Property Investment & Wealth Creation Australia | The Michael Yardney Podcast

Maybe you're too biased to become a successful property investor? What do I mean by that? Well…did you know that we can sometimes be our own worst enemy as property investors? It's not because of the decisions we make, the opportunities we consider, or the investments we miss out on, but rather, it's due to the way we think. By the last count, I've read that there are 188 types of these fallible mental shortcuts in existence, and they constantly impede our ability to make the best decisions about our careers, our relationships, and for building wealth over time. So, whether you are a beginner or an experienced investor, whether you're in business or an entrepreneur you'll enjoy my chat today with Mark Creedon, founder of Mastermind Business Accelerator as we discuss why seemingly rational people act irrationally when it comes to money. Cognitive Biases You Need to Know Without always knowing it, property investors are pre-programmed with a range of biases which may cause them to interpret information incorrectly and thus undertake sub-optimal investment decisions. You see, most of us think we're rational people but we're not. There is no shortage of cognitive biases out there that can trip up our brains. However, because cognitive biases are based on generalizations and assumptions, they can't always be correct. And if you don't check your reasoning, they can lead to judgments and decisions that negatively impact your business. 1. Confirmation bias People tend to search for information that confirms their view of the world and ignore what doesn't fit. In an uncertain world, we love to be right because it helps us make sense of things. One way to counter confirmation bias is to read things you're going to disagree with. In other words, read all you can from reputable sources, whether it's confirming your original view or not. 2. Anchoring bias We have a tendency to use anchors or reference points to make decisions and evaluations, and sometimes these lead us astray. This is because the initial price you set for a house or car or more abstractly, for a deal of any kind, tends to have ramifications right through the process of coming to an agreement. Whether we like it or not, our minds keep referring back to that initial number. It's important for you to evaluate any property deal based on its own fundamentals and all the information you have available from your research and due diligence at the time. 3. Awareness bias How are your investments performing – are you happy with the results you're getting? It's been shown the poorest performers in all areas of life are the least aware of their own incompetence, a phenomenon known as the Dunning-Kruger effect. If you're the smartest person on your team you're in trouble. It's best to work with a team of mentors and professional advisors. 4. Positivity bias In the face of lack of capital growth, prolonged vacancies, or inflated expenses, some investors continue to believe that their investment will turn the corner "one day." The problem with this is that when all signs point to a dud investment, it likely is one – but positivity bias can stand in the way of an investor taking action to rectify the situation. One of the best things an investor can do is admit what they don't know and get a good team of professionals around them. 5. Negativity bias Just as some investors can be overly positive this is the tendency to put more emphasis on negative experiences rather than positive ones. Our ancestors evolved a brain that routinely tricked them into making three mistakes: overestimating threats, underestimating opportunities, and underestimating resources. This helped keep them alive. It's a great way to pass on genes, but a lousy way to promote quality of life or grow your wealth through property. Fact is: there will always be property pessimists around, but you can minimize your risks and maximize your upside if you educate yourself and become financially fluent, follow a proven strategy, and get a good team around you. 6. Status quo bias This describes our tendency to stick with what we know, whether or not it's the best course of action. Psychologists call this "loss aversion" and it explains why so many Australians are willing to stick their money in a plain old bank account earning minimal interest, rather than taking the "perceived risk" of property investment. Successful investors, businesspeople, and entrepreneurs have mentors, coaches, and mastermind groups to help them see their blind spots and to encourage them to keep moving forward. 7. Survivorship Bias The misconception here is that you should focus on the successful if you wish to become successful, while the truth is that when failure becomes invisible, the difference between failure and success may also become invisible. The trick when looking for advice is to not only learn what to do but also look for what not to do. 8. Bandwagon bias This is the psychological phenomenon whereby people do something primarily because other people are doing it. The bandwagon effect has wide implications but is commonly seen during strong property markets where the media stirs up a frenzy and it's one of the factors that lead to asset bubbles. But when it comes to financial matters we know "the herd" is usually wrong – most property investors never build a substantial portfolio. It pays to remember that just because everyone else is doing it, that doesn't mean you should follow the crowds. 9. Restraint bias Following on from bandwagon bias, restraint bias is the tendency for people to overestimate their ability to control impulsive behavior. Psychologists say the very people who think they are most restrained are also most likely to be impulsive. 10. Bias bias Failing to recognize your cognitive biases is a bias in itself. Arguably this is the most damaging bias because having blind spots means you're less likely to recognize any of these psychological influences in yourself. Simply becoming aware of these biases means half your battle against your own worst enemy – yourself – is won. The bottom line: We all want to think we are rational and biases are things that afflict other people. However our brains are designed with blind spots and one of their clever tricks is to confer on us the comforting delusion that we, personally, do not have any biases. This is why so many of us are not only bad with money but make the same mistakes over and over again. Links and Resources: Get the team at Metropole to help build your personal Strategic Property Plan Click here and have a chat with us Why not join Metropole's Mastermind Business Accelerator Learn more about Mark Creedon – Business Coach to some of Australia's leading entrepreneurs Get a copy of Mark's new book here – Have a Business not a Job Get a bundle of eBooks and reports – www.PodcastBonus.com.au Some of our favourite quotes from the show: "It's actually not as much the investment, it's about the person." – Michael Yardney "In fact, it's been shown the poorest performers in all areas of life are the least aware of their own incompetence." – Michael Yardney "There will always be pessimists around, but I don't really know any rich pessimists." - Michael Yardney PLEASE LEAVE US A REVIEW Reviews are hugely important to me because they help new people discover this podcast. If you enjoyed listening to this episode, please leave a review on iTunes - it's your way of passing the message forward to others and saying thank you to me. Here's how

Homeownership is looking further out of reach for anyone without family wealth, as over the last few years property prices kept growing and wages fail to keep up. Over the last decade or so property prices keep growing and wages failed to keep up and over the last few years affordability seems to have decreased as interest rates keep increasing. Is it really harder to get into the property market today than it was a number of decades ago? That's what I discuss today with independent financial adviser Stuart Wemyss. And even if you already own a home, I'm sure our discussion will be valuable because it will help you understand what we believe is ahead for our housing market. Is homeownership harder today? Many people are suggesting it's much harder to buy a property today than it was years ago. They're telling us that Baby Boomers don't really understand how hard it is. My guest today, independent financial advisor Stuart Wemyss, believes it's actually easier to buy a property today than it was many decades ago. Now I know some people listening to this one disagree so I'm looking forward to hearing his views. Millennials are telling us that buying a house today is far harder than when their parent got into the market because the rate by which property prices have soared is well beyond that of wage growth. At first glance these arguments make sense, but there's more to it than that. I would like to suggest that in many respects, buying a property today is easier than it was many decades ago. 1. Abundant access to information, knowledge, strategies, advice, and so forth How do you get ahead financially? One solution is to get the best advice so that you make the most of your financial opportunities. Often people learn by trial and error, but that can be expensive and waste valuable time. You can fast-track your financial success by learning the best way to use your money. ● There is an absolute abundance of information that is available on the internet. ● Most of it is accessible instantaneously at no cost. ● Blogs, forums, podcasts, books, websites, software, and so on. It cannot be underestimated how valuable that is. 25 years ago, no such information was available. There were a few books about property investing, but not many. The only way to learn about borrowing strategies was by meeting bank staff, but they weren't particularly knowledgeable or helpful. Therefore, unless you knew a successful property investor, it was hard to access knowledge. As the saying goes, "knowledge is power". 2. Much higher borrowing capacity Thirty to forty years ago, borrowing 3 times your gross income was seen as very high risk. Today, the banking regulator (APRA) classifies a high-risk borrower as anyone that borrows more than 6 times their gross income. Therefore, by this measure, borrowing capacity has increased by 2 to 3 times over the past few decades. In addition, 30 years ago, it was not possible to borrow more than 80% of a property's value. Today, owner-occupiers can borrow up to 95%. 3. Higher earning capacity and more employment opportunities The internet has made it very easy to connect with people around the world. This means people can explore a lot more job opportunities. In fact, given the increased acceptance of working from home, it is not even necessary for you to live in the same country as your employer. Whilst these advancements might make the job markets more competitive, for some occupations it opens (literally) a whole world of opportunities. Therefore, first-time property buyers can proactively explore many opportunities to increase their income, thereby increasing their borrowing capacity and purchasing power. In addition, incomes have increased in real terms over the past few decades, especially for many professional white-collar occupations. There are some young people earning 2 to 3 times more than what was possible in their occupation decades ago. I discuss this further below. 4. Family guarantees & the bank of mum and dad The biggest impediment that delays first-home buyers getting into the market is saving enough for a deposit. First homeowners need a minimum deposit of at least 12% of a property's purchase price (a 5% deposit plus 7% for costs including stamp duty and legal fees). That can take a long time to save. The most effective way to alleviate a lack of deposit is to get help from family. This might come in the form of providing a family guarantee. Alternatively, parents might prefer to provide their child with a gift or a loan. Most baby boomers have benefited greatly from higher property prices over the past few decades and are in a good position to help their children. 5. Cash flow budgeting/management tools It is critical that young people establish good cash flow management practices as soon as they enter the workforce, as these habits tend to stick with you over your lifetime. Establishing a strong savings pattern will serve two purposes. ● Firstly, it will help a prospective home buyer save a larger deposit, sooner. ● Secondly, it will demonstrate (to themselves and a bank) that they have the necessary surplus cash flow to service a loan. There is a huge array of tools available to people today to help them improve their cash flow management. 6. Ability to invest outside of your domicile location. The internet has made buying a property outside your domicile location a lot easier. For example, if you live in a regional town, it probably makes financial sense to invest somewhere else. A lot more equity in dollar terms It is relatively easy to accumulate over $1 million in equity in a property if you (1) buy well and (2) hold it for a couple of decades. Of course, this is a function of borrowing more i.e., property costs a lot more today than it did decades ago. But if you can afford a higher loan and you hold a property for the long term, the wealth effect can be substantial. One downside to this is that borrowing more means that you either must generate substantial income to be able to repay the loan or downsize the property at some stage to reduce/repay debt. Do all these positives offset higher prices? The average median house price in Melbourne and Sydney in 1980 was almost $53,000. Adjusting for inflation, this equates to $268,000 in today's dollars. The average median house price in Melbourne and Sydney has increased to $1.2 million (Sept 2022). Therefore, house prices have increased 4.5 times in real terms since 1980. Income plus higher borrowing capacity Borrowing capacity has more than doubled since 1980 and professional salaries have risen by more than 30%. This means buying power has increased by a factor of 3 to 3.5 times over the past four decades. It can be more difficult today It can be more challenging to be a first-time buyer today. But a lot of the advancements over the past few decades have gone a long way toward mitigating the impact of higher prices (or, more correctly, driving prices higher). Most importantly, it is easier to make the right decision today. Mistakes can be very costly. If I knew what I know today before I purchased my first home 25 years ago, the financial outcomes would have been a lot different. This knowledge allows younger people to make a lot of money from property if they have the motivation and desire to do so and they are prepared to work hard and sacrifice. Links and Resources: Michael Yardney Stuart Wemyss – Prosolution Private Clients Stuart's Book – Rules of the Lending Game & Investopoly Get the team at Metropole to help build your personal Strategic Property Plan Click here and have a chat with us Some of our favourite quotes from the show: "I think one of the other factors that have changed over time is there are more people to get advice from, which is good in some ways, but it's also hard to work out who you should take advice from." –Michael Yardney "There are a number of state government and federal government initiatives that are helping first home buyers get into the market." – Michael Yardney "A lot of people are rentvesting now. They realize that they can't afford to buy where they want to live, so they rent where they want to live and buy in another state." – Michael Yardney PLEASE LEAVE US A REVIEW Reviews are hugely important to me because they help new people discover this podcast. If you enjoyed listening to this episode, please leave a review on iTunes - it's your way of passing the message forward to others and saying thank you to me. Here's how

Many people are continually in pursuit of financial freedom. Yet, only a few seem to understand the true path to this seemingly elusive destination. It's not just about earning more or saving more; it's about cultivating the right mindset. I'm going to start today's show with a bold claim. I'm going to suggest that this is probably going to be one of the most important podcast episodes you're going to listen to in the next 12 months. Today you're going to hear Jarrad Mahon, director of Investors Edge real estate in Perth, interview me for his Perth Property Insider podcast. This happened a few months ago after Wealth Retreat last year. We're at the beginning of a new year which will be full of challenges but also full of opportunities, and it's very likely that you made some resolutions, or at least some thoughts about your plans for the upcoming year. Now I'm going to share with you a sneak peek behind the curtains of what a small group of already very successful property investors, businesspeople, and entrepreneurs learned at Wealth Retreat. We're going to talk about why a small group of investors outperform and what you may have to do differently this year because, as I also say at Wealth Retreat, the best is yet to come. Links and Resources: Metropole's Strategic Property Plan – to help both beginning and experienced investors Get a bundle of free reports and eBooks – www.PodcastBonus.com.au Jarrod Mahan – Investors Edge Perth Join us at Wealth Retreat 2024 – find out more here and express your interest. Shownotes plus more here: The Game Changer: The Crucial Shifts for Prosperity in this New Year – with Jarrad Mahon

In today's show, I want to discuss with you the five levels of investing, a framework that I have created to help you understand where you are on your journey and to help you make sure you reach the top level as a successful investor. Then I'm going to share some interesting information with you about the tsunami of wealth Baby Boomers are expected to leave their children. Do you understand the Five Levels of Investing? If you want to become a successful property investor, you really need to understand the five levels of investing. I've created a model to explain the progression most investors take in their path to developing financial freedom. Level 0 – The Spender Level 0 are really not investors – they tend to be spenders and borrowers and as a result, end up with a high level of debt. A large part of our adult population falls into this category and they will never become wealthy unless they do something radically different. Level 1 – The Saver Most people who are not spenders will generally be what I call savers. Their main investment is their home, which they aim to pay off over time. Sometimes they save a little, squirreling away a few dollars of what's left over after paying tax but in general, they save to consume, not to invest. They will get the most leverage by investing in themselves and getting a quality financial education and beginning to build a network of peers whom they can make the journey with. Level 2 – The Passive Investor Level 2 investors have become aware of the need to invest. They realize their superannuation won't get them through retirement, so they learn about investment and accumulate assets. While they are generally intelligent people, they are still what I would call financially illiterate – they don't really understand the rules of money. They must unlearn the flawed, incorrect, and misguided lessons they have learned about money and wealth from unqualified teachers. Level 3 –The Active Investor Level 3 investors realize that they must take responsibility for their financial future and become actively involved in their investment decisions. They become financially literate by building a knowledge base of investment strategies and techniques. Level 3 investors usually leverage the time and expertise of a network of industry professionals as they realize that they can't do it all themselves. They also upgrade their network of advisors and peers, often joining a Mastermind group of like-minded people. Level 4 – The Professional Investor A very small group of investors move to the top rung of the ladder and become a Level 4 "professional" investor who has built and now manages a true investment business. A Level 4 investors' property investment business has a substantial asset base that generates sufficient recurring passive income to pay for their lifestyle costs. They keep growing their investment portfolio whether or not they work in a real job. These professional investors don't hand control of their investments over to others; they retain control whilst employing a proficient team: accountants, finance brokers, property managers, solicitors, and property strategists who have great systems that achieve repeated and consistent results, which are reliable and predictable. This gives Level 4 investors the freedom to choose whether they get up in the morning and go to work or not. Asset Growth first, then income stage It's important to understand that the first stage in becoming financially free is to educate yourself; the next stage is that of asset accumulation – your job as a Level 3 investor is to build a sufficiently large asset base to fuel your "cash machine". Then, only when you have grown a substantial asset base, do you transition into the cash flow (income) stage of your life as a level 4 investor. What is your Level of Wealth? Now it's time for some home truths. How far up the Wealth Pyramid are you? Where do you currently sit in this hierarchy of investors? Everyone starts at the bottom – at Level 0 – but not everyone makes it to Level 4. In fact, few do. But you can once you understand why the rich keep getting richer. What I want you to understand is that the "active" income you make (the pay packet you work for every day) has nothing to do with what level of investor you are and in fact is one of the worst predictors of wealth. One great thing about freedom is the freedom to choose to live the life you want to live. Links and Resources: Michael Yardney Get the team at Metropole to help build your personal Strategic Property Plan Click here and have a chat with us Get a heap of eBooks and reports here: - www.PodcastBonus.com.au Some of our favorite quotes from the show: "Savers tend to be afraid of financial matters. They're generally unwilling to take risks." – Michael Yardney "You've got to go through the various stages to become financially independent." – Michael Yardney "Continue to work more on yourself than you do on your job so you become more valuable to your employer, which will help you earn more and also help you as an investor." – Michael Yardney PLEASE LEAVE US A REVIEW Reviews are hugely important to me because they help new people discover this podcast. If you enjoyed listening to this episode, please leave a review on iTunes - it's your way of passing the message forward to others and saying thank you to me. Here's how

In today's show, I want to discuss with you the five levels of investing, a framework that I have created to help you understand where you are on your journey and to help you make sure you reach the top level as a successful investor. Then I'm going to share some interesting information with you about the tsunami of wealth Baby Boomers are expected to leave their children. Do you understand the Five Levels of Investing? If you want to become a successful property investor, you really need to understand the five levels of investing. I've created a model to explain the progression most investors take in their path to developing financial freedom. Level 0 – The Spender Level 0 are really not investors – they tend to be spenders and borrowers and as a result, end up with a high level of debt. A large part of our adult population falls into this category and they will never become wealthy unless they do something radically different. Level 1 – The Saver Most people who are not spenders will generally be what I call savers. Their main investment is their home, which they aim to pay off over time. Sometimes they save a little, squirreling away a few dollars of what's left over after paying tax but in general, they save to consume, not to invest. They will get the most leverage by investing in themselves and getting a quality financial education and beginning to build a network of peers whom they can make the journey with. Level 2 – The Passive Investor Level 2 investors have become aware of the need to invest. They realize their superannuation won't get them through retirement, so they learn about investment and accumulate assets. While they are generally intelligent people, they are still what I would call financially illiterate – they don't really understand the rules of money. They must unlearn the flawed, incorrect, and misguided lessons they have learned about money and wealth from unqualified teachers. Level 3 –The Active Investor Level 3 investors realize that they must take responsibility for their financial future and become actively involved in their investment decisions. They become financially literate by building a knowledge base of investment strategies and techniques. Level 3 investors usually leverage the time and expertise of a network of industry professionals as they realize that they can't do it all themselves. They also upgrade their network of advisors and peers, often joining a Mastermind group of like-minded people. Level 4 – The Professional Investor A very small group of investors move to the top rung of the ladder and become a Level 4 "professional" investor who has built and now manages a true investment business. A Level 4 investors' property investment business has a substantial asset base that generates sufficient recurring passive income to pay for their lifestyle costs. They keep growing their investment portfolio whether or not they work in a real job. These professional investors don't hand control of their investments over to others; they retain control whilst employing a proficient team: accountants, finance brokers, property managers, solicitors, and property strategists who have great systems that achieve repeated and consistent results, which are reliable and predictable. This gives Level 4 investors the freedom to choose whether they get up in the morning and go to work or not. Asset Growth first, then income stage It's important to understand that the first stage in becoming financially free is to educate yourself; the next stage is that of asset accumulation – your job as a Level 3 investor is to build a sufficiently large asset base to fuel your "cash machine". Then, only when you have grown a substantial asset base, do you transition into the cash flow (income) stage of your life as a level 4 investor. What is your Level of Wealth? Now it's time for some home truths. How far up the Wealth Pyramid are you? Where do you currently sit in this hierarchy of investors? Everyone starts at the bottom – at Level 0 – but not everyone makes it to Level 4. In fact, few do. But you can once you understand why the rich keep getting richer. What I want you to understand is that the "active" income you make (the pay packet you work for every day) has nothing to do with what level of investor you are and in fact is one of the worst predictors of wealth. One great thing about freedom is the freedom to choose to live the life you want to live. Links and Resources: Michael Yardney Get the team at Metropole to help build your personal Strategic Property Plan Click here and have a chat with us Get a heap of eBooks and reports here: - www.PodcastBonus.com.au Some of our favorite quotes from the show: "Savers tend to be afraid of financial matters. They're generally unwilling to take risks." – Michael Yardney "You've got to go through the various stages to become financially independent." – Michael Yardney "Continue to work more on yourself than you do on your job so you become more valuable to your employer, which will help you earn more and also help you as an investor." – Michael Yardney PLEASE LEAVE US A REVIEW Reviews are hugely important to me because they help new people discover this podcast. If you enjoyed listening to this episode, please leave a review on iTunes - it's your way of passing the message forward to others and saying thank you to me. Here's how

Are you hoping to be a better investor, businessperson, or entrepreneur? Well, today's show is for you because we discussed the concept of behavioural finance, which is the study of the effects of psychology on investors and financial markets. But don't worry, it's not woo-woo stuff, and it's not technical. Instead, I share several quotes from my favourite author, Morgan Housel, and Mark Creedon and I will try and explain why investors often appear to lack self-control, act against their own best interest, and make decisions based on personal biases instead of facts. Whether you're a beginning investor or well down the track in your investment journey, I'm sure today's show will give you some insights, as you're probably twice as biased as you think, and if you don't think this applies to you, you're probably four times as biased as you think. Want to become better with your finances? Well, you could do a lot worse than learning from my favourite author, Morgan Housel, author of the Psychology of Money. His book The Psychology of Money shares 19 short stories exploring the strange ways people think about money and teaches you how to make better sense of one of life's most important topics. And today, I'd like to discuss several of Morgan Housel's quotes with Mark Creedon, founder and CEO of Metropole's Business Accelerator Mastermind. Doing well with money isn't necessarily about what you know. It's about how you behave. And behavior is hard to teach, even to really smart people. ● Doing well with money has little to do with how smart you are and a lot to do with how you behave. ● Money―investing, personal finance, and business decisions―is typically taught as a math-based field, where data and formulas tell us exactly what to do. But in the real world, people don't make financial decisions on a spreadsheet. ● Emotions can override any level of intelligence. Morgan Housel Quotes "Be careful when reading about how stupid investors can be and not realize you're reading about yourself." "The problem with economic forecasting is that the things you can predict tend to not matter, and the things you can't predict make all the difference in the world." "Planning is important, but the most important part of every plan is to plan on the plan not going according to plan." "Getting rich and staying rich are different things that require different skills." "Most financial mistakes come when you try to force things to happen faster than is required. Compounding doesn't like when you try to use a cheat code." "Imagine how much stuff you'd have to make up if you were forced to talk 24/7. Remember this when watching financial news on TV." ● Investors were probably better informed 20 years ago when there was 90% less financial news. ● Predictions, opinions, and forecasts should be discounted by the number of times the person making them is on TV each week. ● The more you want something to be true, the more likely you are to believe a story that overestimates the odds of it being true. "The market is rational, but investors play different games, and those games look irrational to people playing a different game." ● A lot of financial debates are just people with different time horizons talking over each other. ● Beware of taking financial cues from people playing a different game than you are. ● Everyone is making a bet on an unknown future. It's only called speculation when you disagree with someone else's bet. "When things are going extremely well, realize it's not as good as you think. You are not invincible, and if you acknowledge that luck brought you success, then you have to believe in luck's cousin, risk, which can turn your story around just as quickly." "Controlling your time is the highest dividend money pays." "No one is impressed with your possessions as much as you are." ● Don't attempt to keep up with the Joneses without realizing the Joneses aren't any happier than you are. "Read last year's market predictions, and you'll never again take this year's predictions seriously." ● A big takeaway from economic history is that the past wasn't as good as you remember, the present isn't as bad as you think, and the future will be better than you anticipate. "You're twice as biased as you think you are (four times if you disagree with that statement)." "Tell people what they want to hear, and you can be wrong indefinitely without penalty." "You're twice as biased as you think you are (four times if you disagree with that statement)." "Risk management is less about how you respond to risk and more about recognizing how many things can go wrong before they actually do." "If you have an idea but think "someone has already done that," just remember there are 1,010 published biographies of Winston Churchill." ● Just because someone else has done it before, that's not a reason not to do it. If anything, it means that you can do it too. More people wake up every morning wanting to solve problems than wake up looking to cause harm. But people who cause harm get the most attention. So slow progress amid a drumbeat of bad news is the normal state of affairs. Links and Resources: Get the team at Metropole to help build your personal Strategic Property Plan Click here and have a chat with us Why not join Metropole's Mastermind Business Accelerator Learn more about Mark Creedon – Business Coach to some of Australia's leading entrepreneurs. Get a copy of Mark's new book here – Have a Business not a Job Join us at Wealth Retreat 2023 on the Gold Coast in 2023– express your interest here Get a bundle of eBooks and reports – www.PodcastBonus.com.au "We all think we know how the world works because we've only experienced a tiny sliver of it, so, therefore, we put our thoughts, our emphasis, our bias on this." – Michael Yardney "Past success can't be relied on. You can't repeat that indefinitely." – Michael Yardney "Don't judge your chapter one or two by my chapter 30 or 40." – Michael Yardney PLEASE LEAVE US A REVIEW Reviews are hugely important to me because they help new people discover this podcast. If you enjoyed listening to this episode, please leave a review on iTunes - it's your way of passing the message forward to others and saying thank you to me. Here's how

As the Australian property market continues to defy expectations, financial analyst Pete Wargent joins me to unravel the complexities of its current landscape. Being the first Big Picture Podcast for the new year, I want to look at the clues in the news for what's ahead for our economy and our housing markets in 2024. Insights into Australia's 2024 Property Sector and Economic Trajectory In this episode, Pete Wargent and I discuss: ● How forecasts of housing market declines in early 2023 proved wrong and investors were wise to ignore them ● Supply and demand will continue to drive property markets in 2024 with shortages persisting ● Interest rate hikes had a limited impact on property markets in 2023 and rates are now expected to peak and start falling ● Inflation is cooling in Australia and overseas which is positive for interest rates medium-term ● The economy is slowing which reduces the chance of more rate hikes while also lowering the risks of cuts happening too fast ● Population growth has surged to the highest levels since the 1950s, fueling massive demand for housing ● The construction industry is in crisis and unable to deliver anywhere near the dwellings required ● Foreign investment has fallen but build-to-rent may attract some overseas capital ● Consumer confidence should rebound in 2024 as economic stability returns post-rate hikes ● Clarity that interest rates have peaked will be a positive psychological shift for buyers and investors Links and Resources: Metropole's Strategic Property Plan – to help both beginning and experienced investors Get a bundle of free reports and eBooks – www.PodcastBonus.com.au Join as at Wealth Retreat 2024 – www.WealthRetreat.com.au Pete Wargent's blog Some of our favorite quotes from the show: "There's an under-supply of properties and various estimates that already we're starting with 100,000 - 120,000 under-supply of dwellings and we're just not keeping up. So our markets are going to be under-supplied for years to come. – Michael Yardney "But the big thing that changed towards the end of 2023 is that the Federal Reserve finally has just pivoted and it was pretty clear cut. They're basically done with hiking interest rates." – Michael Yardney "If you cared at all, you're going to get some results. If you care enough, you're going to get incredible results." – Michael Yardney PLEASE LEAVE US A REVIEW Reviews are hugely important to me because they help new people discover this podcast. If you enjoyed listening to this episode, please leave a review on iTunes - it's your way of passing the message forward to others and saying thank you to me. Here's how

Location, Location, Location! In today's podcast, we're going to dive deep into the world of property investment and explore the importance of location in achieving long-term success. And more importantly, what makes an investment-grade location. Joining me today is Brett Warren, National Director of Metropole Property Strategists, to share his expertise and insights into what makes a great location for investment. Whether you're a seasoned property investor or just starting out, today's podcast will provide you with valuable insights and practical tips to help you make informed decisions and achieve your investment goals in our changing property markets which are very fragmented. What to look for in an investment-grade location Location, location, location! I'm sure you've heard about the importance of location. In fact, you've probably heard me say that the location of your property will do around 80% of the heavy lifting of its capital growth. But what makes a great location for investment? That's the topic I'd like to discuss today with Brett Warren National Director of Metropole Property Strategists. Factors that make an investment-grade location There are many factors to take into account when looking for your next investment property, but if you do your research to find an investment-grade location, you'll be well on the way to making a good investment decision. Demographics The first factor to consider when choosing an investment-grade location is the demographics. At Metropole, we look for areas where resident incomes are growing faster than the state average. Supply and demand While a lot of people suggest population growth is a key driver of demand for property, it is important to look at the supply side of the equation. We like to invest in areas with a limited new supply of land or dwellings. That's why we like to invest in the inner and middle-ring suburbs of capital cities. Employment opportunities Employment opportunities are also a significant representative of a suburb's investment value. If an area has a diverse range of employment opportunities nearby, it is more likely to attract and retain a population of working professionals and families, and this will maintain property values. Infrastructure and amenities The availability of infrastructure and amenities is another important factor contributing to what makes a location "investment-grade." Infrastructure refers to the basic services and facilities that support the local community, such as roads, public transport, and hospitals. Amenities, on the other hand, refer to the recreational and cultural facilities that enhance the quality of life in the area, such as parks, restaurants, and entertainment venues. Walkability Investment-grade locations with easy access to shops and lifestyle precincts with high walkability will remain in high demand moving forward and have already seen more than 36% growth over the past 5 years. Beauty, amenities, services, and walkability are all key factors that help set a high-value investment-grade suburb apart from the rest. Gentrification Gentrification is a process where a neighbourhood or an area is improved and redeveloped, leading to an increase in property values and slow displacement of older long-term residents due to rising housing costs. This process often starts with the influx of middle or upper-class residents, new businesses, and amenities, which attract further investment and development. Gentrification is a positive factor for property investment because it brings economic benefits and improvements to an area which in turn creates more demand and therefore attracts higher prices for local properties. Attractive neighbourhoods character Another factor to consider for an investment-grade location is those neighbourhoods that have undergone gentrification and now have an attractive neighbourhoods character. This adds value to the neighbourhood and results in higher local property values because people are willing to pay a premium to live in attractive areas. Low crime rate Areas with a low crime rate are far more desirable to live in than those with a higher crime rate - people are willing to pay more to live in a safe suburb where you can live without fear of crime on your doorstep and this higher demand helps to support property prices. What are the different types of locations? Not all real estate locations are equal and just like there are different precincts on the Monopoly board, there are basically 4 types of locations where you could buy properties in the real world, and some are much more worthwhile than others. Discretionary locations These are the most expensive locations in our capital cities – the "established money" locations where most of the residents have lived for a long time and where many residents have paid off their home loans years ago. Aspirational locations These are the upper-middle-class areas and gentrifying locations of our big cities which would also be considered A-grade suburbs. Affordable locations This is where most homeowners and many investors look because that's where they can afford to buy. However, sometimes investors buy in these suburbs because they are "advised" to buy at the cheaper end of the market. As an investor I would steer clear of these affordable locations – most of these will never gentrify in your lifetime and they will underperform with regard to rental growth and capital growth. Last choice locations In every city, there are suburbs where people live because they really have no choice. No one wakes up in the morning wanting to live in these suburbs, but social circumstances force them to. Of course, investors should steer clear of these locations. A final note… Remember that the location isn't the only thing to consider. Owning the right property in that location is just as important. So be careful … don't get stuck with an underperforming property in the wrong segment of the housing market, because if history repeats itself, and it most likely will, you could end up with a dud property that you will regret owning and have difficulty selling if you need to. Links and Resources Michael Yardney Brett Warren – National Director Metropole Property Strategists Get the team at Metropole to help build your personal Strategic Property Plan Click here and have a chat with us Get a bundle of eBooks and reports = www.PodcastBonus.com.au Some of our favourite quotes from the show: "Your future income's going to be dependent on your tenant's ability to pay rent, and higher rents over time." Michael Yardney "There are jobs and there are jobs. And again, it's not a judge of people, but Australia is becoming a knowledge-based society. People in the higher skill levels get paid a lot more." – Michael Yardney "I'd rather own a family-friendly apartment, or a townhouse, in a good location than a house and land in a poorer location." – Michael Yardney PLEASE LEAVE US A REVIEW Reviews are hugely important to me because they help new people discover this podcast. If you enjoyed listening to this episode, please leave a review on iTunes - it's your way of passing the message forward to others and saying thank you to me. Here's how

Our property markets are changing, and we've now moved into the adjustment phase of the cycle where there will be less capital growth and where, in many locations, property values are falling. So, what should a property investor do? Well, in today's show with Brett Warren, national director of Metropole Property Strategists, we talk about whether property investing is an art or a science, which you'll need to understand if you want to be successful in these more challenging times. And I share some major structural shifts that created property booms in the past and what I believe the next one is going to be. Links and Resources: Michael Yardney Brett Warren – National Director Metropole Property Strategists Get the team at Metropole to help build your personal Strategic Property Plan Click here and have a chat with us Get a bundle of eBooks and reports = www.PodcastBonus.com.au Shownotes plus more here: Is property investing an art or science? With Brett Warren, Summer Series

It's the time of the year when many of us are looking back at 2023 to see what's ahead for our housing markets in 2024. I was recently interviewed by Aaron Christie-David of Atelier Wealth for his Australian Property Investment Podcast. We had such a great discussion I asked Aaron if I could replay this episode for you, followers of the Michael Yardney podcast. In this replay, you'll hear my analysis of the Australian property market's performance in 2023 as well as educated predictions for 2024. Our discussion spans a variety of topics including the resilience of the market amidst rising interest rates, the increasing trend towards higher-density living, and the impact of government policy on homeownership. We also examine the urban infrastructure challenges posed by rapid population growth and consider innovative solutions to accommodate the demand for housing. Whether you're a new or seasoned investor, listening to this episode will help you gain valuable insights and strategies for property investment, underlining the importance of a proactive approach and the right mindset for success in the ever-evolving landscape of real estate investment. Market Mastery: Unpacking Australia's Real Estate Trends In our conversation today, we explore the complexities of the Australian property market, discussing trends from the previous year and making predictions for the future. Our discussion spans a variety of topics, including the resilience of the market amid economic changes, the role of government policy, demographic shifts, and the challenges of urban infrastructure. ● How 2023 went for Metropole ● The dynamic Australian property market of 2023 and its resilience despite interest rate hikes ● The government's influence on homeownership trends and the shift toward high-density living ● The property market's surprising buoyancy and the role of cash-rich buyers in driving demand ● Market indicators such as consumer confidence, auction clearance rates, and active bidders ● Housing affordability and the localized rise in property values ● Urban infrastructure challenges due to population growth and innovative housing solutions ● Insights from an interview with Leilani Burra on demographic trends and the need for new homes ● The importance of mindset and strategies for long-term success in property investment ● Avoiding common pitfalls and the value of mentorship and professional guidance Whether you're a seasoned investor or just starting out, the insights and discussions in this podcast will equip you with the knowledge and foresight needed to navigate the property landscape with confidence. It's a treasure trove of information that underscores the multifaceted nature of real estate investment and the various factors that contribute to success in this field. Links and Resources: Michael Yardney Get the team at Metropole to help build your personal Strategic Property Plan Click here and have a chat with us Aaron Christie-David - Atelier Wealth Listen to the original Podcast here – The Australian Property Investment Podcast Get a bundle of eBooks and reports – www.PodcastBonus.com.au Some of our favorite quotes from the show: "One of the big, big changes at the beginning of this year is I stepped back from being CEO. I founded the company Metropole Properties in 1979, but we've been working with clients for almost 25 years now and I decided to step back and enjoy those things we're talking about." – Michael Yardney "I'd rather bring people up through education, through better jobs, through more skills, through good incentives from the government to allow them to buy their homes as well." – Michael Yardney "Usually, I've found that people who have had luck actually need to have the hubris, the ego, kicked out of them by the world doing it." – Michael Yardney PLEASE LEAVE US A REVIEW Reviews are hugely important to me because they help new people discover this podcast. If you enjoyed listening to this episode, please leave a review on iTunes - it's your way of passing the message forward to others and saying thank you to me. Here's how