Millennials – It’s Our Bloody Time!

I am 28 years old, and I have questioned myself over the past 12 months – “Is the Great Australian Dream over for me already?” NO CHANCE.

Now, please don’t misinterpret this article write up as another inspirational post to yell out to the world and tell everyone around me that “I AM THE GREATEST”, but more an article on what we need to do as a tight-knit, collective generation that has well and truly been stamped on by the Baby-Boomers of this country in the investment property sector.

My numbers might not always be perfectly stacked up, but my due diligence on areas outside of Sydney has now doubled, if not tripled because I now truly understand the power of what property can do for me in the future. As a kid growing up in Sydney’s western suburb of Bankstown, did I care about the property market back then? Absolutely not.
Why now? Well, besides the obvious reason – 28 years of age and should have most of my life worked out – I wasn’t the brightest kid at school nor was I bottom-of-the-class stupid either, but my attention span was terrible and I couldn’t study for the life of me, literally.
My father has been an avid property investor for as long as I can remember, and has worked in the car industry from a time well before I was even a conceptualised idea. What I did realise with all of that was simple, you did not have to be the sharpest tool in the shed to participate in the housing market, and some of the world’s most narrow-minded people have made some serious cash (and yes, used that cash to live frivolously!) over the years through the right property investments.

I was lucky enough to have my parents break my balls to save up for a property since I was about 17 or 18 years of age, trading off with me a ‘no board to pay’ deal if I saved and purchased a property by a certain time frame. I was young, full of energy and didn’t care for it as much, but slowly I saved up and was eligible for the first home buyers grant back in 2011. I Received my tidy little $7k pay-out from the government and was exempt from Stamp Duty as I actually lived in the unit for the first 6 months.
This month is the 6th anniversary of owning my first home and how do the numbers stack up? I have put on a nice $175K in equity and am positively geared by 7.1% in rental yield. I am no Tim Gurner yet, but I am happy with the growth and numbers I have produced from my small south-western Sydney apartment.

Fast forward my life from back then to now, and I have owned my own business with 3 other very close friends, which I decided to move on from at the end of last year, but have realised that I am back in first gear with getting back into the market for a second time round.

It’s like I went on a 5 year holiday and came back to a completely different world – oh wait, I actually did…

So what the f*** do we do now? NETWORK WITH OUR PROFESSIONAL PEERS. And make sure you network with every professional in the investment, finance and real estate industries as much as possible – if you want to get into, and more importantly ahead in the property investment market that is. Otherwise continue sinking frothies with the lads down at the local (which is still pretty fun too, I must admit).

We need to get a solid understanding of how ‘rentvesting’ can really work for our generation and not just hear it from our enemy, the ‘Boomers.
I do it, my CEO does it and most of the leading property industry experts do it too. It is being done for a reason, and now it’s more important than ever to rentvest as a millennial-aged resident of Sydney because unless you’re on the big bucks and the banks like your financial status (which mind you is becoming harder for more and more people these days) then you probably won’t be able to afford here in Sydney unless it’s a unit in the greater regional Sydney areas – which can also be dangerous if not looked into correctly.
This is a generalisation! Like I mentioned before, my numbers may not stack up perfectly and represent ALL of the millennials across Sydney, but this is derived from my personal studies on it all over the past year.

Along with understanding the true value of rentvesting, we also need to thoroughly invest our time into networking with buyer and estate agents alike that specialise in specific areas of interest to us as investors. I have taught my father 4 new property investing methods this year alone through methods taught to me by the buyer agent division of our company, which goes to show that the old ways have proven to be successful for the Baby Boomers, but with a new age comes a new method of strategy to produce the same results, so having older family members and friends of a similar age bracket might not always have the right answer for you. Always remember there is a chance that what worked for them, may not work for you! This is why we need to invest the extra money into buyers agents to help us produce results and educate us on specific areas outside of what we know, because there is a lot of money to be made outside of the Sydney investment property market.

The list can go on, but I hope this small amount of information can benefit the wider audience reading this article today. Just remember, that it is 2017 and there are more people on this planet than ever before, so the network around us is enormous – we just need to leave our comfort zone, pull the task out of the ‘hard basket’ and look a little harder in regional areas outside of Sydney to find some absolute pearler deals. They are out there, the money is out there, you just need to find it and put some effort into finding it these days!

Location: Kariong

Kariong is a locality of the Central Coast region of New South Wales, Australia west of Gosford along the Central Coast Highway. It is part of the Central Coast Council local government area.
Kariong’s boundaries include a considerable section of the Brisbane Water National Park to the south, and the Mount Penang Parklands, with its native gardens. Kariong is considered the entry point to the Central Coast as it borders the Pacific Motorway M1.

With a statistical and physical advantage above other areas within the Central Coast, there are some very good returns to be made when investing in Kariong. A median house price is at a very affordable $663K, but you need to make moves and execute quickly as you won’t see many of them stay on the market for more than an average of 19 days. Within the first 6 months alone in 2017, a staggering 59 investment properties in the area have sold classified as a 3 bedroom freestanding home.

With Kariong being the first exit off the M1 Motorway outside of Sydney, the numbers really do the talking in regards to how much this area has grown over time and more recently, in the past 12 months.
Median house prices for Kariong in 2011 were sitting at the sweet spot of $395K and have now jumped up in 2017 to $663K – an incredible capital growth benchmark in a short 6.5 years. With a suburb average of 1575 visits per property in Kariong, compared the state’s average of 829 visits per property – it goes without saying that this area has a very high rate of rental tenancy from the moment the contract has been signed. Without a doubt you would be able to have your investment property in Kariong tenanted within days of settlement.

At Luxland, our main focal points zone in on compounded capital growth, ensuring that your property is performing well, returning you solid gains to further develop and add to your property portfolio. Kariong boasts a healthy 11.9% annual growth rate – which again exceeds other neighbouring suburbs within the Central Coast region. Rental yields are also above average sitting at 3.6% with the Sydney average sitting at 3.0%.

Luxland’s CEO Zah Azmi has a good portion of his portfolio based in Kariong to date and it has produced incredible results over the past 8 years for him. All suburbs we recommend to our clients are based on what we would personally purchase ourselves, after doing years of market research and due diligence on many specific areas along the Central Coast and Newcastle regions.
To book your personal appointment with Zah and design your personalised strategy to investing into property, contact our top tier management team today and let Luxland help YOU in growing your future – info@luxland.com.au.

Buyer Agent Benefits

With the property market at an all time high, showing very minimal signs of cooling down anytime soon, we as Gen-Y need to look at alternatives to get ourselves securely into the market. We need to utilise the experts in the property industry to leverage us further ahead – at a small added cost on top of the purchase price of your investment, the profits can be quite significantly different if you choose to walk the path of investing alone.

One thing I have mentioned to my peers in recent times is the need to build a very strong network of people from many industries to keep up with the expensive living costs Gen-Y has been left to (somewhat) battle alone. One thing we are all finding in common with one another is the fact that we are now so time poor, if we take our foot off the accelerator for one minute, we are left behind with weeks if not months of catching up to do in many aspects. The process of purchasing a house has never been more time consuming than what it is in 2017. Why, you ask? Purchasing an investment property that is going to grow strong and still give you a great rental return is less likely to be as easy as you think to find…

WHAT IS A BUYER AGENT?

Are you looking to buy an investment property but have no idea where to start? Do you feel uncomfortable by the idea of bidding at an auction, or maybe don’t have the time to do all the real boring stuff after the offer has been accepted? This is where we come into play… Buyer agents can ease the stress and anxiety of buying an investment property by representing you as the buyer.

DO I REALLY NEED ONE?

What you are really need to ask yourself is: what can a buyer agent offer me that I can’t do myself?
To begin, a buyer agent is an objective party in the process – they won’t let their decisions become clouded by emotion – this is a big factor. It won’t be a case of ‘love at first sight’ with an agent; they will do their research thoroughly and objectively and present you with all the numbers you need to know.

Unless you are an expert negotiator, the idea of having to bid or make offers on properties probably gives you cause for anxiety. Your agent will be skilled and experienced in all aspects of bidding, negotiation, contracts, financing and the settlement process. They will also be able to assist you in finding someone to manage that property, should it be for investment purposes.

Buyer agents possess valuable market knowledge, including the ability to identify new or upcoming ‘hotspots’. By the time an area is publicised as a hotspot, it is probably too late for the average home buyer to get into the market. Buyer agents make it their job to be ahead of the game, identifying key market trends and up-and-coming areas well ahead of the average punter.

WHERE DO I GO FROM HERE?

If you are looking to get into the investment property market and have a better understanding of what a buyer agent does for their clients, feel free to contact our team today to organise your free consultation and let Luxland begin the journey to help grow your future – info@luxland.com.au.

Beyond The ‘Big Five’

With recent statistics showing a fantastic growth increase across Newcastle apartments within the past 12 months, 21.3% to be exact – it is no wonder people are diversifying their portfolios and adding more ‘regional’ locations as opposed to the ‘Big Five’ capitals cities, Sydney, Melbourne, Brisbane, Perth and Adelaide.

The Regional Australia Institute’s latest information confirms that city population size does not determine economic performance. There is no significant statistical difference between the economic performance of Australia’s big five metro cities and its 31 regional cities in historical output, productivity and participation rates.

So, regional cities are as well positioned to create investment returns as their ‘Big Five’ cousins. The same rules apply – investment that builds on existing city strengths and capabilities will produce returns.
No two cities have the same of anything. However, regional cities do fall into four economic performance groups – gaining, expanding, slipping, and slow and steady. This helps define the investment focus they might require.

There is a $378 billion potential, but Australia’s capacity to harness it will depend on achieving two major goals.

  • Number 1, shifting the tunnel vision that the smart money invests only in our big metro cities. This is not correct. Regional cities are just as well positioned to create investment returns as their big five cousins.
  • Number 2, regions need to get “investment-ready” for success. Meaning they need to be able to collaborate well enough to put together an informed set of shared priorities for investment, supported by evidence and linked to a clear growth strategy that builds on existing economic strengths and capabilities. They need to show they can deliver.While there has been a lot of debate on the relevance and appropriateness of City Deals in Australia, it is mainly focused on the Big Five. But both big and small cities drive our national growth.

    With up to 6.5 billion dollars underpinning Newcastle’s rebirth as a world class and well respected heavy hitter in the investment world, the Revitalise Newcastle campaign over a 3 year period will prove to the masses as to why the time is now to get serious about investing into the city of Newcastle. With the help of Luxland along the way, we can help you access stock that enables you to make money from day one through our well structured process – ‘The Luxland Way’. Contact our Buyers Agent division today to start the journey and grow your future – info@luxland.com.au

NSW Government: Revitalise Newcastle

In the most recent six to twelve months, there has been hot media speculation on what is going to happen with the Sydney property market – some industry experts saying the ‘boom’ is finished and others saying it will still be quite some time until we see some noticeable cooling periods across the board. Meanwhile, chances are also high that you have heard about the rejuvenated powerhouse, Newcastle.
With many first home buyers and investors on the hunt for an investment property to sink their teeth in anywhere around New South Wales, Queensland or Victoria just to get a foot into the market – I delve in and take a short yet sharp and detailed look into the government funded campaign to communicate the positive change surrounding Newcastle and it’s rebirth which has been shown major interest from developers and investors alike for the past 12 months – ‘Revitalising Newcastle’.

Revitalising Newcastle is a NSW Government program focused on activating the city to attract people, new enterprises and tourism to Newcastle. The NSW Government is investing more than $500 million in the program to transform the city centre by strengthening connections between the Newcastle CBD and waterfront, creating job opportunities, providing new housing and delivering attractive public spaces connected to better transport. The program follows NSW Government investment in the University of Newcastle’s city campus – NeW Space – and the Newcastle law courts, which opened in 2016. Both projects demonstrate the growing confidence in Newcastle as a city in which to invest.

The output generated by the Newcastle economy is estimated at $32.593 billion. Newcastle represents 34.39 % of the $94.783 billion in output generated in Hunter Region, 2.97 % of the $1.098 trillion in output generated in New South Wales and 0.95 % of the $3.438 trillion in output generated in Australia. Below is a more detailed scope on the statistics within specific industries further more solidifying Newcastle’s strength to the NSW economy alone.

Revitalising Newcastle is another step closer to delivering on its promises to the community, through the lodgement this month of a Development Application (DA) for stage one restoration and maintenance works of Newcastle Station.
The station site has been stamped as ‘tourism’ through the planning proposal, which would allow a variety of recreation and tourist uses to ensure the site becomes a hallmark destination befit of its prominence and heritage value.
“We want to ensure this valuable and much-loved city asset does not sit unused any longer. The last thing anyone wants is to see this beautiful building sit and rot. “We are going to breathe new life into the station precinct to ensure the community can enjoy these historic buildings for years to come,” Revitalising Newcastle Program Director Michael Cassel said.

Hopeful property investors should be continually looking outside of their backyard to help get their foot into the market. Infrastructure fundamentals such as schools, jobs, hospitals and multiple economic drivers should underpin the area for future growth. Having someone guide you throughout the whole property investing process is important as our market conditions are constantly changing.

Contact the Luxland team to start with your strategy planning session today and get your foot securely planted into the Newcastle property market with Luxland – info@luxland.com.au

Fat Debt vs. Muscle Debt

Debt can be looked at as a negative when managing your finances. However, debt is the way many successful investors build their wealth. Everybody uses debt to pay for just about everything from large purchases such as property and cars, to smaller purchases like petrol and food. The definition of debt in the dictionary is “ something that is owed or that one is bound to pay to or perform for another.” Under this definition it is hard to make out if debt is either good nor bad. Many are confused by the differences between good debt and bad debt. It is important to understand the differences, as being financially educated on the subject will enable you to make smarter decisions when buying on credit or taking out a loan. Just like Robert Kiyosaki says, “debt is like a loaded gun, it can either help you or it can kill you”.

Having had plenty of experience in the health and fitness industry, I always like to relate a fitness journey to a business journey. The two quests for success work very similar to each other as they both require work, determination, delayed gratification and discipline. So how does fitness relate to debt? Well, if you are not disciplined with your finances and diet then you can ultimately end up broke and overweight. Even a 2009 study by Dr Eva Munster at the University of Mainz in Germany, says that those deep in consumer debt are more likely to be overweight than those who have no bad debt. Supporting Dr Munster’s studies showed links to difficulty buying healthy food on a limited income and/or the inability to delay gratification in spending and eating. The most common form of bad debt is consumer debt that is built up usually on high interest credit cards used to purchase items such as clothing, holidays and other disposable goods that depreciate in value. I call this “fat debt”.

On the other hand, holding good debt can be like having a body like a Spartan warrior, prepared for battle. Good debt is usually used for an investment that will grow in value or generate long-term income. These investments can include student loans for education, small businesses, property and shares. Good debt is an investment debt that creates value that is projected to produce wealth in the future. By using debt to fund investments such as property, it can turbo-charge the return on your equity. Many successful entrepreneurs and investors use this type of debt to help grow their wealth and leverage into larger investments. Therefore I call this “muscle debt”.

I have had the experience in both types of debts and also in both types of fitness levels. There was a stage in my life where I was quite overweight with a body fat percentage of 20% plus. I look at this body fat level the same way as having bad consumer credit card debt. I needed to change my eating and exercise habits to help chip away at my body fat. The problem was that I was addicted to junk food and overeating. It was like a drug that took over my lifestyle. This drug like chemical in the brain is called dopamine, which helps control the brain’s reward and pleasure centres. I was addicted to the instant gratification feeling of having a bowl of ice cream, however long term, the effects were quite negative. Similar to when spending money on an impulse purchase such as those new shoes or expensive holiday bookings, dopamine is increased in the brain making us feel rewarded. This is a short-term gain however, making us ultimately pay the price further down the track.

After setting out a plan and changing my lifestyle and diet, I eventually got my body fat percentage to under 10%. It has been rewarding for the long-term as I now implement the same habits day in day out in my life. I am now at a fitness level I can be proud of and also help others on their weight loss journey. The financial journey is very much the same as you need to focus on habits that will help reward you for the long-term. For example, foregoing that expensive European holiday today in replacement for an investment property deposit, can help you cement yourself into a better financial position later on in life. Or investing into your education can pay very healthy dividends towards your future. It may be hard work now and require a significant amount of effort, however the delayed gratification will be well worth it in the end. Practicing clever spending habits will help you “re-wire” your brain to ensure you feel comfortable with good debt, by taking out loans or credit on assets that appreciate in value and generate income.

Bad consumer debt should be decreased or eliminated whenever possible, just like sugar in a bad diet, if you want to build wealth for your future. Using good debt, such as a mortgage on an investment property or a small business loan for a business can help you leverage into a much stronger net position just like bigger muscles can add more power to your bench press in the gym. Being financially educated will give you the knowledge and power to take on good debt, by using it as a tool to improve your life or financial situation. Work on burning body fat (bad debt) and increasing muscle mass (good debt) in all areas of your life, physically and financially.

Motivation vs Discipline

Everybody needs motivation. From having an ambition of striving to be the richest entrepreneur this planet has ever seen, to losing those extra few kilos of body fat that were gained over the festive season. Motivation is what is needed to help us take that first step. It is the burning desire within us that triggers initiation for us to start on a journey to get to a particular destination. For example, someone who is interested in property investing might read an article that really resonates with them. Then all of a sudden, that person gets amped, pumped and ready to get into the property game. That person becomes highly motivated and starts searching for properties online. After a few weeks of searching through a tough market and slowly realising the actual cost and commitment of the whole exercise, the motivation wears off. That person gets distracted with a holiday or a new car. Property investment then takes a second or third priority. The property dream is over. Motivation is lost. What went wrong? How did one become so motivated, yet was unable to follow through?

The missing link is discipline. Many talk about how they want to invest in property or that they want to start a business but nothing ever eventuates. Why is this? Lack of discipline to follow through with necessary habits to make it happen. Saving a deposit for your first home requires discipline. Cutting back on life’s luxuries, moving back home with mum and dad and eating two-minute noodles for dinner are all made possible with strong discipline. Most cannot follow this type of regime of sacrifice due to the fact that life has just been too good in the past, it is almost impossible for some to go without. Motivation will get you talking, but discipline is what will see you through to achieving your goals. Changing and adapting to a lifestyle that will force you to form and implement habits, is the only way to success. Having the discipline to endure the difficult times is essential, especially when everyone around you is enjoying juicy steaks and drinking expensive bottles of wine.

Getting motivated is easy. Go to a property seminar and you will be guaranteed to be fired up. With all the luxury (sometimes fabricated) outcomes they sell you it’s hard not be motivated. Visit your local Mercedes dealership and sit in your favourite AMG. Start the engine. Smell the leather. Attend a luxury waterfront front home open for inspection in the eastern suburbs of Sydney. Look at the view. Picture yourself living there. Now you are motivated. What is going to get you through though? What is going to keep you getting up at 4am to get to work? What is going to give you the power to say no to your friends when they are all going out for a night out on the town? It’s called discipline. This is what is going to get you through even when you don’t feel like it.

A few years ago I was quite overweight and I set out on a journey to transform my body from 20 plus percent body fat down to under 10 percent. I was in pretty unhealthy shape. My diet was full of high GI carbs and some bad fats. I was doing zero cardiovascular exercise and I had neglected to train the most important muscle in our bodies, my heart. I finally found the motivation to change my life due to a health scare that had shown up on my yearly blood test check up. I started eating better foods, took my supplements regularly, I did a cardio run every morning at 7am (early for me) seven days a week and I also did a second gym session in the evening. There were days when I didn’t feel like going to the gym. There were days when I just wanted to eat ice cream for dinner. But I stuck to my strict routine. After 12 weeks I had transformed my life. The process produced results I didn’t even imagine possible at the start. I am now in the best shape of my life. The habits I learned and implemented along the way, have now stuck with me for life. I still train twice a day, eat healthy food and monitor my progress on a regular basis. It is now a lifestyle. Looking at my blood test results gave me the motivation to make a change. Discipline got me through the process. Discipline got me through when I didn’t feel like training. Discipline got me through when I had cravings for Domino’s.

I have applied these same sort of habits towards my businesses and property portfolio. Just like in health and fitness, in order to be successful we must be disciplined with our time and energy. Motivation alone is not enough. We need to have discipline when saving for a deposit, making our mortgage repayments and managing our property, by forming good habits of sacrifice and delayed gratification. It is having the discipline to learn and educate yourself in all areas of business that will help you to achieve your goals. Small increments everyday can lead to big results later down the track. Focus on the bigger picture, as the long game is the best game when it comes to real estate success.

Successful property investors all have some sort of discipline to get them through the tough times. The times when they don’t feel like sacrificing. The times when they have no more funds to further invest. They teach and educate themselves on a regular basis to keep fuelling that burning desire inside their belly. Motivation alone does not cut it. Having a strong mindset to stay on course, and to learn and execute when needed are all contributors of building a solid foundation of discipline for success. Those who rely solely on motivation, get left behind. Many talk about wanting to succeed but few are willing to do what it takes. Stop TALKING. Start DOING.

Riches Through Property

Rich Dad Poor Dad is a 1997 book written by Robert Kiyosaki. It advocates the importance of financial independence and building wealth through real estate investing, starting and owning businesses, as well as increasing one’s financial intelligence to improve one’s business and financial aptitude. The book is largely based on Kiyosaki’s childhood upbringing and education in Hawaii.

Kiyosaki had a simple philosophy based on straight forward key principles – differentiate between assets and liabilities, the value of financial education, and the importance of entrepreneurial and investment skills in taking control of one’s financial future. The educational author attracted a large crowd throughout the world who gathered to hear his simple message that investing in real estate can make you rich. He wrote a book detailing how he was homeless living in the back seat of his car to becoming financially free, and thousands of people followed his lead and built ultimate wealth through smart real estate investment.

The simple guidelines which Kiyosaki states he put into practice all those years ago have remained true to this day. Purchasing and holding assets today can make you rich in the future. Your family home may be a liability as it does not produce any income – however investment properties in affordable price brackets can help secure financial freedom in the future.

All over the world there are people enjoying financial freedom now because they made a few smart decisions years ago. In their 20’s they bought a one or two bedroom unit and after a few years its value had increased enough that they could use their equity in the property for the deposit on a three-bedroom house in a blue chip suburb as their second investment. A few years later they were able to continue to purchase multiple investment properties using equity from their expanding portfolio. The effects of inflation and the power of compound interest generated growth to keep investing.

This method of investing takes time and does not happen overnight. It is more like a marathon run rather than a 100 metre sprint. However, it works and it has withstood the test of time throughout many peaks and trough cycles in the Australian property market.

Which brings us to todays property market. There is no better time to get into the market and expand your property portfolio than now. Inexperienced investors try and time the market. Experienced long term investors understand that time in the market is key to achieving ultimate wealth. Historical data has shown that owning property can far exceed an individual’s salary as an employee. In exclusive blue-chip areas, it is not uncommon for properties to rise by more than one million dollars per year.

According to RP Data, houses in the Newcastle suburb of Merewether increased in value by more than $450k in 12 months. In Newcastle, the average home has risen by 14.28%. On The Central Coast, home values grew by 13.6% compared with a 12.2% rise in Sydney. These statistics tell us that you can certainly become rich if you invest in the right areas trending for growth. For those who are looking at getting rich from property investment – consider booking an appointment with a Luxland Property Consultant today.

Rentvesting

Rentvesting has been a word that has popped up a lot in recent times due to the sky-rocketing housing prices, especially in Sydney. It’s definition is, “The process of renting where you want to live while owning a property where you want to invest”. The term has been around for quite some time now but has most recently gained popularity from the extreme housing affordability issue in Sydney. Many people are feeling locked out of the housing market as prices in the areas they want to live become increasingly unaffordable due to super low interest rates and increasing population growth.
Demand is outstripping supply in Sydney as the city’s population is increasing by approximately 2000 per week. Rentvesting differs to the traditional “Great Australian Dream” approach, but it may well be the optimal path forward for Australians wanting to build wealth through property.

Apart from not compromising on lifestyle, rentvestors stand a chance to build wealth faster through a well oiled investment property portfolio rather than through their principle place of residence. While many people perceive rent money as dead money, the idea of lining your landlord’s pockets every month may prove to be a more feasible strategy. Building an asset base independently from owning the home that you want to live in can help compound your wealth at a much faster rate. If you are looking to get ahead and are struggling to get into the property market where you want to live, maybe it’s time to reconsider your options.

I have used reinvesting as part of my investment strategy for over 10 years now. I do not plan on purchasing the home that I want to live in anytime in the near future. I rent a luxury inner city Sydney apartment, which I can claim a portion of my rent as a tax deductible expense (home office) through my companies. I pour all of my savings into my businesses and income producing investment properties located in different markets to Sydney such as The Central Coast and Newcastle. I am also able to claim the majority of overheads on these assets as tax deductions as they are business related expenses.

If I owned my own home, all of my cash would be tied up in the property, which would not leave me much change to invest and I would not be able to claim any of my expenses on tax. The icing on the cake is that I can take advantage of the lifestyle benefits of living in the heart of the city being close to my business locations, airport, restaurants and shopping precincts. Plus, the famous eastern suburbs beaches aren’t too far away either!

Buying an investment property, or any property for that matter is one of the biggest financial decisions most people will face. This raises the questions of what and when do you buy? The first thing that should be established is what is your budget/borrowing capacity? This will determine what markets you will have the ability to purchase in. Also if you are investing for the long-term, such as 20-30 years, then it would be safe to say now is the best time as Australian property tends to go through 7-10 year cycles. Historical data shows that 30 years of holding property can lead to true ultimate wealth in the future. Even if you purchase in a hot market today, I’d say in 30 years time you would be glad you made the decision to buy now!

If researched and planned correctly, rentvesting can be a great way to enter the property market and grow wealth whilst not compromising on lifestyle. For example, lets say you have a $2 million budget to buy a property. If you bought a place to live in, your mortgage repayments would be around $10k per month. Alternatively, you could buy 4 x $500k properties all returning around $10k per month in income whilst also appreciating in capital value over time. Most expenses are tax deductible, while expenses on your $2 million home are not. You can rent a $2 million property for around $6k per month, as once properties start to climb above the $2 million mark, the yields start to drop off and work in the favour of renters. If you run a business then you may even be able to claim a portion of the rent on tax. It’s important seek professional help and speak to a property consultant to know your budgets and what benefits you can take advantage of from your own individual situation.

Holding investment properties in markets such as The Central Coast and Newcastle works for me as a business model and investment strategy. I wouldn’t want to necessarily live in these areas but they perform well when looking at the numbers. Sky-rocketing Sydney house and apartment prices and the desire to still live in the city, has forced me to implement the reinvesting strategy creating a flexible lifestyle. There are some downsides with reinvesting such as not being able to renovate or alter the property to your personal preference or having to move if the property is sold, however it is a small compromise at the end of the day when it comes to building wealth and maintaining your desired lifestyle.

Property Mentor

Everyone tends to have a different perspective towards what a mentor actually is. According to some, mentors should be a guide who assists you when you need it, while others are of the view that a mentor does all the work for them. Alternatively, some people think that a mentor tells them what to do at all times and when they fail to get that, they give up as this is not the case.

While looking to find a great property investment mentor, you need to analyse your own situation and figure out what it is you want out of the relationship. Mentors are successful people whose time is very valuable and if you want their help and support, you need to provide value to them. You cannot expect to get free help because you are powered by motivation.

Mentor – Why You Need One?

A mentor happens to be an experienced and trustworthy adviser. To further elaborate, a mentor needs to have experience in the field that the mentee is interested in. Now the experience level could vary depending on what the mentee’s area of interest is and how passionate they are about learning.
A successful mentor may know one thing extremely well and teach that one thing, while other mentors could be good at a number of different techniques and educates on all of them based on the mentee’s need. When seeking a mentor, ensure that they have all the relevant experience you need help with. You need to be specific. If your aim is to be successful in the Central Coast and Newcastle property investment market, then it makes sense that your mentor has proven results in this particular field.
The term “mentor” is also wrongly used sometimes just to make people spend money on unnecessary courses that promise to help you get rich quick. On the other hand, if selected carefully and correctly, spending money on the right mentors to help you learn and educate yourself can be the best investment you can make. The wealthiest of people spend thousands of dollars on mentors and coaches as they understand and recognise when they need specialised training and support, as many of them never stop educating themselves.

How to Decide?

So how do you decide what area to be mentored in? A mentor could help you immensely in becoming a successful property investor in particular markets. You can find a good mentor if you know other people in your network who have succeeded in investing in markets you are interested in. While choosing a mentor to team up with, ensure that you pick one who will offer the most training and support, and can act in your best interests. More often than not, many property specialists that advertise themselves as mentors, actually get paid by builders and developers to sell stock. Therefore, they are not working in your best interests but rather the company or person who is paying them for their commission.
First of all, figure out if they are being paid by you or somebody else. If they state they are a free service then they are getting paid by somebody else and do not have your best interests at heart. If they are a fee for service, just like a lawyer or accountant, then they are most probably genuine in wanting to assist you.

Finding a Real Estate Mentor:

After you have decided on the market you want to invest in, how do you find someone with relevant experience? You need to be cautious with whom you listen to. There are many useful websites offering a lot of information and then there are some sites that are nothing more than sales funnels to real estate training programs.
You will find people pretending to be experts on forums but have no clue what they are doing. When you come across free courses or free books, know that they will try to sell you a course in the future. All courses are not a waste of money but find out everything about the teacher and ensure they are from whom you want to be taught. Be wary of those courses or mentors who make big promises but won’t tell you anything unless you buy.
The best option is to find a local mentor. But here is the thing, local mentors would not be interested in teaching you. Why? Because they will be creating competition for themselves. They will usually be available for a quick coffee or lunch, but they usually do not have the time to teach everything they know to someone.
Many people are more than willing to be mentors for newbie investors but want to be paid. If you feel the need or want to have a mentor, you will get them but see to it that you choose the right person if you are willing to pay for training.

Paying a Real Estate Mentor – Mandatory?

If you want a mentor but don’t want to waste time in researching investing techniques or making the mistakes yourself, then yes, you can pay for it. Some mentors might be willing to assist you free of charge but those are not easy to find, so therefore paying for the mentoring service sometimes makes the most sense.
The problem is that everyone thinks they are super-motivated and most people are, but the thing is that burst of motivation stays for about five minutes. Mentors don’t have time for this lack of action. Merely being motivated is not enough for them nor do they need it. Now you should know that successful investment mentors tend to be very busy, and a lot of people want their help, so you must make sure you are clear with your goals and where you want to head.
Usually, you are required to pay a service fee to the mentor. Depending on your situation, determine what kind of services you will need from them. Are you needing help to buy an investment property? Do you require your portfolio to be analysed and managed? Are you interested in becoming a development partner through a joint-venture? Once you have identified your needs, start booking in some appointments with some potential mentors to get the process going. After going through a few meetings explaining your situation, you will know who you will want to start working with and vice-versa.
Paid property consultants can service you as mentors to help guide you through the whole property investment process. If chosen correctly, this mentor can make sure you don’t make all the common mistakes investors make and at the same time advise you on your options to ensure you maximise your returns as much as possible. Learning the process from someone else who has succeeded is the most common way to achieve your goals. If it has been done before by someone else, then why re-invent the wheel?