02 9522 3000 john@hunterwood.com.au

How to Get Ahead by Rentvesting

The idea of rentvesting has been used by highly dedicated and committed wealth creating property investors for decades. However, it remains a lesser-known approach to building an asset base. It deviates from the traditional ‘buy a home, pay it down and then buy an investment property’ approach, but it may well be the ideal path forward for many modern Australians. The intent of a rentvestor is to remain a tenant while also becoming a landlord. In doing so, they build their asset base independently of home ownership until such time as they can afford their much sought-after dream home. The question is: does it work and how effective is it really? In order to illustrate the value of rentvesting, let’s take a typical low- to middle-income couple and look at the choices they have in order to get started on their investing journey. We’ve introduced you to Kelly and Hamish, a hypothetical couple in their ’30s (see boxout, right). Kelly and Hamish essentially have two options available to them: Save a deposit, borrow as much as they can and buy their own home – even if it takes them years. Then get into their first investment property by saving another deposit through earned income and by drawing on any possible equity raised in their own home. Again, this may take several years. Rent, save a deposit, borrow as much as they can, and buy an investment property. Repeat this while renting. READER SCENARIO Kelly and Hamish are beginning to feel like they’re missing out. Aged in their mid-’30s, they think they’ve been doing all right so far but believe...
How would you feel being a 1% Property Investor?

How would you feel being a 1% Property Investor?

Have you considered playing a bigger game than the average property investor? What if we were to say that it might not be as far-fetched as you think?In fact, it’s quite feasible for a dedicated property investor to eventually be ranked in the top 1% of property investors in Australia. This would sound outrageous if it weren’t for the fact that we have clients and colleagues that fall into this ‘elite’ investor category.  They’re not all high-income earners either. In fact, from our observations over the years, having a high income doesn’t always guarantee the best investment results.Ok, so what does it mean to be just an average property investor in Australia? Surprisingly, it means that you would be among the over 70 percent of landlords that have just one investment property. Even more surprising is that it’s quite likely that you would sell your investment property within five years.Despite media speculation portraying greedy investors snapping up multiple properties and making housing un-affordable for the rest of Australia, the commonplace reality looks quite different.If we focus on the 2014-2015 column in the table below, you can see that the decrease in numbers of landlords that have more than one property is dramatic. There are 1,468,949 landlords with just one property. If you look at the next row you can see the number of landlords with 2 properties is 383,505. You can see that relatively few investors have more than one property, and this drops rapidly to a low number having three or more: Owning two investment properties would put you in the top 19% of property investors, then the percentages decrease noticeably...
Podcast – Getting finance approved in this tightening lending environment

Podcast – Getting finance approved in this tightening lending environment

Many investors who would have been successfully approved for finance last year are struggling now to either begin or continue their property investment journey because of the current financial climate.In this episode of the Smart Property Investment Show, broker John Manciamelli and Momentum Media director Alex Whitlock joins host Tim Neary to discuss how APRA changes and the royal commission have resulted in a tighter lending economy and what that means for Australian investors.They discuss what traps investors should avoid if they are trying to obtain finance, the four key growth drivers in a property market and unpacking trust structures while revealing one type of trust that you should...
John Manciameli talks to Sally Prowse, CEO of Sandcastle Finance

John Manciameli talks to Sally Prowse, CEO of Sandcastle Finance

What first attracted you to help your clients with their investment property aspirations?I’ve always had a passion for property and I completed a Property Investment Advisers course, just before I started working with Slipstream, where I discovered some of the basic foundations. I love exploring the future with my clients and asking them – where do you want to be in 10-15 years time? Why did you choose to work with Slipstream?Anyone who has started working in the investment property space, whether it’s with their clients, or just for themselves personally will know how many cowboys there are out there.     The industry is completely unregulated at the moment and so one of the biggest things that attracted me to work with Slipstream is that they are an aggregator of accredited research houses and buyers’ agents who you can really trust.     I had the opportunity to meet the panel at the first Slipstream workshop I attended and the high standard was obvious. They really understood the whole process from beginning to end and immediately set to work helping me to set out a realistic and manageable process I could follow. What are the key benefits of working with an independent aggregator of investment property research and buyers’ agents?A huge issue is knowing who to trust in the sector, and this is a crucial component of the referral business, so knowing Slipstream has this covered is a huge weight off my mind.     Slipstream’s vetting process for the research houses and buyers’ agents is really strict – this is the way you know you’re working with the best of the best in the industry.      The other...

John Manciamali on The Adviser – Elite Brokers

Former medical sales rep turned broker John Manciameli talks to the team about why he set up Australia’s first aggregator of investment property research houses.In this episode, the Hunterwood broker reveals how his dream of changing the way Australians invest led to him launching Slipstream, as well as why it’s important for brokers to consider ethics in their financial decisions.Tune in to hear more about the relationships he has with brokers and his advice for those new to the industry. In this episode you will find out:How brokers can get the most out of their databasesWhat the investment market looks like nowThe good and bad of investment lending changesAnd plenty more!     ...

Why Now May be the Best Time to Invest in Brisbane Real Estate

Residential prices in Australia rose by 3.7% during the first quarter of 2017. Sydney and Melbourne continue to house the most expensive real estate properties in the states of New South Wales and Victoria respectively. The median property price in Sydney is $950,000 while it is $710,000 in Melbourne. At these prices, no wonder Australians still find it difficult to live the “Great Australian Dream” of buying a home.But conditions may be right for you to consider investing in Brisbane real estate instead of Sydney or Melbourne. Here are 3 reasons why you should keep an eye out for Brisbane real estate: Property Price Differentials. The increase in real estate prices in properties located in the states of New South Wales and Victoria have created significant property price differentials with those located in Queensland.The median price of a house in Sydney is 2.2 times the median price of a house in Brisbane. Meanwhile, the median price of a house in Melbourne can buy 1.5 times the median price of a house in Brisbane.Historically, these price differentials have led to an increase in interstate migrations.Increase in Population Flows. It is estimated that interstate migrations will average an increase of 20,000 to 25,000 population flows to Queensland every year.The increase in population flows is expected to provide a major boost to the economy of Queensland which recently benefited from the resurgence of its mining sector.Increase in Housing Demand. Another beneficiary of the increase in population flows is the demand for housing.Presently, Queensland has 68,000 dwellings under construction. Even though annual dwelling completions increased to 42,000, Queensland’s population rose by just 1.4% or...

Why Migration is going to Shift Demand toward Brisbane

Real estate prices in Australia have been on an uptrend since the start of the new millennium. One of the significant factors driving property prices has been population. In fact, since the Sydney Olympics in 2000 Australia’s population has increased by 25%.Australia’s population growth rate has been driven primarily by migration. More immigrants have arrived on Australia’s shores after the year 2000 than between the years 1950 and 1980 – the so-called “Golden Age of Immigration”. A progressive economy since the end of the Second World War has established conditions that are ideal for migrants to find new opportunities in Australia.New South Wales and Victoria have received double the long-run average contribution to population growth from net migration. These states’ above average net overseas migration inflows are given a boost by positive net interstate migration.On the other hand, the population growth rates of Queensland and Western Australia appeared to have troughed in 2014 after several years of faster-than-average growth.However historical data suggests that interstate population flows to New South Wales and Victoria have begun to ease as the price differentials of houses in Sydney and Melbourne have reached stretched levels when compared to properties in Brisbane.When price differentials between housing in NSW, Victoria reach more than double the value of properties in Queensland reversions in migration occur. The median housing prices of properties in Sydney and Melbourne are currently 2.2 times and 1.5 times the median housing price of properties in Brisbane respectively.Property prices in Queensland have been subject to the effects of a declining population and the rising number of dwellings. Queensland has a situation whereby the number...

Is Brisbane the New Sydney?

Search any travel guide on Australia and chances are Sydney will be named as the best city to visit. What is there not to love about Sydney? It has two of the most iconic tourist attractions in the world in the Sydney Opera House and Sydney Harbor Bridge. The University of Sydney and the University of New South Wales are among the top 50 educational institutions in the world. Sydney is also widely regarded as the financial hub of the Pacific.These conditions plus a thriving economy, friendly interest rates and a growing population have contributed to the consistent rise of Sydney’s real estate prices. Sydney is currently ranked 4th to 7th in most surveys on the most expensive real estate properties in the world. Yet interest in Sydney real estate continues to grow particularly from overseas markets like China, the US and Singapore.But recent data suggests that property growth in Sydney has slowed down and Brisbane may be the new investment hotbed in Australia. The consensus among market analysts is that Sydney real estate prices have risen to a point that Sydneysiders can no longer afford to buy property.According to MacQuarie Research, when price housing differentials in Sydney and Melbourne have grown to nearly twice that of Brisbane (See Fig.1), it leads to shifts in demand that favor the capital of Queensland. This is because demand for properties in Sydney and Melbourne is no longer sustainable. Fig 1 House price relativities – Price differentials between Sydney and Melbourne, relative to Brisbane, have reached stretched levels, which have historically been followed by multi-year reversions.  Currently, properties in Sydney and Melbourne can purchase 2.2 times and 1.5 times properties...
3 Reasons Why You Should Invest in Brisbane Property over Sydney or Melbourne

3 Reasons Why You Should Invest in Brisbane Property over Sydney or Melbourne

If you’re thinking of buying real estate property in Australia, most likely Sydney and Melbourne are on top of your list. These 2 cities are widely recognized as the centers of business in Australia and are popular tourist destinations.But here are 3 reasons why you may wish to consider investing in Brisbane over Sydney or Brisbane: 1. Higher Population GrowthPresently, Brisbane is in a situation where it has an over-supply of dwellings. In the 3rd Quarter of 2016, Brisbane had 68,000 dwellings under construction. However, the population increased modestly by 42,000. Overall, Brisbane’s population grew by only 1.4% from 2015 to 2016.Slow population growth combined with a surplus in dwellings has dampened increases in property prices the past 2.5 years (See Fig. 2).But all of that is about to change. Fig 2 Population & migration: regional swings – After growing at a significantly faster pace over most of the last decade, Qld & WA population growth rates have slowed markedly, whilst surging net migration flows into NSW & Victoria have driven a lift in population growth in Australia’s South East.  Price differentials have increased between Brisbane and its counterparts from the South, Sydney and Melbourne. The differences in pricing have grown to a point whereby property in Sydney and Melbourne could buy property in Brisbane by 2.2 times and 1.5 times respectively (See Fig.1). Fig 1 House price relativities – Price differentials between Sydney and Melbourne, relative to Brisbane, have reached stretched levels, which have historically been followed by multi-year reversions.  Put simply, prices of real estate in Sydney and Melbourne are no longer affordable that investors and property buyers are...