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Speaker 1: Hello and welcome to The Australian's Money Puzzitle podcast. I'm

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Speaker 1: James Kirkby. Welcome aboard everybody. You know. Since I talked

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Speaker 1: to you just a few days ago, we've had news

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Speaker 1: that the government is now modeling changes to negative gearing.

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Speaker 1: To be specific, the government is testing the concept of

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Speaker 1: having a cap of two properties per person on negative gearing.

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Speaker 1: That's for real, folks. It's been modeled inside treasury and

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Speaker 1: it goes hand in hand with clear science. The government

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Speaker 1: is also planning a change to the discount on CGT

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Speaker 1: that is effectively going to be a lift in the

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Speaker 1: amount of CGT tax you will pay on properties specifically.

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Speaker 1: So there are two major changes in the wind if

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Speaker 1: you like, coming through for investors or anyone who's interested

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Speaker 1: in buying a property, and you need to be across

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Speaker 1: this and we're going to talk about it this week,

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Speaker 1: particularly the difference that tax and government incentives are making

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Speaker 1: inside the market. We've had some coverage on the show

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Speaker 1: about the five percent home deposit scheme and the extent

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Speaker 1: of which that has completely skewed the entry level of

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Speaker 1: the market. So it's something that you need to be

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Speaker 1: aware of. As I say, some great questions as well,

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Speaker 1: and as I was mentioning of late, it would be

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Speaker 1: terrific if you, as a fan of the show, would

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Speaker 1: put a rating for us on Apple Podcasts. We'd really

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Speaker 1: appreciate that. Now to steer us through this issue is

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Speaker 1: someone who professionally steers people through issues of this nature.

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Speaker 1: It's Jared McCabe from Weight and Property Group.

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Speaker 2: How are you, Jared, I'm very objimes great to join

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Speaker 2: your guest.

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Speaker 1: Tell me here on the street right, you're you're on

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Speaker 1: the hostings, you're there in front of auctions every week

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Speaker 1: of the year. It seems to me that suddenly there

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Speaker 1: is an actions of government is changing the nature of

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Speaker 1: the property investment market in Australia and we've seen it,

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Speaker 1: for instance rock Hard in the entry level sector where

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Speaker 1: it is now the hottest sector in the market, ironically

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Speaker 1: because it is where all the brands are. And now

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Speaker 1: we see these potential changes coming in. Do they make

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Speaker 1: an investor change their ways? Should they be alert to

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Speaker 1: these changes? How would they affect them?

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Speaker 2: Not necessarily?

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Speaker 3: I mean a lot of these they're always short term

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Speaker 3: changes to the market and most smart investors are looking

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Speaker 3: probably more long term trajectories and Buying property is such

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Speaker 3: an expensive exercise that the strategy around investing your property

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Speaker 3: is usually more over a long term, So it can

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Speaker 3: form part of your decision making, but it shouldn't form

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Speaker 3: part of your overall long.

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Speaker 2: Term strategy is to the type of asset that you'll

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Speaker 2: be selecting.

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Speaker 1: Okay, I did mention to you, and we talked just

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Speaker 1: before the weekend with about negative gearing, something that I

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Speaker 1: found quite alarming really, and I didn't know what was

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Speaker 1: going on, which was that in negative geing. And we

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Speaker 1: know that negative gearing and the negative beginning for you.

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Speaker 1: So I've done it myself, many people have done it

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Speaker 1: over the years, and it's very It's the outstanding tax

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Speaker 1: break for someone who is on a salary. It's the

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Speaker 1: outstanding tax break apart from super that's available to people.

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Speaker 1: But there is a whole sort of mini industry, isn't

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Speaker 1: there of getting people to buy multiple properties? And I

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Speaker 1: was amazed. I talked to Veronica Morgan who runs that

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Speaker 1: Buyer's Academy, she trains buyers agents, and she's just she

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Speaker 1: literally said, there's a Ponzi scheme going on where there

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Speaker 1: are these these groups. If you like getting investors to

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Speaker 1: buy multiple properties. They're buying the properties for them. They're

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Speaker 1: going into country towns. They're zoning in on a country town.

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Speaker 1: They buy so many properties, the price goes up because

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Speaker 1: it's a small town. They go back out to their

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Speaker 1: client list and say look at Double look at Ballarat,

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Speaker 1: look at some town, and they say the prices are

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Speaker 1: Watch how the prices are going up. We get you

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Speaker 1: in on this now. I kind of expected Veronica of

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Speaker 1: a talk like that because I've talked to her before,

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Speaker 1: but I was amazed to see the property council saying

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Speaker 1: something similar a few days ago. So it looks like

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Speaker 1: negative gearing. I mean it does like it does seem

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Speaker 1: that there's dangers that mightn't be obvious to people about

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Speaker 1: negative gearing and the machinery behind it that's grown over

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Speaker 1: the years. What do you think, Yeah.

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Speaker 2: Look at me.

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Speaker 3: I read your comments with Veronica in your article fairly recently,

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Speaker 3: and I thought I agree with a lot of what

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Speaker 3: Varoni Descent were generally on pretty well the same page.

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Speaker 3: And I do see that you do see that happening

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Speaker 3: where there's that influx, and I mean on a different

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Speaker 3: scale and from a different form. We saw that to

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Speaker 3: an extent during COVID where there was people large trenches

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Speaker 3: of people leaving say Meltmoine and go into regional areas.

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Speaker 3: And it wasn't just a Victorian thing it was, but

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Speaker 3: it was emphasizing victoria and it changed the dynamic of

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Speaker 3: that local market and had that influx of people coming in.

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Speaker 3: But then once that continued influx of people coming in

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Speaker 3: stopped and they started to exit, that the market changed dramatically.

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Speaker 3: And we've seen that this is not new to say

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Speaker 3: that the cities that were mentioned, it's been a big

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Speaker 3: thing that's occurred around mining towns. Again not necessarily from

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Speaker 3: advocates or advisor advisory services focusing on areas. It's more

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Speaker 3: been for some type of external reason that there's been

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Speaker 3: a dragging of buyers into that market which is overinflated.

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Speaker 3: But if it's not something that's going to be sustainable

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Speaker 3: long term, then it's had to impact on values and

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Speaker 3: it can impact both positively, but then when that change occurs,

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Speaker 3: it can have a very negative impact on that same

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Speaker 3: market as well. So those are the sorts of things

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Speaker 3: that are mindful in terms of the negative gearing elements.

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Speaker 3: I mean, there's still it's still very early days and

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Speaker 3: there's a lot of different talk as to whether or

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Speaker 3: not it'll be it'll be limited to all property investment,

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Speaker 3: whether it'll be one property, whether it'll be more than

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Speaker 3: if you own more than two properties.

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Speaker 2: I don't mind the idea of it being for more

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Speaker 2: than two.

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Speaker 3: Properties, because I think that it makes the focus more

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Speaker 3: from an investor's perspective, on people buying quality assets rather

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Speaker 3: than just accumulating assets for the sake of it. Because

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Speaker 3: typically when you focus more on accumulating as many assets

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Speaker 3: as possible, that's probably when you start and you're in

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Speaker 3: the cheaper market. That's when you are starting to compete

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Speaker 3: more with first time buys, and that's where the first

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Speaker 3: time buyers are looking into that space, and so investors

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Speaker 3: compete with them.

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Speaker 2: So I don't mind the idea of it.

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Speaker 3: Focusing more on quality assets rather than as many as possible.

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Speaker 2: Quantity over quality jips.

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Speaker 1: Yeah right, Okay, did you one of the things about

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Speaker 1: the negative gearing sort of machinery we were saying about

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Speaker 1: this idea not an idea, This is there's evidence, hard

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Speaker 1: evidence building that this is going on. The town's again

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Speaker 1: targeted basically by big city buyers advocates who bring in investors,

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Speaker 1: they push up prices. The next wave of investors see

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Speaker 1: these above average price increases the egal way. That's and

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Speaker 1: it's worse. That's like a stock market ramp. Isn't it

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Speaker 1: like a pump and dump.

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Speaker 3: Yeah, well it can be, and it does over inflate.

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Speaker 3: As I said, that's what happens. It over inflates and

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Speaker 3: it makes it unsustainable. So it means that first home

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Speaker 3: buyers can't get into those markets, or even upsides. It's

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Speaker 3: not just first home buyers. They might have owned something

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Speaker 3: else and they're trying to just increase from a growing

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Speaker 3: families perspective, and they're not able to do that because

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Speaker 3: it's being over inflated by extra markets. Typically, though, what

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Speaker 3: happens is that's not sustainable. So at some point in time,

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Speaker 3: that market's not going to continue to increase and it's

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Speaker 3: going to weigh the plateau, or it's going to start

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Speaker 3: to reduce, because if you're not getting more and continuous

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Speaker 3: increasing demand into those areas and buyers continually pushing them up,

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Speaker 3: then it's not going to keep growing.

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Speaker 2: Right.

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Speaker 1: It sounds to me like you, if I was talking

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Speaker 1: to you as an investor, you would be saying knowing

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Speaker 1: that negative gearing is already an issue, knowing that there's

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Speaker 1: exploitation there, knowing that there might be a cap of

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Speaker 1: two per investor that you would see it was in

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Speaker 1: your mouth. But logically what I'm needing too is it

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Speaker 1: would seem to me that you would see stay away

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Speaker 1: from the first time buyer area and if you're an investor,

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Speaker 1: move up the scale because the value is better.

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Speaker 2: Not necessarily stay away from it.

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Speaker 3: I don't mean to stay away from it, but I focus,

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Speaker 3: and we focus more for our clients on quality over quantity.

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Speaker 3: So it's about buying a high quality asset. It's about

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Speaker 3: buying it, you know, like where there's strong demand for property,

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Speaker 3: where land is at it is a finite resource, and

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Speaker 3: buying something that's got multifaceted demand. So you don't want

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Speaker 3: it to be just reliant on investors, but you don't

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Speaker 3: want it to be just reliant on first home buyers

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Speaker 3: as well. If you can buy a property that's got

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Speaker 3: different arms and different people wanting to buy into that.

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Speaker 3: So whether it's first time wise, whether it's upsizes, whether

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Speaker 3: it's downsizes, whether it's investors, because tenants like it, the

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Speaker 3: more different buyt profiles, you can have the greater upward

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Speaker 3: pressure from a demand perspective, and it means that you're

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Speaker 3: not relying on one buyer driving the price up. There's

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Speaker 3: a if there's a reduction in government support for first

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Speaker 3: home buyers because it's been going for a couple of

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Speaker 3: years and they take that away, there's still other buyer

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Speaker 3: profiles that will help to lift that market and continue

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Speaker 3: to have it pushing along.

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Speaker 1: So if we put it all together, if we put

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Speaker 1: the fact that there's been a whole series of government

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Speaker 1: incentives into the property market which is skewing the market

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Speaker 1: in the first time buyer layer, that is that the

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Speaker 1: first tone buyer layer is actually the fastest, hottest part

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Speaker 1: of the market. And if we put if we take

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Speaker 1: it that it is very likely there's going to be

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Speaker 1: changes to taxes now on property, certainly CGT effective lift

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Speaker 1: and CGT tax that you will pay, and also perhaps

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Speaker 1: a cap on negative gearing. How do you think that

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Speaker 1: will change? How do you think that will change for

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Speaker 1: the investor? What does the investor need to know about

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Speaker 1: how that will percolate through the market.

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Speaker 3: Tell you why be just property across other asset classes

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Speaker 3: as well.

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Speaker 2: So it's not just they specifically acted property.

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Speaker 3: So for those looking at investment arms in what they

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Speaker 3: can invest their finances in, it's not going to be

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Speaker 3: as much of the decision around that.

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Speaker 1: But Jared, the Senate inquiry is strictly owned property and

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Speaker 1: all the talk is just down properly, So I think

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Speaker 1: we have to say that it's possible it might just

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Speaker 1: be properly.

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Speaker 3: Will have an impact offering a few that where it's

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Speaker 3: been more generic than that.

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Speaker 1: So that's yeah, and I take your point. I take

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Speaker 1: it it would be you know, creating all sorts of

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Speaker 1: unfortunate consequences if they're isolated like that. But there's a

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Speaker 1: chance there.

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Speaker 3: May yeah, and that look, that may end up being

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Speaker 3: the case, but look at something that has to be

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Speaker 3: factored in. But it's still on a profit that you're making.

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Speaker 3: So if you're going to we've looked at this, and

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Speaker 3: there's been discussions around negative gearing and around and in

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Speaker 3: different forms reducing it, whether it's been taking it away totally,

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Speaker 3: whether it's been more income focused, and whether or not

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Speaker 3: it's been not just the number of properties but the

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Speaker 3: amount you're borrowing.

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Speaker 2: There's been all.

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Speaker 3: Sorts of things over the years and you've still got

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Speaker 3: to it's you've still got to have a property that's

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Speaker 3: going to be performing and building wealth in other forms.

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Speaker 3: Just because you're losing money on the income side of things,

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Speaker 3: it's got to be justified in the growth. And if

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Speaker 3: it's not justified in the growth side of things, the

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Speaker 3: negative gearings a waste of time.

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Speaker 1: Yes, okay, interesting and we leave it right there. Pick

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Speaker 1: up on that in one moment, the back in a second.

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Speaker 1: Hello and welcome back to The Australian's Money Puzitive podcast.

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Speaker 1: James Kirby here with Jared McCabe of the Wakelan Group.

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Speaker 1: He is a buyer's advocate and quite outspoken one and

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Speaker 1: well known in property circles and we have had him

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Speaker 1: on the show before.

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Speaker 2: You know what.

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Speaker 1: Catches me this time about negative gearing, Jarard, is that

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Speaker 1: everyone I talked to the CGT obviously is known for

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Speaker 1: a few weeks the negative gearing came out of the blue.

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Speaker 1: Matthew Cranston, who's my colleague on The Australian, actually found

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Speaker 1: out on last Thursday. That is that the Treasury were

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Speaker 1: modeling changes to CGT, which is the process of course,

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Speaker 1: Treasury models the changes and the Government talked about it.

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Speaker 1: Then they kind of floated, see how it goes. Then

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Speaker 1: eventually they put it through. And that's a very sort

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Speaker 1: of steadfast process which they have, and I think we

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Speaker 1: can assume that they will follow this. But there's a

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Speaker 1: lot of talk that the mood has changed. And I

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Speaker 1: found when I talked to you on Friday, and when

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Speaker 1: I talked to Victoria and when I talked to several

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Speaker 1: other people in proper, they all say the same thing.

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Speaker 1: I wouldn't mind it, it's okay. That's a very different

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Speaker 1: response I got back in two nineteen. I think it

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Speaker 1: was when negative gearing came up the first time or CGT.

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Speaker 1: How many people shot it out of the park. The

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Speaker 1: alp ple shortened. They lost the election partly of those plans.

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Speaker 1: Put them together with trank dividends, and you could really

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Speaker 1: justify the case that was the commercial financial reason at

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Speaker 1: least that they didn't win the election. The mood seems

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Speaker 1: to have changed, Your mood teams to have changed. What's changed, well,

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Speaker 1: as hasn't changed. So we said the same thing last time.

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Speaker 1: I mean, if you're only buying property for negative gearing

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Speaker 1: and for tax benefits, then you're doing it for the

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Speaker 1: wrong reasons.

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Speaker 3: In the first place. It's not it's the tax benefits.

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Speaker 3: And we've spoken about this for an extended period of time.

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Speaker 3: The tax benefits are benefit. They're not the reason that

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Speaker 3: you're buy an investment property, so you want to take advantage.

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Speaker 3: No one wants to. They are carried back aside of you.

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Speaker 3: You don't want to pay as any more tax than

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Speaker 3: you need to, and no one does. So the negative

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Speaker 3: gearing benefits helping that regard. But if that's the reason

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Speaker 3: that you're buying and you focus purely on the tax,

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Speaker 3: then you're doing it for the wrong reasons. You should

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Speaker 3: be focusing on barking. It's going to give you the growth.

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Speaker 1: If you're on a salary, it's your only tax break,

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Speaker 1: and you wanted to do it, and the negative gearing

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Speaker 1: meant the numbers that up for you. So you look

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Speaker 1: at the yields and you said, oh, those rentals are

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Speaker 1: tiny compared to how much I'm paying. H But then

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Speaker 1: you put your you say, oh, it doesn't really add up.

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Speaker 1: Then you do your negative gearing and go, oh, well

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Speaker 1: it nearly adds up. I'm not after tax at the

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Speaker 1: end of the year. This isn't going to cost me

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Speaker 1: as much as I thought. If you take that away,

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Speaker 1: what happens to the investment market, Well, it's.

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Speaker 3: You're focusing more on the growth, and that should be

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Speaker 3: you focus. You've got to find an asset that's going

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Speaker 3: to achieve that for you. You've got to find something

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Speaker 3: that's going to build wealth that way. If it's purely

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Speaker 3: about the negative gearing and the tax benefits, you're doing

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Speaker 3: it for the wrong reasons. The reason to buy investment

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Speaker 3: property is to create wealth. You won't create wealth from

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Speaker 3: tax savings.

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Speaker 1: Right, Okay, yeah, yeah, so, and I suppose to that

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Speaker 1: extent that's seriously under minds this. Are you just to

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Speaker 1: that issue that I mentioned at the start of the show.

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Speaker 1: Are you aware of that? Do you come up against

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Speaker 1: that where you see people buying properties as part of

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Speaker 1: sort of group buying that you just know is a problem.

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Speaker 2: I haven't seen it, but I hear about it. Yeah.

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Speaker 3: I can't say to you, yes, I know this person

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Speaker 3: or that group's doing it or that group's doing it,

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Speaker 3: but yeah, I've absolutely heard about it happening and seen

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Speaker 3: that certain regional cities are being propped up in certain areas.

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Speaker 3: I mean, you're not I mean there's not going to

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Speaker 3: be a full demographic of an advisory company that's going

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Speaker 3: to fully sustain and prop up a market like Ballarat.

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Speaker 3: I mean, it's one hundred thousand people living in that township.

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Speaker 3: It's not going to be sustained or propped up by

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Speaker 3: one group coming in and buying properly there and inflating. Now,

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Speaker 3: if they went and focused purely on a certain estate

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Speaker 3: or a certain pocket, then that might be achievable.

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Speaker 2: But they're not copping out Ballarat on their own.

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Speaker 1: Yes, yes, fair enough, Yeah, okay. Just on the other

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Speaker 1: side of this, not the tax side, but the incentive side. Again,

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Speaker 1: for you out there every day in the market, tell

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Speaker 1: me how the federal incentives, particularly the five percent universal

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Speaker 1: home deposits scheme, is affecting the market and what changes

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Speaker 1: it means for your approach. If I'm if you're standing

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Speaker 1: beside me byers agents, and I'm saying to you, I

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Speaker 1: only have a minion to spend on a residential property,

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Speaker 1: and I know that puts me smack in the group

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Speaker 1: where I'm competing with first time buyers.

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Speaker 3: What do you say, Well, it depends on what your

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Speaker 3: focus is and what your objectives are in terms of

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Speaker 3: what's that market being doing.

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Speaker 2: Yes, certainly.

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Speaker 3: So we're obviously Melbourne focused because that's where we work,

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Speaker 3: but this is the same across the board from my

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Speaker 3: discussions with other people in other capital cities. In Melbourne,

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Speaker 3: it's nine hundred and fifty thousand dollars limit. That's where

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Speaker 3: the cap is, and I always assume it's there's varying

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Speaker 3: degrees depending upon where the median house price seeds or

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Speaker 3: the median dwelling price seeds.

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Speaker 1: For a Yeah, I think it's one point five is

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Speaker 1: the top, but it cascades down from there.

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Speaker 3: So yeah, we are and we have seen at different

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Speaker 3: stages over the years when these government incentives in different

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Speaker 3: forms have come in. Sometimes they're hard limits, sometimes they're

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Speaker 3: soft limits. When there are a hard limit like this,

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Speaker 3: you very regularly see first home buyers drive up to

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Speaker 3: that price and then stop them and it's a race

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Speaker 3: to get to that figure who can get there first,

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Speaker 3: And so you can quite often see value properties that

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Speaker 3: are valued or should be valued just below that figure

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Speaker 3: that them get driven up to that. Properties that are

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Speaker 3: valued a little bit above start to struggle because they

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Speaker 3: have been brought down, and buy as aren't prepared because

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Speaker 3: of the free money that they're achieving. It's different in

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Speaker 3: this instance because it's more it's done in a slightly

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Speaker 3: different way. Sometimes in the past it's been a full

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Speaker 3: cash incentive, or it might be stamp duty being taken away.

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Speaker 3: In this time, it's giving people the ability who don't

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Speaker 3: have the cash savings to have a twenty percent deposit

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Speaker 3: to avoid that lender's mortgage insurance.

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Speaker 2: It's giving them an opportunity.

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Speaker 1: So if you've got a house, if there is a

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Speaker 1: market and there's a layer where in each city there's

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Speaker 1: a cap, so Sitney's one point five, it's very top

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Speaker 1: and fifty in Melbourne, et cetera. So tell me about

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Speaker 1: that layer above it. They're finding it hard to sell

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Speaker 1: it because they're not getting the first time. Brus is

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Speaker 1: depending upon.

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Speaker 3: What the property types are, James, because some of those properties,

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Speaker 3: once you get over the where the ridge is, might

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Speaker 3: be suitable properties for upsizes. So people that might be

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Speaker 3: coming from a smaller property, whether it be an apartment

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Speaker 3: or a villa unit and looking to get into the house,

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Speaker 3: and if the house is sitting above that range, then

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Speaker 3: it may not be just as reliant on first home buyers.

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Speaker 3: There may be upsizes coming into that market as well,

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Speaker 3: whereas in the past where it's been at lower levels

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Speaker 3: and it's been far more targeted at first home buyers.

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Speaker 3: I think with the weather, we're certainly in Victoria where

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Speaker 3: the limit sits at the moment, it's not as reliant

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Speaker 3: just on first home boys. It's definitely been driven by

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Speaker 3: them predominantly at the moment, and that's where the most

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Speaker 3: activity is coming from, but there's not as much of

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Speaker 3: a heavy reliance on that center.

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Speaker 1: Okay, So the flip side of that is, is there

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Speaker 1: opportunity just above the cup? So if I said to you,

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Speaker 1: I've got nine to fifty to spend, would you actually

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Speaker 1: see you might be much better off if you just

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Speaker 1: had a million to spend in the market of a cause,

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Speaker 1: if you've.

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Speaker 3: Got it, I mean probably I wouldn't be as try

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Speaker 3: and finesse it as much as that you're saying the

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Speaker 3: nine to fifty to a mil. But if you've got

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Speaker 3: one point one to one point two, then yeah, absolutely

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Speaker 3: there's opportunities in that sort of price backup because you

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Speaker 3: step above for a lot of the first time buyers.

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Speaker 3: You then compete with some of the upsizes, and depending

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Speaker 3: on the property type. It might be a good town

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Speaker 3: based or it might be a good downsized type option

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Speaker 3: as well.

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Speaker 1: Right, And as that starting to play out in the

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Speaker 1: market right now.

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Speaker 2: Yeah, there's certainly that's certainly happening at the moment.

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Speaker 3: The market down here though, is a little bit inconsistent,

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Speaker 3: is probably the best way to put it at the moment.

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Speaker 1: M Just tell us what you mean by that, Well,

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Speaker 1: what does it consistent mean? Bad for some people, good

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Speaker 1: for others?

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Speaker 2: Yeah, that's right, it is.

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Speaker 3: I mean those that are looking to buy, I think

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Speaker 3: there's good opportunities around. But if you asked me the

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Speaker 3: same question in sort of August September last year, was

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Speaker 3: certainly starting to carry There's a lot of interstate investment

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Speaker 3: inquiry and things were building through the spring. But when

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Speaker 3: the inflation numbers started to come out towards the end

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Speaker 3: of the year and the discussion around interest right rises

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Speaker 3: rather than further reductions started to come to the fall,

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Speaker 3: and then when they actually came into play last month,

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Speaker 3: that's certainly changed the dynamic and change the sentiment around.

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Speaker 1: Is that right? Is that interesting? So you think there

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Speaker 1: might be something of a cooling of that interested bargain hunting, Yeah.

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Speaker 2: Well, they're still there, but it's not as strong as

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Speaker 2: what it was.

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Speaker 1: Yeah, okay, because of course we had the interest rate

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Speaker 1: rise and who knows, we may have another one. It's

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Speaker 1: a line ball called but I see Michelle bullet this

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Speaker 1: morning of the RBA mentioned in the oil place, says

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Speaker 1: an issue that could have award pressure on rates and

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Speaker 1: we have to allow for that. All right. I have

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Speaker 1: some really good questions which I kept for Jared. I

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Speaker 1: want to do them. We'll be back in a moment. Hello,

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Speaker 1: Welcome back to The Australian's Money Puzzle podcast. Jared McKay

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Speaker 1: with us today from the Watling Property group of buyers agents,

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Speaker 1: but not one of those. What they've been new for

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Speaker 1: us to be called the new wave of buyers agents

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Speaker 1: been the new wave of buyers agents that are piling

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Speaker 1: people up and pushing them into multiple properties in in

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Speaker 1: country towns where there's something I think literally of a

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Speaker 1: scandal brewing. I mean Michelle Morgan, who I talked to

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Speaker 1: Buyer's Academy, went as far as to call it a

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Speaker 1: Ponzi scheme, which I was, which is pretty strong language,

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Speaker 1: I have to say. But you've been in this for

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Speaker 1: a long time when did you when how long have

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Speaker 1: you been a buyer's agent?

438
00:20:39,280 --> 00:20:42,679
Speaker 3: BOYD Agents into fifteen sixteen years and a value for

439
00:20:42,720 --> 00:20:43,640
Speaker 3: ten years before.

440
00:20:43,440 --> 00:20:45,800
Speaker 1: That, and about sixteen years ago when you started I

441
00:20:45,800 --> 00:20:48,360
Speaker 1: reckon you were still explaining to people what your job

442
00:20:48,359 --> 00:20:50,119
Speaker 1: actually was. It was.

443
00:20:50,160 --> 00:20:52,400
Speaker 2: It was very different. There's a lot of different things.

444
00:20:52,680 --> 00:20:55,879
Speaker 3: Yeah, so the markets changed, the why things operate, the

445
00:20:55,880 --> 00:20:58,000
Speaker 3: why way uprights changed a lot out of that period.

446
00:20:58,160 --> 00:21:01,360
Speaker 1: Would be fair to say that buyers agents started originally

447
00:21:01,359 --> 00:21:03,280
Speaker 1: at the top of the market where they were really

448
00:21:03,400 --> 00:21:07,720
Speaker 1: just for premium and prestige product properties and as people

449
00:21:07,800 --> 00:21:10,080
Speaker 1: saw the value of this and the ability to actually

450
00:21:10,119 --> 00:21:13,520
Speaker 1: get a better price if you'll be using ONECOLTD down.

451
00:21:14,160 --> 00:21:17,040
Speaker 3: I mean, I can speak to this business, our business

452
00:21:17,080 --> 00:21:20,040
Speaker 3: which was started by Richard Waclin back in the mid nineties,

453
00:21:20,040 --> 00:21:23,040
Speaker 3: and certainly the way he started this business focused very

454
00:21:23,119 --> 00:21:25,880
Speaker 3: much on investment, properly buying and representing investors.

455
00:21:25,880 --> 00:21:28,680
Speaker 2: So that wasn't in that premium market, prestige market.

456
00:21:28,720 --> 00:21:31,439
Speaker 3: It was always in the single front of cottages and

457
00:21:31,480 --> 00:21:36,679
Speaker 3: the one and two bedroom.

458
00:21:34,440 --> 00:21:37,320
Speaker 1: But it was still investors. There were worthy people. I mean,

459
00:21:37,720 --> 00:21:39,360
Speaker 1: agents are used by everybody now, it's.

460
00:21:39,160 --> 00:21:40,800
Speaker 2: Not not always wealthy people.

461
00:21:40,840 --> 00:21:42,800
Speaker 3: Though, James, and that's stuff, and it gets thrown around

462
00:21:42,840 --> 00:21:45,119
Speaker 3: a lot with investors as though investors have a lot

463
00:21:45,160 --> 00:21:47,159
Speaker 3: of money. And I can tell you we've had a

464
00:21:47,200 --> 00:21:49,280
Speaker 3: lot of clients over the years that are not wealthy.

465
00:21:49,320 --> 00:21:50,800
Speaker 2: But I'm looking to set themselves up.

466
00:21:51,560 --> 00:21:54,000
Speaker 1: Sure now, what I mean is it seems to me

467
00:21:54,080 --> 00:21:57,280
Speaker 1: that the buyer's agent started as a professional arm if

468
00:21:57,320 --> 00:21:59,159
Speaker 1: you like an investor or, they were used at the

469
00:21:59,160 --> 00:22:00,800
Speaker 1: top end of the market. But it seems to me

470
00:22:00,880 --> 00:22:02,840
Speaker 1: now that buyers agents are used at all the ends

471
00:22:02,840 --> 00:22:03,359
Speaker 1: of the market.

472
00:22:03,520 --> 00:22:06,200
Speaker 3: Yeah, and look, a lot of parents helping children, wanting

473
00:22:06,200 --> 00:22:08,240
Speaker 3: to make sure their children are making the right decision.

474
00:22:08,320 --> 00:22:10,600
Speaker 3: So we certainly have got that a lot of clients

475
00:22:10,640 --> 00:22:11,880
Speaker 3: that we've worked with over the years.

476
00:22:11,880 --> 00:22:13,520
Speaker 2: You could still argue, though, that might.

477
00:22:13,359 --> 00:22:17,480
Speaker 3: Well be wealthy people helping their children get into the market,

478
00:22:17,680 --> 00:22:19,879
Speaker 3: So there's still an argument to be said there. But

479
00:22:20,440 --> 00:22:22,520
Speaker 3: there's certainly a lot of first time wise that are

480
00:22:22,560 --> 00:22:24,520
Speaker 3: seeing the value and wanting to make sure that they

481
00:22:24,600 --> 00:22:25,879
Speaker 3: make the right decisions.

482
00:22:26,440 --> 00:22:28,760
Speaker 1: I have would imagine it just makes sense if it's

483
00:22:28,760 --> 00:22:31,639
Speaker 1: a competitive market. This is not to promote the buioer's agents, folks,

484
00:22:31,640 --> 00:22:33,639
Speaker 1: but to say that, you know, if you wanted to

485
00:22:33,640 --> 00:22:36,560
Speaker 1: give a certain amount to your kids to buy a house,

486
00:22:37,400 --> 00:22:39,600
Speaker 1: well you could spend it a different way instead of

487
00:22:39,600 --> 00:22:41,840
Speaker 1: adding to the deposits. You know, if you use the

488
00:22:41,880 --> 00:22:45,680
Speaker 1: viisations and they were good and it's a gamble, if

489
00:22:45,720 --> 00:22:48,120
Speaker 1: they got to a discount that more than cover their fees,

490
00:22:48,200 --> 00:22:51,479
Speaker 1: then you win, simple as all right. Question from Kerry

491
00:22:51,720 --> 00:22:55,280
Speaker 1: kay or why we've had the federal government annown selling

492
00:22:55,280 --> 00:22:58,920
Speaker 1: off all these defense sites this of lef Why can't

493
00:22:59,440 --> 00:23:02,960
Speaker 1: governments developed some of these sides themselves for a housing

494
00:23:03,400 --> 00:23:06,200
Speaker 1: For the most part, residential land development uses the same

495
00:23:06,280 --> 00:23:09,600
Speaker 1: skills as infrastructure projects. That's a really good point, Kerry.

496
00:23:10,520 --> 00:23:14,280
Speaker 1: I expect that it's beyond them, I imagine. But there

497
00:23:14,280 --> 00:23:16,720
Speaker 1: are some extraordinary spots coming up. Even though you mentioned

498
00:23:16,720 --> 00:23:20,080
Speaker 1: you're based in Melbourne. The Victoria Barricks, think the word wow,

499
00:23:20,520 --> 00:23:24,359
Speaker 1: the Fort Queenscliff Ford, my gosh, I mean wow, these

500
00:23:24,760 --> 00:23:26,439
Speaker 1: pieces of land. How do you think all that will go?

501
00:23:26,600 --> 00:23:29,119
Speaker 3: I was married just outside that Queen's Cliff, Fort James,

502
00:23:29,119 --> 00:23:32,760
Speaker 3: so I know that spot down there.

503
00:23:33,960 --> 00:23:38,560
Speaker 1: It's a sentimental spot with those defense sides. I under

504
00:23:38,560 --> 00:23:40,200
Speaker 1: look at it Intidney too, they're spectacus.

505
00:23:40,240 --> 00:23:42,080
Speaker 3: Yeah, and there's some great spots all over them, I mean,

506
00:23:42,119 --> 00:23:45,160
Speaker 3: and they are in really good locations. And I don't

507
00:23:45,200 --> 00:23:49,840
Speaker 3: disagree with the comment around some form of government involvement

508
00:23:49,880 --> 00:23:53,000
Speaker 3: in what's to be built, because developers will build what

509
00:23:53,200 --> 00:23:56,120
Speaker 3: suits developers and what's going to suit their pocket and

510
00:23:56,160 --> 00:23:58,359
Speaker 3: how are they going to make a profit, And that

511
00:23:58,400 --> 00:24:02,480
Speaker 3: doesn't necessarily line up with what's required from an accommodation

512
00:24:02,560 --> 00:24:05,600
Speaker 3: perspective in certain locations. And I think that's certainly something

513
00:24:05,680 --> 00:24:07,639
Speaker 3: that needs to be It's all well and good to

514
00:24:07,800 --> 00:24:10,359
Speaker 3: have some high density living, but if you're going to

515
00:24:10,400 --> 00:24:12,680
Speaker 3: continue to build one and two bedroom apartments, you're not

516
00:24:12,720 --> 00:24:15,480
Speaker 3: going to attract families to move into those locations.

517
00:24:16,960 --> 00:24:20,360
Speaker 1: I think specifically to your question Kerry, it's the government

518
00:24:20,800 --> 00:24:23,960
Speaker 1: have evolved in such a fashion that it is very

519
00:24:24,000 --> 00:24:28,119
Speaker 1: much partnership now, and all government developments, all the social

520
00:24:28,160 --> 00:24:30,800
Speaker 1: housing is not done by government per se. It's farmed

521
00:24:30,840 --> 00:24:34,040
Speaker 1: out and is developed from architecture of scope out right

522
00:24:34,080 --> 00:24:37,120
Speaker 1: through in partnerships. So I expect they will not sort

523
00:24:37,160 --> 00:24:41,199
Speaker 1: of change. They can't change in midstream. Okay, none of

524
00:24:41,240 --> 00:24:43,720
Speaker 1: this is advice, needs to say, It is information only.

525
00:24:43,960 --> 00:24:48,080
Speaker 1: And the question from Andrew I refer to Stuart Wems observation.

526
00:24:48,160 --> 00:24:51,200
Speaker 1: Now Stuart Weims and you are you work together once

527
00:24:51,200 --> 00:24:53,399
Speaker 1: more time, so you know who I'm talking about. In

528
00:24:53,400 --> 00:24:55,639
Speaker 1: a recent podcast, you said Adelaide is a very small

529
00:24:55,720 --> 00:24:59,800
Speaker 1: capitalist at one point four million, then growing. It's bigger

530
00:24:59,840 --> 00:25:05,560
Speaker 1: than hell Sinki, Copenhagen, Prague, Oslo, San Francisco and Islamabad.

531
00:25:06,200 --> 00:25:09,520
Speaker 1: So I think sometimes we lose sight of being medium

532
00:25:09,560 --> 00:25:13,000
Speaker 1: cities in the world in world term, says Andrew. Thank you,

533
00:25:13,000 --> 00:25:14,880
Speaker 1: and I wonder w are you based in Atlete?

534
00:25:14,920 --> 00:25:15,320
Speaker 2: Don't know.

535
00:25:16,440 --> 00:25:18,879
Speaker 1: I said to somebody at a reception the other night.

536
00:25:19,640 --> 00:25:22,840
Speaker 1: They were from Adlete. They were a manufacturer Adlete, and

537
00:25:22,920 --> 00:25:25,320
Speaker 1: I mentioned the point that Adlete was deer than Melbourne,

538
00:25:25,600 --> 00:25:28,160
Speaker 1: and this person, who has a multimillion dollar business, did

539
00:25:28,359 --> 00:25:31,680
Speaker 1: not believe me. And it's been like that for a while,

540
00:25:31,680 --> 00:25:32,120
Speaker 1: hasn't it.

541
00:25:32,240 --> 00:25:35,240
Speaker 3: Ali's great CDMA again, went to university over there. I

542
00:25:35,800 --> 00:25:38,960
Speaker 3: lived there for three years. It's a great spot. But

543
00:25:39,400 --> 00:25:41,000
Speaker 3: relatively speaking in terms of.

544
00:25:41,040 --> 00:25:43,320
Speaker 1: Do you think it will stay more expensive than Melbourne

545
00:25:43,359 --> 00:25:45,080
Speaker 1: on a medium price basis for along?

546
00:25:46,000 --> 00:25:50,040
Speaker 2: Okay, but it's been unvalued for a long time as well.

547
00:25:50,320 --> 00:25:52,399
Speaker 3: I think that's probably more than the point that it's

548
00:25:52,760 --> 00:25:54,879
Speaker 3: and then with all of the benefits that it's saying

549
00:25:54,880 --> 00:25:58,200
Speaker 3: at the moment, with the international events that are coming there,

550
00:25:58,600 --> 00:26:00,800
Speaker 3: people are recognizing it as a great city and a

551
00:26:00,840 --> 00:26:03,200
Speaker 3: really good city to live in. So I think there's

552
00:26:03,240 --> 00:26:06,280
Speaker 3: certainly scope there. But on the grand scheme of things

553
00:26:06,400 --> 00:26:10,000
Speaker 3: on a national scale, it is still smaller compared to

554
00:26:10,040 --> 00:26:10,720
Speaker 3: a lot of other.

555
00:26:10,600 --> 00:26:11,680
Speaker 2: Cities in this country.

556
00:26:11,720 --> 00:26:14,680
Speaker 3: So it's not well, I think when Stewart talks about it,

557
00:26:14,680 --> 00:26:17,040
Speaker 3: it's not as though it's going to be one of

558
00:26:17,080 --> 00:26:19,560
Speaker 3: the top four or five from a population perspective in

559
00:26:19,600 --> 00:26:22,719
Speaker 3: this country. So yes, it's not a small city compared

560
00:26:22,720 --> 00:26:25,800
Speaker 3: to the ones that were mentioned, but it's still it's

561
00:26:25,800 --> 00:26:28,000
Speaker 3: not even one of the top three within this country

562
00:26:28,000 --> 00:26:29,120
Speaker 3: from a size per spece.

563
00:26:29,760 --> 00:26:32,560
Speaker 1: Okay, very good, Well, I suppose being honest about it, Andrew,

564
00:26:32,560 --> 00:26:34,679
Speaker 1: I imagine we all are susceptible to a touch of

565
00:26:34,720 --> 00:26:37,520
Speaker 1: parochialism now and again, and I think the Melbourne people

566
00:26:37,560 --> 00:26:40,399
Speaker 1: are somewhat disturbed by the fact that adletas dear on

567
00:26:40,440 --> 00:26:42,399
Speaker 1: a medium basis. But I found it entertaining that the

568
00:26:42,440 --> 00:26:44,920
Speaker 1: Adlet people themselves didn't believe it. All right, we might

569
00:26:45,000 --> 00:26:47,600
Speaker 1: leave it right there, Hey, thank you, Jared, thanks having me, James,

570
00:26:47,800 --> 00:26:49,960
Speaker 1: thank you, and thanks for listening our Today's show was

571
00:26:50,000 --> 00:26:53,359
Speaker 1: produced by Leah Summerglue. Do keep the emails coming, The

572
00:26:53,640 --> 00:26:56,760
Speaker 1: Money Puzzle at the Australian dot com dot au. James

573
00:26:56,840 --> 00:26:58,480
Speaker 1: Kirby here, talk to you soon.

574
00:27:00,040 --> 00:27:01,800
Speaker 3: The Wood, The

575
00:27:03,560 --> 00:27:03,600
Speaker 1: S