EPI 081 | Which way is your path to success?

Things we talk about

Contract What’s news

  • Finding another reno project
    (not THAT easy, it seems!)
  • A contract mistake that could
    cost a lot of money
woman_pointing_at_success_400_clr_7860 The Path to Success

  • How to determine your strategy
    in property investing
  • Goal — what, when, how
  • Strategy — how
  • Timeframe
  • Risk profile
  • Activeness
  • Financial situation
  • Creative financing

Quick tip and action

  • Write out your goal
  • Write out a statement of your



Tips on buying products during property investing seminars and organising your life


Checkout this property investing news update from Everyday Property Investing

Highlights in this episode:
01:09  When to buy products during free property investing seminars
01:54   A cool tool to help you organise your daily tasks
03:41   Quick Suburb Review: North Lakes, Queensland
05:31   Next registration date for Everyday Property Mastermind course 
05:50  Quick tip: Insurance broker

Mackay Purchase Case Study: Signing and Settlement—what happens in between

Buying an investment property can take a lot of your time and requires a great deal of effort, such that once you’ve made it past the negotiation and the actual purchase, you would want to sit back and marvel at the outcome of your efforts!

We hate to spoil the party but now’s not the time to rest—just yet—this part of the investing process requires your full attention and is time-sensitive!

We’ve been sharing updates on our Mackay purchase case study for Serg and as of our last post, we were thrilled to announce that we’ve made an offer and the offer was accepted.

Now the road leading to the actual purchase involved research, analysis, more research and inspections. And we’ve documented everything in the hopes that you may pick up some tips from our case study. If you missed the past posts, we suggest you read them here before you proceed reading about the crucial part in the investing process:

  1. Case Study: Mackay, QLD
  2. Investing in Mackay: Three Suburbs to Look Into
  3. Mackay Purchase Case Study: A Quick Look
  4. Mackay Purchase Case Study: Buying

After the Purchase

The things that need to be done after the purchase are as important (and crucial!) as the things you do before buying the property, namely, the research, analysis and negotiation process. What are these things? Below we enumerate the tasks that we need to coordinate before and after the contract signing and settlement.

Contract review

We can not emphasise enough how important it is to review the contract prior to signing it. This is where you will be needing another professional on your team—a property solicitor or conveyancer to review, discuss, and if needed, amend some items in the contract.

A tip  when you’re buying in another state: tap the services of a property solicitor or conveyancer who has had prior experience buying from that state. You would want someone who knows his/her way around as things can be different between states.

Building and Pest Inspection

Once the contract had been signed,  it is important to know whether the property has some issues and whether those issues are relevant enough to be considered as ‘show-stoppers’. Again, it is recommended to have the building and pest inspection done by a local team as they have the knowledge of the area and are familiar with the common issues affecting the area.

In our case, we tapped into the services of a building inspection company in Mackay who found some minor issues in the property. While we deemed those issues as non show-stoppers, we did present those issues to the vendor, considering the property was brand new and those issues should have been identified and corrected by the builder.


It is expected that you have had this one covered before the purchase as this can cause a holdup when not immediately completed. That means  processing paperwork to and fro you, your broker and the bank. Needless to say, it is important to accomplish the things that are needed from your end.

Be sure to have everything in place—a pre-approval is helpful, though not guaranteed, but you can expect that having one will ease up your application. Now the usual time frame in a contract is 14 days but in our case, we asked for 21 days and were able to manage without any holdup.


This is another important process that any property investor should be wary of (and should have covered) as soon as the property goes unconditional. Going unconditional means you, as the buyer, has the right and obligation to pay for and settle on the property per the terms of the contract. Getting a policy quote even before you purchase would be a good idea so you would already have reviewed and obtained one once the property goes unconditional—no one knows what can crop up between the property going unconditional and the settlement period!

Our Mackay purchase case study is a perfect example of this scenario. A tropical cyclone warning was issued on the area where Serg’s property is located and so insurance companies were not issuing new policies during the time. We were able to help Serg secure a policy over this period but not everyone could be as lucky!

Property Management

Once the insurance is done, next task is to find a reliable company to manage the property. The interview process can help you assess what each property manager offers and the fees associated with the services.

In our case, after interviewing at least 5 candidates, we chose a  property management company who then immediately put up the property on the Internet a day after the appointment.


Your property manager is the one in charge of finding a tenant but it would help to work closely with them  to ensure quick results. Whilst you would naturally want to  get the ‘bang for your buck’, it is also important to know the local market in order to have the going-rate for such property.

Depreciation Schedule

Now this one shouldn’t be left out prior to settlement. Have a quantity surveyor prepare a report of depreciation schedule, especially for a brand new property, as in the case of Serg.

These are the important things that need immediate attention soon as you’ve purchased the property. Our case study is nearing its completion. Be sure to stay tuned as you’ll still get bits and pieces of tips that you can apply in your own journey in property investing. See you then!

Insuring your investment property – How not to get caught high and dry


Checkout this property investing news update from Everyday Property Investing

Highlights in this episode:
00:15 Using the tools you know to give a suburb the ‘once over’
02:07 A suburb with newer style housing, only 12km from the CBD with a median well below $400k
03:55 How not to be left high and dry when you buy an investment property
05:25 Want to spend 6 weeks masterminding with Kaz from EPI? Check out www.everydaypropertymastermind.com

Mackay Purchase Case Study: A quick look


Hi guys, here we are with an exciting start to 2013 and I just wanted to provide an update on how our Mackay buyers agent case study progressed over the Christmas break.  Whilst most people were winding down for the Christmas break, I was in a flurry of activity up in Central Queensland on a buying trip for clients!  It was lots of fun, not to mention hot, hot weather!

In regards to our Mackay property purchase for our Queensland Buyers Agent website, Property Zest, we have been documenting the process of buying a property for one of the Property Zest clients, Serg. From the buying criteria to location analysis down to suburb recommendations, we are happy and excited to announce that after going back to the road to do some in-person inspections, we narrowed our shortlist down to three standout properties.

Determining (and targeting) the buying criteria

We’ve highlighted in the past the importance of determining your buying criteria when it comes to purchasing a property. In the case of Serg, after several consultations with him, we determined his criteria to be the following:

  • New to near new
  • 4 bedroom, 2 bathroom
  • Up to $500,000
  • Located in Glenella, Andergrove or Beaconsfield
  • As close to neutrally geared as possible

It is not enough though to have a list of buying criteria then set off to the next step, which is location hunting. There are times that one’s criteria may need to be discussed further in order to arrive at a more specific list. As in the case of Serg who initially had a broad set of criteria, we had to revise the list and created a more targeted one before we finally hit the web, the phone and the streets to assess the properties that fit the specific list.

Dealing with real estate agents

Moving forward with the process, we dealt with real estate agents who were keen to show the properties they have that best suit our criteria. This is one benefit to being a buyers agent—real estate agents know that you mean business so they are eager to show you what they have. Another benefit to being a buyers agent is getting information about the vendor and the property—things that real estate agents may not share directly with a potential buyer.

I must say for the most part, the agents I met with and spoke to in Mackay – and there were many – were very helpful and friendly.

The shortlist and the three-day inspection

So after spending more than ample time researching and exhausting all possible tools (websites, data, business contacts), we finally narrowed down our search to a list we deem worthy of an in-person visit. Off we set then to a three-day  inspection.  We inspected many properties in our target locations.

The shortlist consists of three standout properties. For Serg to review these three standout properties, we provided him documents outlining the location, the pros and cons, the numbers, and photos. The list included one brand new property that had never been lived in and two properties that were just a few years old (“new to near new” buying criteria ticked off). The three properties have similar cash flow; except for the brand new one that has better cash flow.

Exciting times ahead

After reviewing the documents we presented him, Serg finally provided us with instructions on which property he would like to make a first offer on. We did say it’s an exciting start of the year, didn’t we?

EPI 055 | Your Property Success with Renovation – Book club with Jane Slack-Smith

Things we talk about

Quick Tip & Action

  • Get Jane’s book and read it!
  • Going on a mining town road trip— if you’d like to be kept up to date with what we find, then sign up to Property Zest website


EPI 050 | Happy 50th birthday EPI

Things we talk about:

  • Celebrating 50th episode of the Everyday Property Investing podcast
  • Answer questions from listeners about buying close to where you live, what we want to know most when it comes to property investing, and about mining town purchases
  • Includes a very special guest!
  • Clint – our very awesome voiceover guy – Check him out at Marsden Vox.

Quick Tip & Action

Getting your strategy right – 1. Negative Gearing

In our last Everyday Property Foundations series post we talked about knowing your endgame. So I’m going to assume at this point that you’ve considered your overall goal – including the amount of money you’re going to require and the timeframe in which you intend to achieve your goals.

In the ‘Getting your strategy right’ section of the foundation series we’re going to introduce a number of ways or strategies that you may want to consider for investing in property. Today’s post is about negative gearing – and that’s because for the majority of investors their investment property will be negatively geared. So let’s look at what negative gearing is and the pros and cons of negative gearing.

What is Negative Gearing

The Australian Tax Office (ATO) says:
“A rental property is negatively geared if it is purchased with the assistance of borrowed funds and the net rental income, after deducting other expenses, is less than the interest on the borrowings.”  (ATO Website, Accessed 9th July, 2012).

The ATO also tells us that your may be able to claim a deduction for the resulting loss from the property against your rental and other income.

So basically, it comes to down to this:

  • You buy a property
  • The expenses from the property exceed the income from the property
  • You are making a loss
  • This loss can be used to offset other taxable income, such as that from your wages/salary as well as your rental income

The Advantages of Negative Gearing

On the ‘pros’ side, negative gearing is good because it helps you to reduce your taxable income, which means you pay less tax.  Many high income earners use negative gearing for this purpose.  Also, property values often (not always) rise over time and this capital growth in the property can be more than the losses and inflation so you may end up in front in the long run.


The Disadvantages of Negative Gearing

On the ‘cons’ side of the equation, however, you need to remember that if your property is negatively geared then you are making a loss, which means money is coming out of your pocket each month to pay for the property.  Depending on your circumstances this may impact upon your lifestyle as you will need to use your funds to service the loan and expenses.  When a property runs at a loss this also means there is only so much ‘extra’ income that you have available and so at some point, you will be limited in your ability to buy more properties.

Why would you use negative gearing?

Now many people would think – why would you buy property that makes a loss?  Why would you use negative gearing?  For a lot of people, they just can’t get past the idea of buying something that makes a loss – on purpose – and so they focus on property that is positively geared or has positive cashflow (we’ll cover those in the next article).

The main rationale is that the capital growth in the property you purchase may well outweigh the losses plus inflation over time and all the while you are reducing amount of tax you pay.


Negative gearing is where the expenses related to your rental property exceed the income and you have a loss where you may be able to claim a tax deduction.


  • Reduction in overall tax paid


  • The property is incurring a loss that you must fund out of your own pocket
  • May impact upon your lifestyle
  • Can only buy so many of these before you can no longer afford to buy further properties

What do I think?

If you are going to have a negatively geared property then it should be for the right reasons and simply to reduce tax is not the right reason.

Make sure you do your research to ensure the property you are selecting is in the right location and offers the factors that you believe will provide significant capital growth over time.  This is the right reason, the tax reduction is just a by-product.

Also, look at ways to improve the cashflow of your property, for example, undertaking a renovation to increase the yield of the property as well as increase depreciation benefits.

Many ways to skin a cat in property investing

property investing - many ways to skin a catThere are many ways to be successful in property.

I’m very fortunate to get the opportunity to speak to many different investors in my role with Everyday Property Investing.  I also read magazines, books, newspapers and property blogs to keep up to date and learn more.

You will hear different strategies from different people and these strategies may have made these people a LOT of money.

Those strategies may be fantastic strategies and if you’re anything like me then you get excited to hear about the many ways you can be successful with property.   There are many ways to ‘skin a cat’ when it comes to property investing.

BUT – here’s the thing….

You can’t do them all.

Sad, I know, but it is really important that you educate yourself about the strategies that may work, then choose what yours will be and focus on it.  Really learn about it, immerse yourself in it, live it and breath it and make it happen.  Too many people get caught up in the hype of ‘the next big thing’ or get on the merry-go-round of seminars and learning and never actually implement or implement a little bit of everything and never perfect their craft.

One thing that you’ll note from many successful people is that they focused on one technique and perfected it.  Think about that for a minute.

I was listening to the recordings of a business seminar recently and one speaker described it like this.  If you jump from one thing to the next all the time it’s like you’re digging a little hole but you don’t find treasure so you move to the next spot and dig a little there, but you also find nothing, pretty soon you’ve dug a whole bunch of little holes in the ground but you just never went deep enough to find the treasure.

You need to determine your one technique and perfect it too.  The importance of focus cannot be underestimated, it will accelerate your success.

The other point that I want to make here is that sometimes property ‘gurus’ will assert that their method is the only method that will make you successful and if you aren’t doing it that way then what you are doing is wrong.  Once again, there are many ways to skin a cat.  So don’t be put off by people telling you that there is only one way to succeed with property investing.  There isn’t.  In fact you are spoilt for choice!

Now read the first part of this post again – and focus on your choice!


EPI 046 | Property Investment Analysis with Ripehouse

Things we talk about:

Ripehouse.com.au – Location and property analysis website.


Somersoft Forum – Free property investment forum.

Quick Tip and Action: