Vacancies fall and rents increase + Chinese buyers pull the plug + The majority is not always correct

Highlights from this week:

  • Do the opposite to what others are doing
  • How to prepare for tax time
  • A comprehensive report on what Chinese buyers are doing
  • Absent buyers at Block auctions in NZ
  • How lower vacancies will impact investors


How lower vacancies will impact investors – Louis Christopher

Kevin:    We are joined in the show by Louis Christopher from SQM Research. Always love Louis’s statistics, particularly with vacancy rates, because it tells us so much about what’s happening with the market. Data released by Louis and the SQM Research team revealed that the national residential vacancy rate dipped to 2.1% in August, and Sydney’s vacancy rate remained at its highest level in 13 years. Hi Louis. How you doing?
Louis:   Hi Kevin. Not too bad, thank you.
Kevin:    Yeah, interesting stats there. They do tell us a lot about the sentiment of the market and where it’s headed, doesn’t it?
Louis:   It does. Overall it’s telling us that on the rental side of the Australian housing market, it’s a mixed market. As you’ve just pointed out, Sydney is at a 13-year high with its vacancy around 2.8%, and we think that’s going to go high before it peaks. On the other hand, Perth as an example is at 3.7% but it’s trending down. This time last year it was at 4.9%, so we think the rental conditions over in Perth are starting to improve for landlords after what was an extended period of a rental downturn in that market, and then in Brisbane, where we’re recording quite a clear trend downward, so the vacancy rate for Brisbane is now at 2.8%, this time last year was at 3.4%, and we’re also recording falls in the rental vacancy rates in the Brisbane CBD, so the apartment oversupply story in the Brisbane CBD I think’s now coming to an end.
Kevin:    Yeah. That Perth figure of 3.7% that you mentioned, that’s still high, although it is trending well.
Louis:   It is. With the vacancy rates, there’s two factors here. Yes, the absolute number is important to know, and generally speaking, we’re regarded as a landlord’s market when the vacancy rate’s under 2% and a tenant’s market when it’s over 3%, but it’s also the relative direction, which way vacancy rates have been trending, so rents can tighten when, say for example, you’ve got an area that’s going from a vacancy rate of 7%, sort of what we had in the mining towns a couple years back, down to say 4%. In that instance, I can guarantee your rents will actually rise, because rents effectively take into account the rental conditions at the time.
Kevin:    Yeah. Just to keep it in perspective, too, just to show us how much of a powerhouse that Sydney market is, I’m looking at your figures now. The vacancies are up around almost 20,000 vacant properties.
Louis:   That’s right. And we were just under 13,000 a year ago.
Kevin:    Yeah, and that compared to say the Australia-wide stat of 70,000 shows you how huge that market is.
Speaker 2:           Well, yes. That is correct. Something we need to be watchful of, you have Sydney, you have Melbourne, and they are Australia’s two largest capital cities. They don’t represent the whole nation, but they can have an influence upon the nation’s economy when things go bad, and not that Sydney’s going bad. The local economy in Sydney is still strong, but clearly there is a housing downturn occurring in Sydney, and there are ramifications for that.
Kevin:    Just quickly adding up some sums here, almost 50% of the total vacancies Australia-wide are in Sydney and Melbourne, if you add the two figures together, about 10,000 out of Melbourne and almost 20,000 our of Sydney.
Louis:   Yeah. That is exactly right, and look, Melbourne and Sydney are of course the country’s two biggest capital citie, with got each city now basically having about five million people each, so you’ve got to expect that in terms of the absolute counts, a high number of vacancies. As mentioned, those two cities have quite an influence upon the national economy, so yes, there is a downturn occurring. Policymakers and regulators need to watch this downturn. The property markets are vulnerable now, and what I would not want to see is policy which puts a market further into correction, and policy makers need to be careful. They’re slowing the market. I read an RBA piece, that says this downturn has been managed well, well, it’s not over yet in terms of the downturn, and if they were to make any policy mistakes, then that could be bad news for the economy overall.
Kevin:    Yeah, it’s a bit like a fast-moving train. You get a train that’s going full-speed in one direction. To even slow it down sometimes is really hard, but to turn around in another direction is next to impossible. They move quickly.
Louis:   I think that’s right. I must say, as an analyst’s that been watching the market over many years now, one thing I’m concerned about is how things need to be managed. Cycles need to be managed. And when we say managed, It’s through policy initiatives, and that policy initiative is done by relatively few people, and so there is a bit of a power concentration going to very few people in this country who have a lot of control over the economy. I do not like seeing that, I must say.
Kevin:    Louis, great talking to you, mate. It always make a lot of sense. Louis Christopher, great website.  Some great papers there, and a man we always follow. Louis, thanks for your time, mate.
Louis:   Thank you, Kevin.

Do the opposite to what others are doing – Frank Valentic

Kevin:    Well, regular listeners to the show will know the name: Frank Valentic. Frank is the director of Advantage Property Consulting. He’s considered to be one of Australia’s leading buyer’s agents and vendor’s advocate. Operates out of Melbourne.
Kevin:    Those who’ve seen Frank, you would have seen him bidding on the The Block series of auctions, throughout Melbourne, over the years. You would have witnessed his very competitive instincts and energetic nature firsthand. He joins us. Goodday, Frank, how are you doing?
Frank:   Good, Kevin. Thanks for having me on your show. Looking forward to chatting to you.
Kevin:    Ah, it’s always a pleasure, mate. Always a pleasure. I want to talk to you about a comment I heard you make recently, that now is the best time to buy. Why would you say that?
Frank:   Well, Kevin, it is a buyer’s market in most parts of Melbourne, and Sydney, and around Australia, so you want to buy when the market is in your favour. Definitely, it’s a better buying time at the moment. Most buyers follow the herd mentality, and buy when others are buying. In a hot market, we see that, and it’s the savvy investors that are buying now, when there are more opportunities. The clearance rates are lower, and you’ve got less competition.
Kevin:    It’s always amazed me, how people continually chase hot spots, and by the time we get to hear about them, they’re anything but hot spots. I guess the exception there would, probably would be Hobart, that just seems to continue growing, doesn’t it?
Frank:   Yeah. Well, areas like Melbourne, for instance, we’re now seeing how the clearance rates down. That’s around 60%. Last year, that was 76%. I know in Sydney, they’re down sort of 50%, and they were up at 70to $80%. I know Hobart is a little bit more consistent than that, but in our areas, you’re definitely … it’s a better time to buy.
Frank:   We’re seeing one to two bidders at auctions, whereas, last year, we were seeing four to five bidders. My savvy buyers are getting in now. They buy when the market’s down, not when it’s up, and investors retreat. They sort of follow the herd mentality, and when the market’s hot, they buy. That was up at about 50% of the market being investors at the peak a few years ago, and now, they’re down to 25%.
Frank:   That’s really where the opportunities lie. You’ve got less competition from those investors at the moment.
Kevin:    It’s interesting you make that point about number of bidders, because I’ve done a number of interviews recently, where we’ve looked at things like auction clearance rates, and are they a good indicator of what’s really happening with the market? I think a better indicator is, how many bidders are turning up to register at an auction, and how many of them actually bid? That tells us a lot about the sentiment of the market, doesn’t it?
Frank:   Oh, it does, and there’s less buyers out there at the moment. There’s more buyers sitting on the fence, and homebuyers buy all the time, because they have to buy. They’re upsizing, they’re downsizing, so owner-occupiers are the real dominant force in the Melbourne market, for instance, and most parts of Australia at the moment. It’s really now a good time to get in there, and basically, pick up some good opportunities.
Frank:   I will say, Kevin, that property’s a long-term game. It’s not a short-term one- or two-year game, so your 10-year plan starts when you buy, and if you buy now, your 10-year plan strategy comes into effect in 2028. If you hold off and procrastinate a couple of years, two, three, five years, 2023, your strategy doesn’t come out the other end, at about 2033.
Frank:   So it’s really about having a 10-year plan, and sometimes, people get caught up too much with whether it’s a great time to buy at the moment, and whether you’re going to pick up bargains, when it’s really about a long-term game plan.
Kevin:    Frank, can I talk to you about The Block for a moment? It occurs to me, or seems to me, that there is a huge amount of publicity around The Block. Obviously, it’s a television series, when people turn up to bid, as you’ve done in the past. There’s a huge amount of competition, anticipation, that someone’s going to have to pay a premium price. How do you keep a lid on that, the excitement of it all, and not get carried away with it?
Frank:   Well, you’ve got to stick to your budgets, Kevin, that’s number one. That’s why our clients get us to bid, so they don’t get up with the emotion. We’ve now bid on 30 of the 40 Block properties over the last nine series, and we’ll be hopefully bidding in our tenth series in a row in Melbourne.
Frank:   We’ve purchased eight of those properties, but we’ve walked away on another 22, so the main thing is, not to get carried away with the cameras, and the emotion, and the Block paraphernalia, and it’s to really just focus on, what is your walk away price, make sure sure we don’t go over that, and make sure that we stick to our budgets, just as you should in every auction.
Frank:   You’ve got to have a walk away price, and not just keep bidding, and overpay, and then find the bank valuations coming lower, and then you find yourself in hot water.
Kevin:    Frank, let me ask you a question, then, about that walk away price. Is that the only price in your mind? Or do you have one, “if I could secure it at this price, that’d be great? That’s walk away price, but I tell you what, if we’re really pushed another thousand or two, we’d go to this figure”?
Frank:   Yeah, I think, often, you’ve got two prices, and it depends on your client. A lot of people will see me on the phone, getting instructions, once we’ve reached our price. Sometimes, the clients will go a few more bids, and go that extra level, but it really comes down to getting instructions from the client. Unfortunately, sometimes, on The Block, the clients say to us, “Well, bid to this level, and then, call us, and get some further instructions.”
Frank:   So, sometimes, you do have that first price, and then, you might get a few extra bids there, but I make sure the clients never carried away, and spend hundreds of thousands above their original budget. Might be a couple of extra bids, Kevin, and then, you’ve got to call it a day, and say, it wasn’t meant to be, and move on, and try and find something else.
Kevin:    Frank, of the eight that you have purchased, was there any money left in the tank? In other words, were you aware that maybe they would have paid a little bit extra? Or was that it?
Frank:   Most of the times, we were pretty well on our last bid, so your bidding there, it’s pretty competitive, and as you see, Kevin, there’s often four, five, six bidders there, trying to buy these Block apartments. Often, you’re pushing yourself and pushing the budgets right to the limit. So, no, there isn’t a lot of spare change in it, Kevin, because we’ve set budgets that I think are realistic.
Frank:   We’ve never had a problem with any of the bank valuations, and I know some of the other Block purchasers. There was one this year, where one of the purchasers in Elsternwick actually, on sold two of those properties, for whatever reason, and hopefully, it wasn’t because they couldn’t get the finance.
Frank:   But that’s really important for us is, just to make sure that we’re giving our clients the right advice about what they should pay, and what they should walk away at.
Kevin:    Of course, one of the criticisms from people who don’t believe in auctions say that auction doesn’t get you the highest price, it just simply gets you the highest bidder. What would you say to that?
Frank:��  I think auction is a very very good means of selling for the seller, because you’re generally getting that competition there. You can get a bit of emotion, and egos involved, and sometimes, that translates into some back and forth bidding, and you can get some great results, as we’ve seen in the Melbourne market, in the last six years of this boom cycle that we’ve had, and no doubt in the Sydney market.
Frank:   When there is competition at auction, there is emotion. There is that sort of, fear of missing out, and people can push themselves and the properties on the market. They can push themselves 100, 200, $300,000 very quickly. I still think it is a very, very solid way of selling a property for sellers. We try and avoid buying at auction, Kevin, as buyers’ advocates on the block.
Frank:   I’m called in, because most of our clients don’t want their heads on TV, so my bald head goes up on TV, instead, and they don’t want the world to know that they’re spending $2.5 to $3 million, and let everyone know everything about their personal situation. Sometimes, we’ve got celebrities, or a very well-known client, say in Melbourne, and they don’t want to be on TV, apart from Hughsy.
Frank:   He, obviously, he was happy to go on last year, but most are happy to keep it pretty quiet. And so, that’s all part of it, is just making sure that if you’re a seller, I think auction has a lot of advantages. And, as buyer’s advocates over the last 18 years, we probably buy less than 10% of our properties at auction, because we always tend to think we’re going to pay more, when we’re buying under competition.
Frank:   Whereas, if we’re buying private sale, off market, finding those distressed sales, and not having to compete against four other, five other people, as we do on The Block auctions, we’re hopefully going to get a better buying price for our clients.
Kevin:    Wonderful talking to you, Frank. All the best, and I look forward to seeing you on the upcoming Block, the next lot of Block auctions.
Frank:   Thanks, Kevin.
Kevin:    Good on you, Frank. Frank Valentic there, from Advantage Property Consulting. Thanks, Frank, talk to you again soon.
Frank:   Thanks, Kevin. Nice talking to you. Cheers.

Absent buyers at Block auctions in NZ – Joel Smith

Kevin:    Well, viewers in Australia will be well aware that we’re well into the season of The Block in this part of the world. And, in New Zealand, our New Zealand listeners, of which there are many, would be very familiar with The Block New Zealand. Well, we’ve got some news for you, because bidding this year on the block in New Zealand could become a lot easier, especially for people who aren’t going to be there, because Gavl, the site we’ve been talking about quite often on this show, is going be streaming live, live bidding for the real estate auctions in New Zealand for The Block.
Kevin:    Joining me to talk about that, Joel Smith from Gavl. Joel, welcome to the show. Thanks for your time.
Joel:   Thank you for having me.
Kevin:    Great breakthrough for you guys. How is it going work? Because, I understand that the auctions are very shrouded in mystery. They’re done, and then replayed later that night. How will that work?
Joel:   Yeah, well, that’s generally how the auctions have been conducted in Australia, but over in NZ this year, they’re live. They’ve being broadcast live to air, as well, so it’s going to be very interesting viewing, especially seeing how the live auction is conducted. There’ll be no special edits or highlights or cut-tos, so, yeah, it’s television.
Kevin:    So, can anyone anywhere in the world be able to watch it on Gavl, or do you have to be a registered bidder?
Joel:   Oh, you have to be a registered bidder. Obviously, being a TV production, and The Block, as well, there’s all sorts of requirements around, you know, countries and jurisdictions where they can broadcast to and so on, but they have got a proviso for any bidder who’s registered. Obviously, Ray White are running the auctions over there in New Zealand, so any registered bidder through Ray White has got the ability to either bid in person on the day as they do at a traditional auction, or, if they’re not onsite and can’t get to the auction, they’re able to bid digitally and communicate to the agent through the platform.
Joel:   And that also allows them to be able to watch on their device, hear what’s going on, see the bids come up and so on.
Kevin:    And how will it work technically? You’ll have someone in the room taking the bids on behalf of the bidders over Gavl?
Joel:   Yeah, so, effectively, the broadcast of the auction itself on Gavl, all that’s required is a mobile phone and an iPad, and the iPad will be in the agent’s hands, and obviously, with a Gavl staff member beside to make sure that everything’s going well, but, effectively, they will be communicating to the remote bidder through the digital devices, so, through the iPad and through their mobile device. And, as you see at a lot of auctions nowadays, if there’s a buyer on the phone to the agent, the agent calls out the bid, and the same thing will happen here. They’ll call out the bid online, you know, a million dollars, and it’s up to the auctioneer whether they accept or decline that bid, as they do now.
Kevin:    Yeah, it’s certainly a great initiative, Gavl, and allowing people to bid who can’t get to the auction. I understand, and I imagine you’d be following very closely the impact of this on auctions. Have you got any stats to tell me how many more people are attracted to auctions, on average, because of the ability to bid remotely like this?
Joel:   It’s around about a 50 percent increase in audience numbers, and what we also have seen that for bidders who register to bid through the platform, and obviously approved by the agent, that 40 percent of those go on and bid, and it’s around about 25 percent of actually those who bid buy.
Joel:   Only very early days, but there’s a large portion of bidders, registered bidders bidding, and then, you know, one in four are going on to win the property. And we can see that improving over time, as the understanding with the platform and confidence grows around the ability to be able to buy property through the platform.
Kevin:    No, it’s a great initiative, Joel, and I thank you for joining us and talking about it. All the best for the auctions in New Zealand, mate, and all the best with the show. Talk to you soon.
Joel:   Appreciate that. Good luck to all.

A comprehensive report on what Chinese buyers are doing – Carrie Law

Kevin:   A report released recently by estimates Chinese investment in Australian residential and commercial real estate, and I’ll give you the figures in just a moment. There are other reports, of course, foreign investment review board issues a report, but that’s on approved investment. This gives you more of an indication about commercial and residential investment by Chinese, not always necessarily approved. So this gives us an idea on just how dynamic it is. It revealed that Chinese purchased property worth $17.4 billion in Australia in 2017. And in New Zealand, it was $1 billion.
Kevin:   So how does that stack up to previous years, and where is it headed? Joining me to discuss that, Carrie Law, who is the CEO and Director of, the number one Australian real estate portal. How does that compare with previous years?
Carrie:   In year 2017, we see that in terms of the total transactions from Chinese buyers, especially mainlanders, is approximately Australian dollar 23.9 billion, which is a slight drop, as  some jobs actually, as compared with 2016. Because the overall month, is approximately 26%, or 27% down by 2016.
Kevin:   Yeah, 26.8%, that’s quite a drop. How much of an impact do you think the legislation, or changes to legislation in Australia in particular, have to do with that in terms of trying to restrict foreign investment?
Carrie:   I think that both sides kind of pull and push effect. Because in terms of China, as a whole, for restricting capital outflow and then investing in the overseas real estate properties is considered as USD fifty thousand per year, and that’s just one thing Chinese buyer has been looking for ways in getting the money offshore, investing to all markets, not just Australian focus. And in terms of Australia’s  we see that, say for example, Victoria as well as New South Wales, there are restrictions in terms of foreign buyers’ tax. So kinds of significant increments for non-permanent residents in terms of owning properties in Australia. So that is one thing has been restrict and slow down demand because getting also, in terms of money, some bank facilities to finance the projects is more difficult, as well. So that’s combined push and pull, we consider, is causing the changes in the market for this year. However, the next year, or this year, 2018, receive more direct increments, potential increments, in Chinese demand for homes in Australia.
Kevin:   Are there any decreases or increases in other parts of the world? What would you say would be the most favoured area for people and why?
Carrie:   Yes, you have good eyes, I think, Kevin. Especially because of the [inaudible 00:02:59] we see southeast Asia is actually up and coming and a lot of investments or actually developers are very aggressive in marketing to China and Chinese world. We see significant growth in this market, especially Asia, which is up about 352.4% representing a total of 32.9, close to 33 billion USD. So this is a major increment, as this is as expect as Juwai as well, in the last year.
Kevin:   The difference between commercial and residential, your report, of course, combines them both, is there a preference for one over the other?
Carrie:   I still think the demand in terms of residential is still higher, because it’s kind of like 80% of total transaction, meaning approximately 19.4 billion last year, and 4.5 billion for commercial, which is 20%, or 19% in the market. So people buying into Australia, they actually look for more lifestyle as far as education for their children. And only 40% of them are for investments. So maybe because of that, residential still more preferred.
Kevin:   Thank you for your time, Carrie.
Carrie:   Thank you, Kevin.

How to prepare for tax time – Brad Beer

Kevin:   Well, most of us are aware that tax depreciation helps investment property owners claim more at tax time. However, if you haven’t ordered a schedule before, you might be wondering what information you’ll need to provide to request a schedule. Today we’re going to talk to Brad Beer from BMT Tax Depreciation. Brad’s here to give us the inside story on what information you should have on hand when you first make an inquiry and why this information’s going to ensure your schedule is accurate and comprehensive. Brad, welcome to the show.
Brad:   Great to be here, Kevin, as always.
Kevin:   Yeah, mate. If anyone’s not aware, what is a tax deduction schedule, and why is it necessary for an investor to organise one, say, from a special Quantity Surveyor?
Brad:   A tax depreciation schedule is simply a document that tells your accountant or yourself, whoever’s preparing that tax return, how much you should be able to claim in depreciation against an investment property. There’s an amount for the building allowance, or the capital works deduction, and then an amount for the plant and equipment that is able to be claimed, which is things like the carpets and hot water services and other things in there that often get claimed quicker.
Brad:   Why is it necessary to get one from a Quantity Surveyor? It comes down to two things, and the first one of those is really around construction cost and compliance. The Tax Office will accept the numbers that a Quantity Surveyor comes up with as a qualified estimator of construction costs, because that’s what a Quantity Surveyor traditionally does is we measure and estimate construction costs.
Brad:   On top of that piece of compliance, we need to make sure we understand the tax rules and marry that across the construction cost ability, so that we claim everything we can in the maximum way to maximise those tax deductions for property investors and get the most deductions, and therefore the best cash value out of that investment property. They’re going to marry those things together. We prepare a report that goes off to the accountant and tells them how much to claim each year and get you some more tax back.
Kevin:   Can you give me a bit of information, a bit of background, about what a Quantity Surveyor is going to ask for when an investor first makes that inquiry?
Brad:   The key thing we’re after is to try to make sure it’s a simple process. There’s a lot of, I guess, requested information. Whatever you’ve got, great. Whatever you don’t, we’ll work with. Firstly, obviously, the address of your property and who’s involved. We want to know a little bit first to make sure that it’s viable for us to go and do this for you. If there’s not enough deductions to make it worth it, then we’d like to tell you that on this phone call that first starts the process rather than working that out later. But we do make sure that we collect this information, then identify, make sure it’s a viable option for the person with the property. If we don’t get enough deductions from it, we sort of cancel it and walk away, even at the end if we got it wrong from the questions at the start.
Brad:   Obviously, we need to know where it is. We need to know who the agent is to get access to the property. If we’ve got some detail about the type of building, a house, apartment, warehouse, retail store, whatever it actually is, so we can gain as much information about what we’re looking at to identify whether it’s worth it and make sure we can get involved in getting everything we can out of the property. We’d like to know if you’ve lived in the property ever, because then we sometimes change some of the things that we do and identify the best deductions in the years that you’re not actually living in the property.
Brad:   Who your accountant is, in case we need to liaise with them. When you purchased it, settlement and exchange dates, if you’ve got those things are good, because obviously when you buy it is when you start depreciating it, but when you exchange it might change some of the rules and the way we’ve got to treat it. Details of any renovations you may have done, because we want to add those after your purchase. Any plans or information you’ve got about that property that are handy for us to estimate a cost, get access, and see what’s in there are always handy.
Kevin:   I guess most people would shop around, talking to different Quantity Surveyors. How do I know, or what questions should I ask, to make sure that I’m actually going to get the maximum deductions available? Because I would imagine that not all Quantity Surveyors are the same.
Brad:   Well, absolutely. Important things around making sure the whole process is thorough. Now, the first thing about thorough is let’s make sure that someone, and we use our own staff for this all the time, is coming out, having a look at this property, identifying everything, doing a thorough job of estimating construction costs, and finding everything in there that you can claim, then coming back and making sure that the Quantity Surveyor has the appropriate qualifications.
Brad:   Now, as you say, not all Quantity Surveyors are the same. Having the qualifications to estimate the construction costs as a Quantity Surveyor is necessary, but on top of that, needs the specialist in making sure you know the tax rules and marry these two things together and apply all the rules that exist, like making sure it’s projected out for the life of the property, making sure it applies all of the rates to different items, like low-value pooling, low-cost pooling, immediate write-offs, and things that … Make sure that all of the available tax rules are applied to all of the appropriate items, on top of making sure you’ve got their credentials, Institute of Quantity Surveyors tick, tax agent’s number that you’ll need to provide, to make sure you’ve got the qualifications and the experience in knowing how to maximise those deductions all together.
Kevin:   Yeah. All those things you’ve just taken us through, it really demonstrates to me that, even if you save 100 bucks or something from one Quantity Surveyor to the other, you could potentially lose thousands by not claiming everything that you can.
Brad:   Absolutely. We see on a regular basis the claims that are being made by not doing a thorough job, predominantly less, because if you don’t go to site and measure things properly and identify anything special that may be there, as well as a list of all the items that are claimable, you will miss things. We’re $770 to do a depreciation schedule. We inspect the property. We collect the information, et cetera. You’ve got to cut something out of the process to do it substantially cheaper. Cutting something out of the process is less thorough and will probably cost you deductions.
Kevin:   There you go. Pay peanuts, you get monkeys.
Brad:   The average deduction out of a BMT report is, prior to the federal budget, about $10,000 in the first year and after that, about eight or just under 10, or just under $8,000. $8,000 is a fair bit of deduction in the first year of ownership, and this goes for 40 years, remember, if it’s a new property or not as much if it’s not. It makes a big difference to get it done properly, and a couple hundred dollars here or there is easy to chew up if you don’t get a thorough job.
Kevin:   Brad Beer from BMT Tax Depreciation. Thanks Brad.
Brad:   Thanks Kevin. Pleasure as always.

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