 Speaker 1: part of the country. Not everyone is gonna like that, 24 00:01:39,959 --> 00:01:42,959 Speaker 1: I can tell you pretty fast. My guest is Anissa 25 00:01:42,959 --> 00:01:46,560 Speaker 1: Cavello of the Eida Eda Property Group. How are you 26 00:01:46,600 --> 00:01:46,960 Speaker 1: a Nissa? 27 00:01:47,280 --> 00:01:49,560 Speaker 2: Well, thank you, James, thank you so much for having 28 00:01:49,600 --> 00:01:50,000 Speaker 2: me again. 29 00:01:50,280 --> 00:01:52,160 Speaker 1: Oh good to have you on again. We will hold 30 00:01:52,200 --> 00:01:54,400 Speaker 1: back on the holiday home thing for the moment, but 31 00:01:54,480 --> 00:01:57,520 Speaker 1: we will deal with it momentarily, folks, except to say 32 00:01:57,520 --> 00:02:00,360 Speaker 1: it's interesting, but not everybody has one, not everybody wants one. 33 00:02:00,840 --> 00:02:02,800 Speaker 1: You would think that that was the case reading these 34 00:02:02,840 --> 00:02:06,120 Speaker 1: draft rulings. First and foremost, I want to ask you 35 00:02:07,120 --> 00:02:09,800 Speaker 1: about the two things. First of all, you're talking about 36 00:02:09,800 --> 00:02:16,440 Speaker 1: interstate investing becoming the norm. So traditionally people didn't buy 37 00:02:16,480 --> 00:02:18,680 Speaker 1: interested investors just didn't do it. 38 00:02:18,919 --> 00:02:22,440 Speaker 2: Is that right? Well, very rarely. It was really the 39 00:02:22,480 --> 00:02:27,040 Speaker 2: realm of people that had much higher So a lot 40 00:02:27,040 --> 00:02:29,560 Speaker 2: of people think that property investors. Not a lot, but 41 00:02:29,600 --> 00:02:31,760 Speaker 2: there are those, including the government. I think that real 42 00:02:31,880 --> 00:02:34,800 Speaker 2: estate investors are is the realm of the very wealthy. 43 00:02:35,160 --> 00:02:38,000 Speaker 2: I think we're realizing more and more through media that 44 00:02:38,400 --> 00:02:41,400 Speaker 2: in fact it's the middle class Australian that is largely 45 00:02:41,960 --> 00:02:44,840 Speaker 2: investing in, relying on leveraging into property to have a 46 00:02:44,840 --> 00:02:49,639 Speaker 2: decent retirement. And so we originally it was more of 47 00:02:49,680 --> 00:02:53,000 Speaker 2: those high end investors that would look into state because 48 00:02:53,000 --> 00:02:55,720 Speaker 2: they had big portfolios and they had much larger research 49 00:02:55,760 --> 00:03:00,079 Speaker 2: capabilities or the ability to engage people like us. I 50 00:03:00,160 --> 00:03:04,600 Speaker 2: think that's changed enormously because of social media, because we're 51 00:03:04,639 --> 00:03:08,360 Speaker 2: becoming much more investor savvy, and I think the middle 52 00:03:08,360 --> 00:03:10,600 Speaker 2: class investor has got a lot more available to them 53 00:03:10,639 --> 00:03:11,920 Speaker 2: in terms of research now. 54 00:03:12,040 --> 00:03:15,119 Speaker 1: Yeah, the distribution of research, free research, so I can 55 00:03:15,160 --> 00:03:17,400 Speaker 1: look at not just the house around the corner, but 56 00:03:17,440 --> 00:03:19,960 Speaker 1: I can look at any street, at any state, and 57 00:03:20,000 --> 00:03:21,880 Speaker 1: I can find out a hell of a lot without 58 00:03:21,919 --> 00:03:25,960 Speaker 1: sort of leaving my desk. Yeah, that's interesting now one 59 00:03:25,960 --> 00:03:28,160 Speaker 1: of the things that people are really interested in. And 60 00:03:28,200 --> 00:03:31,000 Speaker 1: I can see from correspondence that this is so the 61 00:03:31,120 --> 00:03:34,720 Speaker 1: lift in investor lending, which is now running at its 62 00:03:34,840 --> 00:03:37,560 Speaker 1: fastest pace in a decade from a slow start. I 63 00:03:37,640 --> 00:03:42,640 Speaker 1: might add, but tell me the rent investors, tell me 64 00:03:42,680 --> 00:03:46,480 Speaker 1: what you think is happening there, and I might be wrong, 65 00:03:46,480 --> 00:03:48,680 Speaker 1: But I doubt they're investing interested, but you could. 66 00:03:48,480 --> 00:03:51,640 Speaker 2: Tell me, uh no, they are. They are absolutely not 67 00:03:51,720 --> 00:03:54,200 Speaker 2: as much because there are a lot of people that 68 00:03:54,960 --> 00:03:57,480 Speaker 2: we try to teach people that are property. There's two 69 00:03:57,520 --> 00:04:00,320 Speaker 2: reasons to buy property, to either enjoy it or money 70 00:04:00,320 --> 00:04:02,320 Speaker 2: out of it. But not everybody can get their mind 71 00:04:02,400 --> 00:04:05,360 Speaker 2: around that, and so the idea of knowing that you 72 00:04:05,440 --> 00:04:07,200 Speaker 2: may be able to move into it in the future 73 00:04:07,240 --> 00:04:10,040 Speaker 2: provides a bit of comfort. But where most people can 74 00:04:10,080 --> 00:04:12,120 Speaker 2: afford to buy as a first home buyer, even with 75 00:04:12,280 --> 00:04:15,240 Speaker 2: five percent down, in fact almost more so because you're 76 00:04:15,240 --> 00:04:17,800 Speaker 2: borrowing so much of the value of the property, the 77 00:04:17,839 --> 00:04:21,120 Speaker 2: areas that they can afford to actually a service alone 78 00:04:21,480 --> 00:04:23,440 Speaker 2: tend to be areas that they don't necessarily want to 79 00:04:23,480 --> 00:04:26,240 Speaker 2: live in, particularly if they're looking for capital growth. So 80 00:04:26,440 --> 00:04:29,479 Speaker 2: many rent I would say that of the first home 81 00:04:29,520 --> 00:04:33,360 Speaker 2: buyers that we work with, more than eighty percent would 82 00:04:33,360 --> 00:04:34,680 Speaker 2: become rent vestors now. 83 00:04:35,000 --> 00:04:38,320 Speaker 1: Right, okay, And they typically they are living tell me 84 00:04:38,320 --> 00:04:41,120 Speaker 1: if I'm wrong. Typically they're living in the inner city 85 00:04:41,360 --> 00:04:44,400 Speaker 1: and buying in the inner city or are they buying 86 00:04:44,520 --> 00:04:45,960 Speaker 1: the last time you're on the show, you were quite 87 00:04:46,000 --> 00:04:49,599 Speaker 1: enthusiastic about sort of Ulter Sebbs basically that most people 88 00:04:50,040 --> 00:04:52,240 Speaker 1: rarely mention where are you on that now? 89 00:04:53,400 --> 00:04:55,960 Speaker 2: Very much so. So still the same James where we 90 00:04:56,040 --> 00:04:57,800 Speaker 2: talk to, but it's not just us. I think there 91 00:04:57,800 --> 00:05:00,200 Speaker 2: are a lot of people that have realized through their 92 00:05:00,240 --> 00:05:04,360 Speaker 2: own research online that they cannot afford a growth investment, 93 00:05:04,400 --> 00:05:07,200 Speaker 2: for example, a home on a piece of land in 94 00:05:07,279 --> 00:05:09,800 Speaker 2: the inner urban regions of the city that they live in, 95 00:05:10,240 --> 00:05:14,599 Speaker 2: and so they either have to purchase an apartment, and 96 00:05:14,640 --> 00:05:17,320 Speaker 2: there is a lot of information about apartment purchases now. 97 00:05:17,600 --> 00:05:19,560 Speaker 2: Unless you're one of the lucky people that can afford 98 00:05:19,600 --> 00:05:22,880 Speaker 2: a very expensive apartment or townhouse, you're most unlikely to 99 00:05:22,880 --> 00:05:25,720 Speaker 2: get a lot of growth. And if you want capital growth, 100 00:05:26,000 --> 00:05:29,679 Speaker 2: then you'll be avoiding assets like apartments and townhouses unless 101 00:05:29,720 --> 00:05:32,440 Speaker 2: you're in the minions. Unless you're buying a scarce apartment 102 00:05:32,520 --> 00:05:34,960 Speaker 2: or a really scarce townhouse, even then there's a lot 103 00:05:34,960 --> 00:05:37,680 Speaker 2: of risk. So these people are looking to buy a 104 00:05:37,720 --> 00:05:39,760 Speaker 2: home and they have to look outside the inner urban 105 00:05:40,040 --> 00:05:43,039 Speaker 2: sort of centers, and so they either go to and 106 00:05:43,080 --> 00:05:45,159 Speaker 2: I have a number of clients that have actually moved 107 00:05:45,160 --> 00:05:47,080 Speaker 2: for a year to get the first homeowners grant to 108 00:05:47,080 --> 00:05:49,919 Speaker 2: get the five percent down deal. They've actually moved to 109 00:05:49,920 --> 00:05:52,920 Speaker 2: Geelong for a year and then moved back. One of 110 00:05:52,920 --> 00:05:58,159 Speaker 2: my clients actually moved her family to Bendigo and she 111 00:05:58,200 --> 00:05:59,960 Speaker 2: would actually commute because she didn't want to take a 112 00:06:00,080 --> 00:06:01,799 Speaker 2: daughter out of high school, but it was the only 113 00:06:01,800 --> 00:06:05,000 Speaker 2: way that she could afford a first time So they're 114 00:06:05,040 --> 00:06:07,960 Speaker 2: moving regionally and living in it for twelve months. If 115 00:06:08,000 --> 00:06:09,920 Speaker 2: they need the first time owners grant with the intention 116 00:06:10,000 --> 00:06:12,200 Speaker 2: of it becoming a rental property, not with the intention 117 00:06:12,279 --> 00:06:15,520 Speaker 2: of staying in it, or if they're lucky enough to 118 00:06:15,560 --> 00:06:18,359 Speaker 2: have access to enough to posit and not have to 119 00:06:18,480 --> 00:06:20,839 Speaker 2: use the first time owners grant, then they're moving straight 120 00:06:20,880 --> 00:06:21,599 Speaker 2: into rent vesting. 121 00:06:21,920 --> 00:06:24,240 Speaker 1: Okay, So that a couple of things there. That the 122 00:06:24,360 --> 00:06:29,719 Speaker 1: universally five percent home deposit ability, it's one year, you've 123 00:06:29,760 --> 00:06:32,560 Speaker 1: got count rented for a year. That's the only restriction. 124 00:06:32,839 --> 00:06:35,599 Speaker 2: There are other restrictions, so there's a number of different 125 00:06:35,640 --> 00:06:38,279 Speaker 2: schemes that all sort of blend into each other. Obviously, 126 00:06:38,320 --> 00:06:40,920 Speaker 2: you've got the state based grant, so I put ten 127 00:06:40,960 --> 00:06:43,440 Speaker 2: thousand dollars in Victoria. I think it's more in some 128 00:06:43,480 --> 00:06:46,120 Speaker 2: other states for first time buyers. And then in order 129 00:06:46,160 --> 00:06:49,679 Speaker 2: to qualify for the five percent with no al ami. 130 00:06:50,360 --> 00:06:52,839 Speaker 2: But also the other part to this qualifying for the 131 00:06:52,880 --> 00:06:55,240 Speaker 2: five percent scheme, I can't remember what that one is, 132 00:06:55,240 --> 00:06:56,480 Speaker 2: but that's a federal scheme. 133 00:06:56,560 --> 00:06:59,320 Speaker 1: The first home buyer deposit scheme, federal scheme. We're talking 134 00:06:59,320 --> 00:07:02,200 Speaker 1: about it. President, it's up and running. Just this is 135 00:07:02,240 --> 00:07:04,120 Speaker 1: for listeners, just to catch up with you. 136 00:07:04,520 --> 00:07:07,560 Speaker 2: Yes, yes, thank you, thank you, James, thank you for that. 137 00:07:07,720 --> 00:07:10,640 Speaker 2: So that scaim. The other good thing about it is 138 00:07:10,680 --> 00:07:12,880 Speaker 2: that even though you're going to ninety five percent and 139 00:07:12,920 --> 00:07:16,360 Speaker 2: you're not paying ALAMAI, you're not paying the usual much 140 00:07:16,480 --> 00:07:18,880 Speaker 2: higher interest rate. So if you and I went and 141 00:07:18,880 --> 00:07:21,640 Speaker 2: bought a property and borrowed ninety five percent, we'd be 142 00:07:21,680 --> 00:07:24,800 Speaker 2: hit with ALAMAI. We'd also have huge interest rates because 143 00:07:24,800 --> 00:07:25,560 Speaker 2: the bank is taking so. 144 00:07:25,600 --> 00:07:28,000 Speaker 1: Much frea sarier. And this's an LMI, of course, being 145 00:07:28,000 --> 00:07:31,600 Speaker 1: the mortgage insurance that you must pay. And if you 146 00:07:31,680 --> 00:07:33,440 Speaker 1: don't have a twenty percent deposit. 147 00:07:33,800 --> 00:07:36,800 Speaker 2: Yeah, yes, that's exactly right to protect the banks in 148 00:07:36,840 --> 00:07:39,760 Speaker 2: the event that you default, because they're very at risk now. 149 00:07:40,120 --> 00:07:43,680 Speaker 2: So so you asked what the qualifying requirements are. One 150 00:07:43,760 --> 00:07:46,040 Speaker 2: is to live in the property for a period of time. 151 00:07:46,480 --> 00:07:48,680 Speaker 2: The other thing, though, is that you haven't owned a 152 00:07:48,720 --> 00:07:52,160 Speaker 2: property before, and so you can't. You still have to 153 00:07:52,160 --> 00:07:53,880 Speaker 2: be a proper first time buyer, and you are not 154 00:07:53,920 --> 00:07:56,640 Speaker 2: supposed to have owned a property as an investor because 155 00:07:56,640 --> 00:07:59,440 Speaker 2: it's not in the spirit of the scheme. Okay, whereas 156 00:07:59,480 --> 00:08:03,840 Speaker 2: the cash money the first time buys grants generally allow 157 00:08:03,960 --> 00:08:06,480 Speaker 2: you to be eligible for the grant whether you've earned 158 00:08:06,480 --> 00:08:08,400 Speaker 2: a property as an investor or not, as long as 159 00:08:08,400 --> 00:08:10,560 Speaker 2: you haven't lived you much. Right, that's the big. 160 00:08:10,480 --> 00:08:14,640 Speaker 1: All, right, what's doing? And on the rent vestors, which 161 00:08:14,720 --> 00:08:17,760 Speaker 1: you see as a heart growing area, So you're telling 162 00:08:17,760 --> 00:08:19,960 Speaker 1: me that they are in the market. They are classified 163 00:08:19,960 --> 00:08:22,920 Speaker 1: as investors, so they're part of this bump if you like, 164 00:08:23,000 --> 00:08:26,360 Speaker 1: this lift up cycle in property investing we're seeing now 165 00:08:26,400 --> 00:08:28,640 Speaker 1: in the residential market, and would explain the heat in 166 00:08:28,680 --> 00:08:32,640 Speaker 1: some prices and that they are prepared to buy not 167 00:08:32,880 --> 00:08:37,080 Speaker 1: just in their own town but in other towns wherever 168 00:08:37,120 --> 00:08:39,880 Speaker 1: they can get the property they need. One thing I 169 00:08:39,920 --> 00:08:42,959 Speaker 1: want to ask just about looking across at that group 170 00:08:43,000 --> 00:08:48,040 Speaker 1: and the rent vestors, they must be struggling at the 171 00:08:48,440 --> 00:08:50,920 Speaker 1: entry level because the entry level is the hottest part 172 00:08:51,000 --> 00:08:53,280 Speaker 1: of the market. We saw the toutality figures during the 173 00:08:53,320 --> 00:08:58,160 Speaker 1: week which said that the monthly growth in the housing 174 00:08:58,240 --> 00:09:02,880 Speaker 1: market is running faster in the entry level than any 175 00:09:02,920 --> 00:09:07,040 Speaker 1: other level of the market. So that's no good for investors, 176 00:09:07,160 --> 00:09:07,360 Speaker 1: is it. 177 00:09:08,800 --> 00:09:11,360 Speaker 2: Well, it's no good for first home buyers either, which 178 00:09:11,440 --> 00:09:14,079 Speaker 2: was the whole ecs of the scheme, right. So whenever 179 00:09:14,360 --> 00:09:16,920 Speaker 2: you have such an incredible benefit, if you want to 180 00:09:16,920 --> 00:09:18,920 Speaker 2: perceive it as that, because you know, I've got issues 181 00:09:18,920 --> 00:09:21,840 Speaker 2: with the ninety five percent, it doesn't necessarily get around 182 00:09:21,920 --> 00:09:25,320 Speaker 2: the serviceability issues that a lot of clients have. But 183 00:09:25,400 --> 00:09:28,360 Speaker 2: if you many of you pour you know, basically petrol 184 00:09:28,360 --> 00:09:30,640 Speaker 2: on the market and a part of the market, you're 185 00:09:30,640 --> 00:09:34,760 Speaker 2: going to get prices increasing. So for many home buyers, 186 00:09:34,760 --> 00:09:37,000 Speaker 2: first time buys and investors, yes, the market is getting 187 00:09:37,000 --> 00:09:40,000 Speaker 2: more expensive, and it's happening pretty quickly, we have seen. 188 00:09:40,160 --> 00:09:43,240 Speaker 2: So we look at both purchasing existing properties, new properties, 189 00:09:43,240 --> 00:09:46,120 Speaker 2: building properties. We do a raft of things. But when 190 00:09:46,160 --> 00:09:48,200 Speaker 2: we were turning up to open for inspections in some 191 00:09:48,240 --> 00:09:51,559 Speaker 2: of these growth areas, you know, six months ago, we 192 00:09:51,600 --> 00:09:53,240 Speaker 2: would walk straight in, we'd be one of the only 193 00:09:53,280 --> 00:09:55,040 Speaker 2: people there, and we'd be able to take a week 194 00:09:55,160 --> 00:09:57,320 Speaker 2: or two to make an offer, whereas now there's a 195 00:09:57,360 --> 00:10:00,880 Speaker 2: lot of people at these affordable open friends, if we 196 00:10:00,960 --> 00:10:03,120 Speaker 2: make an offer twenty four hours later, it's generally sold. 197 00:10:03,679 --> 00:10:07,400 Speaker 1: And is that do you think that's directly related to 198 00:10:07,600 --> 00:10:10,320 Speaker 1: the universal five percent scheme? 199 00:10:11,160 --> 00:10:14,320 Speaker 2: Absolutely, because the areas that we invest in mainly and 200 00:10:14,360 --> 00:10:17,920 Speaker 2: that we focus on mainly are these affordable areas. Because 201 00:10:17,960 --> 00:10:20,679 Speaker 2: they're more affordable, You've always got a much larger market 202 00:10:20,920 --> 00:10:23,560 Speaker 2: that can afford it. So where there are issues, economic 203 00:10:23,640 --> 00:10:26,880 Speaker 2: issues and crises, etc. You'll find that affordable part of 204 00:10:26,880 --> 00:10:30,240 Speaker 2: the market doesn't have as experience as much volatility because 205 00:10:30,240 --> 00:10:32,959 Speaker 2: people have to live somewhere. You know, it's usually the 206 00:10:33,040 --> 00:10:36,800 Speaker 2: discretionary investments, all those really high end investments that people 207 00:10:36,840 --> 00:10:40,360 Speaker 2: don't have to live in that will experience major volatility. 208 00:10:40,160 --> 00:10:43,160 Speaker 1: So what do you say to the investor or whatever 209 00:10:43,200 --> 00:10:46,960 Speaker 1: they are, re investor, traditional investor who wants to get 210 00:10:46,960 --> 00:10:49,520 Speaker 1: into the market. They know there's good prospects, there are 211 00:10:49,520 --> 00:10:54,240 Speaker 1: no rates have stabilized, but they also know that this end, 212 00:10:54,360 --> 00:10:56,600 Speaker 1: the entry level end, is overcrowded. 213 00:10:56,840 --> 00:11:01,240 Speaker 2: What do you say, I'd say there's still opportunity because 214 00:11:01,240 --> 00:11:04,200 Speaker 2: you don't necessarily have an option. I mean, how we 215 00:11:04,280 --> 00:11:07,360 Speaker 2: advise somebody that's got a million dollars to invest versus 216 00:11:07,360 --> 00:11:09,160 Speaker 2: five hundred is different and what you got is what 217 00:11:09,200 --> 00:11:11,560 Speaker 2: you've got, right, So you have to make it work. 218 00:11:11,960 --> 00:11:14,240 Speaker 2: But as I've been saying for many years in property, 219 00:11:14,320 --> 00:11:17,320 Speaker 2: for the twelve years I've now been focused on it, 220 00:11:17,520 --> 00:11:19,319 Speaker 2: just what are you waiting for getting? Because it will 221 00:11:19,320 --> 00:11:21,720 Speaker 2: get to a point where the base level is unaffordable 222 00:11:21,720 --> 00:11:24,200 Speaker 2: for most Australians. And if we look at other economies, 223 00:11:24,400 --> 00:11:28,160 Speaker 2: there are many First world economies where people will never 224 00:11:28,400 --> 00:11:31,640 Speaker 2: own a home their generation. Right, we are moving that 225 00:11:31,720 --> 00:11:34,160 Speaker 2: way and I think we believe that should never happen 226 00:11:34,160 --> 00:11:35,280 Speaker 2: in Australia, but it will. 227 00:11:35,520 --> 00:11:38,600 Speaker 1: Yeah, I don't have any argument with the sort of 228 00:11:39,040 --> 00:11:42,760 Speaker 1: principles you're outlying there. I want to ask you one 229 00:11:42,760 --> 00:11:44,679 Speaker 1: thing you've mentioned, and I wanted to pick up on it. 230 00:11:45,280 --> 00:11:49,280 Speaker 1: You kind of lumped townhouses in with apartments there. I 231 00:11:49,320 --> 00:11:53,120 Speaker 1: would have thought that they were closer to houses in 232 00:11:53,160 --> 00:11:55,960 Speaker 1: their price patterns and opportunity. 233 00:11:57,120 --> 00:12:01,440 Speaker 2: No, they're different to apartments. But a lot of the 234 00:12:01,480 --> 00:12:04,640 Speaker 2: apartment the townhouses that I'm talking about that are still 235 00:12:04,880 --> 00:12:07,559 Speaker 2: entry level, so we're still talking about under a million 236 00:12:07,600 --> 00:12:12,280 Speaker 2: dollars and a build like quasi apartments right there. Fixters 237 00:12:12,280 --> 00:12:14,760 Speaker 2: and fittings are basic. You know, the rooms. They're sort 238 00:12:14,800 --> 00:12:17,520 Speaker 2: of called a townhouse, but it's almost an apartment. So 239 00:12:17,559 --> 00:12:20,240 Speaker 2: it's about the quality and the price point that we're 240 00:12:20,240 --> 00:12:22,880 Speaker 2: talking about. James doesn't allow to go into these sort 241 00:12:22,880 --> 00:12:26,280 Speaker 2: of really high and beautiful townhouses. The other thing that 242 00:12:26,520 --> 00:12:28,520 Speaker 2: if you think about it, if you have got if 243 00:12:28,520 --> 00:12:31,280 Speaker 2: you've decided to purchase an investment or a house to 244 00:12:31,320 --> 00:12:33,640 Speaker 2: live in or a property to live in, you will 245 00:12:33,679 --> 00:12:36,400 Speaker 2: always favor a property that allows you to do what 246 00:12:36,480 --> 00:12:38,559 Speaker 2: you want to it in the future, and a townhouse 247 00:12:38,559 --> 00:12:39,840 Speaker 2: has got a lot of limitation. 248 00:12:40,000 --> 00:12:43,000 Speaker 1: Still okay, but what about the argument that it is 249 00:12:43,040 --> 00:12:46,640 Speaker 1: at least land capture as opposed to an apartment, and 250 00:12:47,000 --> 00:12:49,280 Speaker 1: you can't do much with them, but you could do 251 00:12:49,360 --> 00:12:52,120 Speaker 1: more than you could do with an apartment. Not much, 252 00:12:52,200 --> 00:12:53,240 Speaker 1: you could do something more. 253 00:12:53,640 --> 00:12:56,920 Speaker 2: Yeah, I think, Look, I have seen apartments and townhouses 254 00:12:57,000 --> 00:12:59,920 Speaker 2: perform at that entry level very similarly. I don't say 255 00:13:00,080 --> 00:13:02,360 Speaker 2: rate them, but I think when you're talking about, you know, 256 00:13:02,480 --> 00:13:05,560 Speaker 2: a former five million dollar development complex in a bright 257 00:13:05,600 --> 00:13:07,760 Speaker 2: And or a TURECT, that's probably a very different thing 258 00:13:07,880 --> 00:13:10,440 Speaker 2: because you know, they make their scarcity value about them. 259 00:13:10,920 --> 00:13:13,840 Speaker 2: But no, I would otherwise from an investment grade entry 260 00:13:13,880 --> 00:13:16,559 Speaker 2: level perspective. I would put them pretty much together. 261 00:13:16,360 --> 00:13:21,240 Speaker 1: And you would apply these concepts nationwide in every city. 262 00:13:21,960 --> 00:13:26,120 Speaker 2: I think longer term, yes, a shorter term. We've seen 263 00:13:26,280 --> 00:13:30,120 Speaker 2: apartments and townhouses perform in states where they hadn't performed 264 00:13:30,120 --> 00:13:32,200 Speaker 2: for twenty years all of a sudden rise and value 265 00:13:32,240 --> 00:13:36,720 Speaker 2: because of affordability, and you know interstag migration, et cetera. 266 00:13:37,000 --> 00:13:40,080 Speaker 2: So it has it doesn't apply necessarily for the short term. 267 00:13:40,400 --> 00:13:43,200 Speaker 2: A lot of my rules are very long term rules, right, 268 00:13:43,280 --> 00:13:45,679 Speaker 2: which is what we've seen in over fifty years. So 269 00:13:45,760 --> 00:13:49,160 Speaker 2: in the short term you might Newcastle, for example, apartments 270 00:13:49,160 --> 00:13:52,240 Speaker 2: have had an incredible surge, but are they at their 271 00:13:52,280 --> 00:13:54,160 Speaker 2: peak and what will they do for the next twenty years. 272 00:13:54,160 --> 00:13:57,360 Speaker 2: So some of these markets that are not your growth 273 00:13:57,360 --> 00:14:00,080 Speaker 2: focused markets can perform. If you time them right, you 274 00:14:00,080 --> 00:14:01,920 Speaker 2: could make a lot of money in the short term. 275 00:14:01,960 --> 00:14:04,160 Speaker 2: But if your time them badly, you've got ten years 276 00:14:04,200 --> 00:14:07,320 Speaker 2: before you'll get any capital price or before you recover. 277 00:14:07,840 --> 00:14:10,800 Speaker 1: Right, Okay, all property being local, folks, I suppose there's 278 00:14:10,840 --> 00:14:14,840 Speaker 1: the message there, And as Anisa says, there are, of course, 279 00:14:14,880 --> 00:14:17,319 Speaker 1: there are opportunities in certain places at certain times. But 280 00:14:17,400 --> 00:14:19,640 Speaker 1: the point she's making I suppose are kind of universal 281 00:14:20,200 --> 00:14:22,880 Speaker 1: and long term for all property in all places. Okay, 282 00:14:23,360 --> 00:14:25,400 Speaker 1: very good. I really want to talk to you about 283 00:14:25,520 --> 00:14:41,000 Speaker 1: the ato's Little holiday Cloud. We'll be back in a moment. Hello, 284 00:14:41,080 --> 00:14:44,640 Speaker 1: Welcome back to the Australians Money Puzzle podcast. It's James 285 00:14:44,720 --> 00:14:48,400 Speaker 1: Kirby here with Anissa Cavallo of the IDA Property Group. 286 00:14:48,640 --> 00:14:52,160 Speaker 1: EDA Property Group, regular on the show. Always good to 287 00:14:52,200 --> 00:14:54,640 Speaker 1: talk to. It's the time of the year, Anissa, where 288 00:14:54,800 --> 00:14:59,840 Speaker 1: people think about holiday homes. Every spring people talk about 289 00:15:00,040 --> 00:15:03,920 Speaker 1: holiday homes. Every November December, everyone tries to sell their 290 00:15:03,920 --> 00:15:06,760 Speaker 1: holiday home because that's the time people start to fantasize 291 00:15:06,800 --> 00:15:09,280 Speaker 1: about them. We won't go into the whole thing because 292 00:15:09,440 --> 00:15:12,240 Speaker 1: there is actually a show on our archives. If you 293 00:15:12,280 --> 00:15:14,800 Speaker 1: want to learn how to buy holiday home, I've done one. 294 00:15:14,880 --> 00:15:17,880 Speaker 1: You can just search for that. But here's something that 295 00:15:18,000 --> 00:15:22,160 Speaker 1: everyone should know if you are looking at the property 296 00:15:22,200 --> 00:15:26,760 Speaker 1: market as an investor, and if you are considering holiday 297 00:15:26,760 --> 00:15:30,080 Speaker 1: homes in that so that you may be thinking of 298 00:15:30,160 --> 00:15:35,640 Speaker 1: investing in one, renting it then ultimately perhaps getting control 299 00:15:35,680 --> 00:15:37,960 Speaker 1: of it yourself once you've paid it down. I've got 300 00:15:37,960 --> 00:15:41,560 Speaker 1: some bad news for you. The holiday home owners soon 301 00:15:41,640 --> 00:15:46,040 Speaker 1: could be denied tax deductions for their mortgage, interest rate 302 00:15:46,080 --> 00:15:48,520 Speaker 1: costs and all other costs from July one next year. 303 00:15:48,600 --> 00:15:51,480 Speaker 1: Wait to hear this unless they make their properties available 304 00:15:51,520 --> 00:15:54,640 Speaker 1: for rent on popular holidays such as Easter and Christmas. 305 00:15:54,680 --> 00:15:59,480 Speaker 1: This is from the ATO draft guidance that deductions will 306 00:15:59,520 --> 00:16:02,640 Speaker 1: be Discillebert if the property is seen to be mainly 307 00:16:02,800 --> 00:16:07,320 Speaker 1: for personal use. Whoosh, what are they up to? Tell us? 308 00:16:07,640 --> 00:16:08,520 Speaker 1: What do you think they're up to? 309 00:16:08,920 --> 00:16:11,720 Speaker 2: Oh? Well, I mean I think, as I've said offline, 310 00:16:11,760 --> 00:16:16,000 Speaker 2: it's interesting because we don't have any other income where 311 00:16:16,000 --> 00:16:18,040 Speaker 2: we are prescribed, we're told when we need to earn 312 00:16:18,040 --> 00:16:20,120 Speaker 2: that income in order for it to be considered a 313 00:16:20,200 --> 00:16:21,400 Speaker 2: deduction for tax purposes. 314 00:16:21,480 --> 00:16:24,640 Speaker 1: Right, interesting even in I mean, let's even put shares 315 00:16:24,680 --> 00:16:27,280 Speaker 1: to one side. I mean, there's no instructions from the 316 00:16:27,320 --> 00:16:30,280 Speaker 1: ATO on if you're negatively gear shares. There's absolutely no 317 00:16:30,320 --> 00:16:32,280 Speaker 1: instruction of what you should buy. You could buy the 318 00:16:32,720 --> 00:16:34,240 Speaker 1: You could buy a whole pile of rubbish and they 319 00:16:34,280 --> 00:16:39,240 Speaker 1: wouldn't mind. You could buy forty two speculative platinum companies 320 00:16:39,280 --> 00:16:42,120 Speaker 1: in West Africa and they wouldn't have any observation to 321 00:16:42,120 --> 00:16:46,240 Speaker 1: make so on negative gearing. Even is there any other 322 00:16:46,560 --> 00:16:49,560 Speaker 1: ATO rule in property in this that that tries to 323 00:16:49,600 --> 00:16:51,960 Speaker 1: dig in here in this way to tell you when 324 00:16:52,000 --> 00:16:52,800 Speaker 1: and how to rent. 325 00:16:53,760 --> 00:16:56,400 Speaker 2: No, No, not at all. It's very interesting, and I think, 326 00:16:56,440 --> 00:16:58,600 Speaker 2: as we said, they also they don't tell an overdriver 327 00:16:58,680 --> 00:17:00,840 Speaker 2: that unless they work on weekends, you cannot You know, 328 00:17:00,960 --> 00:17:03,640 Speaker 2: it's not considered income for the purposes of tax, right. 329 00:17:04,320 --> 00:17:06,600 Speaker 2: I do know, and I'm not an accountant, but I 330 00:17:06,720 --> 00:17:10,040 Speaker 2: do know that there are guidelines in place to try 331 00:17:10,040 --> 00:17:13,200 Speaker 2: and ensure that people are only deducting what is relevant 332 00:17:13,200 --> 00:17:16,439 Speaker 2: to investment, which sounds very reasonable to me at the moment. 333 00:17:16,440 --> 00:17:19,040 Speaker 2: The guidelines are loose, but they're looking for something like 334 00:17:19,520 --> 00:17:22,959 Speaker 2: four to six months of the property's usage being as 335 00:17:23,000 --> 00:17:25,920 Speaker 2: an investment property. Otherwise, if you're living in it largely, 336 00:17:25,960 --> 00:17:28,520 Speaker 2: then you can't claim anything, but you're only allowed to 337 00:17:28,560 --> 00:17:32,760 Speaker 2: claim for those parts that you used for investment purposes. 338 00:17:33,119 --> 00:17:35,359 Speaker 2: So at the moment, as the law stands, it seems 339 00:17:35,359 --> 00:17:38,680 Speaker 2: extremely reasonable. Now when and where you decide to rent 340 00:17:38,680 --> 00:17:41,440 Speaker 2: it out, I think is very prescriptive, and we're getting 341 00:17:41,480 --> 00:17:43,040 Speaker 2: into a world where what else is that? What are 342 00:17:43,080 --> 00:17:44,320 Speaker 2: they going to do next? What are they going to 343 00:17:44,320 --> 00:17:45,920 Speaker 2: tell us we need to do next to ian to 344 00:17:46,040 --> 00:17:47,120 Speaker 2: climb our deductions. 345 00:17:47,400 --> 00:17:48,880 Speaker 1: So what do you think it will do? I mean, 346 00:17:48,960 --> 00:17:51,440 Speaker 1: do you think, well, just straight up, what is your 347 00:17:51,480 --> 00:17:54,000 Speaker 1: response to Do you think it's are you surprised? Do 348 00:17:54,040 --> 00:17:57,600 Speaker 1: you think it's fair? Do you think it's outlandish? 349 00:17:58,040 --> 00:18:01,000 Speaker 2: I think it's outlandish. And the way that the laws 350 00:18:01,040 --> 00:18:04,320 Speaker 2: or the guidelines are actually prescribed, or that they're delivered 351 00:18:04,400 --> 00:18:08,320 Speaker 2: or is already intent, is already achieving the result. And 352 00:18:08,359 --> 00:18:10,880 Speaker 2: for me, it's just a popularity stunt, another way of saying, 353 00:18:10,920 --> 00:18:13,359 Speaker 2: look what we're doing for holiday makers. We're trying to 354 00:18:13,359 --> 00:18:16,880 Speaker 2: make properties more affordable, like the five percent deposits game. 355 00:18:17,000 --> 00:18:19,159 Speaker 2: You know, say look what we're doing, But in fact 356 00:18:19,200 --> 00:18:22,160 Speaker 2: they're making houses more expensive with the five percent deposits game. 357 00:18:22,560 --> 00:18:25,359 Speaker 2: So I think for me, it's just another way of 358 00:18:25,400 --> 00:18:27,000 Speaker 2: getting botes and getting popularity. 359 00:18:27,600 --> 00:18:30,880 Speaker 1: Yeah, thing, is this the ato, It's not the othernment. 360 00:18:31,440 --> 00:18:34,399 Speaker 2: That's true. That's true. Well, that's actually really true. They 361 00:18:34,440 --> 00:18:35,960 Speaker 2: can't get motioned in our art, can they. 362 00:18:36,840 --> 00:18:40,120 Speaker 1: I'm sure it would be very interesting, be a very 363 00:18:40,119 --> 00:18:42,600 Speaker 1: interesting call if they had a vote for them, but 364 00:18:43,080 --> 00:18:45,400 Speaker 1: they are. I don't need to call I don't need 365 00:18:45,400 --> 00:18:48,080 Speaker 1: to call the atl for them to say no, this 366 00:18:48,160 --> 00:18:53,080 Speaker 1: is us ensuring that we are applying the tax laws properly. 367 00:18:53,119 --> 00:18:56,000 Speaker 1: We're a tax collector. We're not trying to achieve anything 368 00:18:56,000 --> 00:19:01,639 Speaker 1: more than the accurate collection of tax. Yes, but I 369 00:19:01,640 --> 00:19:05,200 Speaker 1: don't know whether that will convince people would be convinced 370 00:19:05,200 --> 00:19:05,600 Speaker 1: about that. 371 00:19:06,040 --> 00:19:08,560 Speaker 2: But I mean saying, because one of the it hasn't 372 00:19:08,600 --> 00:19:12,679 Speaker 2: come in, it's a proposal. We understand that if you 373 00:19:12,720 --> 00:19:17,040 Speaker 2: don't make it available at particular times, then you're not 374 00:19:17,119 --> 00:19:20,199 Speaker 2: eligible for tax deductions. It would be different if they 375 00:19:20,240 --> 00:19:22,720 Speaker 2: said that we are going to crack down on people, 376 00:19:22,760 --> 00:19:25,280 Speaker 2: because of course I might if you've got your property 377 00:19:25,280 --> 00:19:28,800 Speaker 2: for lease that is deemed being leased, if you can 378 00:19:28,800 --> 00:19:31,239 Speaker 2: show that you're genuinely trying to lease it out. So 379 00:19:31,280 --> 00:19:33,600 Speaker 2: I think cracking down on making sure that people are 380 00:19:33,680 --> 00:19:35,560 Speaker 2: using the property because you can't have your cake and 381 00:19:35,560 --> 00:19:37,679 Speaker 2: eat it too. If you want to hearing, then I 382 00:19:37,680 --> 00:19:40,679 Speaker 2: think it's important that you are being reasonable and that 383 00:19:40,720 --> 00:19:44,560 Speaker 2: the property is being used for investment purposes. But I 384 00:19:45,040 --> 00:19:47,560 Speaker 2: agree with cracking down and ensuring that people aren't trying 385 00:19:47,600 --> 00:19:49,520 Speaker 2: to say that the property is rented and it's not 386 00:19:49,840 --> 00:19:52,120 Speaker 2: and they've got no intention of renting it. But being 387 00:19:52,280 --> 00:19:56,440 Speaker 2: scriptive about when you rent it seems it seems very 388 00:19:57,320 --> 00:19:59,960 Speaker 2: very you know, I don't know, seems what's the word 389 00:20:00,160 --> 00:20:00,879 Speaker 2: big brought up to me. 390 00:20:01,680 --> 00:20:05,600 Speaker 1: Yes, well, I'm thinking of someone. I mean, of course, 391 00:20:05,680 --> 00:20:09,040 Speaker 1: if someone's got a gorgeous place and you know, they 392 00:20:09,119 --> 00:20:10,800 Speaker 1: it's worth ten million, and they put up an ad 393 00:20:10,800 --> 00:20:12,520 Speaker 1: in the local shop, you know, and make sure no 394 00:20:12,560 --> 00:20:15,080 Speaker 1: one sees it and say that it's rented. Yeah, I 395 00:20:15,119 --> 00:20:16,879 Speaker 1: can see why the ATO wants to crack down. But 396 00:20:16,920 --> 00:20:21,639 Speaker 1: if someone actually had a long term strategy, had taken 397 00:20:21,640 --> 00:20:23,560 Speaker 1: the risk of buying a property, had taken all the 398 00:20:23,640 --> 00:20:26,399 Speaker 1: risk on board, had done the work, had rented it 399 00:20:26,440 --> 00:20:28,280 Speaker 1: out on the big weekends to get their cash flow 400 00:20:28,280 --> 00:20:31,000 Speaker 1: in the early years, and were at the reward phase 401 00:20:31,960 --> 00:20:34,680 Speaker 1: where they could finally get to this place when they 402 00:20:34,720 --> 00:20:36,880 Speaker 1: wanted to because they had done all the hard work 403 00:20:36,920 --> 00:20:40,720 Speaker 1: and risk beforehand. To be told suddenly, hang on, there's 404 00:20:40,800 --> 00:20:43,400 Speaker 1: rules when you can't rent it out, I think that 405 00:20:43,600 --> 00:20:48,479 Speaker 1: will get a lot of people angry. All right, interesting stuff. 406 00:20:48,560 --> 00:20:50,400 Speaker 1: We will be back in the moment. I've kept I've 407 00:20:50,520 --> 00:21:04,399 Speaker 1: curated some questions, especially for any talking the moment. Hello, 408 00:21:04,520 --> 00:21:08,080 Speaker 1: Welcome back to The Australian's Money Puzzle podcast. James Kirby 409 00:21:08,080 --> 00:21:10,840 Speaker 1: with Anisa Caballo Andnissa, I'll allow you thirty seconds no 410 00:21:10,920 --> 00:21:13,520 Speaker 1: more to tell people what you actually do at Eida Property. 411 00:21:13,840 --> 00:21:17,360 Speaker 2: Yeah, okay, So we help people build wealth by investing 412 00:21:17,359 --> 00:21:19,719 Speaker 2: in property. So we do help people buy their first times, 413 00:21:19,920 --> 00:21:22,880 Speaker 2: but our focus is very much helping middle class Australians 414 00:21:23,119 --> 00:21:24,800 Speaker 2: build wealth using capital price. 415 00:21:25,160 --> 00:21:28,000 Speaker 1: Very good. Gee, that elevator pitch is well honed. You've 416 00:21:28,040 --> 00:21:32,639 Speaker 1: done that before. Very good. I used to say, I remember, 417 00:21:32,720 --> 00:21:35,200 Speaker 1: even as a like a you know, junior reporter or 418 00:21:35,240 --> 00:21:37,520 Speaker 1: business reporter, if you went into a business you know, 419 00:21:37,680 --> 00:21:39,720 Speaker 1: and they took a while to explain what they did, 420 00:21:39,960 --> 00:21:42,199 Speaker 1: you said yourself, I don't know about this business if 421 00:21:42,240 --> 00:21:45,239 Speaker 1: you can't explain to me very quickly what you do. 422 00:21:45,880 --> 00:21:49,440 Speaker 1: The elevator pitch. Very good, All right, Lisa. The analysts 423 00:21:49,480 --> 00:21:52,520 Speaker 1: are talking about new lending rules like we had before, 424 00:21:52,600 --> 00:21:55,520 Speaker 1: with limits on the investor lending in particular. I can't 425 00:21:55,520 --> 00:21:57,320 Speaker 1: believe this is on the cards and we are still 426 00:21:57,359 --> 00:22:01,520 Speaker 1: talking about redcots. What do you know now, Lisa, This 427 00:22:01,600 --> 00:22:04,520 Speaker 1: is never advised. This is information only. This is not 428 00:22:04,560 --> 00:22:06,600 Speaker 1: about the holiday homeless folks, and this is universe and 429 00:22:06,680 --> 00:22:08,760 Speaker 1: this is everybody. I think what she's referring to is 430 00:22:10,200 --> 00:22:13,000 Speaker 1: in the explanation from the banks as to why they've 431 00:22:13,119 --> 00:22:15,719 Speaker 1: changed their forecasts and that they no longer believe there 432 00:22:15,720 --> 00:22:19,080 Speaker 1: will be further red cuts. One of the banks, I 433 00:22:19,080 --> 00:22:21,280 Speaker 1: don't want to guess which one, one of the big 434 00:22:21,280 --> 00:22:24,679 Speaker 1: four banks, said that what we are seeing with this 435 00:22:24,800 --> 00:22:28,560 Speaker 1: rush of investors into the market would under normal circumstance, 436 00:22:28,680 --> 00:22:33,280 Speaker 1: prompt the RBA to consider macroprudential rules, and they are 437 00:22:33,320 --> 00:22:35,880 Speaker 1: of course where the RBA says, okay, we won't lift rates, 438 00:22:35,920 --> 00:22:37,240 Speaker 1: but what we're going to do is we're going to 439 00:22:37,280 --> 00:22:40,239 Speaker 1: target certain areas and put a cap, for instance, on 440 00:22:40,280 --> 00:22:42,800 Speaker 1: how many people can do interest only loans and that 441 00:22:42,880 --> 00:22:46,320 Speaker 1: sort of thing. Any sense of that in the market 442 00:22:47,080 --> 00:22:48,280 Speaker 1: turns about that, Anissa. 443 00:22:49,640 --> 00:22:52,000 Speaker 2: It was actually when I read that question, I was thinking, 444 00:22:52,160 --> 00:22:53,840 Speaker 2: I haven't heard of it, so I've got to investigate 445 00:22:53,840 --> 00:22:56,840 Speaker 2: it further. But my understanding is, yeah, that it's more 446 00:22:56,920 --> 00:22:59,960 Speaker 2: a risk mitigation as well, because the banks can't have 447 00:23:00,040 --> 00:23:02,080 Speaker 2: too much risk on their balance sheets, and so sometimes 448 00:23:02,160 --> 00:23:04,520 Speaker 2: if we've got huge investment flows, they might need to 449 00:23:04,960 --> 00:23:07,640 Speaker 2: they're very much at risk of negative gearing, laws changing 450 00:23:07,760 --> 00:23:11,359 Speaker 2: or you know, things like that. So my understanding is 451 00:23:11,359 --> 00:23:14,520 Speaker 2: that it's a naturals risk mitigation tool that the banks 452 00:23:14,640 --> 00:23:17,480 Speaker 2: must use. I do agree, while we do not want 453 00:23:17,480 --> 00:23:20,159 Speaker 2: to tamper with investment in the market, we should be 454 00:23:20,160 --> 00:23:23,560 Speaker 2: actually really encouraging investors because we need affordable rentals. And 455 00:23:23,600 --> 00:23:25,800 Speaker 2: I think that's what they're getting at. But whether or 456 00:23:25,840 --> 00:23:28,640 Speaker 2: not that's possible in terms of, you know, the bank 457 00:23:28,640 --> 00:23:30,400 Speaker 2: taking on so much risk, I'm not sure. I need 458 00:23:30,440 --> 00:23:31,920 Speaker 2: to understand a little bit more about it. 459 00:23:31,960 --> 00:23:34,040 Speaker 1: Was whatty about ten years ago they did this for 460 00:23:34,080 --> 00:23:36,560 Speaker 1: the first time when property around very hot, and instead 461 00:23:36,560 --> 00:23:39,240 Speaker 1: of lifting rates, they're not in rules which the banks 462 00:23:39,240 --> 00:23:42,840 Speaker 1: had to emit instantly sort of follow. They literally said 463 00:23:42,840 --> 00:23:44,919 Speaker 1: to them, you can have this number of interest rate 464 00:23:45,000 --> 00:23:47,760 Speaker 1: only loans for instance, et cetera. And that cooled the market, 465 00:23:47,840 --> 00:23:49,800 Speaker 1: and it did cool the market pretty quickly. So that's 466 00:23:49,880 --> 00:23:54,720 Speaker 1: I think on the table if the piece of investor 467 00:23:54,800 --> 00:23:59,280 Speaker 1: lending we are seeing just now continues through the summer. 468 00:23:59,400 --> 00:24:01,080 Speaker 1: See and I think that is from one of the 469 00:24:01,119 --> 00:24:04,600 Speaker 1: big four banks, As I say, which one I can't recall, 470 00:24:04,760 --> 00:24:07,840 Speaker 1: Navra Westpac. All right, Andrew says, after listening to the 471 00:24:07,880 --> 00:24:10,879 Speaker 1: podcast with Cameron Kusher, I think I've come up with 472 00:24:10,880 --> 00:24:15,399 Speaker 1: a solution which would work. Well, this is his solution, folks, 473 00:24:15,440 --> 00:24:19,200 Speaker 1: This is Andrew's solution about trying to control property prices. 474 00:24:19,280 --> 00:24:22,119 Speaker 1: It's currently accepted you can that you can have up 475 00:24:22,160 --> 00:24:26,199 Speaker 1: to thirty thousand of salary sacrificed into super My idea 476 00:24:26,280 --> 00:24:29,680 Speaker 1: is to apply this similar number to negative gearing as 477 00:24:29,680 --> 00:24:33,840 Speaker 1: the maximum amount of tax return a person can put 478 00:24:33,920 --> 00:24:37,439 Speaker 1: through per year. So what he's saying is we limit 479 00:24:38,000 --> 00:24:42,400 Speaker 1: negative gearing, not by property numbers or whatever, but by 480 00:24:42,440 --> 00:24:46,320 Speaker 1: how much that person, any person could put through each 481 00:24:46,400 --> 00:24:50,480 Speaker 1: year at thirty thousand, which I expect to some people 482 00:24:50,680 --> 00:24:54,000 Speaker 1: I think is a little low. Andrew, but he says, 483 00:24:54,000 --> 00:24:56,520 Speaker 1: interested to hear your thoughts. Well, I'm interested to hear 484 00:24:56,560 --> 00:24:59,680 Speaker 1: the thoughts of a guest. So, Anissa, what do you 485 00:24:59,720 --> 00:25:01,440 Speaker 1: think of that sort of thing? 486 00:25:02,200 --> 00:25:05,200 Speaker 2: Yes, I don't agree. You know how, I'm adamantly against 487 00:25:05,320 --> 00:25:08,320 Speaker 2: tampering with negative negative gearing. And I wonder why it's 488 00:25:08,359 --> 00:25:10,600 Speaker 2: always the property industry that's up for question and not 489 00:25:10,640 --> 00:25:13,959 Speaker 2: all other industries. You know, we've discussed that, so I 490 00:25:13,960 --> 00:25:16,280 Speaker 2: think that it's been tabled. A whole lot of different 491 00:25:16,320 --> 00:25:18,880 Speaker 2: ideas have been tabled in terms of do we cap 492 00:25:18,920 --> 00:25:21,640 Speaker 2: how much you can well that you can claim, et cetera. 493 00:25:21,800 --> 00:25:24,560 Speaker 2: So there's probably a version of his idea that's out there. 494 00:25:24,960 --> 00:25:29,119 Speaker 2: But I just think that if we're tampering with negative gearing, 495 00:25:29,200 --> 00:25:32,320 Speaker 2: which is a huge part of tax rules and opportunities, 496 00:25:32,320 --> 00:25:34,200 Speaker 2: why does it just have to be property right? Why 497 00:25:34,280 --> 00:25:38,240 Speaker 2: is it applied only to the property industry and industry persecution? 498 00:25:38,280 --> 00:25:40,440 Speaker 1: I would say you've got a persecution complex, because that 499 00:25:40,480 --> 00:25:42,400 Speaker 1: would suggest that you're imagining it all. 500 00:25:44,240 --> 00:25:46,439 Speaker 2: Thank you. I'm glad, I'm not. I wish I was. 501 00:25:46,600 --> 00:25:48,880 Speaker 1: Yeah, no, I don't think you are. Clearly some property 502 00:25:48,920 --> 00:25:54,240 Speaker 1: investment areas are in are being targeted. We know that 503 00:25:54,280 --> 00:25:56,960 Speaker 1: the show has covered it quite thoroughly that obviously it 504 00:25:57,000 --> 00:26:00,240 Speaker 1: was very much targeted in Victoria, where there are ten 505 00:26:00,520 --> 00:26:05,520 Speaker 1: taxes on property. But interesting in the show today that 506 00:26:05,560 --> 00:26:09,840 Speaker 1: we see it signs of that sort of disposition at 507 00:26:09,920 --> 00:26:13,080 Speaker 1: at the federal level, this in particular through the ATO 508 00:26:13,400 --> 00:26:16,560 Speaker 1: though a narrow channel though it may be, as you said, 509 00:26:16,560 --> 00:26:21,760 Speaker 1: in this what will they get up to next? Okay, terrific. Hey, 510 00:26:21,800 --> 00:26:23,439 Speaker 1: we might leave it there. Thank you very much for 511 00:26:23,480 --> 00:26:25,240 Speaker 1: running out of time. Lovely to have you on the 512 00:26:25,240 --> 00:26:25,760 Speaker 1: show again. 513 00:26:26,480 --> 00:26:29,119 Speaker 2: Thanks for having me, James, always a pleasure. 514 00:26:29,160 --> 00:26:31,240 Speaker 1: Always good to hear from you. And Issa Cavella the 515 00:26:31,440 --> 00:26:35,280 Speaker 1: either EDA property group. Okay, folks, let's have some questions. 516 00:26:35,280 --> 00:26:37,879 Speaker 1: Great to have ideas by the way, like Andrew's idea. 517 00:26:38,000 --> 00:26:42,560 Speaker 1: Always interested to read out ideas, suggestions, complaints, whatever you got. 518 00:26:42,880 --> 00:26:45,360 Speaker 1: Send them in the money puzzle at the Australian dot 519 00:26:45,400 --> 00:26:47,640 Speaker 1: Com dot au. Talk you soon.