{"id":5911,"date":"2015-10-01T01:00:51","date_gmt":"2015-09-30T15:00:51","guid":{"rendered":"http:\/\/realestatetalk.com.au\/?p=5911"},"modified":"2015-10-01T01:00:51","modified_gmt":"2015-09-30T15:00:51","slug":"develop-your-property-portfolio-by-using-lazy-equity","status":"publish","type":"post","link":"https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/","title":{"rendered":"Develop your property portfolio by using lazy equity – Michael Beresford"},"content":{"rendered":"

 
\nMany property owners don\u2019t know how wealthy they really are and do not realize the potential they have to develop a property portfolio by using what is called lazy equity. Hear Michael Beresford<\/strong> from OpenCorp explain.
\n <\/p>\n

Transcript:<\/h4>\n

Kevin<\/b>:\u00a0 It\u2019s quite incredible, but many property owners don\u2019t realize just how wealthy they really are, or they don\u2019t realize the potential they have to develop a property portfolio by using what is called lazy equity. There are a few reasons for this. To help us understand it, I\u2019ve invited Michael Beresford, who is the Director of Investment Services at Open Corp, to explain.
\nMichael, thank you so much for your time.
\nMichael<\/b>:\u00a0 Hi, Kevin. It\u2019s good to talk to you.
\nKevin<\/b>:\u00a0 Firstly, what is lazy equity?
\nMichael<\/b>:\u00a0 Lazy equity is basically equity in a property, typically someone\u2019s own home, or maybe an investment that they have already that they\u2019re not using. To use a simple example, let\u2019s say that the property is worth $500,000. The bank will lend 80% of that, which is $400,000. If there\u2019s a mortgage of say, $150,000 against that property, then the difference, being $250,000, is what\u2019s called lazy equity.
\nIt\u2019s really interesting. Talking to a lot of people over the last ten years helping them with their investments, I\u2019ll say to them, \u201cIf you had $250,000 available to you, would you invest that or would you stick it in a garbage bag and bury it in the backyard?\u201d Nearly everyone has told me that they would invest it. But in reality, very few people actually do.
\nKevin<\/b>:\u00a0 Is it because they don\u2019t really realize that it\u2019s there or that it can be used, Michael?
\nMichael<\/b>:\u00a0 Typically, it\u2019s two things. It\u2019s that, and it\u2019s also they\u2019re not quite sure how to get their hands on it. Really, it\u2019s a very simple process. It generally takes two to three weeks and a little bit of paperwork and dealing with the banks, which is not everyone\u2019s cup of tea. But it\u2019s a very simple process where you apply to unlock that equity.
\nThe bank will do a valuation on the property, so they\u2019re lending against their assessment, and basically give you access to some or all of that $250,000 depending on how much you service for and how much you want to take out. It\u2019s really a lot more simple than most people think.
\nKevin<\/b>:\u00a0 Once I understand how much equity is there, how do I use that to continue building a portfolio?
\nMichael<\/b>:\u00a0 First and foremost, you apply to get it released and available to you, and then it\u2019s just really money that you can use for investment. You set up that equity loan or line of credit, which is interchangeable terminology that banks use. Once you have access to that, then you use that money to cover the deposit and costs portion of the investment property that you\u2019re looking to buy. Then typically, go to a different bank to get the loan for the remainder. That way, your own home stays separate to the investment and is not cross-tied with the banks.
\nKevin<\/b>:\u00a0 Are there any restrictions that the bank would put on me if I do actually set up that line of credit or that extended financial availability?
\nMichael<\/b>:\u00a0 Yes. There are two components to the financial recipe in terms of what banks will lend to you, Kevin. The first is the equity side of things. Does equity actually exist that you can access? If that\u2019s the case, they will do a lending assessment based on your servicing, as well \u2013 or how much income, whether it be your salary, rental, and so on \u2013 that will determine how much you can actually borrow. Provided that your servicing is okay, then you\u2019re able to access as much equity as you have in the existing property.
\nKevin<\/b>:\u00a0 Yes, you make a good point there about servicing. I guess that\u2019s the other thing. Just having the equity there doesn\u2019t necessarily mean that I can use it because I have to be able to service any borrowings.
\nMichael<\/b>:\u00a0 Exactly right.
\nKevin<\/b>:\u00a0 That\u2019s probably one of the major restrictions the banks would have. They would look into how much income I\u2019m earning now.
\nMichael<\/b>:\u00a0 That\u2019s one thing they\u2019ll look at. They\u2019ll look at not only your income, but they\u2019ll look at rental income from any other properties that you might have. Family tax payments, depending on if there are dependents, can be factored in, as well, or any other income that might come from a part-time business or anything like that. It\u2019s really important to disclose all of the different income sources that you have access to, to increase your likelihood of being able to get access to the money.
\nKevin<\/b>:\u00a0 Michael, you mentioned there, too, once I do get access to that equity, then go to another bank to borrow for another property. I think I\u2019ve heard you talk about concentration risk. Can you explain to me what that is?
\nMichael<\/b>:\u00a0 Yes. The main thing that you want to do \u2013 and this comes from personal experience many years ago \u2013 is maintain control over the money that you borrow. In short, concentration risk is having everything with the one lender. The issue with that is that they call the shots.
\nWhat you want to be able to do is to not only keep your own home separate to the investments that you do, you don\u2019t want to have your own home as security against the investments. That\u2019s very simple to avoid. You get the equity loan set up as we talked about, and you go to a different bank to borrow the rest.
\nMost people feel they have a relationship with their bank. The marketing departments that these big lenders are geniuses; they market a relationship. What\u2019s easiest is you go back to the bank that has your mortgage already, and that\u2019s how those properties get cross-tied.
\nIt\u2019s an extra application and a little bit more work but well worth it to keep the control and have your own home secured separately.
\nKevin<\/b>:\u00a0 Always good talking to you, Michael Beresford. Michael is the Director of Investment Services at Open Corp.
\nYou\u2019re doing a lot of work, too, in the Southeast Queensland area, as well, Michael, aren\u2019t you?
\nMichael<\/b>:\u00a0 Yes. The Brisbane market is really well placed from the property clock perspective in our opinion. I bought a couple there this year myself, so yes, I\u2019m looking forward to hopefully some growth in the years to come in the Southeast Queensland market.
\nKevin<\/b>:\u00a0 Is it right across the Brisbane market or Southeast Queensland, or are there particular areas that you\u2019re focused on?
\nMichael<\/b>:\u00a0 We\u2019re concentrated more in the north. We have some big natural barriers to urban sprawl and a lot of government investment in the principle activity centers located throughout the north of Brisbane, so that\u2019s typically where we\u2019re focused.
\nKevin<\/b>:\u00a0 Good on you, Michael. Thank you so much for your time. Michael is the Director of Investment Services at Open Corp. Thanks, mate.
\nMichael<\/b>:\u00a0 Thanks, Kevin.<\/p>\n","protected":false},"excerpt":{"rendered":"

  Many property owners don\u2019t know how wealthy they really are and do not realize the potential they have to develop a property portfolio by using what is called lazy equity. Hear Michael Beresford from OpenCorp explain.   Transcript: Kevin:\u00a0 It\u2019s quite incredible, but many…<\/p>\n","protected":false},"author":176692471,"featured_media":5062,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_post_was_ever_published":false},"categories":[10,13,25],"tags":[101],"class_list":["post-5911","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":"\nDevelop your property portfolio by using lazy equity - Michael Beresford - 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\/develop-your-property-portfolio-by-using-lazy-equity\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Develop your property portfolio by using lazy equity - Michael Beresford - Realty Talk\" \/>\n<meta property=\"og:description\" content=\"  Many property owners don\u2019t know how wealthy they really are and do not realize the potential they have to develop a property portfolio by using what is called lazy equity. Hear Michael Beresford from OpenCorp explain.   Transcript: Kevin:\u00a0 It\u2019s quite incredible, but many...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/\" \/>\n<meta property=\"og:site_name\" content=\"Realty Talk\" \/>\n<meta property=\"article:published_time\" content=\"2015-09-30T15:00:51+00:00\" \/>\n<meta name=\"author\" content=\"rolanrush\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"rolanrush\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"6 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\\\/develop-your-property-portfolio-by-using-lazy-equity\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/develop-your-property-portfolio-by-using-lazy-equity\\\/\"},\"author\":{\"name\":\"rolanrush\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#\\\/schema\\\/person\\\/384a57ac9e52cb9bf19896cb15eaa52d\"},\"headline\":\"Develop your property portfolio by using lazy equity – Michael Beresford\",\"datePublished\":\"2015-09-30T15:00:51+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/develop-your-property-portfolio-by-using-lazy-equity\\\/\"},\"wordCount\":1230,\"commentCount\":0,\"image\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/develop-your-property-portfolio-by-using-lazy-equity\\\/#primaryimage\"},\"thumbnailUrl\":\"\",\"keywords\":[\"podcast\"],\"articleSection\":[\"Kevin Turner\",\"Latest Stories\",\"Sponsored Channels\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/develop-your-property-portfolio-by-using-lazy-equity\\\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/develop-your-property-portfolio-by-using-lazy-equity\\\/\",\"url\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/develop-your-property-portfolio-by-using-lazy-equity\\\/\",\"name\":\"Develop your property portfolio by using lazy equity - Michael Beresford - Realty Talk\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/develop-your-property-portfolio-by-using-lazy-equity\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/develop-your-property-portfolio-by-using-lazy-equity\\\/#primaryimage\"},\"thumbnailUrl\":\"\",\"datePublished\":\"2015-09-30T15:00:51+00:00\",\"author\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#\\\/schema\\\/person\\\/384a57ac9e52cb9bf19896cb15eaa52d\"},\"breadcrumb\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/develop-your-property-portfolio-by-using-lazy-equity\\\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/develop-your-property-portfolio-by-using-lazy-equity\\\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/develop-your-property-portfolio-by-using-lazy-equity\\\/#primaryimage\",\"url\":\"\",\"contentUrl\":\"\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/develop-your-property-portfolio-by-using-lazy-equity\\\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Develop your property portfolio by using lazy equity – Michael Beresford\"}]},{\"@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\\\/384a57ac9e52cb9bf19896cb15eaa52d\",\"name\":\"rolanrush\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/86544778804295a7fa45cbde097dc3a58a45ba6ed28859f17059ca74c38723d2?s=96&d=mm&r=g\",\"url\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/86544778804295a7fa45cbde097dc3a58a45ba6ed28859f17059ca74c38723d2?s=96&d=mm&r=g\",\"contentUrl\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/86544778804295a7fa45cbde097dc3a58a45ba6ed28859f17059ca74c38723d2?s=96&d=mm&r=g\",\"caption\":\"rolanrush\"},\"url\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/author\\\/rolanrush\\\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Develop your property portfolio by using lazy equity - Michael Beresford - 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\/develop-your-property-portfolio-by-using-lazy-equity\/","og_locale":"en_US","og_type":"article","og_title":"Develop your property portfolio by using lazy equity - Michael Beresford - Realty Talk","og_description":"  Many property owners don\u2019t know how wealthy they really are and do not realize the potential they have to develop a property portfolio by using what is called lazy equity. Hear Michael Beresford from OpenCorp explain.   Transcript: Kevin:\u00a0 It\u2019s quite incredible, but many...","og_url":"https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/","og_site_name":"Realty Talk","article_published_time":"2015-09-30T15:00:51+00:00","author":"rolanrush","twitter_card":"summary_large_image","twitter_misc":{"Written by":"rolanrush","Est. reading time":"6 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/#article","isPartOf":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/"},"author":{"name":"rolanrush","@id":"https:\/\/channels.realty.com.au\/realtytalk\/#\/schema\/person\/384a57ac9e52cb9bf19896cb15eaa52d"},"headline":"Develop your property portfolio by using lazy equity – Michael Beresford","datePublished":"2015-09-30T15:00:51+00:00","mainEntityOfPage":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/"},"wordCount":1230,"commentCount":0,"image":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/#primaryimage"},"thumbnailUrl":"","keywords":["podcast"],"articleSection":["Kevin Turner","Latest Stories","Sponsored Channels"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/#respond"]}]},{"@type":"WebPage","@id":"https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/","url":"https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/","name":"Develop your property portfolio by using lazy equity - Michael Beresford - Realty Talk","isPartOf":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/#website"},"primaryImageOfPage":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/#primaryimage"},"image":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/#primaryimage"},"thumbnailUrl":"","datePublished":"2015-09-30T15:00:51+00:00","author":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/#\/schema\/person\/384a57ac9e52cb9bf19896cb15eaa52d"},"breadcrumb":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/#primaryimage","url":"","contentUrl":""},{"@type":"BreadcrumbList","@id":"https:\/\/channels.realty.com.au\/realtytalk\/develop-your-property-portfolio-by-using-lazy-equity\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/channels.realty.com.au\/realtytalk\/"},{"@type":"ListItem","position":2,"name":"Develop your property portfolio by using lazy equity – Michael Beresford"}]},{"@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\/384a57ac9e52cb9bf19896cb15eaa52d","name":"rolanrush","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/secure.gravatar.com\/avatar\/86544778804295a7fa45cbde097dc3a58a45ba6ed28859f17059ca74c38723d2?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/86544778804295a7fa45cbde097dc3a58a45ba6ed28859f17059ca74c38723d2?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/86544778804295a7fa45cbde097dc3a58a45ba6ed28859f17059ca74c38723d2?s=96&d=mm&r=g","caption":"rolanrush"},"url":"https:\/\/channels.realty.com.au\/realtytalk\/author\/rolanrush\/"}]}},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/posts\/5911","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\/176692471"}],"replies":[{"embeddable":true,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/comments?post=5911"}],"version-history":[{"count":0,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/posts\/5911\/revisions"}],"wp:attachment":[{"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/media?parent=5911"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/categories?post=5911"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/tags?post=5911"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}