Property market versus Covid

Property market versus Covid

“Hello and welcome back to weekly buying tips I’m Dean Berman from Berman Buys.

Today I want to discuss what’s been happening in the property market since the start of Covid around March 2020?

I would have thought by now there would have been a greater impact on the general property market.

I believe there are 4 key factors keeping the market relatively stable to this point.

1) Supply – during 2020 there has been low total listings around the country, resulting in low supply of properties to purchase. I often see markets where nothing comes to market for a few weeks. What do you think will happen when that next listings comes up…competition.

2) Lending – lending rates have gradually declined over 2020 to record low levels, making finance affordable. When finance is affordable, this makes buying a much easier choice as it can often be comparable or cheaper to renting.

3) Government incentives – particularly for first home buyers have kept demand and competition for available properties strong. This includes increased purchase prices to still gain government incentives and or purchasing new style options or building a brand new home.

4) Job keeper/seeker – these payments have helped many businesses keep many staff employed, enabling subsequent flow on spending in the economy. This flow on spending has helped many other businesses benefit through the multiplier effect.

I think there will be a portion of home owners who will need to sell over the coming months as financial hardship and deferment of mortgage repayments provided by the banks eases.

Also potential easing of job keeper and job seeker may potentially impact. I would think those markets most affected would have lower levels of savings rates and higher gearing levels.

In general though, over the last 8 months or so, I feel these 4 factors combined are in many ways beating Covid.”

A simple idea to end homelessness

A simple idea to end homelessness

“Can homelessness be eradicated?

The general consensus from journalists, public servants, businesses and governments is ‘yes’ it can.

Through a symbiotic approach of mixing safe and affordable housing, support services, jobs, social inclusion and prevention.

Culminates in a mixture which will eradicate homelessness.

What I want to talk about is a simple idea, which has nothing to do with housing.

It has to do with the person.

The human with experiences and stories both sad and happy.

What would happen if everyone cared about ending homelessness?

Even only for a few days or hours a year…

There are approximately 14 million residents in Australia aged between 20-65 and approximately 120,000 homeless.

Meaning there is someone homeless for every 116 Australians between 20-65 years of age.

As there are 365 days per year, what happens if each resident in this age bracket would need to help someone homeless for just 3 days per year?

Could this work?

So every just under 4 months, you had an assignment to achieve to make someones life slightly better for just one day.

Could you do it?

Maybe it was having a simple zoom or Skype chat about both your lives.

Possibly even professional guidance or advice.

This one person will be getting at least 116 different Australian’s opinions thoughts and more importantly connections per year.

Would you think society would be better off or worse off because of this?

Maybe you meet a new person and never talk to them again, or maybe you make a new friend?

It will put a lot of people outside their comfort zones.

Although this looks like a social inclusion strategy, I see it as a something much greater.

Let me ask you this question.

When you are shopping and someone you haven’t seen for ages says ‘hi’ to you.

Do you feel better or worse after?

Unless you really don’t like that person, you usually feel slightly happier.

The same goes for this idea.

You are making the person feel important.

You are giving them a sense of worth.

You are giving them confidence.

I believe when you make someone an active member of society they will act like that.

They will want to change their ways.

Improve themselves.

I believe it’s this fundamental shift in mentality that will make the difference.

You can have all the social housing, public housing and rental assistance on earth.

But if someone doesn’t feel worthy of living in it.

Then they won’t.

They will stay as they are.

It’s what’s comfortable and familiar.

When you give someone confidence and self-respect.

You create a new person.

You change the conversation and homelessness in Australia forever.”

Go to auction or buy beforehand?

Go to auction or buy beforehand?

“Hello and welcome back to weekly buying tips I’m Dean Berman from Berman Buys.

Both methods will have competition but the auction will be transparent whereas buying beforehand can often involve unknown competition.

The price quoted can be within 10% of where the agent thinks it will sell.

With the auction you will generally need to get everything ready beforehand such as contract review, knowing your numbers and finances, pest and build and or strata report.

The same goes for buying beforehand during an auction campaign as it is fairly common for the agent to request a 66W or unconditional exchange to ensure the deal proceeds.

Emotions can get in the way in both methods, however on auction day and during the heat of the moment these can be at their highest, whereas buying beforehand can give you a little more time to catch your breathe

Generally speaking in both methods you will need to provide the agreed deposit once successfully agreed as the highest bidder and signing of the contract, in the auction this will happen straight after the auction finishes and in beforehand, this will usually occur within a few hours at most when buying beforehand.

It’s a hard one to say which one you will get for a lower or higher price, it really does come back to the property itself and the level of competition.”

Many ways to get the same result…that’s property investment

Many ways to get the same result…that’s property investment

“Hello and welcome back to weekly buying tips I’m Dean Berman from Berman Buys.

See, trying to make money in property isn’t a one size fits all.

There are many ways to do the same thing.

Some things are right for me, but they won’t be right for you. And vice versa.

I mean what’s the difference between someone who makes $100k flipping a property in a year to someone who makes the same because the market increases or the land is re-zoned or a developer comes and knocks on there door?

Wouldn’t the flipper have the most satisfaction as they have physically created that profit?

Could the same not be said for the investor who bought land that is re-zoned knowing their research was bang on?

Or the one who timed the market perfectly?

I think it really comes down to time, money and skills.

The flipper likely has the time, money and skills to fully dedicate to the project, whereas the researcher may only have a few hours a week.

I would argue on a likelihood scale of success, the flipper will have the highest chance of success as they are less dependent on external factors, whereas the researcher is very dependent on external factors falling into place, particularly in the short-term.

Then again the flipper has more cash flow risk, particularly if undertaking on a full-time basis as they may not have a full-time job and income security, unlike the researcher.

Which then is the right approach?

In my opinion, it’s the one that you feel comfortable with and can work within your lifestyle.

No point trying to hands on flip a property when you have less than 5 minutes a day spare.

In that situation, maybe you hire a builder to undertake the work, provided there is still enough potential profit margin left.

Set realistic expectations as well.

Like anything, property is a process and you learn with experience.

Don’t be discouraged if your first effort didn’t achieve what you wanted or your fear of trying stops you in your tracks.

Think about the lessons you will gain from the experience.

They may just make you $100k in a year.”

How can we be #1 and #2 in the OECD?

How can we be #1 and #2 in the OECD?

“I saw a graph which alarmed me a few days ago.

Showing NZ and Australia having the highest per capita homeless rates in the OECD.

Hello, I’m Dean Berman from Berman Buys.

Today I want to talk about why headlines can be misleading.

NZ are a bit under 1% of population.

Australia a bit under 0.5% of population.

Compare this to Japan which is at virtually 0% of population.

When you look a little closer you will notice the definitions used are totally different.

There are over 7 categories which can be recorded in the definition.

Australia and NZ record 6 out of 7 categories.

Japan records 1 out of 7 categories.

Who do you think will have the higher number?

If you make the definitions ‘like for like’ then the numbers look much similar.

Australia and NZ also drop dramatically down the rankings from number 1 and 2.

To outside the top 20 and below average rates under 0.1% of population.

The fact that there is any homeless is concerning.

Particularly over 8,000 and 4,000 people living rough.

But at least the we aren’t 1 and 2 in the OECD.

So next time you see a dramatic headline, delve a little deeper because it might prove to be normal.”