The Property Couch

607 | The Best Lending Structure Today (In the New Negative Gearing Era)

• Ben Kingsley, Opti & The Couch Crew

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Two months on from the Budget's negative gearing and CGT changes, the data is telling a clear story. In our latest episode, Ben sits down with couch crew Luke Oxenham, investment-savvy mortgage broker, and Polly Chu, Qualified Property Investment Advisor, both fielding real client conversations daily. 

Together, they're unpacking what's actually happening on the ground: auction clearance rates stuck below 50% for weeks (the worst run since 2018), open home attendance down 43% year-on-year, and the lending data driving it all. 

  • How lenders scrambled to rewrite borrowing power calculators within days of Budget night — some borrowers lost up to $160K in capacity overnight 
  • Why majors and smaller lenders are treating investment debt so differently 
  • What AFG's lodgement data really reveals about first home buyers, upgraders and investors 
  • The shift toward interest-only loans as borrowers protect negative gearing and build buffers 
  • Why this cautious market might be the smartest time for new investors to prepare — and what "prepared" actually means 

Tune in to hear the conversations happening behind closed doors right now. 


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607 | The Best Lending Structure Today (In the New Negative Gearing Era)

SPEAKER_04

It's the best tax haven you've got in this country.

SPEAKER_03

That's why having the offset account and the facilities associated with that give you that ability to pivot depending on what the boards may look like.

SPEAKER_05

When it comes down to thinking about the overall strategy in terms of whether we go, say, a basic loan or whether we go like a package loan, I think it comes down to You're tuning in to the Property Couch, Australia's number one property, finance, and money podcast.

SPEAKER_00

Featuring the titans of the industry since 2015. We're trusted by tens of thousands of investors on their journey to financial peace. This show is powered by more.

SPEAKER_04

Thanks, Optie again. We have or it's a big show today, people. I'm glad that you're along with us because we are going to dissect some of the data that we're seeing post-the federal budget and the impact on the property market. And we're also going to get some anecdotal evidence of two of Australia's leading experts in their field when it comes to property investment advice and also when it comes to mortgage advice around investment savvy mortgage brokers. So Luke Oxenham, welcome back on the couch crew. And Polly Chu, welcome.

SPEAKER_03

Thank you.

SPEAKER_04

Thanks for coming back. So we've got a lot to unpack because there really is major changes that are happening in the property market. We've got some data to support that. But again, you guys are in the field in terms of what's actually happening out there. So I want to get the conversations that you're having and all of those types of things. So our community can get a real bonus

Free resources: Upcoming webinar, Moorr’s latest borrowing calculator and get a personalised lending assessment.

SPEAKER_04

and understanding in terms of what's what's basically people have been thinking about. And you might relate to those thoughts. And you might be thinking what's next for you as part of that. So hopefully at the end of the show, you'll be fully briefed in terms of what to do and what to be thinking about as part of that. Before we get in, a couple of housekeeping things that we like to do. We are absolutely getting bombarded with questions around new versus established property. And so that is why I am doing a webinar on that next Tuesday, the 28th of July at 7.30 p.m. So it's new versus established. What should you buy in today's market? Because obviously there's the debate around getting the tax advantages versus getting the fundamentals right. So I'll be unpacking that in detail at that upcoming webinar. You can register for that at the propertycouch.com.au forward slash register now. So just make sure you get along to that and make sure you register. We usually have over a thousand people come along. Also, some exciting news around the more platform. So we have a borrowing power calculator that effectively grabs all of the financial information that you've put in there and gives you a realistic calculation. Come on, we've all used the bank calculators and how rubbish they are when it comes to giving you an indication. Of course, this is still an indicative indication because it's only one model borrowing power calculator, but it's quite reliable and we'll be talking about the impact of what's happening with negative gearing in terms of borrowing power calculator throughout today's show. Now, if you're not, uh if you haven't created a more account, it's free to do so. Um but if you want to learn more about the borrowing power calculator before you create an account, you can go to the more website, which is mr.com.au forward slash free-borrowing dash power dash calculator. And uh we'll have those, the link in the show notes so you can get that straight straight across to there. And finally, um with these uh times and the changes that are happening around borrowing calculators, cost of living, and all those types of things, uh, just a shout out to our Empower Wealth business. Um, we are offering at the moment personalized lending assessments. So if you want to have a free chat to one of our investment savvy mortgage brokers and our empower wealth team, you

Setting the scene: a market in shock

SPEAKER_04

can go to the Empower Wealth website uh and you can uh look, click on the link to book a free consultation with one of our teams as well. So, in setting up today's show, because I want to get straight in to the discussion, there is no doubt that we're seeing through the data that there is a change uh in terms of a shock that's occurring in the market that's impacting sentiment. Uh, and so I want to give you a couple of data points, which just bring you up to speed in terms of what's going on. And and of course, the media loves a fear story. So, you know, if it bleeds, it leads, and the property market is one of the favorite things that the mainstream media want to talk about. So let's let's address a few things here. So auction clearance rates are an important lead data indicator, okay? We when we see the results coming through from Cotality and also from um you know Prop Track and all of these others, we when they're normally a 12-month median rolling average, and so you can see some slow things happening. We already know through our own data when we look at it on a monthly basis that there is some real price corrections that are going on across the market. And the appetite to buying at the moment is also being uh affected. So we've seen for the first time that the auction clearance rate, so the initial read um is hovering around that 50 to 55 percent. But obviously, once the final data is collected for all of those uh results coming through, it's fallen below 50% for I think it's about seven or eight weeks in a row at the time of recording. And so technically these are the worst conditions since we've seen since 2018. Now, if we rewind, or if we're not, we don't remember what happened in 2018, a few things happened. We had a banking, a Royal Banking Commission, um, which uh you know affected confidence in our banking sector and lending money. And we also had a very um uh prominent uh uh animal spirits from the investors. Uh and APRA also uh interfered in the market with their macroprudential regulation changes as well, and that slowed down the appetite for borrowing from our investor community as well. The other data point, the other two data points I want to quickly talk to, and you'll see this on the screen. Uh, so you'll see Ray White's open home attendees. I think this is a really nice, also leading indicator because it's telling you so Ray White is obviously the biggest uh franchise and and network group across the country, and they measure the count of the number of attendees that are attending each open home. So we haven't talked about this data point before, but we've been tracking this for a long time. Um, and it's down 43% uh from this time in the previous year. So again, at time of recording, uh you can see that that's that's down. So on average now we're seeing 2.1 attendees per open home. Um, and last year that was around 3.6. Um, and that's sort of consistent for the winter months. So, but it is a 43% decline. So that's that's a meaningful number when you're talking about thousands of open tens of thousands of open for homes that are happening throughout the course of a weekend. Um, and what you can also see in that data point on the chart is um, although it was actually lower than the previous two years, which is consistent with an interest rate change, where you will see um housing affordability start to be impacted by um rising interest rates. And we've had three rate rises in this last cycle, we have seen a further deterioration off the back of the federal government's changes to negative gearing and capital gain stacks. And that's what we want to talk about. And finally, to really uh bring home the story around the data points, uh, Westpac and Melbourne Institute released uh their consumer sentiment survey. And the July data, which was collected from the 6th to the 9th of July, showed a small increase uh in terms of the overall consumer sentiment index rising to 83.9, which was up 4.1% on the month, down 9.9 for the year. But it actually doesn't include the recent escalation in tensions and activities and airstrikes from the US, et cetera, on Iran and the Middle East tensions that are going on, which is increasing the oil price. So we would expect there'd be a further deterioration. But when we focus on time to buy a home, we can see that's also down 3.5% over the year. It had a slight improvement. So there might be some smart people out there to a 5.3% improvement over the course of the last month to 85.4. So remember, anything above 100 is optimistic. Anything below 100 is pessimistic. So it's still

What consumer sentiment is really telling us

SPEAKER_04

a time to buy a dwelling is still pessimistic as part of that story. And then the one that's always been fascinating for us, and if you've been listening to us for a long time, including our RBA and economic updates, house price expectation index, um, which is averaged 130.3. So there is a lot of baked-in belief in this country that house prices will go up over the long term, and that's fundamentally about economic activity, human interest, and human behavior. So we don't disagree with that. That's why we invest in property. Um, but you can see here there has been uh 27.5% year-on-year deterioration in that number and a further decline of 8% to a reading of 118 in the July data. So that is definitely telling a story that there is a sentiment shock, um, and that's playing out in terms of the market confidence. So I've got some more lending data points, but we're going to come back to those in a minute. Luke, I do want to start with you, right? I mean, ultimately you're on the ground when it comes to strategy and structure around lending. What are we initially seeing in terms of um the well, let's start with the the borrowing power. Yep. So there was a lot of confusion and chaos early on. Take us through what happened when the government announced that effective from 7.30 on the 12th of May, um, there was going to be changes to negative gearing and capital gains tax. What did that mean for the lenders and their calculators and how they issued pre-approvals? Take us through that whole

Budget night broke the calculators

SPEAKER_04

story. Yeah, definitely.

SPEAKER_05

And thank you for all that good news as well. It sounds great. Oh no, it's yeah, all positive stuff, isn't it? When it's all read out together like that, it's just a real like one-two, isn't it?

SPEAKER_04

Yeah, it is a punch in the face.

SPEAKER_05

No, so giving us a bit of a recap of essentially we had budget night on the Tuesday. Yep. Uh two days after that, we started seeing lenders change how they did their calculations for borrowing capacity. So even when lenders work out your capacity in the calculator, they will try and simulate negative gearing. Now it's not based in reality. No, but it's but it does try and simulate the effects of what's happening, right?

SPEAKER_04

Which is about the adbacks that you're going to get, which is going to help you support the repayments on the line.

SPEAKER_05

Yeah, exactly. So initially we started seeing lenders essentially remove that for any new purchases that were happening, uh, which you know severely changed what capacity was looking like. Um and then we had several weeks of lenders telling us that they would be changing how they do their assessments, but not releasing the calculator. So we had a situation where the rules say one thing, and technically that's fine. But then we'd randomly have lenders come out saying, look, we've changed the rules now. Here's a new calculator, and it applies to every application that's in motion at the moment.

SPEAKER_04

And why did they do that?

SPEAKER_05

So that was just to take into account the obviously the changes and the responsible lending around sort of negative gearing and what's happening from there, which it makes sense, but it does make it difficult, uh particularly as a mortgage worker trying to work out someone's borrowing capacity when you are using the calculator that's technically valid as of today, but you know that that calculator is going to change pretty quickly.

SPEAKER_04

So effectively the lenders were covering their own backsides because under the um legislation that in a foreseeable event uh needs to be factored into their responsible lending. So they were thinking they don't want to get millions of dollars of fines by continuing to lend under the current situation. So it caused a lot of chaos. Now, we're let's fast forward to where we are today. Um initially uh we saw borrowing capacity impacted, let's let's call it a range of 15 to 30 percent at the extremes. Yeah. Um where is it landed now in terms of we're seeing these new calculators come out? Where's the sort of borrowing assessment impact where it sits right now?

SPEAKER_05

And that's one of the things as well, where you know, just like how every lender has a different interest rate, uh, they've all had a different approach to how they're changing the calculator. So we've seen some simply adjust how they look at new investment builds specifically. But we've also had some completely change how they include investment debt as a whole in the calculator. So for some of the smaller lenders, so you know the majors are pretty much if it's existing, play on business as usual. Uh unless it's a new build, in which case they've got another spreadsheet to send to you for fill out to work out the gearing on that side, which is fine. Um but the smaller lenders have quite uh dramatically changed how they include investment lending in the calculator from there, which we've seen impact of people not just buying the next investment, but people that say have an investment property or two that want to buy an own hoc. Because of the way that it's including existing investment debt into the calculator, that's changing their overall position as a whole. Uh so I've had quite a few clients that were, you know, have property one, property two, now they want to uh upgrade the home. And then, you know, they're seeing their capacity in real time essentially come out and change. And it's what caused us to have to stop, reassess, or pivot or potentially change lenders or you know, find another solution there because you know, depending on the position, it can be somewhere from you know twenty, thirty thousand dollars of capacity to the largest one I've seen of one of my clients is about 160k. Wow. Um, so there's a big spread, and it is very dependent on lender to lender.

SPEAKER_04

And uh and obviously as the weeks have passed, from the initial one where it literally wiped out a lot of investors'

How much borrowing power did people actually lose?

SPEAKER_04

opportunities, um, we've we're you know, we're starting to see like at the end of the day, the lenders are in the business of lending money, right? And they wanna they want to do it reasonably and they need to keep you know their their the the economy running. Yeah. Um so it is it is a bit of a risk there. Um has it, you know, each time they release a new calculator or have a new treatment, yeah, is it is that improving borrowing capacity?

SPEAKER_05

Uh or is it more than the change for the budget or just in general? It it feels a little bit like obviously there's and the way that lenders change their calculators normally, there's obviously that sort of knee-jerk shock reaction, and then there's that constant refinement. So lenders are normally always in the background changing or tweaking, like adjusting credit policy on this side, or they're updating their calculator, or how they do something on the other side from there as well. So it's pretty normal to see that you know that change and then have it uh adjusted over time. That's probably the best way to say it.

SPEAKER_04

Yeah, well, and I think what what it highlights to me is more than ever, it given that it's changing week on week, you need to have your your professional advisor in your corner. Because, you know, like to that point, okay, what do we need to do? Well, do we wait and see? Do we play a little wait and see game? Because especially early on, it was a bit of a wait and see game.

SPEAKER_02

Yeah.

SPEAKER_04

Now, if if those obviously if you had a pre-approval and you're committed to a purchase, that's a different story. You need you know, a surety of supply in terms of getting that loan. But I think, you know, doing the modeling that you guys have to do, there's there's lots of moving parts as part of that in terms of that. And I think, I think as we see more of these changes come through, and I think, you know, what what we are also seeing, and I haven't spoken about it yet, but we've got a deteriorating economy in lots of respects. I'm hearing anecdotal evidence of people that I know in business and industry, retail spending is falling off a cliff. Um, the wealth effect is really kicking in, discretionary strength, discretionary spending, CBA reporting is all so this has cooked the economy in respect of that economic shock. So I think, you know, like we're gonna have to wait and see what comes out of that from because Labour, you know, one of the things that will cause them to lose the next election is if they stuff the economy, right? Because that's that's their Achilles heel. Every time they're in power for you know two or three terms, the economy cracks. And so that's why they've they've never got a good outcome in terms of you know longer-term elections. Polly, I want to talk to that story around the modelling and the scenario stuff.

SPEAKER_02

Yeah.

SPEAKER_04

Because obviously that leads into your world. So can you just you know refresh for our or for our new people who are listening along? What does a qualified property investment advisor do? Um, and then in that modelling that you do, what are some of the things that you're seeing or getting asked to look at, you know, in terms of helping your customers model their scenarios?

SPEAKER_03

Yeah, cool. Um, so so QPIA, one of the things we do is help clients to understand how property as a journey fits into their overall wealth goal. Whether it's buying a home first, whether that I guess the next property goal. Yeah. Is it upgrading my home? Is it buying my home? Should I be investing? Um, so part of what I do every day is to model some of these uh different scenarios, options, and understand the cash flows, the implications of each of them to make that informed decision. Um a lot of the work we do is also provision for um working closely with a mortgage broker like like Luke to understand what capacity we're working with. Does it make sense to use all of it, most of it, a portion of it? Um, and how does that impact, I guess, our lifestyle more design goals as well.

SPEAKER_04

Because that's right, the the challenge there is that um even though the cash flow might model that it's affordable, if we can't get the lending, uh the deal's dead. Yeah, the opportunity for the customer, the potential for the customer is then not available.

SPEAKER_05

The way I like to say it to my clients is that like Polly will look at what your actual position is. I my position or what I look at is how is the bank going to look at our position? And more and more, particularly lately, those two scenarios are very, very different.

SPEAKER_04

Yep. So and so we've got to be led by that in terms of as QPIAs, because I was, you know, obviously used to do the work that Polly did. We um, you know, when we're looking at that, we're basically saying, look, um the I think the most valuable piece of the work that we're doing is making the invisible visible. Yes. So even, you know, because back in the day when I was doing a lot more plans, um, we could borrow a lot more than what was potentially sensible. Now, that that pendulum's definitely swung in the other direction. But it is about also, you know, like what we do, and and this is a message out for for anyone uh in the community, um, is we don't want you to acquire an asset that in two or three years you're gonna be a force seller on. And you certainly don't want to be a foreseller uh in the current market. Yeah, but I've been really vocal on that.

SPEAKER_03

100%, Ben. And I've just come out of some strategies where I could see cash flows tight or I just lag, look, well, you don't want to be purchasing a property when you don't have that stability income or or cash flows just tight with a you know mortgage repayments, those kind of things, because you'd always in your current market, if you are selling, you are selling in a position of weakness, I think. Um 100%.

SPEAKER_04

You don't want to be a foreseller in these markets because you're not gonna realize that value. Um, and look, I mean, you know, we've been talking for 18 months about the the these new generation buyers agents who have been, you know, finding ways to get money for their clients to go again and again and again and artificially inflate values in different markets. Well, you know, this is that classic case of when the tide goes out, who's swimming naked? How many of those people are now? And we're seeing it in the data, the number of new listings coming through, um, the aging of that listing profile. So, what I'm talking about here, people, is the is the listings of the for sale listings, they are spiking across the country. Um, so and you're seeing that in all of the data coming out from Cotality and and REA Group and uh Prop Track and so forth. So, so there is definitely a lot more supply that's coming online. Um, the age of that supply is moving beyond that three months, and usually 90 days when a property's been sitting there for that long, people are like, what's wrong with it? Like, why hasn't it sold? Yeah, you know, in terms of that. And so we're also seeing a spike in withdrawals. So, in other words, um, we track every uh four to seven days um every listing that's going on in the market at any one time. And so what we're seeing there is, you know, what what what's the age profile of that listing, what's the uh the absorption, how quickly are those properties being absorbed? But also, what about the listings that have been withdrawn that we can't then find evidence of an actual sale? So there's no evidence that it's been sold as part of that. So that is all spiking. And in some markets, like the regional markets, which are low profile markets, that's material. In the bigger markets, that's not as as prevalent, but in the in the regional anyway. Oh, you know, that's a story for another day. Um, but I do want to talk about some of the lending data, uh, and then we'll come into you know, uh, later on on the episode, I want to talk about some of the questions you are getting because I think that's really important. So let me just unpack this. Because it leads into the behavioural stuff that we're talking about. Now, AFG is Australian Finance Group, and they are the largest aggregator in the country, full disclosure. They're also

Who's really buying right now?

SPEAKER_04

our aggregator in our business. And we do around, well, last year we did around $1.4 billion of mortgages, and we have around or well over $3 billion of mortgages under management as well. So that's the disclosure in terms of, but they have some really insightful data that they released to the market. And what was interesting is 44% of the market mix. So this is basically the last quarter, was upgraders. So this is where we're trying to get clues around buying behavior. So it does feel like post the federal budget that was up on the previous quarter, that that's what we're having. Now we've said here publicly on the pod that the principal place of residence is now a tax haven. It's the best tax haven you've got in this country because the politicians won't touch it because it'll force them out of power in their mind. So they're happier to pick on the investor as part of their policy design. But it's a first clue that we're basically starting to see upgraders come into the market. Now, first home buyers, however, this one is where it gets interesting. So Labour argued as part of this federal pitch and this policy change that they wanted to even

Did the Budget actually help first home buyers?

SPEAKER_04

the playing field and allow first home buyers to get back into the market. And their budget estimates forecast 75,000 additional first home buyers will be able to get into the market under this policy. So let's have a look at over 10 years, wasn't it? That was over 10 years. Yes, over 10 years, like not a big number, but over 10 years. Well, let's see how they've started uh in the first couple of months. So AFG reported 12% of their lending flows was steady. Um so that was consistent with 12% that they got in the uh January to March period, and then obviously from April to June was the same number. But here's where it gets interesting. So um the CEO of Lendy Group, um which operates Aussie Home Loans, which is also a significant distribution outlet for mortgage broking, said first homeowned lodgements had slumped by 20%. And then loan market data also found that first home buyer applications, so loan market also is the um sister company of the Ray White Group, and so they've got an enormous distribution as well uh through their aggregation business. Um first home buyer applications fell by 16% just in June compared to four weeks before the budget announcement. Um, interesting, full disclosure, investor loans also fell by 19% over that same period. So that just gives you a bit of an idea that um, you know, is this policy incentivizing first-hand buyers to come into the market? No, because it's had such an economic shock that first-hand buyers are probably now also worried a little bit about their job. You know, if if basically households aren't spending, um, unemployment is going to be challenged in the current market. And of course, if we have another rate rise because of inflation, yeah, um, it could get worse before it gets better. Now, I'm not saying that a rate rise is on the cards, but it's it's a 50-50 flip of the coin that next month it even if it's not on the cards, it's still on everybody's minds.

SPEAKER_05

Totally.

SPEAKER_04

So it's just the sentiment point uh and the confidence point around it. Yep, so we saw uh number of lodgements, so these are the volumes. So um just to give you the the sheer understanding of volume and size, there were 38,583 um lodgements of mortgage loans through AFG uh for the June quarter. Now that was compared to a record 43,977 um recorded in the Q1 uh of 2026, and there was 40, uh 810 in the same period last year. So that is that just gives you a bit of an idea in terms of volumes are going down. Um, and Westpac's chief economist, Lucy Ellis, has forecast new investor activity could fall by 34% in the near term, and total housing market turnover could decline by 20%. Now that's problematic everywhere. It's problematic for construction jobs, it's problematic for um stamp duty revenues, yes, for state governments that rely on that, especially states that have stupid amounts of debt, like Victoria. You know, it's their third biggest revenue generator. This is super problematic for the economic flywheel that's happening in this country. And again, you know, we'll be talking about that over the coming episodes as we do some deep dives, and we're going to go deeper into a mid-year market outlook uh in a couple of weeks' time. But that's the sort of stuff that we're talking about in terms of that. Now, from a buyer behavior point of view, in terms of the lending product changes and product features, this is where it gets interesting. And I'll go to you, Luke. AFG reported principal and interest loans accounted for 74% of all mortgage lodgements in the June quarter, down from 78%. So if you're not doing principal and interest, you're doing interest-only loans, and that has risen obviously to um 25% of all loan flows. Luke, why am I doing interest only as opposed to principal and interest?

SPEAKER_05

I think it might have something to do with the grandfathering of negative.

The quiet shift to interest-only loans

SPEAKER_05

Well, if they're hanging on to the negative gearing benefits for existing investment loans against your existing investment asset, then a lot of people are trying to retain that loan size rather than paying it down. So having your loans on interest only one can be great for cash flow, which is pretty helpful in a time where I think the sentiment at the moment is all about building your buffers up. Yep. So quite a few clients uh we're seen trying to sort of maximize that offset. Yes. Um, but also having interest only is you know helps retain that lending and refocus that cash flow onto something else, whether it's your non-deductible debt, or even if it's just trying to build that offset for safety.

SPEAKER_04

So this is a good reminder, I'm gonna come to you, Polly, next. The the the important point here is when you set policy, there are unintended consequences and there are behavioral changes that will come off the back of that. And you get the best, you know, so-called economists in the room, and they're trying to predict what will happen here. And to build on your point, Luke, um, what they also said is that grandfathering that's also available on your principal place of residence.

SPEAKER_02

Yeah.

SPEAKER_04

So if you owned your home before the 12th of May with it with a with a mortgage, and one day you potentially want to turn that into a negatively geared property that also gets those benefits, then why would you pay it down as part of that story? And in addition to that, what are we also seeing, Luke, about the interest in offset accounts? How powerful has an offset account become?

SPEAKER_05

It's become an absolute like a must, really. Um you know, wanting to, you know, like I mentioned, but when things start getting tough, I think the first thing people think about is cash flow and where their buffers are. So being able to have that money sitting in the offset to reduce your payable interest, particularly seeing as interest rates don't seem like they're going anywhere for the foreseeable future, they're probably going to sit where they are, if not potentially maybe, you know, I think Westpac's saying, what is it, another two increases over the years?

SPEAKER_04

Yeah, well they're they're they're they're Lucy Ellis, the chief economist from Westpac, is committed to one. Um, the other four big four banks are no more rate rises, but she believes that there'll be a rate rise in either August or September. And she but she's not as committed to the second one. She's basically but she's doubled down on one more one more interest rate rise, 25 basis points rise. Now, Polly, this is, you know, as a QPIA, we're we're just interested in cash flows, right? That's what we're trying to do. We're trying to optimize sequencing, we're trying to work out expenditures, costs, living, general living, kids' school fees, you know, um childcare, uh incomes going down to part-time, full-time, all of that sort of modeling stuff that we do. How much are you now playing around with moving money in offset buckets? Because we've been a huge fan of offsets and setting up offset buckets against uh the investment portfolios that we help our clients build. So, how how's that playing out in terms of?

SPEAKER_03

This has been an important strategy, I would say, as part of a lot of the strategies I've been working with. Um, some of my clients

The offset account trick most investors miss

SPEAKER_03

they do have an existing portfolio of properties with um cash in the offset, uh, and they're looking to further acquire another property. We're now looking at options when I'm doing the modeling, moving that cash from an offset against a negative V gear property to the loans that you can't negative e gear. Uh so you get to, I guess, preserve and optimize um the grandfathering rule.

SPEAKER_04

So just to unpack that a little bit more for us in terms of if I've got uh um, let's say an existing investment property that I've been able to build some offset buffers on, what am I doing with that money?

SPEAKER_03

You're just moving that cash from one offset account into another offset account, which will be um against the new loans that you buy for the properties you can't negatively gear.

SPEAKER_04

So that's like reducing the loan-to-value ratio on that new property, which means it's more likely to be neutral or negatively, uh sorry, positively geared as part of that strategy.

SPEAKER_03

Yeah, so it's all about optimising that cash flow piece.

SPEAKER_04

Yep.

SPEAKER_03

Um, so sort of on that new property you buy where you can't get the negative gearing benefits, you're you're putting more cash against us if it's interest only from an outf cash outflow perspective, a little bit less. Um, and so you can then also need even gear on and uh the loans on an existing portfolio you have under the grandfathering rule.

SPEAKER_04

Your job just got more important, Luke, in terms of moving a strategy and structure of loan um, you know, purpose as well as obviously um the uh security. How are you sort of navigating that world and what it what's some of the advice you've been giving to your clients around how important um packages are where you do get multiple offsets and the functionality to do what we just talked about?

SPEAKER_05

Yeah, and I I think it's it's an interesting one, right? Because it is different for every person. Yeah. So I think having that conversation with your broker is pretty important because like for some instances, that basic loan on that chart. Right, that's pretty helpful. Um but under the under the package where we've got specific tailored discounts to what your loan to value ratio is or what your total loan size is, um, you can sometimes find that it is actually a stronger benefit to have the package than it would be to try and sort of cut costs and keep it as that no-frills line. Um so I think it's very important to you know have a look at whether those numbers are and understanding whether it uh factors in. Because it's not it's not just a case of the fee, it's also the benefit that you get from having that money sitting in offset as opposed to using the redraw, which could potentially sort of flow into tax implications later.

SPEAKER_04

Yeah. Because what we're dealing with here, and and explain to our community, Luke, um we now have pricing based on purpose, obviously investment versus personal use. We have uh loan-to-value ratio pricing, um, we have principal and interest versus interest-on pricing. Yep. And to the point you just made there, we've got um no-frills type loans and your full package type loans, so your basic uh loans, which you only get redraw versus offset, because I still hear people making stupid mistakes about thinking that they can just move the money out of redraw, and then that still makes that that loan deductible. So, so to your point, it absolutely is essential you're speaking to your broker to get a full understanding because of these types of challenges. But just give us some of the flavor in terms of when you're explaining that to your to your clients, how are you going about that and and what how are you aligning that to their goals? Because that's an important part of that story, isn't it?

SPEAKER_05

Yeah, absolutely. Um, so I I think when it comes down to thinking about the overall strategy in terms of whether we go, say, a basic loan or whether we go and like a package loan, I think it comes down to one, you know, obviously the the interest cost for where that sits. Yep. Um to what our longer term strategy is, particularly, you know, when it comes to having use of that offset.

SPEAKER_02

Yeah.

SPEAKER_05

Um, because I think being able to have money in that offset, whether it's against um the non-deductible debt or whether, you know, for example, if we're releasing equity and putting money into that offset, so we want that money to sit in a holding it's essentially in a holding pattern like all line of credit until we use it. I think um, you know, it like I said before, it does mention it does depend from case to case, but at the same time, you know, I think having that longer term play is where it ties in.

SPEAKER_04

That's why the marriage of you two guys is critical because at the end of the day, you're about a goals-based outcome, do we?

SPEAKER_03

100%. And I think when we're doing a strategy, I'm thinking there's three phases in our plan and our overall goals. We've got accumulating phase, debt reduction, and then retirement. So if you're still in an accumulating phase where you're still looking to buy your properties, buy the home, those kind of things, having flexibility and optionality with money parking to offset and therefore going for that package makes a lot of sense. Um because it gives you you're able to pivot depending on your circumstances and of course regul any regulatory change.

SPEAKER_05

It's I think I think having that flexibility and being able to, you know, because when you're in that build phase, you're just all about getting equity out, getting the next property. It's not so much about you know reducing rates or paying the loan down, it's just trying to get in and build, yeah.

SPEAKER_04

Um perfectly, perfectly true. Because I mean, at the end of the day, if if if my if I'm a uh person who's trying to get on the property ladder, so let's say I'm a first home buyer, but my first home is not my forever home.

SPEAKER_01

Yeah.

SPEAKER_04

And it's certainly not my dream home. So if I go to a broker and they don't ask me about what my future plans are, and they just serve me up a basic variable home loan and just talk about the interest rate, they've done an injustice to me because I might have been in a, and especially if I'm a single person, and then I've got a scenario where I own that home for five years, I'm I'm paying it off because and I've got the free redraw, so I'm thinking I'm doing the right thing, but I'm paying that loan down. Yes. I'm thinking everything's going right because that's all my broken you. And then I partner up with my future wife, and and we're sitting back, and we're then thinking, okay, well, combined household income gives us greater borrowing capacity, and all of a sudden now we can use the equity in the home that I originally bought, my, you know, my getting on the property ladder home. And we might now be in a position where we can actually hold that as an investment property. But wait a minute, I haven't had the the structure done correctly, and so I don't have that optionality, right? And so all of a sudden, now instead of having that money in an offset bucket, which I could have then put on my non-deductible principal place of residence debt, I now can't do that, right? And and ultimately the cash flows don't allow me to then hold on to that property. So I've robbed myself of a capital appreciating asset that I could have controlled. And now that I now I can't. So yes, obviously I want to pay down my principal home as quick as possible. So it's it's it and that's why, you know, even with our new, you know, the new property

Introducing "livevesting"

SPEAKER_04

pathway plans that we've designed and we're building for new clients, it's very much focused on um what we now refer to as live vesting, because the principal place of residence is now a tax haven. And you know, credit to Stuart Williams, who's a great mate of mine, um, in you know, coining that phrase. But live vesting is what these people are doing. Like, and so I I want to see my property asset, even if it's my home, I want to see it being an appreciating asset. Because in theory, in practice, I know it's I'm making a lifestyle choice, but if I'm buying in a location that I'm gonna then pay uh hundreds of thousands of dollars on interest on, I'd like to think that I could get that money back in time. Otherwise, I would have probably been better renting than owning a home. So that appreciation over time is really important. And, you know, for anyone who understands economics, that wealth creation and that realization of the wealth is absolutely critically important for economic growth because it then frees up disposable income when people downsize. So the point you're making around the setup, the accumulation phase, uh, the debt consolidation phase to build the passive income for a timer phase, they are all critical. But if I'm a young person also thinking about what my property journey looks like, um, I should be thinking about that through a lens of an aspiring strain, which is this is an appreciating asset, people. It's not like a car I'm buying. So I want to be able to get into that market. And I think I think that's an important message around how those offset accounts work. Now, Luke, we also know that there's still some misinformation about redraw versus offset and um the whole idea of when you um you release money or equity out of a home that it instantly becomes um you know negatively gearable uh in the new age. Tell us what's true and what's not true about that.

SPEAKER_05

No, that's I I get quite a few of those questions. Also the ones about um like offset accounts not being linked, so that's why

Busting the redraw vs offset myth

SPEAKER_05

we should just redraw over offset all the time, which is just there's some wild uh theories that go on out there. Um so basically the way that it works is we always want to think about the loan based on purpose. Yes. So it's not so much the amount of debt we've got against the property. So for example, if we've got uh an investment property, we've got 300k of debt against it. If we suddenly say, okay, well, we're going to increase that loan to 500k, that doesn't suddenly make 500k tax deductible.

SPEAKER_04

No.

SPEAKER_05

So you know, because the original 300k was for that property, so anything relating to going to the accountant relates to that. Um, you know, that extra 200k relates to whatever we're using that 200k for next. So by putting it as a one loan, we've essentially mixed the purpose for what it's for, and we're essentially probably gonna cause their accountant to have a stroke.

SPEAKER_04

So Well Paul, you you accountant by trade and you know, advisor in that space, yes. How often does it come up where people just don't understand um security versus purpose? Because it it is gonna be a little bit messy, right? Because people are thinking, well, the government told me that that property is now negatively geared. Yeah. And so if I release money again that's secured against that property, then technically I should be able to negative gear it. Well, that's not what's in the legislation, is it?

SPEAKER_03

No, no, it's not. And it's always going to come down to purpose at inception. Um, so whatever you set that value to be, um, if you're paying it down, you just keep going down, even if you're mixing the purpose, it's important to split that out.

SPEAKER_05

Yeah, that's the same with redraw, isn't it? Like if you're if you put a bunch of money on the redraw and you pay it down and then draw it back out for something else. Yes.

SPEAKER_04

Uh Luke is being facetious there, but it's exactly the case. So that's the point we're making, right? Yeah. We're trying to make so you can't do it. You can't put it into redraw and get it out and say, I'm gonna, and now it's all deductible again.

SPEAKER_01

Yep.

SPEAKER_04

Just not. And so they're and unfortunately, there are buyers' agents out there, um, there are mortgage brokers out there who aren't well versed in um financial services or tax legislation, and they get it wrong. Yes, and they are lying to their clients about what's possible, and those clients are gonna have the shock of their life when they actually do speak to their tax accountant in terms of in terms of what's gonna be happening there as part of that story.

SPEAKER_03

Yeah, yeah, we see that quite a lot. Um, and then having to work with somebody like Luke. Hey, Luke, we have a client here who's got a mixed purpose loan, please help to split that up for clarity purposes going forward.

SPEAKER_05

It's always possible to try and fix someone who's received wrong advice, but I think sometimes you know it's better to try and prevent that from the jump than it is to, you know, meet a client five, ten years later, um, and then having to kind of pull apart their position and try and fix it and then you know have Polly get involved or have an accountant try and sort of piece together the story of what's happened.

SPEAKER_04

Oh I had my experience. I I've been a victim of going to see a mortgage broker before I became one. Um, where the mortgage broker told me about the different lending options that I had and didn't mention offsets.

SPEAKER_05

The experience was that bad you ended up having to like skill up and just do it yourself.

SPEAKER_04

Yeah, exactly. Well, you know, the the the point here is that you know, Bryce and I have always talked about that property is obviously bricks and mortar. That's the security and you're in control of it. But it's a game of finance and it's a game of managing cash flows around that, right? Because property investing is. Still a viable option post what's happened because I can control a higher value.

SPEAKER_03

Yes.

SPEAKER_04

Um, and and so my job is to just make sure I can service the debt, right? Uh, but get I get a return, a cash-on-cash return on the higher value. And so that hasn't changed. Of course, um, will there be the sort of same level of growth across the market? I don't believe there will. Uh, and I've got, you know, there's plenty of webinars and other stuff that we'll be talking about. Go listen to past episodes, and of course, all future episodes, I'll be prosecuting this argument. Land is not equal. There's a hierarchy of land, and there's a hierarchy of type of accommodation on that land. There's future productive use of that land, there's margin of safety and margin of errors that come into the science of where you buy that land and economic activity, you know, the agglomeration economies, all of those things make up an important story. So, but broadly speaking, if you buy the right property in a scarce location, you're gonna do okay. Um, and as long as you can control that cash flow as part of that. So, uh, I mean, I could talk to you guys about this forever because I love this sort of stuff, but I'm going, I'm gonna come to the final phase of what we're talking about here, and I want to just go through the target audiences. So, let's talk about the different market segments. Um, so homeowners post um what we've seen. Um, what are we seeing from them? I mentioned one of the things, the upgraders. There's they're they're they're smart people by the sounds of things.

SPEAKER_01

Yeah.

SPEAKER_04

Um, so Polly, what are you what are you, you know, what are you talking about with your clients? Because investing in property is not just about the investment properties, it's also about your home.

SPEAKER_03

Yeah.

SPEAKER_04

So tell us what you're sort of advising your clients at the moment on that.

SPEAKER_03

Encouraging, encouraging clients to think about their upgrading, asking that question: is your home fit for purpose? Are you thinking about upgrading those kind of things? Um, perhaps is perhaps I would think is the best time to be doing that now. Um, if you've got the cash flows, borrowing capacity to support it.

SPEAKER_04

Yeah, I mean, I I've we've used a terminology in our business where we've obviously got getting on the property ladder and you know the next property move.

SPEAKER_01

Yes.

SPEAKER_04

But we've always talked about our um forever home. Right? So we're trying to get you into the forever home, but now there's this whole idea of my forever home was comfortable for me. That's it meets it meets all of our practical needs. But now the dream home could be a reality for some of those. So it's almost like that next step up. I've got my forever home, it's pretty cool. It's got, you know, it does 90% of what I want, but I I would love to go into the dream home, which in reality is more about dream location. Yeah, so dream location becomes really important because at the end of the day, it's land depreciates, building depreciates. That's the liability of the building. So, so this whole idea now of dream location slash home is plausible for these owner occupiers, right? And because they are feeling more comfortable about the fact that every every bit of gain is 100% tax free, that's that's why that buyer behaviour is leaning into that conversation.

SPEAKER_05

Yeah.

SPEAKER_04

Luke, um, we also talked about um it's also a great time to look at refinancing for those guys as well. Take us through one of the what are the options you might be thinking about for existing homeowners and looking at borrowing power, looking at potentially sharpening up rates. Definitely.

SPEAKER_05

One of the um, like, you know, we've seen a heap of like we mentioned, the upgrading the PPOR, a lot of people going from okay, well, we're gonna do a subject to sale. Now, is there a way maybe we can hang on to that property? Yep. Um just trying to work through that section. In terms of things like reviewing interest only, you know, again coming down to cash flow and wanting to try and build that buffer up as quickly as we can, um, I think taking the opportunity now to look at you know whether our interest only terms are expiring or looking to do those refinances because uh if we're seeing some of that data come through in terms of values starting to decline, that's going to be the next challenge for mortgage broker. So you know, if we think a few years ago with interest rates were increasing, you know, very difficult for people to refinance onto a better rate or because capacity was so scarce. Um we saw lenders come out with different policies to try and make it a bit easier for you to refinance or reduce your interest rate. Um, you know, the next challenge I think is if we see the market slump and we see values decrease, then a lot of people are going to be in a position where they want to refinance or want to reduce their rate, but they can't because they don't have the equity that they had when they got the loan originally.

SPEAKER_04

So it's great lending hygiene at the top of each cycle to get your properties revalued and get all your equity out

Good lending hygiene at the top of the cycle

SPEAKER_04

and get your restructuring done. I'm doing one at the moment. I've got one of my loans which is coming out of its interest-only term. Yeah. So I'm going back to lending and saying extend it for another five years. Yeah. But all but it just so happens that that property price has gone up significantly, and I had a split loan for $158,000 against the $1.1 million loan I've got over. So now the property's worth X, so I'm just going to combine those loans. So I just don't need that extra split loan anymore. And then reset that.

SPEAKER_05

If you've got the ability to do it now, like it makes sense to semi-future-proof yourself run. So if we've got lending that's changing every 15 minutes, it feels like, well, the amount of calculators I've done over the last eight weeks, it's nuts. But if you know, if we've got the ability to, you know, we've got the equity now, we've got the capacity to do it, you know, we can have the money sit there in an offset in a holding pattern. I think that just gives you so much leverage to then act quickly if you need to. But also it means that if stuff does change later, then you're not too stressed because you've just given yourself another few years of essentially having your structure set the way that you need it.

SPEAKER_04

Correct. And Polly, again, it's you know, we're doing a lot of reviews for existing clients. Um, and okay, the grandfathering is good for them, but to that point and the new product that we've just you know built, which is the pathway plan, um, that's really smart play because to what Luke was just saying is okay, well, I never thought my forever home might actually turn into an investment property, but it just might. Yes. Because ultimately I've you know, I've got the grandfathering provisions on the negative gearing, and if I've done the right thing, I've lifted the offset bucket so I can move those offset funds across to the dream home now. And so, but they don't know whether they can afford it. So coming to obviously a QPIA, getting that modelled, getting that understood to make an informed decision. Um, and in in some cases, they might also consider selling and underperforming or one of their other assets in their portfolio because the judgment's been made by you as you're reviewing that portfolio that that's just better located land.

SPEAKER_01

Yes.

SPEAKER_04

And that's a that's a more scarce asset that's gonna have future growth. So these are the types of decisions that are going to potentially be made. And of course, we don't know what's going to happen in regards to the next political cycle. And, you know, if if labor does get thrown out and um uh the new government's formed, well, we know that that new government will only what the Greens won't form government, impossible for them. But in terms of the coalition and potentially minority government with the one nation, even though they're ruling it out, but let's let's make no mistake, they'll rule it in if they can form government. Um, both of them are saying that they'll reintroduce negative gearing and make some changes again. So we've got this situation where if I buy an established property now for investment purposes, in a couple of years' time, it could actually become negatively geared in the traditional sense of negative gearing, where I can offset that against my um my other income or my salary income.

SPEAKER_03

Yeah, and I think that's why having the offset account and the facilities associated with that give you that ability to pivot depending

What happens if negative gearing rules change again?

SPEAKER_03

on what the rules may look like as well. Um so I think just sort of comes back to getting your loans set up in the best way with offset account, making sure your cash flows make sense as part of uh you know, reviewing any future property purchases, what are your next property goals? Those kind of things will come in.

SPEAKER_04

And first home buyers, so that's homeowners. If you're an existing homeowner, you got some opportunities here. Take advantage of what the

Is now a good time for first home buyers?

SPEAKER_04

guys are telling you about. In terms of first home buyers, what are we thinking? What are what I mean? Generally, let's let's lean on you, Polly. Um, is it a good time?

SPEAKER_03

Yeah, 100%. If your cash flows can support, um, hopefully I've said that enough many times now. Yeah, um, definitely cash flows can support, you've got the deposit. Yeah, uh, this is a good time to go shopping. The the market is in a shock. Yeah, um, it's you know, if you're thinking about the own occupier could be one of the more expensive assets you buy. Um, and you know, if you use time holding for that long-term piece, you'd be glad that you took action, perhaps now.

SPEAKER_04

And then in terms of the lending options for those, Luke, you're you're going to be asking that question, aren't you, about what's your intention, what's your medium to longer term plans?

SPEAKER_05

Definitely. Definitely. I think also it's important to, and again, part of my job as the mortgage worker is to think about, okay, well, what's the worst thing that can happen? And then trying to avoid that. So focusing on, you know, stress testing about okay, well, what does happen if the interest rate moves, which I think is already on a lot of people's minds, particularly first home buyers going from, you know, however much they're paying for rent per month to suddenly having a mortgage repayment, which if you're under the first home buyer scheme and you've got a 95% loan, that can be a pretty sizable chunk of your cash flow already. So I think you know, knowing where that sits and what that looks like, but also knowing what could happen to that repayment too is critical in terms of you know, before you pull the trigger.

SPEAKER_04

And super consistent with our investment philosophy and ethos around this is our client's money. Like, and our and our goal is to do whatever we can to not lose money. You know, like you know, what's Buffett say, rule number one, don't lose money, rule number two referred to rule number one. So we're we are naturally a little bit more conservative than some of these, you know, next generation investment advisor houses, which you know, you look at their own profiles and it's all about how wealthy they're getting, not necessarily how wealthy you're getting. A good little test of that is yeah, have a look at their have a look at their profiles. It's a it's a good story about that that gentleman who was walking along the docks and saw all of these gentlemen pointing at their yachts and you know, talking about basically, you know, how great their yachts are. And the bloke says, Well, you guys have been all successful in business. What are you doing? And they say, Well, we're in financial services. And he goes, Oh, where are your clients' boats? You know, so that's the point we're trying to make here in terms of you know, when you've got a good trusted advisor is the people who put your money and your outcomes before their own, um, as a little tip in terms of you who you're going to choose. Existing investors, what are we doing for those in terms of um uh you know, and I'll probably take this one quickly in terms of we're in a down cycle, they've been through down cycles before. They're more relaxed than those who are new to the game. Um, and so to your point, Luke, they're absolutely talking to their investment savvy broker about releasing equity now, seeing what sort of equity they can get out. And those who are in a fortunate position, they're taking action. I mean, I've I'm fortunate enough that I get to ring around the industry a lot, and uh a lot of us are you know are out there saying, I was never planning to buy another property, but well, the conditions are that good, and certainly Melbourne is coming up in a lot of conversations around, you know, doesn't get any worse for Melbourne in terms of what that story looks like.

SPEAKER_05

As a Melbourne homeowner, it doesn't feel like it.

SPEAKER_04

No, well, let's let's hope that that is true because yeah, there's definitely a lot of um unrealised value because of the economic settings down here in Melbourne. That's but that's the existing investor in terms of the down cycle. For the new investor, um, what are we thinking about for them? Um, are they what are you are they more cautious? Yes, um, Polly, what are you know what are the conversations you're having with them?

SPEAKER_03

Yeah, certainly a lot more cautious. I think it still comes down to cash flows, understanding um without the negative

Fearful market, smartest opportunity

SPEAKER_03

gearing benefits, um, what does it look like if it's deferred to PACs? Um, can you still afford to hold for that long term? Um just giving that comfort from a cash flow perspective, even with high interest rates, 7% holding costs, council rates, all those kind of things. If it still makes sense, let's take action.

SPEAKER_04

Mentally, they're in this space that that they want the first post to be a winner. But you know, that first one needs to do well for them. I mean, when with all the other investors, when the first one does well, they get really comfortable and that's why they rinse and repeat. Um, so the mindset is they become fearful when others are fearful. Um, whereas the counter-intuitive or the smarter investor actually reverses that out. So for first-time investors, this is actually the best time. Like, you know, Bryce and I, and and the whole community, we've always said consistently for 11 years on this, and for the 30 years I've been teaching people about investing in property, is the best time to invest to poly, what you know, what's been drummed into us, when your cash flow is going to allow out, when you've got job security, um, and you can hold it for the long term, right? But if there is a a timing in the market story here, it's got to be when the market's depressed. Yes. It's got to be in a down cycle. Yeah. Now we don't know where the bottom is, and no one will ever really know. It'll be shown up later once we pass through it. Yes. But the point being, and the message here for whilst they are more cautious and some of them are sitting on their hands, the smart money, the smart people, they actually, the counterintuitive idea here is this is when you should be looking. Now I'm not saying buy yet. You know, some of the conversations we've been having with our team is about this prepare, get your pre-approval, get in the market, start making offers on properties if those if those properties tick the boxes. So if the properties tick in the box, make you know, make a low ball offer on it. You just don't know, right? Like ultimately, if it's been sitting on the market for a little bit longer. I mean, you know, our buyers' agents are having a bit of a field day out there at the moment because they're they're getting unbelievable deals away, and they can be patient, you know, and they can wait for the seller and the selling agent to come back to them. So they're in control of the conversation. When it does become a buyer's agent's a buyer's market, I should say, um, there's a lot more control that they have in terms of the negotiation. Um it's different, obviously, in a moving market as part of that story. But that's um that's that's for new investors. I would be saying, um, even if you think I'm gonna wait, because it's gonna get worse before it gets better, be prepared. Yeah. Because if that right property does show up, um, the moment that it turns, there is gonna be pent-up demand.

SPEAKER_05

There's gonna be all of those, you know, the 70% that didn't decide to act are sitting there, and then all of a sudden they'll rush in, and that will cause uh a small little uh demand shock that will come in there, and all of a sudden we're off again in terms of and that's where having your offset ready to go or having your equity release done because a lot of people come to you because they found the property,

Getting structured to move fast

SPEAKER_05

but then the strategy they want to do involves a refinance or an equity loan or like which is like you're looking at a five to six week lead time to get a lot of that done. So if you've got that all done and you are ready to go, yeah, like you can just move so much quicker. Yep.

SPEAKER_03

Yeah, and understanding how much you should spend on these properties, you know, what year, what growth.

SPEAKER_02

Yeah, great.

SPEAKER_03

If you know all of that and you've got all the ducks lined up, you will be the first to make that offer. Yeah, and you don't know who might be on the other side. They might need this cash because they bought something already. So they need the settlement to cut them.

SPEAKER_05

They're also looking to upgrade or something.

SPEAKER_03

Yeah, so it's a good time to sort of take advantage of that, um, the tactics there.

SPEAKER_04

100%, Polly. I mean, property, the property journey that we're going on. If we think about life and next goals, we've got next wealth goals and next personal goals and next goals for our children and our family and our health goals. But our wealth goals and our property goals, there's a series of properties that we're gonna buy throughout our lives, traditionally, for the most of us. You know, we're we're staying there between seven and nine years or whatever before we move on. So uh come and sit down with a property advisor and get a plan for your property goals, right? So whether that's investment or whether that's owner-occupier or a combination of those to optimize to know what's gonna happen. But get make the invisible visible. So plan to become what you plan to become, then talk to your broker about getting structured and set up to take action is a big part of that because I've written down here the themes of what both of you have just said is all about flexibility and optionality. And I think that's a great way to finish. It's about sort of saying to people and saying to our community that there is opportunity and potential out in the marketplace. Keep doing your research, keep getting educated, but start to build a plan and a strategy around what that looks like because you need to understand what that optionality and that flexibility looks like, and lean on people who do this every day, who are specialists in their field in terms of how that happens, and you'll limit no guarantees that you won't make mistakes. It is important to understand that even with the best advice, sometimes it doesn't all pan out as you planned. But you you greatly increase your probability of success when you work with experts in the industries of investment savvy broking, property planning, buyers advocates, tax advisers, and also financial planners. And hopefully, you know, this just little fly-on-the-wall experience that you've just had with the three of us talking about the anecdotal and the diagnosis that we've just done on the initial few weeks or couple month and a half, two months after the May budget, there's definitely changes happening, uh, and we'll continue to report on those changes. Uh, the data supports the fact that we are definitely experiencing a shock off the back of this, not just the interest rates, but off the back of these tax hikes and these tax changes. So understand, uh, go and get some advice and make sure you make the next move a winning move. Sound like a plan? Sounds good. All right. That's a wrap. Until next week. Always remember people, knowledge is empowering, but only if you act like it.

SPEAKER_00

Hey folks, Opty here, the Smart Money Scieke Inside More. Just one quick thing before we sign off. If you're new to the property couch community, welcome. One quick tip to help you get the most value from the show. Our first 20 episodes cover the foundations we build on every week. And yes, listening on one and a half speed is totally acceptable. If you're short on time, download our free binge guide. It distills those episodes into one easy read with heaps of visual diagrams, alongside free tools inside more, your all-in-one financial home, to help you organize your money and plan your next best move. Check out all the links in our show description. And just a quick reminder before you go anything we cover on this podcast is general in nature. It's not considered to be financial advice, and we certainly recommend that you seek out professional advice before making any financial decisions. Once again, everything mentioned is linked in the show description. Ready when you are. Catch you next week.

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Ben Kingsley

Host
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Bryce Holdaway

Host