Property Investment, Success & Money | The Michael Yardney Podcast

How do you evaluate the investment potential of a particular property? Well, that’s what I’m going to share with you today as we I share 5 metrics that we use at Metropole when discussing the investment potential of properties that we’re considering showing to our clients. But I’m also going to share 1 metric that you probably think is important, but we think is very misleading. In assessing a property’s investment potential, we have a checklist of more than 100 metrics. I’m only going to share 5 with you today. But they’re going to give you a good balance of the science and art of property investing. If you don’t understand what that means, you’ll understand a lot better after today’s show. Then, as always, I’m going to share today’s mindset message with you. Here are 5 numbers you can use to assess a property's investment potential and one you shouldn’t When it comes to the numbers (scientific) component, I see many investors get swamped by the seemingly endless numbers that can potentially paralyse them into inaction. In reality, you don’t need to know one million things; you just need to understand a few critical metrics. While this list is not exhaustive, here are a number of metrics the team at Metropole uses to assess the investment potential of a property. Past sales history We look at past capital growth to give us an indication of future growth potential. You probably know that one of the rules in Metropole’s Six Stranded Strategic Approach is buying in an area that has a long history of strong capital growth and one that will continue to outperform the averages because of the demographics in the area. Once we’ve confirmed the quality of the location, we need to drill deeper into the property itself. And the best way to gauge its growth potential is to back-track its past performance by getting the history of at least two previous sales (if possible.) This is where a seasoned buyer’s agent with intimate local market knowledge can be worth their weight in gold. Days on market Days on Market (DOM) is a measure of how long it takes to sell a typical property in a particular suburb, and more important than the actual number is the trend which provides context. Clearly, when demand is high and there are more buyers than properties available, the days on market will decrease. On the other hand, when the market is soft because of economic conditions, perhaps, or because of a flood of new properties becoming available, then time on market will increase, which will drive down prices. This statistic helps investors to identify those locations that are strengthening so they can buy before the masses and therefore make the most of the price uplift as the time on market decreases. Depth of Market What we’re looking for here is an assessment of the supply vs demand balance within a particular market. This is a measure of how long it would take for the current inventory (number of properties on the market) to be absorbed completely (purchased) based on the current rate of monthly sales, assuming there is no more new inventory being added to the market. A market is considered to be balanced if it has between 5 to 7 months’ worth of inventory (properties for sale.) If hypothetically all the stock on market (inventory of properties) in less than 5 months that implies there is great market depth – lots of buyers waiting in line, with an inventory turnover of more than 8 months implies an oversupplied market with little depth of buyers. Ratio of owner-occupiers to renters While many beginning investors have their prospective tenant top of mind, an important strand of Metropole’s Six Stranded Strategic Approach is to only buy properties with owner-occupier appeal. Since owner-occupiers own 70% of Australian properties they “make the market” and add stability to property values in those suburbs where there is a predominance of established owner-occupiers who bought their homes many years ago and have significant equity in their properties. This is very different from the instability and volatility we see in house prices in areas dominated by investors - think the inner-city apartment market or the other suburbs where there is little scarcity and many first home buyers have over-committed themselves and have a little equity in their homes. Above average wages growth Since property investment is a game of finance with some houses thrown in the middle, it’s important to find locations where the local residents have higher disposable income than average and suburbs where wages are growing faster than the state averages; as in these locations people will be able to afford to, and usually be prepared to, pay more to buy new homes or upgrade their homes. You’ll often find these suburbs are going through gentrification - a change in the fortunes of the suburb as it is discovered by a higher income demographic, which slowly pushes out the lower-income residents. Be careful relying too heavily on the data There is no doubt that it’s important to understand the property fundamentals and research property data, and the longer back the data research goes the more accurate the data is likely to be in forecasting future trends. But let's be frank -- you can make data say almost anything you want. I've seen too many property investors find a property that they like, one they become emotionally attached to, and then find the data to confirm their decision. That's called "confirmation bias” - they're using data backward rather than in the right way. What I'm getting at is that while you need the data in the research phase of your investment journey, to be a successful property investor you need much more – you need on-the-ground experience and perspective. Don’t get me wrong, doing your research is a critical step in getting ready to invest, but it is only one of the many important steps. There is no substitute for practical, on the ground experience. One commonly quoted metric that a lot of people investors look at, which we tend to ignore Median price data, which is the most common data reported in the media (other than auction clearance rates) and researched by property pundits, is actually very unreliable and can lead to costly investment mistakes. So here are 5 things you need to understand before you draw any conclusions from the regularly reported changes in median prices: How is the median price calculated? The median house price is essentially the sale price of the middle home in a list of sales where the sales are arranged in order from lowest to highest price. So in a list of 11 sales, it would be the sale price of house number 6, which has 5 lower-priced sales below it and 5 higher-priced sales above it. This is different from the average, which would be the total value of all the house sales, divided by the number of homes sold. A change in the median price does not necessarily mean a change in your property’s value While median prices are a useful tool for understanding the price changes of properties that have transacted in a market, a 10% increase does not necessarily mean that your property is worth 10% more.  In fact, your property could have dropped in value during this time. What it does reflect, however, is activity in the market. Median prices are a more valuable indicator in some areas than in others Changes in median price statistics are more meaningful in determining property price growth in some areas than others.  For instance, suburbs where the properties are largely homogenous and therefore of similar pricing are likely to see the median price as a more accurate reflection of true value changes. Different data providers measure different statistics Ever wondered why different data providers’ median prices are different? That’s because there are three key differences between all the providers. The data they collect, The time frames they report on – daily, monthly or quarterly The accuracy/complexity of the index methodology they rely on. Statistics are more reliable if looked at over the long term Investors should pay less attention to short term trends and understand that median prices (as with all statistics) are more useful when viewed as a change in trend over a longer time frame and not at over a month-to-month period. This helps you get a better understanding of an area's performance. Median prices are really best used as an indication of the composition of sales rather than a good indicator of changing property values. The bottom line In summary, understanding these 5 metrics will give you a head start in analyzing the investment potential of any given property. However, just like any other parameter in the property market, the numbers may not mean much on their own and there is a risk of drawing a wrong conclusion from them if you do not have intimate hyperlocal market knowledge. That’s because, as I said, successful property investing is part science (understanding the data) and part art (having on the ground perspective to interpret the data correctly.) Perspective comes at a cost - the cost of time, experience, and learning from your mistakes. You can't buy perspective, but you can "hire it” by working with an independent property investment adviser, like the team at Metropole to ensure your property selections are the best they can be every single time. 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 Shownotes plus more here: 5 metrics you can use to assess a property’s investment potential and one you shouldn’t Some of our favourite quotes from the show: “While past performance is obviously not a guarantee of future performance, the basic fundamentals of a location or a property don’t change.” – Michael Yardney “I’ve found owner-occupiers buy with their hearts and not their calculators and they tend to happily pay an emotional premium if there is something unique about the property they fall in love with.” – Michael Yardney “The problem is data is often wrong or to put it correctly – the way investors interpret data is often wrong.” – 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

No one expects 2021 to be the same type of rollercoaster ride as 2020. And while there’s plenty of good news for our economy and our property markets, it’s important to remember that considerable uncertainty remains and the extreme dislocation to many businesses over the past year will take time to resolve. Now the general optimism is well-founded. We seem to have this virus “thingy” under control, around 90% of the jobs lost during the pandemic have now been restored – and that’s a tremendous achievement and our property markets are rebounding. Australia and the world also stand on the cusp of the biggest vaccination rollout in human history, which will only increase the rising levels of consumer and business confidence we’re experiencing. Sure, the COVID rollercoaster may be slowing, but we still face a bumpy road to economic recovery and that’s what I’m going to discuss in today’s show with Pete Wargent as well as giving you five of my predictions for our property markets in 2021. Then I’ll share my mindset message with you. 2021 Property Trends It seems that everybody has been making predictions for our housing markets for 2021 and they’re all extremely positive. While on the one hand I love to hear this, on the other hand I’m always concerned when everybody thinks the market is going to perform in a particular way as we have seen how wrong consensus opinion has been over the last few years. So in today’s show I share 5 property trends that I think will occur in 2021 and I’m looking forward to Pete Wargent’s view on these, plus we’ll discuss some economic trends that will influence our property markets. Property demand from home buyers is going to continue to be strong. One of the leading indicators I watch carefully is finance housing approvals, and these are at record levels suggesting that we will have strong demand from owner occupiers and investors in the first half of this year. Despite the “recession we made ourselves have”, rising unemployment, and many small businesses facing challenges, interest in buying residential property has skyrocketed. This has come particularly from owner occupiers who have amassed household savings at levels not seen since the mid 1970s, and this is in part because they have not been able to spend their money on vacations or even local entertainment as they normally would. Now, with borrowing costs lower than they ever have been, the reassurance that interest rates won’t rise for at least 3 years and increasing confidence that we’ve got this virus thing under control, it is likely that buyer demand will remain strong throughout the year. Investors will squeeze out first home buyers While currently there are many first-time buyers (FHB’s) in the market, buoyed by the many incentives being offered to them, I can see demand from first homebuyers fading as property values rise from increasing competition as investors re-enter the market. You see…typically investors compete for similar properties to FHB’s. Property Prices will continue to rise As always, there are multiple real estate markets around Australia, but in general property values should increase strongly throughout 2021. However certain segments of the market will still continue to suffer, in particular in the city apartment towers and accommodation around universities. It is unlikely the segments of the market will pick up for some time and the value of these apartments is likely to continue to fall as there just won’t be buyers for secondary properties. At the same time some rental market will remain challenged. In particular the inner-city apartment markets which are reliant on students, tourists (AirBNB) and overseas arrivals. People will pay a premium to be in the right neighbourhood. If Coronavirus taught us anything, it was the importance of living in the right type of property in the right neighbourhood. In our new “Covid Normal” world, people will pay a premium for the ability to work, live and play within a 20-minute drive, bike ride or walk from home. Residents of these neighbourhoods have now come to appreciate the ability to be out and about on the street socialising, supporting local businesses, being involved with local schools, enjoying local parks. We will not fall off the fiscal cliff in March Some commentators are concerned that we will fall off the fiscal cliff when JobKeeper and the mortgage deferral system end in March. I can’t see the government allowing this to happen after having put so much time effort and money into “building a bridge to get us across the other side” as Prime Minister Scott Morrison promised. In fact APRA (the Australian Prudential Regulatory Authority) released data showing Households and small businesses are now paying back more than 80 per cent of the almost $250billion in loans deferred at the height of the coronavirus pandemic. This is just another sign that the national economic recovery is on track and we won't fall off a fiscal cliff in March as some of those Doomsayers were predicting. The reduction in our banks’ exposure to loans that may default puts them in a stronger position to continue lending and support of the economic recovery by lending to homeowners, investors and businesses. Now, let’s talk about the number of the influences that will help influence our economy and our property markets in 2021 The IMF now expects global GDP to grow5% in 2021, Huge fiscal spending worldwide plus unbelievably low interest rates plus vaccinations will stimulate economies Australia’s projected growth ranges from 4.5% to 5%, which is huge compared to our usual growth rates. In the past we were excited if Australia had 2-3% growth! Unemployment fell and jobs are being created Interest rates are low and likely to remain so for three years, even though some people are suggesting this may not occur if our property markets keep rising InflationThis year has started with a bit of an inflation scare and US and Australian headline CPI inflation measures look like rising to around 3.5-4% over the year to the June quarter as last year’s June quarter price slump drops out of annual calculations and higher commodity prices feed through. Core and underlying inflation measures will remain the main focus of central banks and right now they are well below target in the US, Europe, Japan and China as is the RBA’s preferred measure of underlying inflation in Australia at 1.2% year on year.  Consumer and business confidence is rising Some concerns: China will be a problem, but the fact that we’re not travelling overseas means we are spending $69 billion locally instead Whether rising house prices cause because Apra or the RBA to interfere Links and Resources: Michael Yardney Metropole’s Strategic Property Plan – to help both beginning and experienced investors Pete Wargent – Next Level Wealth Pete Wargent’s new book Low Rates High Returns Shownotes plus more here: Here's why I'm excited about 2021 - What the next 12 months has in store with Pete Wargent Some of our favourite quotes from the show: “I’m optimistic about our future, but this year we’re going to require optimism balanced with realism because that’s what gives us resilience. – Michael Yardney “We’re not going to have a cliff. We may not even have much of a step in March.” – Michael Yardney “One of the things that happens after every downturn is a flight to quality.” – 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

Would you like to know where the property hotspots are going to be as Australia enters some semblance of normality in 2021? Or maybe you’d like to know exactly where property values are going to end up at the end of this year. Now I know that’s what a lot of the other podcasts are currently offering you, so I’m sorry if I’m going to disappoint you, but I’m not going to make any short-term predictions. You only have to look back 12 months to see how all those short-term forecasts worked out, or even further back to the beginning of 2019 and again see how incorrect those predictions were. On the other hand, it’s much easier to tell you what the value of well-located investment-grade properties will be in 10 years’ time.  But that’s not as sexy, is it? The problem is many investors take a short-term approach to real estate which is really a long-term investment. They try and make a quick profit such as buying cheaply, or looking for the next hotspot, which is a short-term approach, and then wonder what to do next; rather than taking the long-term approach of owning the best asset they can which will give them long-term compounding growth and in time produce substantial wealth. In today’s show we are going to continue on the discussion I started last week with Stuart Wemyss and work through his 8 fundamental rules for property investment. These will serve you much better than learning where the next hotspot is going to be because as you know, this year’s hotspot will become next year is a not-spot. When you understand these fundamentals and use them to formulate your investment decisions, you’ll be ahead of the game and be in that small group of investors who builds a multi-million-dollar property portfolio, rather than in that large group of 1.9 million Australian investors who never gets past their first or second property. If you haven’t heard last week’s show, please listen to that after you’ve heard this episode – the order in which you listen won’t matter - just go to The Michael Yardney Podcast on whichever player you use to listen to the podcast because the two shows are complimentary – there was just too much information to pack into one show. And while you are there, if you don’t already subscribe, please subscribe to this show so you keep up to date as we enter an interesting year ahead. Once you’ve listened to these two episodes, I believe you’ll be in a much better position to take advantage of the changing property market in 2021 as you understand Stuart Wemyss’s eight rules of property investment. The Golden Rules That We Discuss This Week: Golden Rule 5: Set your asset allocation to reduce risk and maximize return Understand that you can’t predict what’s going to happen in the short term. Invest in a combination of assets that diversify outcomes. Be realistic about what long-term returns are going to be. Golden Rule 6: Invest in the share market using low-cost passive investments Two types of approaches: active fund management and passive management. Golden Rule 7: Only invest in ‘investment-grade’ property Three characteristics of an investment-grade property: Strong land/value component Have scarcity in terms of location and in terms of architectural style or building type Proven performance Golden Rule 8: Protect your investments from expected and unexpected risks Plan for the worst and hope for the best. Make sure that you have the right insurance, including income protection insurance. You need to put a will together. You need access to several year’s worth of living expenses. A finance strategist can help you put the appropriate buffers in place. 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 Stuart Wemyss – Prosolution Private Clients Stuart’s Book – Investopoly Shownotes plus more here: 8 Golden Rules for building wealth in this new property cycle – Part 2, With Stuart Wemyss Some of our favourite quotes from the show: “Property’s lumpy, so it’s not easy to buy a property every six months or every six years.” – Michael Yardney “Investing is meant to be boring, to give you the wherewithal to make the rest of your life fun.” – Michael Yardney “The first rule summarizes it all, also. Invest for the long-term. Understand the long-term rules. Don’t invest for the latest hotspot.” – 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 we enter a new year, many of us will be focusing on the strange year we've had and trying to extract the lessons we've learned. Rather than do the same, in today’s episode of the Michael Yardney Podcast I’d like to remind you of some of the foundations of lifetime investment success with Stuart Wemyss. Now to be clear… this is very different to what you hear in the news, which basically focuses on short term investment trends.  One of the core tenants of my approach is that true lifetime investment success is goal-focused and planning-driven.  And the good news is by focusing on the long-term big picture trends it removes the burden of correctly guessing future short terms trends such as interest rates, inflation, hot spots, and the many other variables that the average analysts and many investors spend their days obsessing over. In a culture that will always be market-focused and performance-driven, my approach sees our clients at Metropole and also my personal investing acting on a financial plan, a customised strategic property plan that we build for our clients, rather than reacting to the vagaries of the investment markets. And that’s why I’m looking forward to my chat with Stuart Williams today because I know he takes a very similar approach. Four Investment Principles At Metropole our approach is built on an evidence-based foundation of four investment principles. Master these, and lifetime investment success will be available to you. The four inner principles are: Faith in the future There are so many doomsayers out there, and I regularly get trolled by them, particularly on YouTube. But based on history, I confidently believe in the ability of a capitalistic society to prosper on the back of our collective ingenuity. Patience Contrary to the financially illiterate, the strategic investor refuses to react inappropriately to disappointing events. That’s why they have a plan to follow, and they act on this plan rather than the short-term ups and downs of the investment markets. Discipline Similar to the principle of patience, discipline sees strategic investors continue to do the right things, even if the fruit of these decisions can't be seen in the short-term. Building a great team around you. Property investment is a process, not an event. In fact, property investment is a long-term process, and it takes up to 30 years to develop financial independence through residential real estate.  And all successful investors I know can you to educate themselves, so they become financially literate, but they’re very careful who is your bias they take, because they have learned most educators and so-called advisors have a vested interest They also surround themselves with professionals and mentors who they are prepared to pay for advice to ensure they maximise the investment returns, by having elastic advice in the areas of not only property but finance, tax, structuring legal matters and estate planning. These financially literate investors accept the guidance of their holistic wealth advisors and if they have sufficient disciple and allow time compounding and leverage to work its magic, their investment success is all but guaranteed. While simple, it's not easy. The 8 Golden Rules of Successful Investing - part 1 Golden Rule 1: focus on the long game Long term financial decisions promote exercising delayed gratification – patient investors are rewarded, impatient ones are not. The best question you can ask yourself is “what action can I take today that will result in me being a lot financially stronger in 10, 15 and 20 years?” Golden Rule 2: Know what you need and when you need it You need to set two important goals: how much income you need in retirement and when will you retire? Look at what you are spending today to extrapolate what you will need. Golden Rule 3: Spend less than you earn. Then invest the difference Commit to an annual surplus that you will contribute towards building your financial future then spend what’s left over. If you are not a “saver” then redefine “saving” as “future spending” Golden Rule 4: Grow your asset base first. Then tilt towards income Select assets that provide most of their total return in growth and lower proportion of income How can capital growth help fund retirement? Sell assets, with enough time income will be substantial, invest in other income-style assets, sell one property and reinvest in bonds, etc. You need to develop a financial model in order to work out how much to invest, when and in which asset classes. 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 Stuart Wemyss – Prosolution Private Clients Buy Stuart’s book Investopoly here – use the coupon code Yardney Shownotes plus more here: The 8 Golden Rules for mastering the game of building wealth – Part 1 with Stuart Wemyss Some of our favourite quotes from the show: “While it's easier and more trendy to be a pessimist, I believe that optimism is the only realism.” –Michael Yardney “They haven’t learned the simple fact that the cheapest advice is the one that gives you the best investment results” – Michael Yardney “In Australia, residential real estate is a high growth, relatively low yield investment.” – 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

What’s ahead for our property markets this year? Is it time to be fearful or time to be greedy? We survived 2020, and 2021 is going to be another interesting year with a lot of positive things happening, but there’s no doubt will have our share of challenging times, because even though we are over the recession there it will still be fallout from the recession to deal with, and clearly, we will keep getting reminders about coronavirus coming out of the blue. And every year there’s an unexpected X Factor– I don’t know what it will be otherwise it wouldn’t be an X factor, but hopefully my discussion today will give you some clarity and direction forward to hitting property. However, there is one thing that I can assure you will happen this year. The typical property pessimists will be back again telling us our property market is going to crash. So today I share with you my thoughts or the short and long term prospects for our property markets. And in my mindset moment today I’m going to teach you one of the most useful lessons you can pass on to your children and grandchildren, and even if you don’t have any or are not planning to have any, this lesson will be critical for you if you want to obtain financial freedom. What should you do in the current "interesting" property markets? I know many investors are confused with concerns remaining about the Coronavirus, high unemployment and the many mixed messages forecasting what's ahead for our economy and our property markets. I've noticed two types of emotion in those interested in property: Last year as it became clear our markets wouldn't crash like some property pessimists predicted, FOBE was the predominant sentiment - Fear Of Buying too Early - home buyers and investors trying to time the market wondering "what if prices do fall further?" Now FOMO (Fear Of Missing Out) is creeping back as house prices are rising around Australia. In fact, master investor Warren Buffet advised: “I'll tell you how to become rich.... Be fearful when others are greedy and be greedy when others are fearful.” The two significant structural events that caused the massive rise in property values over the last three decades were:  The Reserve Bank kept inflation within a narrow band meaning interest rates could fall at a time when time banks became deregulated and this allowed new non-bank lenders like Aussie John Symond to make cheap finance available for borrowers and over time interest rates kept falling and credit was easily available. At the same time wages grew and there were more two-income households. This allowed more Australian families to buy new homes or upgrade their existing homes as their families grew. These factors won't carry our markets forward in the future, in fact they played out a few years ago and haven't been relevant for much the last decade. We are currently in a low inflationary, low interest rate environment (not only in Australia but around the world) and there is really no room to lower interest rates. The effect of the extra spending power of low interest rates has washed its way through the system. We are now in a period of lower wages growth and more part-time jobs so it's unlikely that the average Australian family will have more cash in their pockets to spend on property There is still economic fallout from the recession we decided to have. Here's why I believe property values will increase in the short term. The big game changer that will bolster our property markets moving forward is the anticipated loosening of restrictions on banks’ lending practices in March this year which will give the average home buyer and property investor significantly more borrowing capacity. More than that, there is a perfect storm of positive factors developing for our property markets – a confluence of multiple growth drivers which will propel our property markets into 2021 and 2022: Our economy is improving and moving forward further jobs creation, consumer confidence and business confidence (leading to spending and employment) will underpin our housing markets. Auction clearance rateshave been consistently strong in the last few months of 2020, not just in the two big auction capital of Melbourne and Sydney but around Australia. More buyers and sellers are in the market and transaction numbers have increased At the same time the banks are keen to write new business– another positive for our housing markets. Bank loan deferrals have been falling– there’s no chance of an avalanche of forced mortgagee sales as many were worried about. The latest rate cut and the “guarantee” of rates remaining low for at least 3 years, will give home buyers and investors’ confidence. Why our property values are guaranteed to increase in the long term While it’s important to understand that while many factors like interest rates, supply and demand and market confidence, affect a country’s property prices in the short term, in the long term prices are driven by two main factors: Population growth, and The wealth of the nation Despite our international borders currently being closed, Australia's strong future population growth is a given and as a matter of fact so is our increasing wealth. Then there's all the good economic news If you're reading the general media you'd be forgiven for feeling a little pessimistic about the state of our nation. The recession we experienced in 2020 wasn't due to a fundamental problem with our economy – it was our government putting the economy on hold to get a health problem under control. But our economy is on the move again and likely to keep grow strongly over the next couple of years; and despite the geopolitical and trade challenges we will are likely to face, Australia's economy is well positioned to keep growing strongly. The bottom line: While nothing in life is guaranteed, if like me, you are confident that Australia has a prosperous future, and you agree that our population is going to keep increasing and that most of us are going to want to live in much the same parts of our lucky country; you can understand why I see a strong long-term future for our capital city property markets. Sure there is a risk in buying property, but don’t forget there is also a different risk in not buying! 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 Shownotes plus more here: Is it time to be fearful or greedy in property in 2021? Some of our favourite quotes from the show: “It’s been said that the 2 most powerful emotions that drive markets are fear and greed.” – Michael Yardney “I accept that some of the gains over the last three decades were related to structural changes that won’t be repeated.” – Michael Yardney “Please excuse me if I remind you how COVID has made neighbourhoods more important than ever – location more than ever important.” – 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

While many markets suffered from the economic impact of COVID-19, Brisbane’s property values remained resilient last year, and now almost all property analysts are suggesting that Brisbane’s housing markets will perform strongly in 2021. On today’s show, I chat with Brett Warren, national director of Metropole Property Strategist based in Brisbane to understand what’s really going on and why this time is different. In fact, digging deeper into the statistics of property growth over the last few years, some properties have far outperformed others and freestanding Brisbane houses with 5-7 km of the CBD or in good school catchment zones have grown in value strongly. Brisbane has really been a two-tier market and I know that many of the properties purchased for clients of Metropole’s Brisbane office showed double-digit capital growth over the property last 12 months. While Melbourne and Sydney are highly regarded as Australia’s two world-class capital cities, Brisbane is what many class as a “New World City”, and on today’s podcast we will explain what that means and why those investors who take advantage of the changing trends in Brisbane will benefit significantly over the next few years, so welcome to today show Some of the things we discussed Metropole has had an office in Brisbane for almost 2 decades and in that time I’ve seen the city morph into a new world city. Australia is very different from other countries with regards to the way we live. 86% of our 25 million population live in urban areas and 50% of these Australians live in either Sydney, Melbourne, or Brisbane. While overall, the Brisbane property market has underperformed Melbourne and Sydney over the last decade there are different segments of the market that performed very strongly and we dig into this as we have a chat. Australia has two global cities – Sydney and Melbourne - they are recognized around the world – Sydney for the Opera House, Melbourne for sport and art. Now Brisbane is being recognized as a “New World City.” Brisbane punches above its weight - It's only the 172nd biggest city in the world, but it's the 80th most globally connected. It's in the top 30 percent of the world's fastest-growing cities, it's got world-class direct foreign investment, a competitive labour market, a highly lifestyle model and it's an international student city. A New World City must also have some "globally oriented" business clusters. In Brisbane's case, it's higher education, it's the digital economy and it's commodities and professional services of various kinds but it's also travel and tourism and conventions." Brisbane has been building its infrastructure and economy and is now attracting population growth. Also, Brisbane has less traffic congestion than Australia’s 2 big global cities. What is the Brisbane property market? Let’s be clear what we’re talking about - many outsiders see Brisbane as stretching from the Sunshine Coast in the north to the New South Wales border in the south, 200 km long. In one sense they are right because the Gold Coast and Sunshine Coast are now closely interconnected with Brisbane and workers will commute from these locations on their jobs in Brisbane. In fact, that’s one of the reasons why property values have not grown as strongly over the last few decades -  because SE Queensland has had abundant supply of properties, however, we’re not recommending investing just anywhere in this large parcel of real estate. We only focus on properties in prime locations within 5 to 7 km of the Brisbane CBD. Brisbane has underperformed Brisbane’s capital growth has been from the top down. There has been strong capital growth in the sought after, more affluent, more established inner suburbs within 5 to 7 km of Brisbane, but there has been minimal capital growth in many of the outer suburbs where there is less affluence and plenty of supply, and in fact abundant new supply. For example, there are a number of commentators out there suggesting one should be investing in the Logan district or Ipswich, and while there has been substantial physical growth there – lots of new estates – there has been minimal if any capital growth. Brisbane’s demographics are changing For a number of decades, Brisbane suffered a “brain drain” where skilled, educated young people finished university and moved to Sydney or Melbourne where the more highly paid knowledge jobs were. This is no longer the case, and a lot of millennials now are keen to stay in Brisbane as it is now a fun place to live. So, the big shift is that people no longer want to leave Brisbane, they want to come to Brisbane. This was clearly seen through the challenges Australia experienced in 2020. Millennials will shape the Brisbane housing markets. Demographics will always drive our property markets and because of their sheer size and stage in the life cycle, no generation will shape Australia more during the 2020s than millennials. They are now at the stage of their life where the earnings are increasing, and they will spend these on houses and lifestyle and their growing family. However, this will create a challenge for all those high-rise tower block apartment blocks that were built over the last decade or so as millennials leave their centrally located one or two-bedroom apartments and migrate to the suburbs. As millennials move into the suburbs, who will move into the inner-city apartments left behind? The problem is that the Zs, who should take their place is a much smaller generation than the millennials and, with lower migration intake because of the coronavirus during the next few years, inner-city properties will stagnate or fall in value. Brisbane has multiple pillars sustaining its economy Tourism Agriculture – the food bowl of the world Mining – some very big mineral deposits Construction As a New World City, Brisbane has a lot to offer and it’s comparatively cheap to move there and live there. That’s why it’s attracting people. Some things we need to understand about the Brisbane property market: One City Council One of the major benefits of investing in Brisbane is the fact that you are bound by only one city council. This has been efficient and proactive. Affordability The price gap between our biggest capitals and Brisbane are now at an all-time high. This includes quality properties in quality locations. Lifestyle People are getting excited about all of the new changes that are happening in the area. Proximity to Asia This doesn’t necessarily mean China. It’s important to understand that there is more to Asia than China. International students and other positives come from these relationships. Undersupplied There’s huge demand and not enough supply for the good A-grade properties. 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 Shownotes plus more here: 5 Good Reasons to Invest in Brisbane with Brett Warren Some of our favourite quotes from the show: “I believe Brisbane’s what we call a new world city.” – Michael Yardney “We know that COVID hit Australians differently. Not just health-wise, where some age groups, some demographics suffered more than others. Similarly, some demographics suffered more financially, economically than others.” – Michael Yardney “It’s the investors who create the booms and busts when they get exuberant during the booms and get a bit down when difficult times occur.” – 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

With interest rates near zero, Australia’s economy rebounding, and pumped with massive amounts of stimulus, and the coronavirus all but eradicated from our shores, our property markets are looking healthy and starting the year off on a strong footing. The stats show that after the nation went into lockdown last year, national property rates fell overall a cumulative 2.2 percent. And of course, this was led by Melbourne and Sydney that were most affected by the lockdowns. But of course, this was nothing like the predicted calamitous falls. Now on the back of continuing increase in confidence, strong growth low mortgage rates, and the emergence of a vaccine plan, many are projecting house price growth in 2021. In fact, many are projecting double digit growth this year. Are they right? That’s what I discuss with Dr. Andrew Wilson, along with lessons from last year and housing market forecasts for 2021. Then, as always, I’ll share my mindset message with you. Lessons learned from 2020: It was really the physical restraints to property transactions that impacted the market, rather than a change to our supply and demand. In other words, the property market fundamentals were and are strong Be really careful whose forecasts you listen to. Property investors who listened to catastrophic predictions missed out on good opportunities There isn’t just one Australian property market. Markets are segmented by geographic locations as well as by factors like the type of dwelling and the price. Property investment is really a game of finance with some houses thrown in the middle What’s occurring now: The unemployment rate is falling The economy is recovering well due to falling unemployment and even new jobs There’s been a huge surge in housing loan approvals – 24.4% above pre-pandemic levels Consumer optimism is trending upward First-time home buyers are in the mix There is a lower number of listings in the market than usual The fiscal cliff is not a real cliff, more like a step However, the rental market still has some challenges 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 Guest: Dr Andrew Wilson – MYHousingMarket.com.au  Shownotes plus more here: Here’s why we’re going to have a ripper year in property + Housing Market Forecasts for 2021 with Dr. Andrew Wilson Some of our favourite quotes from the show: “You know what they say about opinions – there’s like bellybuttons, everyone’s got one, but they’re not very useful.” – Michael Yardney “The property market moves in a cycle and after every boom, there’s a downturn or a slump phase, and then it actually starts to pick up again slowly, then eventually another boom occurs.” – Michael Yardney “It may sound like a cliché, but maybe it’s time to play more and work less.” – 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

Would you like Life Time Wealth? Well…today we’ll explain what that means and how you could achieve it as I replay a chat I had with my good friends Louise Bedford and Chris Tate from The Trading Game and we discuss the concept of true wealth. This is the last of the summer series of podcasts where I’ve been running three shows a week rather than two in January, but since this was the second most downloaded listen to podcast I’ve ever recorded I thought it important to let you listen to it again for the first time or again if you’ve been a subscriber for some years. The original recording of the show came about when Louise Bedford, Chris Tate and I were sitting around chatting about Wealth Retreat 3 or 4 years ago and we were discussing the concept of creating lifetime wealth, what true wealth really is, and some of the concepts we wanted to share with attendees at WR retreat. And the conversation was so good, it was a bit philosophical, that we actually pulled out a phone, I think it’s Louisa’s phone now and we just recorded an episode of the podcast for her podcast and mine, because we were talking about things we only tend to talk about between ourselves and we wanted to share with other people. For example I talked a bit about my first investment property, almost 50 years ago. We talked about how being truly wealthy is a lot more than just how much money you have or how many properties you have. We talked about the concept of creating lifetime wealth and leaving a legacy and we discussed how we are the mentors for our children and how if you want to leave a legacy you have to be important what do you pass on to your children, not moneywise – it’s not what you leave your children but what do you live in your children. We talked a lot about the impostor syndrome, something that we speak for specialises in and we discussed about success, the miss match in some couples – something I come across very frequently were very different to our life partners with regards to how we think about money and success. There were so many fascinating concepts we talked about that I really believe you’ll enjoy today show, but be warned, it’s a little bit longer than normal and the sound quality wasn’t as good as normal because, as I said we recorded it on the fly – we were just in the right zone talking about this content so I thought it was really important to grab the information to couple of years ago and it’s just as relevant today, so welcome to this episode of the Michael Yardney podcast.* How to Obtain Lifetime Wealth Michael shares how he bought his first investment property over 40 years ago. He’s made plenty of mistakes, but has still built a substantial property portfolio. He also gives back. To be truly wealthy you need much more than just money. You need money plus family, friends, health, spirituality, growth, and contribution. Chris shares his background. It is similar to Michael’s but replace the word property with shares. How children absorb things without being taught directly. Legacy and leaving a ripple or something outside of you that carries on when you are gone. We learned about money, wealth, and riches from our parents and culture. What is your financial thermostat set for? You’ll be surprised – it’s set for what you have already got. Your thermostat won’t change until you change and throw away the blame. The imposter syndrome or undeserved success. Not feeling worthy and self-sabotaging. Self-awareness deserving your success. How people believe the tool has something to do with their success, when it is actually the software that makes a success. How people who’s views are mismatched may not be a match as a couple. The disconnect can produce tension and tear relationships apart. Couple’s need to talk about their views about money. Partners need to be compatible on a whole host of issues. In the old day’s people passed their trades on. Now property or shares can be passed to your kids, but it is not what you leave your kids it is what you leave in your kids. How we learn about money from our parents whether it is spoken or unspoken. Replacing non-productive beliefs with empowering beliefs. Teaching kids about training by loaning them money to trade and letting them keep half of the profits. How IQ and socioeconomic status can be linked. The importance of mentorship and getting together with other entrepreneurs. Find like minded people and the isolation disappears. How attending Wealth Retreat can help change your mindset and money habits. 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 Join us at Wealth Retreat in June 2021 The Trading Game Chris Tate Louise Bedford Shownotes plus more here: How to attain lifetime wealth, with Louise Bedford and Chris Tate – Summer Series Our favourite show quotes: “Wealth isn’t about how much money you have, but what you’re left with if you lost everything and had to rebuild it.” Michael Yardney “You either have to pay the world, the market, or your mentors when learning about investing.” Michael Yardney “If you took all of the money in the world and divided it equally it would all end up in the same pockets again.” Michael Yardney

During his five years studying the rich and the poor Tom Corley identified 10 hard truths about the wealth gap that no politician or member of the mainstream media would dare reveal.  And as I share them with you today, you’ll probably get a few surprises. These aren’t just our thoughts. In his 5year study, Tom asked 361 rich and poor people 144 questions each. That’s 51,984 questions. From the data he gathered, he was able to identify 344 differences between the way the rich and the poor conducted their lives. Over one hundred million individuals have read something about my research, which has been cited, quoted, referenced, commended and criticized in 25 countries around the world. As a result, Tom has made a lot of friends and a lot of enemies. And he’s about to make some more with this podcast. His research opened my eyes. One of the many benefits of having done this research is that he became privy to the inner workings of the lives of the rich and the poor. For five years he was that fly on the wall. And this fly has identified 10 hard truths about the wealth gap which we’re going to discuss today in an episode which is part of what I call our summer series where apart from bringing you one new show each week we are replaying 2 previously published shows, and the foundational wealth lessons I’m going to share in today’s show which was originally published a number of years ago will help you take advantage of the new property cycle that is appearing in front of our eyes in 2021 10 Hard Truths About the Wealth Gap Bad Parents – The poor have parents who simply do not do their job. Drugs, alcohol, gambling and a host of other parent character flaws pull the rug out from underneath their kids.  Broken Families – The poor are raised in broken families. Divorce, incarceration, abandonment are common denominators among the poor that fracture the family unit. No Work Ethic – The poor are bad employees who have a bad work ethic. As a result, they find themselves regularly unemployed. Financial Negligence – The poor spend their money as quickly as it comes. They don’t save. They don’t invest. They are financially illiterate. Poverty Ideology – The poor believe they will be poor their entire lives. They see poverty as a fact of life. They are without hope and thus, without motivation to escape their poverty. Bad Health – The poor do not exercise regularly. They eat and drink too much junk food. They frequent fast-food restaurants. They take drugs and drink too much alcohol in order to numb their pain. They are overweight and out of shape. Uneducated – The poor do not embrace education. It’s not part of their culture. They do not self-educate themselves. They do not read. They do not engage in self-improvement. Bad Habits – The poor have many bad habits and few good habits. Entitlement Ideology – The poor believe they are entitled to things others have to work very hard for. Victim Ideology – The poor believe others hold them back in life. They see themselves as victims. They look to the government to take the wealth of those who are producing and working hard in society and redistribute it to poor people. I now know that rich people, particularly the self-made rich, are the good people. They were raised by good parents, parents who cared and who mentored them to succeed. Poor people, conversely, were raised by bad parents. Some were raised in broken homes, some were raised with little to no work ethic, some were raised to be ignorant of finances, some were raised with a poverty mindset, some were raised to disregard their health, some were raised to shun education, some were raised with bad habits, some were raised to believe they should be given free stuff and some were raised to believe the world was aligned against them. We don’t have a wealth gap in this country.  We have a parent gap. If, as a society, we truly want to end poverty, we have to first acknowledge the cause of poverty. Parents. Parents cause poverty. Parents are to blame. As a great man once said, “the truth shall set you free.” Links and Resources: Michael Yardney Tom Corley - Rich Habits Get your own copy of our international bestseller Rich Habits Poor Habits  Shownotes plus more here: 10 hard truths about the Wealth Gap with Tom Corley – Summer Series Some of our favourite quotes from the show: “We know that children develop habits from things they see, things they experience, things they hear, and their mentors as a child are really their parents.” – Michael Yardney “Bad mentoring from parents is more likely to – but not certainly – going to give you a disadvantage in life.” – Michael Yardney “It’s probably worthwhile reminding our listeners that we’re all walking around with some good habits, some bad habits, some rich habits, some poor habits, some habits that are empowering us, and some habits and beliefs that are disempowering us.” – 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.  

How wealthy are you? I guess that depends upon how you define wealth. In today’s podcast, I chat with demographer and social commentator Mark McCrindle about wealth distribution in Australia. We talk about what’s happened to the wealth gap between the rich and the average Australian, and we answer the question “are we better off financially than our parents were?” And of course, I’m also going to share my regular mindset message with you. So at the end of today’s show, you’ll have a better understanding of where you sit on the wealth ladder and what you can do about this. My conversation with Mark McCrindle: The rich keep getting richer, or so we keep hearing. But is that true? And last year, the coronavirus has seemed to affect certain demographics more than others. How has that affected the wealth distribution in Australia? With higher wealth and income levels than ever are we any better off? It’s mixed. The cost of living is rising, costs of property and rentals are rising as well. So we expect income to rise because costs of living are rising. It’s not as though we’re rolling in money, but on average we’re paying our bills. Two-thirds of Australian households carry debt, and a quarter of them have debt that’s three times their household, so we’re still carrying a lot of debt. But Australians have been moving forward with both income and wealth. How is wealth distributed amongst the different generations? It’s mainly held by the older generations. It’s largely in the household home. About one third is in financial assets such as shares and superannuation Are we better or worse off than our parents were? In so many ways, the younger generation is better off. It is getting more expenses to own a house. But the costs of things like travel, transport, and daily commodities are less expensive. Plus, the younger generations are investing more in their future earnings with education. Over time, they will start to catch up in terms of wealth. The younger generations will live longer and work longer, so they have a broader spread of wealth accumulation years. They also have the support of parents and higher earnings as they begin. What’s happening to the gap between the rich and the poor? One of the best measures of that is the Gini coefficient. It highlights that inequality is getting less. How did COVID affect wealth? In many ways, it added to the equality of Australia. The government stepped in with Jobkeeper and Jobseeker and intervened to level the playing decks. Because of the uncertainty, many Australians also paid down debt and saved more. 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 Mark McCrindle’s article on Australia’s Income & Wealth Distribution Find out more about McCrindle Demographers Shownotes plus more here: What’s happening to the wealth gap and are we better off financially than our parents were? With Mark McCrindle Some of our favourite quotes from the show: “My grandparents’ generation were more workers and it was rare for them to go to university.” –Michael Yardney “I think one of the things you’ve got to remember is that in Australia, our poor are still richer than the rich in many other countries.” – Michael Yardney “Timidity is not a virtue, it’s an illness.” –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