DECEMBER 2014 – MERRY MERRY
IN THIS ISSUE: Monthly Highlights
2
Reports you should read
3
Magazine Summaries
5
Magazine Summaries cont.
6
FREE Resources
7
MONTHLY HIGHLIGHTS As 2014 draws to a close we have a chance not only to look back at the year that was but start planning for 2015. Last week I was interview for Real Estate Talks and Kevin asked me what learning from 2014 would I take into 2015? The answer was easy TAKE ACTION. The wonderful Russell and Heather Berndt, you can see on the front cover, did just that in 2014, as you probably read about in last month’s Australian Property Investor. After 25 years of thinking about investing in property they did something about it. They got over their fear of losing all they had worked hard for and they got educated. The invested in The Ultimate Guide to Renovation, they located a suburb, a street and then a property to invest in. $8,300 and 16 days later their property was worth $60,000 more and now they are looking at buying their second. On the other hand I had a student go through the same course. They did the Dot Map exercise for Sydney they looked at price pressure, the ripple effect, infrastructure plans and identified an inner west suburb that was looking to boom. And it did! The problem was that after identifying this suburb in early 2014 the student procrastinated. Life got busy, work was busy, things just happen – we all know about that! So after all this careful planning they finally started narrowing down on the right property ripe for renovation and a healthy profit! The problem was all their research was right – the suburb was ripe to take off and in the next 6 months it did. At auction the property went $50,000 over their expectation. Why because the area had moved. The delay in taking action had not only seen an increase of the value of unrenovated properties but the renovated property price had not increased as much so the profit gap was squeezed, so they moved on. Now at the beginning of 2015 they are starting the research again targeting a new suburb in their price range with a decent amount of disparity between renovated and unrenovated properties in an area set to grow. How quickly a few months can make, if they had taken action without even having to renovate the property they could have been $50,000 further ahead. So in 2015 take action! Do something! It might be just the commitment to get educated. Maybe my book or one of my courses can assist you in getting ahead. Maybe you take some time at the local library and grab some books on property investing this holiday break. Maybe it is sitting down and setting some goals for yourself. Whatever it is make 2015 work for you. After all Robert Kiyosaki says “Do you work for your money or does your money work for you?” Otherwise you could be working hard for 40 hours a week, for 40 years to retire on 40% of your current income. Now in my opinion that is the Great Australian Crime. So in 2015 take a step forward. I look forward to seeing your property success in 2015. Till next DECEMBER|2014
month. Jane
PAGE 2
Reports you should read Herron Todd White Herron Todd White valuer’s around the country this month give us a look at the drivers in their markets that signal a shift. This month is the Year of 2014 in Review – and they report back on their predictions from Feb 2014 – a great read. CLICK HERE to download.
Capital City Market Conditions at a glance A quick look around the country to see what stage the markets are in. Data is sourced from Herron Todd White and RP Data. Source December 2014.
ANZ Housing Update –ANZ 2015 Economic and Property Outlook According to ANZ Australia should expect a soft outlook for economic growth, employment and household income will moderate the Australian housing market, and home price growth, in 2015. Furthermore they do warn that tighter Bank’s lending policies are on the cards. As a mortgage broker I have seen this happening in the last quarter of 2014 with lenders being more and more concerned about ‘rental reliance’ and high exposure to the property market. ANZ says they “expect that APRA will introduce some form of policy tightening (ie tighter lending criteria rather than Loan to Value Ratio restrictions) in the coming months to dampen investor lending, particularly in New South Wales (see Figure 6). While investors tend to be more highly geared than owneroccupiers, the RBA recently highlighted that the distribution of investor lending in Australia does not present a systemic risk Click here for the full report. DECEMBER|2014
PAGE 3
RP Data - Wrap Watch this 2 min video – for a quick recap on the state of the market according to the RP Data and Rismark home value index. Capital city dwelling values moved 0.8 per cent higher over the last quarter, over the last 12 months values are up by 8.5%pa. This is the slowest quarterly growth in the last year. In summary “it is obvious most cities have moved through the peak of their growth cycle”.
Residex State of the Market 2014 This great report reflects on the year we have had and looks ahead. Essentially it is my one stop shop for everything that is happening in the markets across Australia. So you can’t miss this report · Including · National Property Market Overview · Market Summaries for all Capital Cities · Affordability Calculations · Unemployment trend data and graphs · Key Statistics and more Click here for the full report. I have just received in my inbox the latest Residex Best Rent and Predictions Reports – so I have lots of reading to look forward to. More on that next month.
DECEMBER|2014
PAGE 4
Magazine Summaries and Reviews for the Month Money Magazine It is time for the annual wrap up. The best loans, super funds, bank accounts etc. If you are looking to reorganise your finances in 2015 check this out. Host of ‘Sky TV’s’ Property Show, Chris Gray, discusses ‘timing the market’. After interviewing 200 property experts he has yet to see one that tries to time the market. If you are waiting for rates to rise, or drop, till the market cools, till after your holiday or when you have time then you could be missing out as property prices rise around you. Remember 2015 is the year for ACTION. The property professor Peter Koulious looks at the top areas for 2015 and discusses why Australian capital cities still have growth in them. SQM Research MD Louis Christopher agrees. He even states ‘next year across Australian capitals expect 5-9% growth and 8-12% in Sydney.’
Your Investment Property Magazine YIP is ahead of the other magazines with their entire cover story, in fact the entire magazine is dedicated to where to buy in 2015. This is not to be missed – if you are looking for just one magazine to enjoy over your holiday break grab a copy today! They provide a great high level review of each State including economic drivers, where there is an oversupply (and undersupply – a key capital growth driver) and the Top 20 suburbs to invest in. The Regional areas are also included so check it out. This is GOLD!
Australian Property Investor Magazine PACKED with Holiday reading – grab a copy today.The cover story asks ‘Is it possible to retire on $200,000 in 10 years?’ The experts seem divided. There is no doubt that there maybe a few that achieve this lofty goal but for the majority, even if you apply the great tips in this article it might be a bit of a stretch. The fabulous news is though even if you get ‘only’ half way there that is still a better result than 90% of Australians achieve. For those with a long term focus Bernard Salt looks at the current birth and death rate and states that the demand for properties in the middle and inner suburbs at least till the end of the 2020’s are set for growth. Last month I shared my Big Fat Property Mistake which centred around a purple feature wall and other renovation mishaps. This month Margaret Lomas shares her off the plan Cairns property purchase that is worth $11,000 more than when she bought it 16 years ago. Ouch.
DECEMBER|2014
PAGE 5
Smart Property Investment Magazine Some great case studies this month including the cover story. Paul turned $20k into a $2.7mill portfolio, you can read about his not so trouble free experience, including bad tenants, DIY renovations that went wrong. So wrong his mate ended up in hospital for 8 weeks, and his learnings, including why landlords insurance is so important. This month SPI explains how to try and time the market and then two experts go head to head over the topic. I don’t believe in trying to time the market. In my opinion buy the best property you can when you can afford it then spending ‘time in the market’. Don’t miss the article by our good friend Jane Eyles-Bennett on budgeting for a renovation.
Want a quick property overview? Join property experts the popular radio show Real Estate Talks. Every Saturday grab a coffee and listen to a great wrap on all things property. Check it out here http://realestatetalk.com.au/category/shows/
The students from the October intake have almost finished the 12 weeks of content. The feedback on our amazing renovation calculator has been awesome and the activity in our private Facebook Group “The Renovator Network” has been amazing. Students from all intakes are sharing renovation plans, actual results, resources they are finding and generally giving great support. Now that we have moved from the modules on setting yourself up and finding an area to invest in. The final 6 modules are on actual renovating for profit. The designs for our ‘box at the back’ structural renovation have been revealed and I am sure we will see many of these quick and cheap structural renovations pop up in 2015. Great work guys I am so happy to see your results. Don’t forget our next live Q&A call on the 18th December 8pm ESDT.
Join me on a Webinar Would you like to hear how to make money with renovation as your strategy? If so then join me on this free webinar. Click here to organise a time
Looking for a Christmas Gift? If you have not got a copy of my latest book http://yourpropertysuccess.com.au/book/. Order now and you’ll receive free postage and a free e-book; “Renovation Tips and Tricks”. DECEMBER|2014
PAGE 6
“I am happy to say that your book I purchased recently was. Very informative
Websites, Apps, Resources & Subscriptions you should sign-up for (mostly free) Let us know about any you’ve found helpful enquiries@yourpropertysuccess.com.au
Congratulations Everyday Property Podcast has hit their 100th Episode – it has been my pleasure of Australia’s #1 iTunes property Podcast Congratulations Karen Young for all your efforts in making this great show. Subscribe so you don’t miss out.
Locating the Best Suburbs to Invest in? One of my previous students has developed one of the most powerful software programs for finding property that I have ever seen. It literally has cut my time in finding an area to invest in and then the street to invest in, in half. You have to check this out it really is amazing. Great work Jacob. See it here.
Borrowing Capacity and Where to Buy Calculator Check out the Investors Choice Mortgages website. Thank you for those who sent me emails on how much you loved the Property Plus calculator. It’s a borrowing capacity calculator that tells you where you can afford to buy AND it shows you on a map all the properties currently for sale and rent in your target area. A wonderful resource, check it out if you have not already and bookmark the page.
Disclosure – I purchase with my own money many courses and reports and I give my personal thoughts and opinions on these products and only recommend those I feel of benefit to property investors. In some cases I am invited to be an affiliate of some of these reports, courses and related products and if you buy through my links, I am paid a commission. I believe this does not influence me, but you need to decide that for yourself. I do believe transparency is vital and hence this disclosure.
DECEMBER|2014
PAGE 7