Sydney property market<\/a> could be slowing just a little bit, but record high auction clearance rates and the question on a lot of investors\u2019 lips is \u201cWhere is the next Sydney?\u201d<\/p>\nOne of Australia\u2019s prominent property experts, Margaret Lomas from Destiny Financial Solutions, is going to be answering that and a number of other questions at the 2015 Property Buyer Expo. It\u2019s on at the end of this month, the end of October.<\/p>\n
Margaret joins us. Hi, Margaret. Nice to be talking to you again.<\/p>\n
Margaret:<\/b>\u00a0 Thank you.<\/p>\n
Kevin:<\/b>\u00a0 I\u2019m looking forward to seeing you at the Expo, as well. It\u2019s on in Sydney, isn\u2019t it? Sydney Showgrounds.<\/p>\n
Margaret:<\/b>\u00a0 Absolutely, and it\u2019s going to be in October. Hopefully, everybody in Sydney is going to be able to get themselves along there and have a little look.<\/p>\n
Kevin:<\/b>\u00a0 October 30 to November 1, so make sure.<\/p>\n
Margaret, that\u2019s the question. Where is the next Sydney?<\/p>\n
Margaret:<\/b>\u00a0 Look, that\u2019s always a good question on everybody\u2019s lips. But before we talk about where to go to next, let\u2019s have a look at what\u2019s actually been happening in Sydney. Keeping in mind that between 2003 and 2010, when every other capital city doubled in value, Sydney only went up by 17%. In some respects, the recent boom has been a little bit of a catch up, first of all, and then it overshot the mark.<\/p>\n
If you look back over in history, it\u2019s not unusual for this to happen to big centers like Sydney, and what will happen now is that there will be a decided flattening. It\u2019s just gotten too overheated. It\u2019s gotten out of the range of most people or the average homebuyer, and so we have no other way to go than flat from here.<\/p>\n
I don\u2019t believe we\u2019ll necessarily lose value, although having said that, I think people who came in in the last closing part of that window because of the frenzied may have paid too much for their property and they think they\u2019ve lost a little bit, but the market in general will probably just plateau.<\/p>\n
Then when we take a slice at history, a ten-year reading, we\u2019ll see that this massive boom hasn\u2019t really done much more than what most capital cities do in any 10- or 15-year period.<\/p>\n
Kevin:<\/b>\u00a0 I think it\u2019s important, too, isn\u2019t it, to learn about buying well on a consistent basis as opposed to chasing the crowds, Margaret?<\/p>\n
Margaret:<\/b>\u00a0 Exactly. The thing about it is that most property investors are in it for the long term. If you\u2019re buying and selling to get those gains, you\u2019re not only paying capital gains tax every time you sell and losing a fair amount of money in that, but the tax office may eventually consider you a property trader, and then they\u2019ll treat you differently. They\u2019ll treat you as if you\u2019re in the business of buying and selling property, and then your capital gains discounts go out the window, you pay tax on a quarterly basis, and a whole pile of other things, as well.<\/p>\n
We have to remember that most property investors do keep their property for probably 10 to 15 years, and most property investors are doing this to be able to create a retirement income for themselves. What they\u2019re really after is consistent growth year in, year out that they can then leverage against to buy more property. The way you get that is to understand what drives growth and to not chase the big booms, but to just chase that consistent growth.<\/p>\n
Kevin:<\/b>\u00a0 Yes, and of course, there\u2019s an excellent series that I recorded with Margaret some time ago about those growth drivers. They\u2019re still as reliable as ever, Margaret?<\/p>\n
Margaret:<\/b>\u00a0 Look, let\u2019s look at them again. What we\u2019re mainly after is an area that looks like it\u2019s going to have pressure sustainably for a period of time. To get that kind of pressure, we need a couple of things to be happening, but we need all of them to be happening at the same time.<\/p>\n
I don\u2019t like it when people run out and buy in an area because they think there\u2019s a new hospital and they see that as infrastructure, or they think there\u2019s a new road and they see that as transport upgrades.<\/p>\n
There are a lot of things that have to be happening \u2013 starting, of course, with population growth. But it\u2019s important to understand that the population has to be growing within the right demographic. If the population is growing because everybody is retiring there, that isn\u2019t a demographic that traditionally drives sustainable growth; an aging population usually has the reverse effect.<\/p>\n
We need that population to be growing within that family demographic, and when we have families coming into an area, what we also see happening is normally they don\u2019t move too much. They move to an area, pop their kinds into the local schools, and from there, they like to stay in that one area so that they\u2019re not disrupting the kids throughout their schooling life.<\/p>\n
Families become important. On top of that, we then need no new land in the area. If we have all of these families coming in but all they can do is buy the established housing, obviously, we\u2019re going to get a pressure in that housing. When they upgrade, they upgrade within that area to another home, but we still see pressure on existing houses.<\/p>\n
In order to keep the families in the area for a long period of time, we have to have the right kinds of services and infrastructure. We need good schools, we need hospitals and health precincts, we also need sporting facilities because these days parents are always putting their kids into all kinds of sports, and we also need plenty of family and community services available.<\/p>\n
The last little piece of the puzzle is that rising median household income. When the median household income is increasing faster than inflation, then we also have an area that\u2019s becoming more affluent, so they can afford to keep upgrading, they can afford to keep putting pressure on prices, so we see those properties grow.<\/p>\n
Kevin:<\/b>\u00a0 If you go to the website, RealEstateTalk.com.au, in the search box, just put in Margaret Lomas. A more extended version of an explanation by Margaret of all of those growth drivers will be there for you, as well.<\/p>\n
Margaret, just before you go, we look forward to seeing you at the Property Buyers Expo, as well.<\/p>\n
Margaret:<\/b>\u00a0 Your listeners can get some free tickets to that. All they have to do is to go to the ticket page of the Property Buyer show and type in the code \u201cdestiny,\u201d and they\u2019ll get some free tickets.<\/p>\n
Kevin:<\/b>\u00a0 There you go. Well done. That\u2019s a gift from Margaret, so thank you, Margaret.<\/p>\n
Margaret:<\/b>\u00a0 You\u2019re welcome.<\/p>\n
Kevin:<\/b>\u00a0 That\u2019s very nice. Just go to the Property Buyer Expo website \u2013PropertyBuyerexpo.com.au \u2013 and make sure in the coupon box there you put in the word \u201cdestiny,\u201d and those tickets will be available for you. Thank you, Margaret.<\/p>\n
Margaret:<\/b>\u00a0 You\u2019re welcome. Thanks for having me today.<\/p>\n
<\/p>\n
Nhan Nguyen<\/h3>\n
Kevin<\/b>:\u00a0 A great topic I\u2019m going to talk to Nhan Nguyen about now. Nhan, of course, is from Advanced Property Strategies, and he\u2019s no stranger to any of us.<\/p>\n
Good morning, Nhan, and thank you for your time.<\/p>\n
Nhan<\/b>:\u00a0 Excellent, Kevin. Thanks for having me, mate.<\/p>\n
Kevin<\/b>:\u00a0 I want to talk to you about picking your property team. We quite often talk about this, Nhan. Sometimes when people get into property, they tend to think they can do it all on their own or they don\u2019t develop a team around them. Tell me who you would suggest we should develop into our team.<\/p>\n
Nhan<\/b>:\u00a0 That\u2019s a really good point that most people do it by themselves. They haven\u2019t really been trained to work in a team. The first couple of people you need are definitely a solicitor and an accountant. Those people are important to know because you might have to structure it in a company and\/or a trust or in your personal name and put certain clauses in contracts. So definitely start with them.<\/p>\n
Kevin<\/b>:\u00a0 As you\u2019re talking about that, too, I can hear people saying, \u201cYes, well, I\u2019ve got an accountant and I\u2019ve got a solicitor.\u201d But my question would be are they on your team? In other words, tell me how you involve these people in a team atmosphere.<\/p>\n
Nhan<\/b>:\u00a0 Look. The thing about accountants is there\u2019s accountants and there\u2019s accountants. There\u2019s a person down at the shopping center doing your tax returns or the person who\u2019s going to help you grow and put the right structures in place for your family and distributions down the track and potential tax problems. With your solicitor, they\u2019re going to be talking about how to structure yourself with asset protection and minimizing your tax together with the accountant.<\/p>\n
With property, if you\u2019re going to do development, if you\u2019re going to subdivide, if you\u2019re going to strata title, there\u2019s a handful of things \u2013 like whether it\u2019s GST, margin scheme, which I\u2019m not going to cover \u2013 there are problems that you\u2019re going to have to encounter and extra expenses \u2013 like land tax \u2013 that you need to really discuss with them. Tell them what you\u2019re doing. Tell them that you\u2019re about to expand and do property deals, so that they know to allow for that.<\/p>\n
Kevin<\/b>:\u00a0 By bringing them onto your team, too, you\u2019re actually bringing someone else in who can be your ears and eyes on the ground and be listening out for things that you might be interested in. It\u2019s just having more people on the ground.<\/p>\n
Nhan<\/b>:\u00a0 Absolutely, and it may come to you having to sack your accountant and\/or your solicitor. I know I\u2019ve gone through a lot of accountants and solicitors over the years because I\u2019ve grown, my opinions have changed, and I\u2019ve been a bit more aggressive in my property activities.<\/p>\n
If they\u2019re going to be talking about certain things like negative gearing or buying in your personal name all the time because they don\u2019t want to spend money on companies and trust, you really need to challenge those beliefs.<\/p>\n
Kevin<\/b>:\u00a0 Yes. There are a couple of other obvious ones to have on your team, too \u2013 your real estate agent and a finance broker. They\u2019re pretty well no-brainers, but particularly, a real estate agent is someone who can keep you in touch with those early deals or even help you sell one if you need to turn it over, Nhan?<\/p>\n
Nhan<\/b>:\u00a0 Absolutely. There are different types of real estate agents. There are some agents who are just happy to sell property at any price. Sometimes you can find those by talking to them and putting in low offers. At other times, there are other agents who you don\u2019t want to buy through them; you just want to sell through them because they\u2019re there to get top dollar all the time. You need to find out which agent is actually working for you as the buyer or the seller, whichever instance that you\u2019re in.<\/p>\n
Kevin<\/b>:\u00a0 Yes. We\u2019ve mentioned some pretty obvious ones there \u2013 solicitor, accountant, real estate agent, and finance broker \u2013 but there is one big one that I want to talk to you about and how you use them, and that is a town planner.<\/p>\n
Nhan<\/b>:\u00a0 Yes. A town planner is very important, especially if you\u2019re looking at doing more than one dwelling. What I mean by that is if you\u2019re just going to do a buy-and-hold, that\u2019s fine, but if you\u2019re going to do townhouses, if you\u2019re going to do units, developments, or land subdivision, then you need to talk to someone who knows the rules, because once you add additional dwellings, there\u2019s lots of approvals, there are surveys that need to be done, there are engineering plans, and you can\u2019t just do whatever you want to do. You need someone who knows the process and how to get the approvals for you.<\/p>\n
Kevin<\/b>:\u00a0 Nhan, speaking about town planners, are there different types of town planners \u2013 small development, medium development, large development?<\/p>\n
Nhan<\/b>:\u00a0 Absolutely. I find that they fall into a couple of arenas. Firstly, there\u2019s a handful of town planners just focused on one council, whichever council they\u2019re in. Whether it\u2019s Brisbane, Ipswich, Logan, or Moreton Shire, they have specialties, and they know the people in council. They know what they like. They know what they don\u2019t like. So the first thing you want to look at is find a town planner who specializes in your particular council.<\/p>\n
The second thing is there are town planners who are really good at what we call cookie-cutter approvals, which are risk-smart. For example, it means that it ticks all the boxes. It can go through quickly. There are some town planners that are really good at that, and anything that\u2019s outside of that, they don\u2019t really like or they take a long time to process. Those are the more difficult projects, and you will need a different town planner for that.<\/p>\n
Kevin<\/b>:\u00a0 It\u2019s always good talking to you, my friend. Nhan Nguyen from AdvancedPropertyStrategies.com.<\/p>\n
Nhan, thank you so much for your time.<\/p>\n
Nhan<\/b>:\u00a0 Thanks, Kevin. Thanks for having me.<\/p>\n
<\/p>\n
Rob Balanda<\/h3>\n
Kevin<\/b>:\u00a0 You may or may not have heard of the term gazumping. Probably, you might have if you\u2019ve been in real estate or you\u2019ve been around real estate people. Let\u2019s find out what gazumping is because there may just be a way around this. While it doesn\u2019t apply in all states of Australia, it certainly does in the two major states of Victoria and New South Wales, which is where a lot of our listeners reside.<\/p>\n
Rob Balanda from MBA Lawyers joins me. Rob, firstly, let\u2019s get an explanation about what gazumping really is.<\/p>\n
Rob<\/b>:\u00a0 A seasoned investor in New South Wales would probably think that was a strange question to ask because they know only too well. They\u2019ll have probably been burned a number of times.<\/p>\n
It\u2019s Jewish. It\u2019s a Yiddish term. It means, essentially, to over-charge or to cheat. Basically, what it means is when you think you have secured a property by signing a sales note in Victoria or in New South Wales, you think that property is now under your control \u2013 it\u2019s off the market \u2013 but while your solicitor is negotiating with the seller\u2019s solicitors to do the little ceremony called exchange of contracts, which takes place in three or four weeks after you exchange sales notes, the seller is like the prettiest girl in the class at school \u2013 if I can put it this way, Kevin \u2013 and is negotiating with two, three, or more other people to sell the same property to.<\/p>\n
Kevin<\/b>:\u00a0 Which school did you go to?<\/p>\n
Rob<\/b>:\u00a0 It wasn\u2019t an all-boys one, mate.<\/p>\n
Kevin<\/b>:\u00a0 Obviously not.<\/p>\n
So that\u2019s gazumping. It\u2019s still fairly commonplace, isn\u2019t it?<\/p>\n
Rob<\/b>:\u00a0 I was talking to a chap at Byron last week. He was lamenting to me and complaining that he\u2019d just put in two offers and been gazumped on two of them that week. His question to me was, Kevin, \u201cHow can I avoid this happening to me a third time this week?\u201d<\/p>\n
Kevin<\/b>:\u00a0 I understand you do know that there is a way around this. What is it?<\/p>\n
Rob<\/b>:\u00a0 Yes. It\u2019s not rocket science. What you need to do is remember the process in the two big eastern seaboard states is you start with a sales note, then your solicitor does all the searches of the property, all the due diligence, and then three or four weeks later, they sign off on the terms of the contract with the other solicitor, and you have an exchange of contracts.<\/p>\n
In the big resource states, Western Australia and Queensland, that\u2019s the same position we\u2019re in when you make an offer. You make them in those two states via a live active contract, which once accepted, that is the same position you\u2019re in three or four weeks later in New South Wales when you actually exchange contracts.<\/p>\n
What you basically need to do is move to that Western Australian\/Queensland position as soon as you possibly can. Don\u2019t do all the searches and checks and due diligence before you exchange because in that three- or four-week period, that\u2019s when you can be gazumped. You can have the seller double dealing you, triple dealing you, even.<\/p>\n
\u201cHow do you protect yourself, then?\u201d is the question. You\u2019re going to instruct your solicitor to exchange contracts now. Don\u2019t do the searches. Do them as we do them in Queensland and Western Australia \u2013 after the event. You exchange contracts subject to a little clause, just subject to a due diligence. Then that way, your conveyance and solicitor can do the searches after you\u2019ve exchanged. That way, you\u2019ve taken the property off the market, and you cannot be gazumped.<\/p>\n
Kevin<\/b>:\u00a0 Rob, it only just occurred to me that this could be one of the reasons why auctions are much more popular in New South Wales and Victoria. If you buy a property at auction there, it is unconditional. You\u2019re not going through that sales note process.<\/p>\n
Rob<\/b>:\u00a0 Yes, and you can\u2019t be gazumped. You can\u2019t lose the property. You can\u2019t be Dutch auctioned either. Yes, I agree with you, Kevin.<\/p>\n
Kevin<\/b>:\u00a0 Because in Queensland, when you buy a property, as you indicated, and you sign a contract, once that contract is signed by both parties, it\u2019s a formed agreement. You can\u2019t be gazumped.<\/p>\n
Rob<\/b>:\u00a0 No. The only person who can pull out after you\u2019ve done that is you, the buyer. You control it.<\/p>\n
But you get push back, though. Even when I talk to solicitors in these other states, they push back and say, \u201cOh, no. You can\u2019t do that down here.\u201d Well, in fact, you can. There\u2019s no legal reason why you can\u2019t instruct your solicitor to exchange contracts now subject to a due diligence; it\u2019s just that they don\u2019t usually do it with residential purchases.<\/p>\n
Kevin<\/b>:\u00a0 Why is that?<\/p>\n
Rob<\/b>:\u00a0 That\u2019s because in between the sales note and the exchange of contract, they do all the searches. They apply for finance. They do the pest and building inspection. There\u2019s no need, usually, by the time you get to exchange of contract stage in those two states that have any subject-to clause, they\u2019ve all been satisfied. But there\u2019s no reason why you can\u2019t do it.<\/p>\n
In fact, in New South Wales, you quite often see commercial contracts that are a little more complicated. They, quite often, are subject to a number of due diligence requirements, subject to a DA, subject to a feasibility, subject to securing other partners to bring them into the deal, this sort of stuff. It\u2019s common enough with commercial and industrial sales in New South Wales. It\u2019s just a mindset.<\/p>\n
Kevin<\/b>:\u00a0 Yes. In New South Wales and Victoria, if you do what you\u2019re suggesting, which is put the due diligence clause in there and exchange the contracts, you\u2019re effectively forcing the solicitors to do the type of transactions that are done in Queensland, which are almost on-the-spot contracts.<\/p>\n
Rob<\/b>:\u00a0 Yes, and there\u2019s a couple of hundred years of history reasons for the resistance. You can see why they push back. They just don\u2019t feel comfortable. It\u2019s not the status quo.<\/p>\n
But as an investor, you have to stop yourself being gazumped. If this happens to you once and even twice, it will burn you. It will leave you with a nasty taste in the mouth. It will cost you that opportunity. You will have missed out on the property. It might have cost you a thousand or a couple of thousand in legal fees and due diligence inquiries and stuff \u2013 all just thrown away.<\/p>\n
The sales note to you as an investor doesn\u2019t give you even a fig leaf of security against the risk of being gazumped. You have to get to exchange of contracts as soon as you can. If you do that, subject to a due diligence, you protect yourself. It\u2019s just a matter of telling your conveyancer that\u2019s the terms of your offer.<\/p>\n
Kevin<\/b>:\u00a0 But, Rob, what if you get push back through the agent from the seller saying, \u201cWell, we don\u2019t want that period of uncertainty?\u201d<\/p>\n
Rob<\/b>:\u00a0 They\u2019re still in a lot better position than they would be, Kevin, if they waited, signed the sales note, and waited for you, the buyer, to do all your searches for the next three or four weeks, and then exchange. Something could come up in the searches. The buyer can come back in that three or four weeks before exchange and even attempt to rewrite the whole deal.<\/p>\n
I\u2019d be pointing out to the seller, if you sign up now, subject to a due diligence, at least we\u2019ve nailed the big ticket items \u2013 the price, the deposit, the settlement date. You\u2019re in a lot better position as a seller signing up subject to a due diligence, rather than waiting for another three or four weeks for the buyer to carry out their searches.<\/p>\n
Kevin<\/b>:\u00a0 I would take it that that due diligence clause is going to be somewhere inside that excellent book of yours, which is called \u201cClauses Made Simple.\u201d<\/p>\n
Rob<\/b>:\u00a0 Yes, Kevin. Thank you, and which you can acquire by going to my website, ClausesMadeSimple.com, and there are many more other helpful clauses.<\/p>\n
Kevin<\/b>:\u00a0 There are, indeed. I\u2019ve been talking to the author of that book, none other than the one and only Rob Balanda from MBA Lawyers.<\/p>\n
Rob, thanks for your time.<\/p>\n
Rob<\/b>:\u00a0 Thank you, Kevin.<\/p>\n
<\/p>\n
John Lindeman<\/h3>\n
Kevin<\/b>:\u00a0 As we continue to look at what\u2019s inside the November issue of Australian Property Investor<\/i> magazine, my next guest is John Lindeman.<\/p>\n
There are so many questions that need answering for you to find the best property to fit your investment portfolio. That places even more importance on planning and research before you buy. Property investing is a very complex matter and throws up difficult questions every step along the way.<\/p>\n
John Lindeman has answered many of those questions in the November issue of Australian Property Investor<\/i> magazine, and John joins us now. John is the Director of Property Power Partners.<\/p>\n
John, thanks for your time.<\/p>\n
John<\/b>:\u00a0 It\u2019s a pleasure, Kevin, and hello, everybody.<\/p>\n
Kevin<\/b>:\u00a0 John, I know that it\u2019s only one element of the research cycle that we should be doing, but probably it\u2019s one of the most requested, and that is how do I find the best growth areas?<\/p>\n
John<\/b>:\u00a0 That is indeed the most commonly asked question I have, as well. I\u2019ve studied the performance of the housing market and the major indicators and dynamics for about 15 years. What I discovered was that there are three key dynamics to the performance of the housing market. I call them the three Ps, which are people, purchasing power, and properties. If you can measure those accurately, then you can indeed work out what\u2019s going to happen.<\/p>\n
But just to explain what I mean by those three Ps: people is really just population growth and a movement of people from one suburb or city to another. The problem with that is that we only measure these every five years in the census. At other times, the quarterly stats produced by the ABS are really just estimates, and they don\u2019t do them at suburb level, so we really don\u2019t know where people are moving to and from.<\/p>\n
We\u2019re not a police state, we don\u2019t have ID cards, and we simply don\u2019t track these things. In any case, these people could be potential renters or owner-occupiers, so we don\u2019t really know. Even though we know changes in demand or if we could know that, we wouldn\u2019t know what they were going to do when they moved.<\/p>\n
The other one is purchasing power, which is then looking more at how many of these people do actually get financed to buy a property. You can get finance figures. They\u2019re updated every month, but they, again, don\u2019t go down to small areas.<\/p>\n
The problem there is that some people, like retirees, don\u2019t actually need finance. You have a huge number of people out there who are overseas investors who are borrowing money overseas, so they don\u2019t appear in our finance stats, either. There are huge hidden numbers of potential buyers out there, which we\u2019re not tracking.<\/p>\n
I then looked at the third one, which is properties, and I realized that, yes, we can measure the changes in supply and demand, and we can do that quite accurately with data that\u2019s available readily for all investors. It took me a number of years to work out exactly what the relationship of these were and how investors could use the information.<\/p>\n
Kevin<\/b>:\u00a0 Without oversimplifying something, how important is supply and demand to a growth area?<\/p>\n
John<\/b>:\u00a0 Well, it\u2019s important because, as I indicated, it\u2019s the only indicator that we can obtain fairly accurately and easily. The other ones, you can\u2019t really measure, but you can measure supply and demand. When I looked at the relationship of supply and demand, I found out that it was over 90% accurate in terms of working out where the prices were likely to be rising or falling in a particular suburb.<\/p>\n
Kevin<\/b>:\u00a0 So supply really is number of houses on the market and demand is number of sales?<\/p>\n
John<\/b>:\u00a0 In a nutshell, that\u2019s how it works. Yes. You\u2019ll be looking on a listing site such as Domain, and you might go in there and look in a suburb and see how many houses are currently for sale. That tells you the supply of houses in that area.<\/p>\n
Then you go to the Australian Property Investor<\/i> magazine. At the back, in the market watch section, look up the same suburb and look up the number of houses that have been sold in the last year. It\u2019s the first figure that appears after the suburbs, so it\u2019s very easy to find.<\/p>\n
Those two figures are all you really need, but the important thing is the relationship between them.<\/p>\n
Kevin<\/b>:\u00a0 I\u2019m fascinated by this topic because I think there are some interesting stats that come out of this. If you look at supply and demand and you look at the number of sales, you get a factor of turnover. Is there a tipping point there with turnover when we can actually see it move from a buyers\u2019 market to a sellers\u2019 market?<\/p>\n
John<\/b>:\u00a0 There is, and again, it took me quite a few years to work out what it was. But as with all these fundamental statistics, it\u2019s really quite simple once you know what it is. The relationship is when the number of houses currently for sale in a market is about the same as the number that was sold in the last year \u2013 that is, the number in the magazine \u2013 you have what I call a neutral market, and that means that prices aren\u2019t moving up or down. If the number of sales is higher, then it\u2019s a seller or a boom market, and if it\u2019s lower, it\u2019s a buyer or a stressed market. It was that easy.<\/p>\n
Kevin<\/b>:\u00a0 It is interesting. In other words, if no more houses came on the market in a particular suburb or area and there was enough there for sales for a year, that\u2019s about the tipping point. That\u2019s the balancing point. Has that changed much do you think, John?<\/p>\n
John<\/b>:\u00a0 It hasn\u2019t. That relationship has been studied by a number of academics around the world, and they\u2019ve looked at the American housing market and the British market. Other academics have studied the Australian market. All come to the same conclusion.<\/p>\n
The amazing thing is that, as I said, it\u2019s over 90% accurate in terms of forecasting the direction. To get the direction of change, what you need to do is to study the figures every month. It doesn\u2019t take you very long \u2013 a few minutes \u2013 and of course, you have the API<\/i> magazine, and you can look up the number of listings, so you can get these figures very easily, and they are a really excellent indicator of which way prices are likely to go.<\/p>\n
Kevin<\/b>:\u00a0 Yes, because if you go around Australia, there are some markets where there has been enough supply to last for two years, and that\u2019s a good indicator that there\u2019s a lot of downward pressure on prices.<\/p>\n
John<\/b>:\u00a0 That\u2019s right. You can very quickly do little tests. Look at places like Moranbah and compare the number of properties sold in the last year to the number that are for sale right now, and you\u2019ll find there\u2019s about five years\u2019 stock sitting there, so it\u2019s a stressed market.<\/p>\n
It\u2019s very accurate and easy to do this, and it warns you off markets. If you\u2019re not sure, if you have somebody saying, \u201cLook, these are selling faster than hotcakes; get in quick or you\u2019ll miss out,\u201d you do this little analysis, and you say, \u201cHang on. No, this is not right. There are way too many properties on the market, and the prices can\u2019t possibly be going up.\u201d<\/p>\n
Kevin<\/b>:\u00a0 Yes. Make sure you check out John\u2019s article. Your photo is up above it, I noticed there, too, John. That\u2019s in the November issue of Australian Property Investor<\/i> magazine.<\/p>\n
My guest has been John Lindeman, Director of Property Power Partners. The web address is UnderstandProperty.com.au.<\/p>\n
John, thanks for your time.<\/p>\n
John<\/b>:\u00a0 It\u2019s been a pleasure, Kevin. Thank you very much.<\/p>\n","protected":false},"excerpt":{"rendered":"
Ever thought of quitting your job and working on, or living off, your property full time? Is it even possible? Michael Yardney gives us a reality check. He says its possible but not easy and he explains why. With record high auction clearance rates…<\/p>\n","protected":false},"author":176692473,"featured_media":6033,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[24],"tags":[101],"class_list":["post-25249","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-shows","tag-podcast"],"yoast_head":"\n
Where is the next Sydney | Developing your team | How to avoid being gazumped | "The deal of a lifetime" Properties | Quit your job & work in property full time | Seller vs. Buyers Market - Realty Talk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Where is the next Sydney | Developing your team | How to avoid being gazumped | "The deal of a lifetime" Properties | Quit your job & work in property full time | Seller vs. Buyers Market - Realty Talk\" \/>\n<meta property=\"og:description\" content=\" Ever thought of quitting your job and working on, or living off, your property full time? Is it even possible? Michael Yardney gives us a reality check. He says its possible but not easy and he explains why. With record high auction clearance rates...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/\" \/>\n<meta property=\"og:site_name\" content=\"Realty Talk\" \/>\n<meta property=\"article:published_time\" content=\"2015-10-09T01:00:30+00:00\" \/>\n<meta name=\"author\" content=\"Kevin Turner\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Kevin Turner\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"37 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\\\/\"},\"author\":{\"name\":\"Kevin Turner\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#\\\/schema\\\/person\\\/ae5a3b5e891767bd82ad3a068c514329\"},\"headline\":\"Where is the next Sydney | Developing your team | How to avoid being gazumped | “The deal of a lifetime” Properties | Quit your job & work in property full time | Seller vs. Buyers Market\",\"datePublished\":\"2015-10-09T01:00:30+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\\\/\"},\"wordCount\":7466,\"commentCount\":0,\"image\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\\\/#primaryimage\"},\"thumbnailUrl\":\"\",\"keywords\":[\"podcast\"],\"articleSection\":[\"Shows\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\\\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\\\/\",\"url\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\\\/\",\"name\":\"Where is the next Sydney | Developing your team | How to avoid being gazumped | \\\"The deal of a lifetime\\\" Properties | Quit your job & work in property full time | Seller vs. Buyers Market - Realty Talk\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\\\/#primaryimage\"},\"thumbnailUrl\":\"\",\"datePublished\":\"2015-10-09T01:00:30+00:00\",\"author\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#\\\/schema\\\/person\\\/ae5a3b5e891767bd82ad3a068c514329\"},\"breadcrumb\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\\\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\\\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\\\/#primaryimage\",\"url\":\"\",\"contentUrl\":\"\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\\\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Where is the next Sydney | Developing your team | How to avoid being gazumped | “The deal of a lifetime” Properties | Quit your job & work in property full time | Seller vs. Buyers Market\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#website\",\"url\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/\",\"name\":\"Realty Talk\",\"description\":\"Your Trusted Voice For Property Investing. Anywhere, Anytime.\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#\\\/schema\\\/person\\\/ae5a3b5e891767bd82ad3a068c514329\",\"name\":\"Kevin Turner\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/d2d83fe833d0cb22c11728d9aa25f73b319e658b72509553eff8680404d8bfa7?s=96&d=mm&r=g\",\"url\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/d2d83fe833d0cb22c11728d9aa25f73b319e658b72509553eff8680404d8bfa7?s=96&d=mm&r=g\",\"contentUrl\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/d2d83fe833d0cb22c11728d9aa25f73b319e658b72509553eff8680404d8bfa7?s=96&d=mm&r=g\",\"caption\":\"Kevin Turner\"},\"url\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/author\\\/kevin-turner\\\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Where is the next Sydney | Developing your team | How to avoid being gazumped | \"The deal of a lifetime\" Properties | Quit your job & work in property full time | Seller vs. Buyers Market - Realty Talk","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/","og_locale":"en_US","og_type":"article","og_title":"Where is the next Sydney | Developing your team | How to avoid being gazumped | \"The deal of a lifetime\" Properties | Quit your job & work in property full time | Seller vs. Buyers Market - Realty Talk","og_description":" Ever thought of quitting your job and working on, or living off, your property full time? Is it even possible? Michael Yardney gives us a reality check. He says its possible but not easy and he explains why. With record high auction clearance rates...","og_url":"https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/","og_site_name":"Realty Talk","article_published_time":"2015-10-09T01:00:30+00:00","author":"Kevin Turner","twitter_card":"summary_large_image","twitter_misc":{"Written by":"Kevin Turner","Est. reading time":"37 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/#article","isPartOf":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/"},"author":{"name":"Kevin Turner","@id":"https:\/\/channels.realty.com.au\/realtytalk\/#\/schema\/person\/ae5a3b5e891767bd82ad3a068c514329"},"headline":"Where is the next Sydney | Developing your team | How to avoid being gazumped | “The deal of a lifetime” Properties | Quit your job & work in property full time | Seller vs. Buyers Market","datePublished":"2015-10-09T01:00:30+00:00","mainEntityOfPage":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/"},"wordCount":7466,"commentCount":0,"image":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/#primaryimage"},"thumbnailUrl":"","keywords":["podcast"],"articleSection":["Shows"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/#respond"]}]},{"@type":"WebPage","@id":"https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/","url":"https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/","name":"Where is the next Sydney | Developing your team | How to avoid being gazumped | \"The deal of a lifetime\" Properties | Quit your job & work in property full time | Seller vs. Buyers Market - Realty Talk","isPartOf":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/#website"},"primaryImageOfPage":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/#primaryimage"},"image":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/#primaryimage"},"thumbnailUrl":"","datePublished":"2015-10-09T01:00:30+00:00","author":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/#\/schema\/person\/ae5a3b5e891767bd82ad3a068c514329"},"breadcrumb":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/#primaryimage","url":"","contentUrl":""},{"@type":"BreadcrumbList","@id":"https:\/\/channels.realty.com.au\/realtytalk\/where-is-the-next-sydney-developing-your-team-how-to-avoid-being-gazumped-the-deal-of-a-lifetime-properties-quit-your-job-work-in-property-full-time-seller-vs-buyers-market-2\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/channels.realty.com.au\/realtytalk\/"},{"@type":"ListItem","position":2,"name":"Where is the next Sydney | Developing your team | How to avoid being gazumped | “The deal of a lifetime” Properties | Quit your job & work in property full time | Seller vs. Buyers Market"}]},{"@type":"WebSite","@id":"https:\/\/channels.realty.com.au\/realtytalk\/#website","url":"https:\/\/channels.realty.com.au\/realtytalk\/","name":"Realty Talk","description":"Your Trusted Voice For Property Investing. Anywhere, Anytime.","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/channels.realty.com.au\/realtytalk\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/channels.realty.com.au\/realtytalk\/#\/schema\/person\/ae5a3b5e891767bd82ad3a068c514329","name":"Kevin Turner","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/secure.gravatar.com\/avatar\/d2d83fe833d0cb22c11728d9aa25f73b319e658b72509553eff8680404d8bfa7?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/d2d83fe833d0cb22c11728d9aa25f73b319e658b72509553eff8680404d8bfa7?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/d2d83fe833d0cb22c11728d9aa25f73b319e658b72509553eff8680404d8bfa7?s=96&d=mm&r=g","caption":"Kevin Turner"},"url":"https:\/\/channels.realty.com.au\/realtytalk\/author\/kevin-turner\/"}]}},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/posts\/25249","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/users\/176692473"}],"replies":[{"embeddable":true,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/comments?post=25249"}],"version-history":[{"count":0,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/posts\/25249\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/media?parent=25249"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/categories?post=25249"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/tags?post=25249"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}