POBH Ep 01
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[00:00:00] Welcome to Property and Other Bad Habits, the podcast where we share our obsessive love of all things real estate, overly deals for fun and talk profits, renovations, and real life case studies. If you love a good floor plan, a strong yield, and the occasional reality check, then you are in the right place.
So let's get into it.
Welcome to property and other Bad Habits. Now, why that name? Quite simply because property is one of my, um, obsessions in life, and many people that I know that work in the industry are equally obsessed with all things real estate, whether it's from a wealth creation aspect or it is their bread and butter.
That's what they do as a hobby. Renovators investors, uh, developers. Often I'm working with people who are in the finance side of things, how to fund it all. So yes, property is my hobby, it's my obsession. And amongst other bad habits that I've got, I tend to [00:01:00] take holidays and then was, I'm on holidays, I am on real estate or domain looking up, uh, local real estate to see how much, uh, farm might cost or.
A property with a water view in a local area, so to say I'm obsessed is pretty much an understatement. So that is it. Property and other bad habits. So instead of telling you how good I am at what I do, I might just share with you a quick story about how bad some other people are, what they do. Recently I spoke to a client of mine, um, who's looking to do an investment.
In New South Wales, and they shared with me an example of a property they were heartbroken that they purchased in May of last year. So the circumstance of when you listen to this, that's we're talking about seven months of ownership and the property is in the Melbourne market. I'm not a Melbourne based buyer's agent.
I do have. A fairly decent understanding of the Melbourne market, but I'm by no means, um, it's not my zone of genius. And they were a bit heartbroken because they had used the services of an expert to [00:02:00] secure this property. Now they themselves live in Sydney, so they never visited the property. And over six months of engaging this buyer's agent,, they only shared with them three properties to choose from, which is quite appalling.
He got 26 weeks as a buyer's agent to share with somebody. A property, a potential asset, , three properties is completely unacceptable. Certainly in my world, uh, would've already secured a property for somebody in half that time, , and certainly three, I've never only ever sent anyone three. It's just, it's anyway, appalling.
Let's park that concept. The second part that's shocking to me is the fact that my client's strategy was to buy something. Uh, with a granny flat or a dual income potential. So this property is a six bedroom house and when purchased, they actually said, yep, you can split it in half or split it in, you know, four bedrooms, one side and two bedroom.
The other chuck a wall up, and therefore you'll have ease of access to, , two front doors, two lots of income, a high yielding property. So in [00:03:00] all, for all intents and purposes, it sounded fantastic. It's not quite that simple. People. Um, you do need to have approvals. It needs to be, um, properties need to be built to order.
That's why I love the dual key properties and duplexes that are built with the intention of having. Two incomes and they've got two sets of water bills and two sets of power bills. It's the properties are acoustically sound to accommodate two family units living underneath the one roof line. There's a brick wall that separates the two halves so that, um.
You know, if someone falls asleep and a candle's burning next to their head and a fire starts, it gives everybody a bit of a fighting chance between the two sides of the property. So, needless to say, um, the property, that you don't just buy a house and go, yep, I'm gonna shove up it's a stud wall and declare it, uh, you know, 12 A and 12 b.
So they shared with this with me, bit heartbroken. The information they got was lame, poor, um, insufficient. And second to that, look, I had a look [00:04:00] at the numbers. I said, don't, don't let go of it just now. Like, hang in there, you know, the property's yielding. Okay? It's not a, you know, a bad buy. It's near primary school.
It's a good size footprint. It's on a corner block. There are aspects to like about it. Property is a marathon. It's not a sprint. Don't give up after seven months and sell it. You're sort of throwing the baby out with the bath water. Especially in a market like Melbourne where 2025 and 2026, you know, it could still be a little bit in the, um, shade, but that, that will change.
And I think it's, you know, hanging there on hold for the period of time just to realize the. Potential UPG growth, outgrowth up, you know, capital uplift I should say. And that was my feedback to them. But don't spend the money on trying to reconvert this house into two separate lots, the tens of thousands of dollars that you'll need, and the time and effort it would become a redundant property acquisition for them.
They just have to accept that this is just a decent footprint at house six bedrooms, they've got a tenant in there, a [00:05:00] yield's 4.7%. I didn't secure the property for them. When we're talking about their next acquisition, they said, you know, are you gonna help us? Please get a property manager on board? And, you know, absolutely no question about it.
Of course, I would see somebody through to having a tenant on board. I would never just secure a property for somebody and say, here's the keys. See you later. Um, I'm driving off into the sunset. Uh, our job, you know, my, my mind and over,, all these years of doing what I do as an investor myself and looking after.
Hundreds of clients is. You know us, our specialty is working with investors. Of course, I'm gonna see a tenant in there. If you've got a property, haven't got a property manager, I'll interview the local property managers and get one assigned to you. If that property manager turns out to be fabulous, but then eight months later goes on maternity leave and the replacement's poor, I always say to my clients, our relationship is not over.
You know, come back to me. If you need to find someone new, I'll start again. Let's go find your fantastic property manager. Property managers are not created equal, but they [00:06:00] definitely make an impact. Um, a poor one can make a really bad impact on the successes of your investment property, whether they're not doing their quarterly inspections or they're not responding to tenants who have highlighted an issue.
And I've seen this plenty of times where there's been like a water leak that's become a far more significant and costly problem. Um, you know, mold that hasn't been dealt with when it's controllable and things like that. So. A good property manager has the eyes to see that and responsiveness when a tenant raises a flag to say, Hey, we've got a problem here.
And, and it's not an easy job. Anyone who he's listening is a property manager. Um, like, you know, kudos to you. My, it's, um. Yeah, tough gig. I mean, no one's ever ringing to say hi. It's always a problem. Or an ink or a pain or a, a whinge and you know, it's a bit of a thankless task and you are ringing your clients to tell them about bills they've gotta pay and invoices and quotes.
They're gonna get to get things fixed, but you know, it's property owning property and investment property is a business. It's a business model. It's, um, it's [00:07:00] not, you know, it could, in some respects, you can say it's passive, but it does require some involvement. Houses require maintenance. They get old like humans, you know, and they start to go and there's aches and pains, and if you let the cracks become bigger, then you've gotta deal with the fallout with that.
So. Stay on top of it. Get a good property manager, in fact, and you need to fire them fast if they're not performing, or hold them to task and challenge them as to why they're not doing their quarterly inspections because it can lead to far more, uh, expensive problems for you as a homeowner as well. So that's my little whinge about my client's journey, I feel on behalf of them.
And just generally cranky when I hear stories like this where you do get our industry, and I know it's the same for sales agents, you get so many fantastic sales agents that are carrying the weight of their industry, perception of them all being a little bit out for out for blood. But the reality is a lot of, a lot of sales agents work incredibly hard and do a very, very good job by.
Both, both the [00:08:00] buyers and the sellers, and they do get a rubbish reputation, and that's not always fair across the board. So when I hear about a buyer's agent not doing a job properly for a client, I'm equally miffed by it. And I just think it just looks like it's a gouge for, for money and for funds, and they're not always doing the right thing by the client.
So just if you're shopping around for a buyer's agent, ask for testimonials. Do a, do a Google search. I mean, it's a, it's a considered expense, but it's one that should save you a lot of stress, a lot of time. Put you into a property that is gonna perform, um, put you into a property that's gonna provide you with a strong yield.
It's gonna be something that's sits in your portfolio and. Will over time develop equity and that equity can then be utilized to build your net worth and a good, clever, well connected buyer agent who knows what they're doing. And not only that, but they can negotiate the heck out of a [00:09:00] property. It's worth paying for that service.
So there you go, property and other bad habits.
If you love the episode, share it with your property partner in crime. Hit subscribe and leave a review so we can get this into the years of future smart investors. And if you are done with the late night realestate.com, that AAU s scrolling and ready for a proper strategy, come and join us inside the Virtual Buyer agents.
All the links for how we can work with us are inside the show. This podcast was recorded on Garal country. I acknowledge the traditional custodians of the land and pay my respects to elders past and present Happy investing.
