Property Investment, Success & Money | The Michael Yardney Podcast

In today’s show, I’m going to teach you the most important money lesson you can teach your children to help them become successful in life.  This lesson is relevant to you as well, so even if you don’t have children, you can learn something from listening to this episode.  Today’s debt equals tomorrow’s slavery  Limiting your debt obligations when you’re younger will mean having more control over your personal finances later in life and avoid the financial chains that bind your freedom to choose how you live life.  He who dies with the most toys is not the victor The truth is possessions don’t make for a rich life, it’s the experiences and people – the things that money can’t buy – that make you truly wealthy.  Taking responsibility makes you the master of your own destiny The truth is if you’re courageous enough to cast a critical eye over your life, recognise you are where you are as a direct result of your own choices and take ownership of your decisions, you build confidence, self-esteem, and self-respect.  Patience and waiting is luck is made through hard work Understand the difference between wants and needs and recognise that all the money you spend on those material items you just ‘had to have’ today, is less that you’ll have to fund your retirement with tomorrow.  Luck is made through hard work While a handful of people have lucked out by winning the lottery, truly successful people do the hard yards to reach the pinnacle of their chosen field or endeavor.  You don’t need millions to achieve financial freedom Financial freedom is not dependent on money itself, but on your relationship to it and the level of personal responsibility and fiscal discipline, you’re prepared to exercise throughout life.  Spend less than you earn…and invest the rest Aim to invest at least 10 percent of your earnings and the power of compounding will take care of the rest. And speaking of the power of compounding…  Your youth won’t last forever, so use it wisely Given enough time, compound interest is so effective that Albert Einstein called it the most powerful force in the universe.  The bottom line  Unless we teach our children good daily success habits and level the playing field, the rich will continue to get richer and the poor will continue to get poorer.  So it just might pay (literally) to give them a bit of your time.  The most important lesson to teach your children about money  Patient people are more likely to save their pennies than seek “easy” (and expensive) credit because they are happy to wait for a new car or big screen TV.  But we need to remember that this skill isn’t natural for most people.  Humans are wired for instant gratification. That’s one of the reasons many high-income earners are not ‘rich.’  You’ll often find the more they earn, the more they spend and they end up on a treadmill where they tend to spend more than they earn because they need to support a lifestyle that has little or no enduring value but has high fixed costs to maintain.  Learning delayed gratification isn’t easy but it can become a skill in your Rich Habit toolkit if you follow a few simple tips.  Write down a list of money goals and put them somewhere that you can see them every day.  Every time you’re tempted to purchase something consider whether it’s a want or a need.  We all can develop the Rich Habit of delaying gratification and accepting what good things are worth waiting for.  Links and Resources:  Michael Yardney Metropole Property Strategists Metropole’s Strategic Property Plan – to help both beginning and experienced investors  Some of our favourite quotes from the show:  “Most Australians don’t teach their children anything about money, meaning, we’re raising our children to be financially illiterate.” –Michael Yardney  “The fact is, there’s no such thing as rich victims.” –Michael Yardney  “When it comes to a gadget or a fad, most of us just don’t have self-control.” –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  

Overwhelm is the feeling that everything is just too much, that feeling that we will never get everything done, that there are too many things in the to-do list at the end of the day and that we don’t have the time or the ability to do anything about it. Left unattended overwhelm can led to levels of negative self-talk which take us to the point of simply giving up. It can affect our emotional state and even our physical health. That’s why we need to have a strategy to get on top of it. Here are six things you need to know and work on in order to overcome overwhelm.         1. It’s normal.  Remember that overwhelm is perfectly normal We have lots of competing interests and pressures on a day to day basis so overwhelm will happen. Knowing it’s normal helps because it shows that we are not alone in the situation and that if others experience and overcome it then we can too. Once you recognize it’s normal then the following five steps will help to resolve it.  Here are the next five steps:         2. We have accepted that overwhelm is normal. It’s normal in business and in everyday life. One thing we can do is to take a day out.  If you don’t think you can cope with a whole or even a half-day out then at least find something which is your “happy place” and schedule some time there. Perhaps it’s a round of golf, a movie or some time with friends or family. I recently took a day out to spend with my grandchildren. The following day my thinking was far clearer, my productivity increased, I was more creative and overall happier. Whatever the day point or happy place may be for you, the trick is to schedule it. Lock it into your calendar so you can be sure it happens. There is one layer peeled.         3. Get back in touch with your “Why”. It may be the Why you started your business or “Why” you have the job you have. The “why” may be your big-picture goal, your vision or it may simply be the next “reward’ you are working toward. Whatever it may be, the trick here is to remind yourself of it. If you are struggling to remember your “why” ask those around you, your family, friends, team members or clients. Think about the impact that what you do has on others, the transformation that it brings to their lives and to yours.  Understanding your “why” may just be the shot in the arm you need to motivate you to push on and peel another layer off that overwhelm onion.           4. Plan We all know the saying that a failure to plan is a plan to fail. Plans, in my mind, shouldn’t be complicated, they should be simple and even better if you can put them on to one or two pages.  Having a plan will give you the two important C’s, certainty and clarity. With a plan you know exactly where you want to go and precisely how you’ll get there. Taking some dedicated time out to plan will save a lot of hard work over time. You will get certainty and clarity.         5. Break things down. Any task or project which contributes to overwhelm can and should be broken down to bite-size chunks.  Looking at a large project or problem as a whole only contributes to the overwhelm. breaking it into achievable pieces works to remove the overwhelm.  By seeing the component parts to any project, we may also see where those parts can be completed by someone else, potentially someone who would be better and faster than us. Is that another layer of the overwhelm onion I hear hitting the floor?         6. Find some tools to help In Mastermind, we have our One Page Plan and our Sprint Planners. These are simple one-page tools that help implement the other steps in the process. The one-page plan is simple, it just makes to look at your “why” your big-picture vision, then work out what you want to achieve in the next twelve months which will fit in with that vision. Next, once you have the twelve-month goals clear, set up some projects which you can achieve in the next 90 days which once completed will step you closer to your twelve-month goals.  Complete that all on one page and you have addressed the major parts of this overwhelm removal process.  Following these six steps will help you peel the necessary layers from your overwhelm and help you to move forward with clarity, energy, creativity and most importantly, confidence. Happy peeling! Links and Resources:  Metropole’s Business Accelerator Mastermind Mark Creedon – Business Coach to some of Australia’s leading entrepreneurs  Some of our favourite quotes from the show:  “Today’s demanding work environment and technology keeps you hooked into work twenty-four seven.” – Michael Yardney “We all know our mental health affects our physical health, doesn’t it?” – Michael Yardney “If you want to get above and beyond everybody else, if you want your business to grow further, if you want to be more successful in your career, you actually are going to have to do more than others.” –Michael Yardney  PLEASE LEAVE US A REVIEW  Reviews are hugely important to me because they help new people discover this podcast. If you enjoyed listening to this episode, please leave a review on iTunes - it's your way of passing the message forward to others and saying thank you to me. Here's how.

In today’s podcast, we’re going to talk about property management, and more specifically what a property manager does.  There will be some things that surprise you.  We’ll also talk about how to select a property manager, because if you’re going to build a business, a property business on the side, you’ve got to have one that doesn’t have too many working parts and that works for you even when you’re not there.  And that means finding a property manager who cares as much about your property as you do.  Then, in my mindset moment, I’ll share a lesson from my mentor, Jim Rohn, about 4 important emotions that can turn your life around. What do property managers actually do? Property managers: Collect rent Keep vacancies to a minimum Check references Advise landlords on tenant selection Ensure compliance with legislation Ensure leases are legally enforceable Have and apply market knowledge Choose tenants with whom they can have a long-lasting relationship Questions to ask a potential property manager: Pretend to be a tenant and arrange a mystery shop experience. See how they treat tenants. This is important because tenants are just as important as customers as landlords. Does the agency have a dedicated property management department? Is there a director or owner involved in day-to-day property management? How long has the property manager been in the industry? What are the specifics of the property manager’s experience?  How long have they been in the industry? Is their presentation professional? Who is in the office handling inquiries and concerns from tenants/landlords/investors while the property manager is out in the field? Links and Resources: Michael Yardney Metropole Property Strategists Metropole’s Strategic Property Plan – to help both beginning and experienced investors Why not speak with the team at Metropole Property Strategists and get their independent property advice -click here Leanne Jopson – national director Metropole Property Management For more details and the full show notes go the show's webpage: How to find a property manager who cares as much about your property as you do Some of our favourite quotes from the show: “I know that at Metropole what we do is we have systems looking after the property and people looking after the systems.” – Michael Yardney “If you’ve got a multimillion-dollar business, don’t take shortcuts with the people who are part of your team, including your property manager.” – Michael Yardney “The day you allow the emotions to fuel your desire, that’s the day your life’s going to turn around.” –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

If you’re a property investor, I’ve got a warning for you.  Some high-rise buildings are going to become the slums of the future.  As a property investor, it’s important to recognize that you’ve got to own the sort of property that’s going to outperform the averages, and many properties in the future are going to underperform because they have a shadow hanging over them.  That’s the one million apartments build over the last decade or so.  In today’s episode, I’m going to explain a little more about what I mean and what you can do about it.  I’m also going to have a chat with Brett Warren, director of Metropole Properties Brisbane about the research you should do to help understand what’s happening on the ground in property markets. In fact, it’s the research that we do and he’s going to explain how we do it and what you should look for.  Then, in my mindset moment, I’m going to tell you a story about a Cherokee Indian. This story has an interesting message that will help you gain some clarity for your future.  Warning – some high-rise apartment buildings will become the slums of the future. The way we live in Australia has changed.  We’re trading backyards for balconies and courtyards and this has resulted in around one in five Australians living in an apartment today - up from one in seven in the 1990’s. The problem is not all apartments are the same.  Some will make great investments increasing substantially in value over the long term, but many of the high-rise towers built in the last fifteen years will continue to underperform with poor, if any, capital growth in the foreseeable future. This sector of the property market has lost the trust of the buying public and confidence will take quite some time to restore as various stakeholders including state and local governments as well as the construction industry including building surveyors and certifiers scramble to shore up building sector. You see…there tend to be three major types of building issues faces by apartment owners: Structural defects – These are the ones that grab the headlines but, in reality, major structural issues only relate to a small number of buildings. Fire issues – These often relate to inferior cladding used during construction. Cladding audits are ongoing, but so far 629 affected buildings have been identified in Victoria alone. Water issues – These are very common and occur to some extent in almost every new building – things like leaking balconies, showers and roofs. While these are a nuisance and can be expensive, they can usually be rectified. Fact is, the buildings with major problems requiring mass evacuation are the outliers, but for those involved their losses will be significant as they will have hefty repair bills and have no real market for the sale of their apartment in buildings that could well become the slums of the future. But that’s not all folks… The standard of high-rise apartment tower construction is a vivid example of how in today’s disposable society, the quality of many things is falling in the pursuit of bigger profit margins. This in stark contrast to the quality of the 100-year-old buildings that stand proudly next to them in our CBD’s. They were craftsman built with durable materials and have stood the test of time and multiple generations. They still stand strong today – a far cry from the buildings being thrown up in the modern era. But I believe recent round of disclosures about structural problems in the apartment towers built over the last decade or two for the investor market is just the tip of the iceberg. It’s been suggested the high-profile stories that have hit the media are just the tip of the iceberg and many more buildings with structural problems – some big, some small – will come to light over the next few years. Some developers will have the funds to repair their buildings, but others won’t.  And insurance often won’t come to the rescue of the unfortunate owners as sometimes it will be difficult to know where to lay the blame:  Councils who have encouraged higher density development and at times been willing to negotiate building guidelines in order to promote development. Developers who have chosen the cheapest builder to increase profit margins Builders who been prepared to compromise to win the deal. Contractors who may have been willing to cut corners like import cladding from overseas because it was cheaper.  Certifiers who approved the standard of construction. And even if when the issues come to light, they are repaired, what rational purchaser is going to want to buy into these buildings?  The bottom line: Demand for apartments is set to accelerate from a more diverse buyer profile as apartment living emerges as a preferred lifestyle for many, from the younger generation leaving home to the older generation wanting to downsize The peak of the current building cycle has now been reached and it has now emerged that many of the buildings built during the last construction boom will have a shadow hanging over them for some time. At the same time reluctance from future purchasers will make it harder for new developments to have sufficient pre sales to get out of the ground at a time when tighter planning restrictions for apartments, particularly in suburban areas, will exacerbate the emerging undersupply of dwelling required by our growing population. This will create two tiers of units moving forward. Solidly built medium density apartments and townhouses developed by reputable builders and many of the towers that dot our big cities that could well become the slums of the future. Research statistics for property investors People often ask us, “what research do undertake at Metropole?” What do your research team and your buyers agents do to understand what’s happening in the local market?  There’s lots of information you can get on the internet, lots of reports that come out, but I believe that when you have an on-the-ground team that has been purchasing properties and buying and selling on the ground, you can learn from their perspective, and that’s what I’m going to talk to Brett Warren about. The common things that most investors and homebuyers look for: Median house prices Auction clearance rates These are lagging indicators Metropole property experts drill down a little deeper and look for more immediate indicators What Brett Warren’s team looks for: Asking prices Stock on market Time on market - If time on market shortens significantly, it means the market is heating up Discounting Demographics of the market Brett’s team doesn’t just look once, they look and analyze information each day.  They also examine the difference between this time in the market and what the market was doing this time in previous years. Links and Resources: Michael Yardney Metropole Property Strategists Metropole’s Strategic Property Plan – to help both beginning and experienced investors Brett Warren – Metropole Properties Brisbane Organise a time to speak with Brett by clicking here  Read the show notes plus more at the show web page A ticking time bomb for high rise apartment owners | Research statistics all property investors must understand Some of our favourite quotes from the show: “Which wolf is going to win your battle? Let me answer that right now: the one that you feed.” – Michael Yardney “Median prices are very much a lagging indicator because what’s reported is often what’s been sold 30, 60, sometimes 90 days earlier.” – Michael Yardney “At the end of the day, the property statistics can help you get a better understanding of the property markets, and the statistics we’re currently examining are suggesting that it’s a great time to get into the market.” – 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

Should you worry about the upcoming recession? If you believe the media, then, of course, you should.  But it’s important to get both sides of the story.  Today, in my discussion with Pete Wargent, you’ll hear about some of the negatives affecting our economy as well as the many positives that the media tends to forget.  We’ll give you a balanced assessment of what’s likely to be ahead.  This show is going to be valuable for property investors, future homeowners, and businesspeople as well.  Then, in my mindset moment, I’ll explain to you that you’ve won the lottery. Listen in to find out what I mean.  Some of the topics I discuss with Pete Wargent: Reported GDP is really historical information – it tells us what’s gone on before Credit is the lifeblood of the economy, so if you limit people’s ability to borrow, you slow the economy, as happened in the recent credit squeeze Nobody knows for sure if we’ll get a recession, but if you look at the probabilities and what markets are saying, it’s pretty unlikely Australia’s currency and low debt tends to help rebalance the economy quickly Construction is a big hole in the economy that needs to be filled International uncertainties may constrain growth, but there are always uncertainties to consider Interest rates have been cut and tax rates have also been cut. So far these incentives have not had a big effect on the economy, but they may with time Population growth fuels new construction and adds to demand in the economy.  Immigration also helps as it slows the aging of the population and reduces the dependency ratio Business investment is improving Recession can often be a confidence issue, enhanced by scaremongering in the media Why not allow Metropole to help you secure your financial future – here’s 3 ways we can help Strategic property advice. - Allow us to build a Strategic Property Plan for you and your family.  Planning is bringing the future into the present so you can do something about it now! Click here to learn more Buyer's agency - We'll help you find your next home or an investment-grade property.  Click here to learn how we can help you. Wealth Advisory - We can provide you with strategic tailored financial planning and wealth advice. Click here to learn more about we can help you. Links and Resources: Michael Yardney Why not speak with the team at Metropole Property Strategists and get their independent property advice -click here Get more details about Michael Yardney’s Property Renovations and Development workshop Pete Wargent -  Next Level Wealth Read the full show notes plus more at this episodes page: Should you be worried about the upcoming recession? With Pete Wargent Some of our favourite quotes from the show: “Economists have actually got a pretty poor track record of predicting recessions” – Michael Yardney “Large parts of the retail sector are suffering from the trend of online purchasing and… the lack of consumer spending.” – Michael Yardney “I’ve read that the probability of even existing comes out to one in something followed by 2 million zeroes.” – 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

The content of today’s show has been designed by you, because we’re going to answer your finance questions.  Today’s conversation with Dan Gold will be helpful for both beginning and experienced property investors.  I’ve also thrown in my own question, and I think you’ll enjoy hearing the answer: - Is it really true that you can get a finance approval in as little as two days?  You’ll find out today. Some of the questions we discuss today: Will buying higher-yielding properties in regional Australia increase borrowing capacity? And will that allow the buyer to purchase more properties? In the current lending environment, high-yielding residential properties do not have a material impact on borrowing capacity. What factors are important to look at other than interest rates when looking for a loan for an investment property? Focus on finding a lender that can actually meet your requirements and objectives and be selective with the person or bank that’s going to be taking you through the process. Are interest-only loans back? For the right borrower, interest-only loans never really went away.  How do you release the equity from your property portfolio? Do a review of your property portfolio to get a sense of how much equity you have. The banks will allow you to borrow up to 80% against any one asset, so if you’re only leveraged up to 50%, you may be able to release that remaining 30% to fund deposit and purchase costs on your next property.  Can you get a loan approved in a couple of days? There are lenders in the current marketplace that can turn loan applications around quickly. To get a loan approved quickly, you need to: Deal with a bank that’s capable of doing fast loans Make sure that you have 100% of your required documentation upfront Discuss any areas of complexity up front before starting your application Links and Resources: Michael Yardney Why not speak with the team at Metropole Property Strategists and get their independent property advice -click here Get more details about Michael Yardney’s Property Renovations and Development workshop Dan Gold – Long Property Read the full show notes at our web page: All your finance questions answered Podcast Some of our favourite quotes from the show: “In my mind, residential real estate’s a high growth, relatively lower-yield investment.” – Michael Yardney “While interest rates are interesting, they’re probably not the most important factor at all.” – Michael Yardney “People sort of forget that that’s their asset that they can borrow against, so yes, see what your loan-to-value ratios are, also see are your current loans appropriate for today’s marketplace and can you maybe save a little bit in interest by just asking.”— 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

Australia's housing markets have clearly turned the corner.  The housing market recovery in our two biggest cities, Melbourne and Sydney, gained pace with property prices increasing over the last month. Buyers are back making plans, looking at properties and approaching their lenders for finance. They are buoyed by falling interest rates and the prospect of another rate cut early next year and a generally positive media. Sellers are slowly returning to the market encouraged by rising prices. This now marks the fourth consecutive month of price gains in Melbourne and Sydney, which was where the downturn hit the hardest over the last couple of years. As a result, auction clearance rates are up, asking prices are up, property values are increasing and some property commentators are even forecasting double digit capital growth next year. We called the market bottom a few months ago in our regular Property lnsiders video chats, so today we discuss what’s going on in the world of property at the moment Another interesting month overseas There is continued uncertainty regarding the global economic outlook. US Trade Wars – these are continuing, however with the next round of Presidential elections in 2020, Trump is going to want to go into that campaign with strong jobs growth and the US economy in good shape. So it’s likely Trump is going to look for a resolution to this issue sooner rather than later. The Brexit saga: the uncertainty about this continues. Interest rates around the world are easing to try and stimulate economic growth. This was by the Federal Reserve in the USA reducing interest rates.  Australia’s Economic Data  Australia’s GDP growth for the June quarter was reported as only 0.5%, bringing the annual rate of growth down to 1.4% from 1.7% in the March quarter - the slowest growth rate that we’ve seen in the economy for nearly 10 years. But remember this is a lagging indicator and really reflects what happened before and around the time of the Federal election and clearly things have changed considerably since then. In a well publicised speech RBA Governor Lowe explained he was looking for further progress towards full employment and to achieve the inflation target over time and explained our economy is gently turning around. We’re still creating plenty of jobs.  34,700 new jobs created for August. And we have been creating around 26,400 jobs every month since the start of this year. However, we’re seeing a record high level participation rate of 66.2% causing our unemployment rate to lift from 5.2% to 5.3% percent. Dwelling approvals have fallen for 21 months in a row with the latest figures (being for August) showing approvals are now at their lowest level since January 2013, being down 29% year-on-year and are below the estimated level of underlying requirements.  This is particularly evident in the high rise segment of the market as both developers and investors pull-back from the market.  Interest rates fell to historic lows. The recent evidence of a strong rebound in Sydney and Melbourne property values wasn’t enough to stave off a rate cut. In what was a well telegraphed move, the RBA cut the official interest rate to 0.75% on October 1st citing weaker than expected growth in the domestic economy and global uncertainty. The RBA made the following pertinent comments in their statement announcing the rate cuts:  “The Board will continue to ease monetary policy further if needed to support sustainable growth in the economy, full employment and the achievement of the inflation target over time.” The Governor’s Statement certainly opens the door to even lower rates although a follow up move in November seems unlikely. Even though some lenders have already starting lowering their variable rates, it's going to take more than a rate cut or two to restimulate our economy. In my mind the government now needs to implement fiscal reforms to drive long-run growth because it’s likely these rate cuts will have a smaller impact than in the past. Interest rates are already at historically low levels and banks are clearly not passing on the full rate cut. At the same time many Australians are stashing their cash and paying down debt rather than spending while businesses seem hesitant to invest due to the uncertain global economic outlook. Auction clearance rates point to higher prices ahead. Auction clearance rates in both Melbourne and Sydney kept rising over the last month continuing the post-election bounce in confidence in our property markets. The prospect of easier access to finance, falling interest rates and a tax cut has boosted confidence, driving strong auction results across Australia. It is unlikely that clearance rates will rise any further now especially as more stock comes onto the market for sale in the next few months. The rental markets Our rental markets are still relatively flat, and vacancy rates have crept up a little over the last month in Sydney and Melbourne. What’s ahead for property prices? The rebound in housing conditions should help to support an improvement in economic conditions as higher housing prices translate to a wealthier and more confident household sector that will inclined to spend more.   Stronger housing conditions should also support the residential construction sector where approvals dropped through the housing downturn. Overall property values are likely to rise modestly to the end of 2019 before growing about 3-5 percent in 2020. It’s a great time to buy countercyclically in Sydney and Melbourne and ride the property next wave of the property cycle in Brisbane.  Links and Resources: Michael Yardney Metropole Property Strategists Metropole’s Strategic Property Plan – to help both beginning and experienced investors Dr. Andrew Wilson, chief economist of MyHousingMarket.com.au  Join us at our annual Property Renovations and Development Workshop in October – click here for more details For complete show notes and all the charts discussed in the podcast go to the episode webpage here: Australian Housing Market Update October 2019 | PROPERTY INSIDERS VIDEO Some of our favourite quotes from the show: “We still seem to be creating a lot of jobs – 34,700 jobs were created in August. We’ve been creating about 26,500 jobs every month since the start of the year.” – Michael Yardney “The government now needs to implement some reforms to drive long-term growth.” – Michael Yardney “Higher house prices tend to translate into people feeling better, feeling wealthier, feeling more confident, spending a little bit more.” – 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

On any given day, if you ask someone if they are happy, their response will be dictated by their current state of happiness. If they are nearing, or in the midst of a happiness event, they will say they are happy. If they are recovering from, or in the midst of an unhappiness event, they will say they are unhappy. Happiness is event-driven The quantity of happiness events you have during your lifetime is the only true way to accurately measure your level of overall happiness with your life. Those who have experienced more happiness events during their life will view their life as happier overall. Those with less will view their life as less happy overall.  The key to overall happiness, therefore, is to accumulate happiness events. To understand the importance of happiness events we must first dissect what causes happiness: 50% of happiness is determined by your genes 40% of happiness is determined by your activities 10% of happiness is determined by your circumstances Genes play a major role in your level of happiness. Some people are simply hardwired genetically for happiness or unhappiness.   They have a happiness baseline that they were born with. But the good news is that irrespective of your genetic makeup, you can increase your level of happiness by engaging in certain activities that will make you happy and that will also change your circumstances in life. Happiness Activities That Improve Financial and Non-Financial Circumstances: Pursuing some long-term goal, big dream or major purpose in life Engaging in the daily habit of educational reading Practicing gratitude Practicing optimism Engaging in some creative pursuit like painting, writing, building, music, manufacturing, inventing, etc. Engaging in new activities Overcoming a fear Aerobic exercise Mentoring others Helping others  Doing work that you love in which you can make money Solving problems Overcoming obstacles that interfere with achieving some goal or realizing some dream Living in the present – enjoying happiness events without thinking about anything else Receiving awards for something you’ve done Losing weight Saving money Being productive at work Building relationships with other successful people Vacation homes – 52% of the wealthy own vacation homes.This allows them to engage in more frequent weekend retreats with business associates, customers, clients, etc. Country Clubs and Golf Clubs – Many of the wealthy are members of country clubs or golf clubs.They engage in activities at these clubs with business associates, customers, clients, etc. Happiness Activities That Have No Effect on Financial Circumstances: Vacation homes – This allows them to engage in more frequent weekend retreats with family and friends Country Clubs and Golf clubs – They engage in activities at these clubs with their family and friends More unique social gatherings – Because the wealthy surround themselves with other successful people they are able to participate in more unique social gatherings More unique vacations – The wealthy are able to go on more unique vacations with family and friends More parties – Because the wealthy have more money they can have college graduation parties for their children, they can also afford to pay for weddings for their children and they can afford more parties for family and friends Happiness is activity-driven. It is not a destination. It is the culmination of frequent happiness events. The wealthy are able to engage in more happiness activities because of the wealth they accumulate in life.  Links and Resources:  Michael Yardney Tom Corley Metropole Get your own copy of our international best-selling book: Rich Habits Poor Habits  See the full show notes at the show website: Why Wealthy People are Happier People|RICH HABITS, POOR HABITS Podcast Some of our favourite quotes from the show:  “Any problem that money can solve isn’t a problem.” – Michael Yardney “There does seem to be something inbuilt in certain people, that they just can’t see the good in things.” – Michael Yardney “A lot of the poor people are going to be jealous of the rich people and not recognize that part of what they do with their money is also help other people up.” – Michael Yardney  PLEASE LEAVE US A REVIEW  Reviews are hugely important to me because they help new people discover this podcast. If you enjoyed listening to this episode, please leave a review on iTunes - it's your way of passing the message forward to others and saying thank you to me. Here's how.

Are you enjoying the low-interest rates at the moment?  They’re likely to get lower over the next year or so, and remain lower for a decade or longer. But what does this mean for property investors?  What are the implications for property and other asset classes? What does it mean for your returns?  How should you invest differently over the coming years?  These are all important questions for people who want to become successful property investors. I’ll be discussing these questions with Pete Wargent in this episode.  I’ll also share a mindset moment about where you’re going to be in ten year’s time.  I learned this lesson from one of my mentors, and I hope it helps you in the process of planning your future and getting the most out of your life.  How does a low-interest-rate environment affect your investment strategy? The Reserve Bank has cut interest rates in 2 consecutive months – June and July to historic low rates and the money markets are factoring in two more interest rate cuts one later this year and another in the first half of 2020.  And it’s likely we’re in for a long period of low-interest rates moving forward.  So, what does this mean for property investors?   It’s not just Australia that has low-interest rates – why is this happening? In fact, we’re catching up to the rest of the world – wherein general rates have been low since the GFC Long term fixed mortgage rates in the United States are less than 3% p.a. In the UK, rates are under 2% and even lower in Europe (circa 0.50% p.a. in France for example).  In Australian this week, a 5-year fixed home loan rate fell below 3% p.a.  And in Denmark the other week, one announced it would pay borrowers 0.50% p.a. to take out a mortgage!  What’s going to happen to interest rates? The market is predicting that the RBA will cut rates by 0.50% by mid-2020. If this turns out to be correct, Australian mortgage rates could fall even further. Many commentators have suggested that interest rates may not increase materially for a decade or longer. Will low interest rates have the desired effect? Eventually, yes. The Reserve Bank has more tools they can use such as QE, or the government can spend more money.  Interest rates may need to fall pretty close to zero before inflation returns to that target 2%-3% rate.  Now we’re talking about the official cash rate - - home mortgage interest rates are higher – what will happen to those?  The banks need to charge a margin to cover their overheads and deliver a profit to their shareholders – this margin needs to be at least 2%  What does this mean for investors, especially those that borrow to invest in property? Lower holding costs for property investors – for many this will make property more affordable The negative cash flow – drain on your personal finances will be considerably lower.  Less negative gearing - ow interest rates significantly reduce the negative gearing tax benefits for property investors – but negative gearing was never really a reason to invest However, some investors were investing in property with the hope of it reducing their tax liabilities. A low interest rate environment makes borrowing/leverage a sensible investment strategy Don’t use your own money if you can achieve a better investment return greater than the mortgage rate Well located capital cities properties have grown on average by 7% per annum over the last 40 years – then add the rental returns and you easily get 10% total return on your property – it makes sense to borrow at these low rates to get those sort of returns, which you can improve through correct asset selection. It also makes sense to borrow to leverage into a dividend producing share portfolio - the dividends should well cover the interest cost and give you positive cash flow What will low interest costs do for property values and for rentals? Theoretically, low interest rates should push up property values. The problem will be obtaining finance  In the past, cheap money has led to more speculation and asset bubbles – property and shares If interest rates are low and more people can afford properties and it becomes cheaper to own than rent, this may lead to a smaller pool of tenants and lower rents. The bottom line Correct asset selection will be critical – only own “investment grade” properties that will remain in continual strong demand by a wide range of owner-occupiers  Links and Resources: Michael Yardney Metropole Property Strategists Metropole’s Strategic Property Plan – to help both beginning and experienced investors Pete Wargent -  Next Level Wealth If you’re interested in taking your property investing to the next level, join us at my annual Property Renovations and Development workshop in October. view the full show notes at the episode webpage: Investing differently in a low interest rate environment Some of our favourite quotes from the show: “The key is to look and say where am I? What could I do to make the changes to ensure that I could take more certain daily steps towards the treasure that I want?” – Michael Yardney “It doesn’t make sense to use your own money, not to borrow, if you can achieve a better investment return with a mortgage.” – Michael Yardney “The rich don’t like to commute.” –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

Over the years, I’ve worked with thousands of investors and I’ve found that most fall into one of three categories.  I’m going to explain what those categories are and let you work out which one you fall into. I’ll also explain why one of those categories tends to be more successful than the other two. I’m also going to have a chat with Leanne Jopson, the national director of Metropole Property Management, about what you can do when a tenant doesn’t pay rent. Then, in my mindset moment, I’m going to share an uncomfortable truth. What type of investor are you?  There are three main types of property investor. Which category do you fall into? Passive Investor:   Tend to spend little time looking for a property.  Not really interested in understanding all of the ins and outs that go along with creating a property portfolio such as finance, tax laws, compounding and so forth. Rather than conducting any due diligence or consulting industry professionals for advice, they’re more likely to buy one of the first properties they come across  Active Investor: Puts in some degree of work in order to find a good investment prospect. Gains a basic understanding of the principles involved in property, finance, and taxation. Tend to seek professional advice with regards to the structuring of their portfolio and conduct some due diligence in the hope that they can increase the likelihood of making a viable investment purchase. Analytical Investor:  Tends to run around for months, sometimes even years, examining every nook and cranny of our property markets, endlessly comparing values and sales, reading reams of material regarding real estate do’s and don’ts and seeking advice from as many experts as possible before committing to anything. They like to conduct as much due diligence as possible and look for the ‘ultimate’ investment property. So which is better? If property investment was like many other things in life, then the more effort and energy you sink into property investing, the greater your rewards are likely to be. In other words, the passive investor would enjoy smaller gains than the active investor, while the analytical investor would come out on top as they were willing to do the hard yards. Yet, in relation to property investing this is only partially true!  Many passive investors purchase their investment properties the way they would buy their home – emotionally. They tend to buy their investments near where they live, or near to where they work or close to where they want to retire or holiday – all emotional reasons. Some live to regret their investment decisions and have difficulty holding on to their investments. The active investor usually does well if he seeks advice from a team of consultants. What about the analytical investor? Let me share a story with you… I remember years ago when I was still presenting at Property Expos (they seem to be a thing of the past now) and I ran into Leonard – a successful IT Engineer. He has subscribed to my newsletter for over 5 years and when I first met him about 3 years earlier he said he was going to invest in property. When I asked him how his investments were going, he explained that he had still not made a move. Instead, he continued to research the market. Leonard was very intelligent and has a tendency to over-analyze things, hence he is still waiting for the perfect property, the perfect time or the perfect set of circumstances in which to buy. What he doesn’t realize is that this will never happen. On the other hand, let’s look at an example of a passive investor… Let’s call him Mark – who was so naïve that he bought the first property that he could get his hands on twenty years ago for $200,000. At the time, his friends and family told Mark he was “crazy.” He paid way too much for the house, it was a bad time to buy and it was a foolish thing to do. Although he may not have done all of his homework, Mark still bought in a popular inner Melbourne suburb and guess what? The value of that home is now in the order of $800,000, and if he was half as smart, Mark would have borrowed against its increasing equity to allow him to buy more properties. The lesson from all this is...It really doesn’t matter too much if you’re a passive, active or analytical investor. As long as you are taking action and are in the market. It doesn’t really matter if you’re not into running around examining every aspect of the property market. Or maybe you are and that’s not such a bad thing – as long as you don’t get so absorbed by the process of learning about property that you forget to actually use that knowledge and buy something! In other words, if you have been thinking about investing in property, now may be the right time for you to act! It’s the best counter-cyclical opportunity in a decade. You may not have another opportunity like this for another decade or two. But you can’t just buy any property as Mark did. To ensure I buy a property that will outperform the market averages I use a 6 Stranded Strategic Approach.   I would buy a property that would appeal to owner-occupiers. Not that I plan to sell my property, but because owner-occupiers will buy similar properties pushing up local real estate values. This will be particularly important in the years ahead when the percentage of investors in the market is likely to diminish I would buy a property below its intrinsic value – that’s why I avoid new and off the plan properties which come at a premium price. In an area that has a long history of strong capital growth and that will continue to outperform the averages because of the demographics in the area. This will be an area where more owner-occupiers will want to live because of lifestyle choices and one where the locals will be prepared to, and can afford to, pay a premium price to live because they have higher disposable incomes. In general, these are the more affluent inner and middle-ring suburbs of our big capital cities I buy properties with a high Land to Asset ratio – this doesn’t necessarily mean a lot of land – just that the land is valuable I would look for a property with a twist  – something unique, or special, different or scarce about the property, and finally I would buy a property where I can manufacture capital growth through refurbishment, renovations or redevelopment rather than waiting for the market to deliver me capital growth.  By following my 6 Stranded Strategic Approach, I minimise my risks and maximise my upside. Each strand represents a way of making money from property and combining all four is a powerful way of putting the odds in my favour. If one strand lets me down, I have two or three others supporting my property’s performance. And I definitely do not look for the next speculative “hot spot” – I’m an investor not a speculator. But I do look for suburbs going through gentrification (improving in value as young people and developers move in and replace the old houses with refurbished homes or new developments.) So…what type of investor are you? What if my tenant doesn’t pay their rent?  When a tenant doesn’t pay their rent on time, having a management process in place that starts before you reach the point of evicting them for not paying rent is very important. Within 3 days of late missed rent payment, a property manager should be following up. Within 5 days, it’s important to be on the phone advising your landlords. 10 days past the due date is indicative of a serious problem, but you still can’t take formal action yet. You can’t file a notice giving the tenant 14 days to pay or leave until they are 14 days behind in the rent. However, staying on top of the dates and filing the appropriate paperwork on time is important, because your landlord’s insurance may not pay for losses for days when you could have filed but didn’t. If a good tenant is experiencing an unusual or one-time dilemma, you may be able to work with them to get the problem resolved without going to eviction. But it’s still key to find out what’s going on early and have a process in place for communicating with that tenant. Having a property manager who has a relationship with the tenants can help. Links and Resources: Michael Yardney Why not speak with the team at Metropole Property Strategists and get their independent property advice -click here Get more details about Michael Yardney’s Property Renovations and Development workshop Our Guest : Leanne Jopson – national director Metropole Property Management  Read the shownotes at the episode website: What type of Property Investor are you? Some of our favourite quotes from the show: “In my mind, it’s the best countercyclical opportunity in at least a decade.” – Michael Yardney “You can either buy right, or you can buy well.” – Michael Yardney “I never buy new, I wouldn’t buy off-the-plan because they come at a premium price.” – 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