{"id":5677,"date":"2015-09-10T01:00:20","date_gmt":"2015-09-09T15:00:20","guid":{"rendered":"http:\/\/realestatetalk.com.au\/?p=5677"},"modified":"2015-09-10T01:00:20","modified_gmt":"2015-09-09T15:00:20","slug":"property-portfolio","status":"publish","type":"post","link":"https:\/\/channels.realty.com.au\/realtytalk\/property-portfolio\/","title":{"rendered":"Property Portfolio – Margaret Lomas"},"content":{"rendered":"

 
\nIn today’s show we talk with Margaret Lomas<\/strong><\/a>,\u00a0\u00a0from\u00a0\u2018Your Money Your Call\u2019<\/i>\u00a0and Destiny Financial Solutions, about her portfolio.
\n <\/p>\n

Transcript:<\/h4>\n

Kevin:\u00a0\u00a0<\/b>Earlier in the show, I was talking to Margaret Lomas in answer to Matt\u2019s question. We continue that conversation with Margaret now as we talk to her about her portfolio.
\nMargaret, how often do you review your portfolio?
\nMargaret:\u00a0\u00a0<\/b>Every year, I have another look at it. People think that because I\u2019m what I call a buy-and-hold investor, that means that I buy and never, ever sell. That\u2019s not true either. I frequently look at my portfolio and sometimes even sell.
\nI sell as a result of many things. If I realize after giving it a couple years that I\u2019ve actually made a mistake after all. I\u2019ll go back and review the area and realize that I didn\u2019t read it well, and all the things I thought were going to happen are never going to happen, and I\u2019m going to sit on that property with it dragging down my portfolio forever, so I need to get out of it.
\nThe second reason why I might sell is if a property has already had a really, really good period of growth and I don\u2019t feel there\u2019s any more in it.
\nSome areas have some real sentimental growth that\u2019ll happen, and you can be lucky and time it to get in early enough for that. Then at the end of that sentimental growth there\u2019s no more real growth drivers.
\nUnder those circumstances I might sell, as well, particularly if it\u2019s holding me back from borrowing more money to buy something that I think has better opportunity.
\nIn the main, my portfolio remains the same, and I review it just for rent rises and things like that, but I\u2019ve been known to sell around the edges of the portfolio to reshuffle it and to get a better-performing portfolio.
\nKevin:\u00a0\u00a0<\/b>What\u2019s your drive right now \u2013 for cash flow, as you indicated, or is this a time to be looking for capital growth?
\nMargaret:\u00a0\u00a0<\/b>I always look for both, Kevin, and there\u2019s no question in my mind that you can have both. I think people are mistaken, and I think they\u2019ve been led to believe for many years by the spruikers that it\u2019s one or the other.
\nEven a couple of weeks ago, someone on my show said, \u201cYou know, if you buy that property, you\u2019ll get cash flow and it\u2019s going to come at the cost of growth.\u201d That doesn\u2019t naturally follow to be true, so I really want everybody to understand that that is not true.
\nI\u2019m not the kind of person who always buys exactly the right property. I make mistakes, too, so I have some lemons.
\nI\u2019ve gotten rid of a couple, and I still have a lemon in the portfolio, but most of the properties in the main that I have bought have had both cash flow and growth.
\nI firmly believe that there are indicators in all areas that tell you that that area is going to see its rents grow and it\u2019s also going to see growth to the capital value of the asset. To suggest that in all cases, growth comes at the cost of cash flow and cash flow comes at the cost of growth is just not true.
\nKevin:\u00a0\u00a0<\/b>That lemon you\u2019re holding your portfolio now, Margaret, why are you holding it?
\nMargaret:\u00a0\u00a0<\/b>To continue to remind me of the lessons I need to learn as an investor. To be honest, it\u2019s not a big enough lemon for me to sell it. I almost did sell it this year. It\u2019s the very first property that I bought in Cairns.
\nKevin:\u00a0\u00a0<\/b>I remember you telling me about this one.
\nMargaret:\u00a0\u00a0<\/b>It did go up, and then it went down. The last valuation a couple of years ago put it at about $4000 more than I paid for it 15 years ago.
\nIt\u2019s funny; I was having a chat to my friend Dr. Andrew Wilson the other day, and I said, \u201cI\u2019m going to get rid of\u00a0<\/b>Cairns.\u201d He said, \u201cNo, don\u2019t, because you\u2019re actually going to see some growth next year.\u201d Now, I know that that growth will only be a window, because\u00a0<\/b>Cairns doesn\u2019t have the kind of growth drivers for sustained growth over time.
\nIn your portfolio, you want your properties to grow every year. They don\u2019t have to boom, but you want them to grow every year. In the main, my properties do.\u00a0<\/b>Cairns doesn\u2019t. I guess I\u2019m kind of hanging onto it.
\nIt\u2019s got a pretty good cash flow. I get a good rent on it. I\u2019m hanging onto it, just waiting to time the market next time that we get some investor sentiment in the area, which is coming because everyone\u2019s talking it up. It\u2019ll get some investor sentiment in that area, and I will then sell when everybody else is buying.
\nKevin:\u00a0\u00a0<\/b>Is that what\u2019s going to drive that growth in Cairns, purely that investor sentiment? Just talk?
\nMargaret:\u00a0\u00a0<\/b>Absolutely. Look, a few things are happening up there, but nothing that\u2019s going to create sustainable growth. We have to face the fact that markets like Cairns are very much itinerant markets.
\nA good number of the people who live in areas like that are from one of two demographic groups. They\u2019re either retired or semi-retired. The proof is there that any area where we have a significantly higher average age than the national average doesn\u2019t grow as well. Those people tend to sell down, not sell up. They tend to go to smaller homes, and therefore we don\u2019t get the pressure.
\nThe second demographic is itinerant people who go there just to work; they push the rent up because it\u2019s too far to take all your furniture to Cairns, so people go up there and rent furnished properties \u2013 and they get good yields on those \u2013 but then they leave. They don\u2019t stay. Cairns is the kind of area where you don\u2019t stay.
\nCertainly, young people and families don\u2019t tend to stay in places like Cairns, and we need families to anchor an area. We need to see private schools coming in. We need a lot of schooling. We need to see more and more schools because of the population growing so fast. We need sporting grounds and the facilities that families want.
\nFamilies bring money to an area, grow an area, work in an area, spend their money in an area, and overall make an area become more affluent. Places like Cairns don\u2019t get that.
\nKevin:\u00a0\u00a0<\/b>Margaret, great talking to you. I know we deviated a lot there from what Matt\u2019s original question was, but it\u2019s always good talking to you.
\nMargaret Lomas from Destiny Financial Solutions. Thank you so much for your time.
\nMargaret:\u00a0\u00a0<\/b>Thank you.
\nKevin:\u00a0\u00a0<\/b>And Matt, stand by, because we are going to give you a 12-month subscription to\u00a0Australian Property Investor<\/i>\u00a0magazine for being our question of the week.
\nMargaret, once again, thank you. Look forward to talking to you again soon.
\nMargaret:\u00a0\u00a0<\/b>Great. Thank you.<\/p>\n","protected":false},"excerpt":{"rendered":"

  In today’s show we talk with Margaret Lomas,\u00a0\u00a0from\u00a0\u2018Your Money Your Call\u2019\u00a0and Destiny Financial Solutions, about her portfolio.   Transcript: Kevin:\u00a0\u00a0Earlier in the show, I was talking to Margaret Lomas in answer to Matt\u2019s question. We continue that conversation with Margaret now as we talk…<\/p>\n","protected":false},"author":176692471,"featured_media":5683,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[10,13,25],"tags":[101],"class_list":["post-5677","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-kevin-turner-sponsored-channels","category-latest-story","category-sponsored-channels","tag-podcast"],"yoast_head":"\nProperty Portfolio - Margaret Lomas - 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\/property-portfolio\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Property Portfolio - Margaret Lomas - Realty Talk\" \/>\n<meta property=\"og:description\" content=\"  In today’s show we talk with Margaret Lomas,\u00a0\u00a0from\u00a0\u2018Your Money Your Call\u2019\u00a0and Destiny Financial Solutions, about her portfolio.   Transcript: Kevin:\u00a0\u00a0Earlier in the show, I was talking to Margaret Lomas in answer to Matt\u2019s question. 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