Make sure that you’re always doing here is you’remaking the job of WWW.Vlasic.com.Au the value of super simple and you’vie backed up your research you’re not trying to bullshit the value of the com parables have to be real guys don’t if you’vie got three-bedroom house or three-bedroom townhouse don’t compare them to four-bedroom houses okay it’s got to be comparable it’s got to be property that is similar they’vie sold the last thereto six months the magic words I’m never playing sell the property I’m abut-and-hold long-term investor if you’re probably worth fifteen to twenty percent more as a result of the high valuation you can then leap frog Fremont it to another a lot faster this will enable you to achieve your financial goals much faster okay your job as professional investor is to reveal you invest some properties minimum every single year you know Radial you them you have to do anything with the valuation but even if you create grand or grand more every year in your property portfolio while willing to do it for bucks it will take you a couple of weekends to get opinions $ and you’begot more equity in your property now one thing it’s important to note as strategy. The other message I’begot there is there is a responsibility of of government and regulators to you know we’re in an unregulated marketplace now when you’re in a in that sort of marketplace if people can borrow more than they can afford to repay down the track we also have you know mortgagee sales and and sentiment shifts and then all of a sudden you know confidence falls out of the market and then people panic and then they want to get out so one of the big things that I’m pushing for a pro to do and is to to to put ceiling on assessment rates and what Oman by that is put a minimum level of assessment right now the assessment rate if you remember going back to what we talked about with borrowing power that’st he rate in which the lenders make ac all about have the ability of the borrower to repay the loan so it’s At’s a buffer range of usually one or two percent above what the actual retail rate is of interest that’s being paid by the borrower so I’m calling on APRA to instead of putting in silly regulations and that which can be counterproductive for economic WWW.valance.com.Au activity counterproductive for first-home buyer sand and up sellers and down sellers what what’s important to note here is if you put a minimum ceiling it means or minimum level it means. that people are going to borrow sensibly they’re not going to get caught up in his frenzy and they’re not going to be listening to the hot merchants who are out there in Thespis go space right now who are talking up the Sydney market they’re talking up investing in all these areas where in reality you know they’re lining their own wallets they’re not necessarily going to be making sure you’re lining your wallet in investment returns so it’s really important to understand that if we can get some form of compliance around making sure people don’t get into the frenzy of borrowing more and more and more but in in reality sensible investors are going to say I don’t need to buy in the peak I need to buy property valuers Adelaide in the trough and I need to look at marketplace that might be or months away from delivering gold then that helped us really well through the Fathead the assessment right because one of the things that happens in booms is easy access to credit the out so if the bank’s knew that they saw the experience of what happened in the GFC in America States yep and they decided that you know even though rates have been creeping down there has been that buffer so it’s not as if you any you know person in. This will notwork and you know this is what it looks like over and I can teach you these guys because I’vie done this myself’vie retired from working as a financier from that and I’ll lived off my property portfolio and I’vie capitalized interest for years living off my equity so i know this works because I’vie done it myself and that gives me the right to teach you this information which is pretty cool the reality is when you start off like in – you never know which equity you’re going to be drawing out from which property because no one’s got Crystal ball even if you buy in the right area we’vie done all the research okay and you bought a property for example in in Hampton there’s noway you can tell me the Hampton’s going to go up by exactly ten percent in next months you know yes on average over years Hampton will do ten percent valuations qld but some is you’ll do six some easily fifteen percent you know so what I’moseying is the moment you start this there’s no way Ben knowing in the future where the equity is going to be coming out of to buy which property and this is exactly what my property portfolio looks like over the last years I mean it’just all over the place in terms of equity because. Prices are still high compared to what they were back in , but not that much higher.
Valuations QLD is a serial house prices have doubled, almost tripled over that period of time. That’s the same chart I showed you for Australia a moment ago. Now, what’s been driving it, this is the next chart. This the ratio of mortgage debt to GDP. So guess which one is America.Ryan I can still see the same graph as before. Oh, wait. Hold on. Alright, Australia is the blue line, obviously and it just keeps going up. And America’s dropped during their burst,basically. During the crash.Steve Yup. So we manage to avoid that, but only by taking on more debt. So, consequently,at some point, and we’re approaching it now, I think. The growth in debt will stop and when it does, house prices will fall over. The only thing that’s likely to keep them up have been Chinese buying.Ryan Yup, which is being stunted by the Chinese government, USN’t it?Steve Yeah and by the Australian government, funnily enough. I thought they would have any balls about that, but they finally got some.Ryan Okay, cool. Let’s start the interview and we can go through all this during the interview. Just so you know, my audience tends to be kind of newer investors so they might own property. They might be looking to get into the market.