Speaker 1: Hello, and welcome to The Australian's Money Puzzle podcast. I'm
Speaker 1: James Kirby, the editor at the Australian. Folks. My guest
Speaker 1: today is Anissa Cavallo and she has an exceptional story
Speaker 1: as a property investor and I want you to hear
Speaker 1: it and I think you'll find her very interesting as
Speaker 1: a guest. She started in the funds management world at
Speaker 1: Mercantile and Mutual. She worked for various operations. Q. I see,
Speaker 1: you'd know some of them. But at a certain point
Speaker 1: things changed and in some ways became very challenging for her,
Speaker 1: and she was divorced at one stage and ended up
Speaker 1: having to go back and live in her parents' house
Speaker 1: with her own kids in tow At that point she
Speaker 1: decided to get very serious about property investment and has
Speaker 1: since then and has become quite no since then for
Speaker 1: building a residential property empire of sorts. She has about
Speaker 1: fifteen investment properties, she tells me at the moment, and
Speaker 1: we're going to talk about a whole bunch of issues
Speaker 1: relating to property and her particular perspective on it. And
Speaker 1: mister Cavello, how are you welcome to the show.
Speaker 2: Oh, thank you for having me, James, it's a pleasure
Speaker 2: to be here.
Speaker 1: I'm great to have you on. The first thing that
Speaker 1: struck me, even in the course of introducing you there
Speaker 1: was that you have now built up a considerable property
Speaker 1: portfolio of about fifteen residential properties. That's a hell of
Speaker 1: a lot of properties. That's a hell of a lot
Speaker 1: of issues. Yes, and I imagine you have a considerable
Speaker 1: spreadsheet telling you all the various situations and the various
Speaker 1: incomings and outgoings with those. But one of the things
Speaker 1: that comes up all the time, perhaps not inside property investment,
Speaker 1: but in national debate, it's about people having multiple properties,
Speaker 1: and should people have multiple properties? And is it in
Speaker 1: some way a problem that people do. I don't know
Speaker 1: where you come from that. Well, what I might ask
Speaker 1: you is we often have people right into the show
Speaker 1: when they're starting to build and they have this target
Speaker 1: in my Is there a number that you think is
Speaker 1: ideal in terms of investment property ownership.
Speaker 2: I'm in pains whenever I'm interviewed or I have the
Speaker 2: privilege of being able to talk to the media about
Speaker 2: my journey, I'm at pains to tell people that I
Speaker 2: don't think people should buy fifteen properties, because you're quite right,
Speaker 2: fifteen properties fifteen headaches.
Speaker 1: Right.
Speaker 2: The only reason that I'm in that situation is because
Speaker 2: it's actually my industry, and so it's a lot easier
Speaker 2: for me to trade and move things around, and you'd
Speaker 2: expect me to have a larger portfolio than other people
Speaker 2: if this is indeed my expertise. Right. So is fifteen
Speaker 2: property right for everybody?
Speaker 1: Know?
Speaker 2: Is one right for everybody?
Speaker 1: Know?
Speaker 2: I say to people, for me buying property, the benefit
Speaker 2: of property, the really where you get the real goal
Speaker 2: out of property is two things, and I disagree with
Speaker 2: anybody that disagrees with me on this one.
Speaker 1: Right.
Speaker 2: It's leverage and capital growth. So it's where you can
Speaker 2: take a little bit of money that you've saved, and
Speaker 2: many of my clients take ten years to save fifty
Speaker 2: thousand dollars. If you put that in the stock market
Speaker 2: in ten years, it's not going to be worth very much, James, right,
Speaker 2: You take that fifty and you leverage it into five hundred,
Speaker 2: and you may indeed have a million dollars in ten years.
Speaker 2: So I'm at pains to explain to people that what's
Speaker 2: important in property is the benefits of leverage, and that
Speaker 2: couple with capital growth. Now, that doesn't mean you need
Speaker 2: fifteen properties and fifteen headaches. It means that you need
Speaker 2: to just buy one, two, three, really good quality properties
Speaker 2: at the right price that you can afford, and hang
Speaker 2: on to them for as long as you can. I'm Italian,
Speaker 2: do the European thing. Never sell, hang onto them, let
Speaker 2: the market do the work for you.
Speaker 1: Yes, it gets tougher as read school what, I'm sure,
Speaker 1: but just a couple of things there. So would you
Speaker 1: think we would be better or worse off if people
Speaker 1: didn't strive to have as many properties. We'd be better
Speaker 1: off with less land lords and other words.
Speaker 2: Yes, And this comes up all the time, and I
Speaker 2: find it really interesting actually that even through my journey,
Speaker 2: which was a tough one but very also very lucky,
Speaker 2: and I realized that I'm privileged. I was able to
Speaker 2: live with my parents, many people can't. I don't take
Speaker 2: any of that for granted, But I'm always fascinated by
Speaker 2: the people that are actually angry with me. You know,
Speaker 2: I've had comments saying that I'm responsible for the shortage
Speaker 2: of properties, But the reality is that we live in
Speaker 2: a society where everybody will never be able to afford property,
Speaker 2: and there are many other cultures first World countries where
Speaker 2: properties are much more expensive. And as economies get more
Speaker 2: developed and become more sophisticated and population skilled immigration grows,
Speaker 2: that gap between affordability gets it gets greater and greater,
Speaker 2: and so I think if it wasn't for people like
Speaker 2: us that were purchasing properties to make it more affordable
Speaker 2: for renters, we'd have even more homelessness. And you think
Speaker 2: about what even the RBA is saying with interest rates
Speaker 2: that the people that have and hardest hit with interest
Speaker 2: rates is actually it's the renters. Because there aren't enough
Speaker 2: people actually putting houses, buying investment properties for renters. We
Speaker 2: need to actually get the private sector, I think to
Speaker 2: solve the housing crisis, because we don't have enough money
Speaker 2: in the government to solve it. I think it's this
Speaker 2: utopian idea that everybody can afford a house is unrealistic.
Speaker 2: We we live in a capitalist society, and so the more
Speaker 2: people we can get purchasing properties and making them affordable
Speaker 2: for people that aren't in a position to purchase and
Speaker 2: maybe don't want to buy. I know lots of people
Speaker 2: that don't want to be an owner of a property
Speaker 2: I think is a good thing. It should be encouraged.
Speaker 1: Is there any one outstanding issue or measure that could
Speaker 1: be introduced that would acceleries that provision if you like
Speaker 1: supply of rented property.
Speaker 2: I think an obvious one is a stamp. Due to
Speaker 2: interest rates, etc. I think the market will do the
Speaker 2: work for us. I think that eventually. I think markets
Speaker 2: go through cycles. As you and I have discussed before,
Speaker 2: fundamentals in markets, and those fundamentals don't change. It's just
Speaker 2: the market gets driven by sentiment until times are good
Speaker 2: and then they remember the fundamentals. So no, I think
Speaker 2: that I think making it easier for investors to produce
Speaker 2: affordable properties would be helpful. And there's a myriad of
Speaker 2: things that would need to change, certainly making it more
Speaker 2: affordable to invest through stamp, duty, less taxes, etc. There
Speaker 2: are a lot of tax incentives for investors still though,
Speaker 2: and you know, I believe that as an investor, it
Speaker 2: is still very affordable to own property even with additional
Speaker 2: taxes in Victoria. But I think other things like really
Speaker 2: getting more people into the construction workforce, because one of
Speaker 2: the big issues at the moment is just is building
Speaker 2: houses fast enough? So really scaling up construction workers could
Speaker 2: be could make a huge difference as well.
Speaker 1: Yes, yes, you know one thing that I have to say,
Speaker 1: and I like a property. I'm always been a property investor,
Speaker 1: but I'm a diverse fied investor and I'm across all
Speaker 1: markets and one thing that strikes me there And I'm
Speaker 1: not saying you said this, but there was the sort
Speaker 1: of implication that you mentioned, like a property pays off
Speaker 1: and part of that big payoff is leverage. Right, sure,
Speaker 1: but I mean you can leaver, that is, you can
Speaker 1: take a loan on shares just as easily. In fact,
Speaker 1: you can negatively gear shares just as easily, and they're
Speaker 1: doing ten percent a year at the moment. So is
Speaker 1: there some part of property that makes you more confident
Speaker 1: that you personally feel more confident about property as an
Speaker 1: asset to leverage than shares.
Speaker 2: Yes, of course, because it's a real asset, right, It's tangible,
Speaker 2: so it's easier to leverage, and you can't leverage to
Speaker 2: the same extent and the cost of leverage is not
Speaker 2: as much for property.
Speaker 1: No, that's very true. Yeah, the banks won't go with you.
Speaker 2: No, that's right. And if you leverage a lot into
Speaker 2: shares it is excitingly expensive and you can get a
Speaker 2: margin call, whereas with a property, as long as you
Speaker 2: pay your loan back you never get a margin call. Right,
Speaker 2: nobody says sorry, the property is now worth fifty percent less.
Speaker 2: You lbr too high. You hours some money. So I
Speaker 2: think that because it's a real ass ish, it's a
Speaker 2: tangible asset, it's a lot easier to levery. Are there
Speaker 2: other reasons? I think the scarcity issue. You know, we're
Speaker 2: not making any more land we've got. I think one
Speaker 2: of the things that you and I have discussed, or
Speaker 2: a theme that comes up a lot, is are the
Speaker 2: fundamentals getting greater? Are there more reasons to invest, particularly
Speaker 2: in Australia, And as our population grows, as we encourage
Speaker 2: more skilled migration into Australia. I think that the fundamentals
Speaker 2: do get more compelling in Australia for property. I think
Speaker 2: that gap that is just going to get bigger and bigger.
Speaker 1: What we might do is take a short break and
Speaker 1: we'll be back in a moment and we'll have a
Speaker 1: look at where anissa Is thinks in terms of both style,
Speaker 1: structure and location of good property opportunities At the moment,
Speaker 1: and she will also give give us her five minutes
Speaker 1: worth on the terrors of investing in the state of
Speaker 1: Victoria at the moment, with with its with its rush
Speaker 1: of unexpected taxes, and it is a very live and
Speaker 1: real issue for investors in that state. Okay, back in
Speaker 1: the moment, Hello, welcome back to The Australian's Money Puzzle podcast.
Speaker 1: I'm James Kirby. Well that are at The Australian talking
Speaker 1: to Anissa Cavallo, property investor and property commentator. And Anissa
Speaker 1: would I always ask someone new on the show to
Speaker 1: do this because I think it's in terms of added value.
Speaker 1: Every listener wants to know, is there in terms of
Speaker 1: types of property that are good value out there at
Speaker 1: the moment, without talking about locations, what is there a
Speaker 1: type that you are particularly attracted to? Just now?
Speaker 2: Okay, so when we look but when I personally look
Speaker 2: for property, I look for when I go fundamental then
Speaker 2: and there's two parts to that. One part is what
Speaker 2: are the characteristics that are going to drive growth in
Speaker 2: property and what are the characteristics that are going to
Speaker 2: drive risk in property?
Speaker 1: Right?
Speaker 2: And I think particularly we talked about leverage, leveraging into
Speaker 2: property where you're leveraging into any asset, you want to
Speaker 2: reduce as much volatility and risk as possible, and so
Speaker 2: those two things have to come together. In financial services,
Speaker 2: we call it a risk adjusted return.
Speaker 1: Right.
Speaker 2: So what I'm looking for is I'm looking for understanding
Speaker 2: where are those pockets that are going to potentially experience
Speaker 2: the greatest capital growth. And I believe that when you're
Speaker 2: in property, if you really want to make some money
Speaker 2: in property, if you really want to change your wealth position,
Speaker 2: it's capital growth. It'll do it. It's never yield. It
Speaker 2: really is helpful to help you pay for the property
Speaker 2: while it goes up in value. And that's about it,
Speaker 2: because it's not really a yield play. So I'm looking
Speaker 2: for capital growth and what is that? And there's two
Speaker 2: things internationally that are very common in films. For a
Speaker 2: country is that drive growth, right, the drive property price growth.
Speaker 2: And one of those things is population growth. But it
Speaker 2: has to be the right sort of population growth and
Speaker 2: access to money. At the moment, we've got the right
Speaker 2: sort of population growth. Skilled immigration. And I won't tell
Speaker 2: you the stage because we won't give away our areas,
Speaker 2: but fifty percent of skilled immigrants go to one particular
Speaker 2: state in Australia. That's been a trend for a very
Speaker 2: long time now. And skilled immigration leads to something called
Speaker 2: family income growth. You've probably heard that term before, a
Speaker 2: household income growth. So where you've got households becoming wealthier,
Speaker 2: you generally have property price growth. Okay, So access to
Speaker 2: money and is another one. Right, So a lot of
Speaker 2: people say, we'll interest rates are so high, there's no
Speaker 2: access to money. But we've got massive participation in the workforce,
Speaker 2: we've got some wages increasing for the first time in
Speaker 2: a long time. When you compare it to other property
Speaker 2: markets where interest rates have actually been a lot higher
Speaker 2: and unemployment's been a lot higher, actually got pretty good
Speaker 2: access to money.
Speaker 1: That's interesting. I'll just pick up on two things there.
Speaker 1: Victoria is the skilled immigrant state, isn't it. I assume
Speaker 1: that they all come to and so you get that
Speaker 1: improved income here, but it's the weakest of the states.
Speaker 1: Just now, the numbers in Victoria defy the logic you're applying,
Speaker 1: but perhaps there's more to it. What's happening there.
Speaker 2: So we've got these extra taxes that we're paying because
Speaker 2: of how for many of us, a lot of the
Speaker 2: community feels at the government. State government mismanaged COVID and
Speaker 2: set us broke, and as a result, they're taxing in
Speaker 2: different areas to try and make some back some of
Speaker 2: that money. And I think a lot of it is
Speaker 2: anger and sentiment. But when you do the numbers, and
Speaker 2: I've done the numbers, the average cost to add investor
Speaker 2: to the average investor, the average additional annual cost is
Speaker 2: about one thousand dollars. Let's call it a thousand bucks, right,
Speaker 2: So one thousand dollars a year, which is taxed deductible
Speaker 2: not enough of a disincentive to continue affecting property markets
Speaker 2: when you've got these other true, really fundamental like skilled migration,
Speaker 2: population growth, the need for housing a shortage. We're building
Speaker 2: fifty thousand houses less than we should be annually at
Speaker 2: the moment in Victoria. So sentiment's actually a wonderful opportunity
Speaker 2: for people to take advantage of a market that's potentially
Speaker 2: well underpriced.
Speaker 1: Okay, So you see it as a moment in time
Speaker 1: basically where people have perhaps overreacted to the surprising position
Speaker 1: of taxes and perhaps the disposition of the particular state
Speaker 1: government just now about property around property and basically they
Speaker 1: seem to see it as something Yeah to trax, that's
Speaker 1: sill the investment point of view. So just back on one.
Speaker 1: Other things which didn't quite get was what type of
Speaker 1: property then, irrespective of location. If I say to you, hey,
Speaker 1: you're so experienced in property, you've bought fifteen properties yourself,
Speaker 1: at least I want to buy one. What type of
Speaker 1: property is dollar for a dollar the best value do
Speaker 1: you think just now?
Speaker 2: I would be houses, So I'm a very big one
Speaker 2: for houses, and there's a lot of history. We're don't
Speaker 2: to value air in Australia. We don't so in need Land,
Speaker 2: which is where the scarcity is right, and I'd be
Speaker 2: looking for growth suburbs where are these skilled migrants moving.
Speaker 2: And that's also for affordability. If you've got five million
Speaker 2: dollars to spend by all means buy in South Melbourne
Speaker 2: Middle Park, et cetera. But the average investa hasn't got
Speaker 2: that sort of amount of our average client doesn't have
Speaker 2: that to spend. So there are many areas that are
Speaker 2: just on the outskirts of in urban Melbourne that have
Speaker 2: got incredible infrastructure growth, hospital growth, a lot of job growth.
Speaker 2: Are the Maturance State government's actually been very good at
Speaker 2: creating employment clusters instead of creating a commuter suburbs where
Speaker 2: the suburb has to commute to go to it to
Speaker 2: get to work. There's a lot of local employment, so
Speaker 2: something like on average, seventy percent of the people that
Speaker 2: work full time I'm in Melshiam City Council actually live locally.
Speaker 2: They don't actually community and that's a great thing for
Speaker 2: local economy. So i'd be looking for local employment. I'd
Speaker 2: be looking for family income growth, skilled immigration, hospitals, education,
Speaker 2: that infrastructure that brings a community together.
Speaker 1: Really interesting answer. It strikes me you're a feeling you're
Speaker 1: a very statistically driven investor. I won't say top down,
Speaker 1: but more than most, you're very across the demographics that
Speaker 1: you're investing in and the economics that you're investing in,
Speaker 1: not just the particular property. That's really interesting and a
Speaker 1: really interesting view. Okay, folks, now we have some really
Speaker 1: good questions for Anissa, and we will be back in
Speaker 1: one moment. Hello, and welcome back to the Australians Money Puzzle.
Speaker 1: I'm James Kirby and I'm talking to Annisa Cavella of
Speaker 1: Eida Eda Property. She's the founder of that group and
Speaker 1: avery experienced investor, has some really good views, fresh views,
Speaker 1: I think on property investing. Great to have around the show. Okay,
Speaker 1: I have a few questions. You've seen them in advance.
Speaker 1: Let's just have a spin through them. I'll see how
Speaker 1: we go in this. I would be interested to hear
Speaker 1: your answers, obviously on the property. Some are more property
Speaker 1: centric than others. Lorraine, my husband and I are keen
Speaker 1: to get on the property ladder here in Australia. Our
Speaker 1: dilema is what do we do we have saved in
Speaker 1: every if individual advice Lorraine. Okay, it's it's information only
Speaker 1: to all the Lorraines out there, But in any event,
Speaker 1: I think we could safely say she they have saved
Speaker 1: a few hundred thousand dollars, but less than the price
Speaker 1: of an average house. Let's put it that way. They
Speaker 1: live in Sydney. They're debating between a house and an apartment,
Speaker 1: and they're debating between Sydney and Brisbane, which seems to
Speaker 1: me and if nothing else, they're wide open. They're wide
Speaker 1: open to what sort of property they will buy, even
Speaker 1: to the point of living in two different cities which
Speaker 1: are not a lot of people are. What would your
Speaker 1: broad observations be.
Speaker 2: To the okay disclaimer right, not knowing everything about Lorraine.
Speaker 1: And of course there's two.
Speaker 2: Reasons to buy property. One is to make as much
Speaker 2: money as you can out of it. One is to
Speaker 2: enjoy the property. I always say to client, so decide
Speaker 2: wire twenty when they do it. Okay, I'm going to
Speaker 2: assume that what Loraine and her husband want to do
Speaker 2: is make some money out of property. So I certainly
Speaker 2: wouldn't be purchasing an apartment. I'd be looking to purchase land,
Speaker 2: as much land as I can in a growth area,
Speaker 2: because there's no point buying land in Timbuktu, where nobody
Speaker 2: wants to live anyway, right, So buying in an area
Speaker 2: which gives me access to as much land as I
Speaker 2: can afford, in a growth area that has those attributes
Speaker 2: we discussed before, family income growth, skilled immigration, lots of infrastructure, growth,
Speaker 2: et cetera. I would also be I don't like timing
Speaker 2: the market, James. I believe that we don't. We never
Speaker 2: time it right. The economists get it wrong, per will
Speaker 2: weed to get it right. But I do believe that
Speaker 2: there are particular markets that are very sicklical and when
Speaker 2: and unless you buy right at the right time, ten
Speaker 2: years before you get your money back. So I would
Speaker 2: be looking at markets with less volatility, markets that tend
Speaker 2: to just have a little bit of volatility, but they're
Speaker 2: always trending up woods so it doesn't matter if you're
Speaker 2: by today. It might take you a year to get
Speaker 2: your money back, but it certainly won't take you five years.
Speaker 1: Right, So what would that elimoned? Then?
Speaker 2: I don't want to pay markets, but I certainly wouldn't
Speaker 2: be investing in Western Australia at the West Australia has
Speaker 2: a history of very strong volatility, and it doesn't mean
Speaker 2: that it doesn't have a bit more to go. But
Speaker 2: will it come back? Historically yes it will. It's red
Speaker 2: hot and very peaked to resources. Still it's a deeper
Speaker 2: market than it used to be, but it is still
Speaker 2: very peaked to resources.
Speaker 1: Right.
Speaker 2: Queensland is expensive. It's more expensive than Melbourne. It's never
Speaker 2: been like that before. We've got a bigger market, we've
Speaker 2: got a greater larger need for housing here where a
Speaker 2: shortage of housing is great, and yet it is currently
Speaker 2: more expensive. So I would be wondering whether it was
Speaker 2: getting to the top of a cycle. I don't see
Speaker 2: it as the same as certainly don't see the time
Speaker 2: as a Western Australia. If you're a Mark Thomas certainly
Speaker 2: wouldn't be investing there. You can afford New South Wales.
Speaker 2: I think New South Wales has a much smoother ride,
Speaker 2: a lot less volatility that I would be telling her
Speaker 2: to consider Victoria, and I want to I want to
Speaker 2: preface that with I don't just invest in Victoria. I
Speaker 2: just think Victoria is really good timing at the moment.
Speaker 1: Yeah, in terms of the investment clock, that is worth knowing.
Speaker 1: And I'm sure Lorraine is familiar that if she's listened
Speaker 1: to recent shows. It is very much a consensus just
Speaker 1: at this time that the Victoria market is is weaker
Speaker 1: than it should be and has an element of catching
Speaker 1: up to do. And if you believe in the reversion
Speaker 1: to the mean, which again is another sort of economic
Speaker 1: notion which I can I think that is probably backing
Speaker 1: on there. It is worth more than it's showing at
Speaker 1: the moment. Okay, two quick ones. One Imran, I've been
Speaker 1: looking for a financial advisor. I'm wondering about their minimum
Speaker 1: account size requirements. Look at Imran. The nature with financial
Speaker 1: advisors is that there are some that have a minimum.
Speaker 1: They want you to have whatever, a million, half a million. Generally,
Speaker 1: what they want is to be able to justify their
Speaker 1: time with you. Very roughly on average, they're charging four thousand,
Speaker 1: three hundred a year. Now if you reverse that and say,
Speaker 1: does it make sense for me to have to pay
Speaker 1: this person four thousand and three hundred a year, then
Speaker 1: that is that makes sense for you. Don't worry about
Speaker 1: whether you make sense for the advisor. The only thing
Speaker 1: I would say to you, which is tough, but it's true.
Speaker 1: If you have nothing, If you have no money and
Speaker 1: you don't look like you're going to make any an
Speaker 1: advisor is not going to spend much time with you. You
Speaker 1: may have a very valuable home, for instance, and you
Speaker 1: might have a good depension arrangement or something, but that's
Speaker 1: no good to an advisor. The advisors in the business
Speaker 1: of making money for you, and they want it to
Speaker 1: make sense for both of you that they share your time.
Speaker 1: I might sound a bit severe on that one, but
Speaker 1: I do no advice quite well, and I've been obviously
Speaker 1: involved in it for a long time, and Lisa can
Speaker 1: I ask you, actually, which just struck me. Do you
Speaker 1: use any outside services in the way I've say, buyers,
Speaker 1: advocates or whatever. Do you do it all yourself?
Speaker 2: No, I do it all myself. But I've come from
Speaker 2: financial services as well, so I'm a little bit different.
Speaker 2: I'm a bit controversial with that whole thing. I think
Speaker 2: it's a shame that commissions because one of the things
Speaker 2: that we used to do with charged commissioners financial services,
Speaker 2: and I think they threw the baby out with the
Speaker 2: bath water a bit by no longer allowing a client
Speaker 2: to have the supply and pay has meant that we're
Speaker 2: quite underinsured and underrepresented. Now. I feel like there was
Speaker 2: probably a better model so that people that don't have
Speaker 2: five ten thousand dollars to spend on a financial planner
Speaker 2: can still get really good advice and it's worth the
Speaker 2: advisor's time. But I tend to agree with you that
Speaker 2: if you don't have a lot what the financial planner
Speaker 2: doesn't have a lot of incentive to work with you.
Speaker 1: Un Fortunately, it's difficult, it really is. There's no such
Speaker 1: thing as chief financial advice. That just isn't. I'd have
Speaker 1: to tell either isn't. But read and listen to shows
Speaker 1: like this and you will learn a lot. That's that
Speaker 1: much we will try to bring through for you. Okay, Ben,
Speaker 1: this was on lender's mortgage insurance. He says, surely if
Speaker 1: there is not much risk and it's a free market price,
Speaker 1: then the price of it should drop. What's to go?
Speaker 1: I don't know, Ben, but I don't see it dropping.
Speaker 1: I don't see it dropping anytime soon. I know it's
Speaker 1: a market, but I wouldn't be waiting for that one.
Speaker 1: All right. Finally from Dean, Now this is a detailed question. Again,
Speaker 1: we are not going to give advice and we're not
Speaker 1: going to be too precise here, but generally, what Dean
Speaker 1: is asking is he has a townhouse and the townhouse
Speaker 1: is in wa and here's the thing. It's one of six.
Speaker 1: The others are freestanding. He's got a joint wall. Is
Speaker 1: your expert able to provide general advice on the pros
Speaker 1: and concept converting right converting a townhouse from strata title
Speaker 1: to a freehold title to realize potential capital growth? What
Speaker 1: did you think of that issue? And this said, is
Speaker 1: there anything you can add to it?
Speaker 2: Well, I've got to say this is not my expertise,
Speaker 2: and this is how I would think about it, that
Speaker 2: there'll be additional costs by separating, because you'll all suddenly
Speaker 2: be charged to lots of rates et cetera, et cetera.
Speaker 2: So there are some benefits of keeping it together. I'm
Speaker 2: not sure how much difference it will make in terms
Speaker 2: of capital growth, and it depends on what he wants
Speaker 2: to do with it in the future. If it's a
Speaker 2: buy and hold, which is my advice with most properties,
Speaker 2: I wouldn't bother paying the cost of it. If he's
Speaker 2: wanting to sell one off, then absolutely, But to be honest,
Speaker 2: I've got to admit this is not my area of expertise.
Speaker 2: You needs to speak to a conveyancer and a lawyer
Speaker 2: about the repercussion.
Speaker 1: Yeah, okay, And just one last thing. It struck me
Speaker 1: that in earlier the show you said you like houses,
Speaker 1: and I'm sure that wasn't a casual comment. Do you
Speaker 1: mean to say more precisely that your efforts are largely
Speaker 1: in the investment and management of standalone houses as we
Speaker 1: know them, and that implies you, to some extent steer
Speaker 1: away from town townhouses, units, apartments very much.
Speaker 2: Sometimes for my detriment, I've just found in my history
Speaker 2: that the performance has been very different. It's a lot
Speaker 2: harder to you don't have as much flexibility with what
Speaker 2: you can do with them. And I just haven't seen
Speaker 2: the capital growth, certainly the EELD, but I just haven't
Speaker 2: seen the capital growth in units and townhouses.
Speaker 1: Very good, Thank you very much, and that was really interesting,
Speaker 1: interesting story, interesting perspective. Thank you very much for coming
Speaker 1: on the show, Thanks for having me terrific. Okay, folks,
Speaker 1: some more questions would be very welcome on any issue
Speaker 1: you like. The email is the money Puzzle at the
Speaker 1: Australian dot com dot au. Talk to you soon.