Your Property Success Mentor Call - February 26-02-2015

The broadcast is now starting. All attendees are in listen only mode. Hello and welcome to everyone for the February call. Now, just to make sure that everyone can hear me, please just put into the question box, yes, Jane, I hear you and yes Jane, I can see your Q and A big screen. See a lot of people here. Hello, can anyone hear me? Yes. Who are you and what are you saying? Send Gavin. Thank you. It's always good to have you on board. Ah yes, I'm glad you can hear me. Look, I'm really forward to, looking forward to hearing from you guys tonight. It has been a big month for us here at your property. Success and wow, what a way of starting the year. January and February has been pretty amazing and I hope you've all got your, your plans in place and set goals and you know, we really covered some of those things last month and yeah, it's been pretty, pretty exciting. So without anything to tell you, let's just get going. So I can see there's a lot of people on on board this evening and some people are going to be listening to this delayed in the recording section. So welcome to you guys as well. Look, these calls are exclusively for my mentoring clients, my students of the Ultimate Guide to Renovation and my Investors Choice Mortgages diamond clients. And if this is the first time on the call, a very, very warm welcome to you. So don't be shy, say hello. You know we're here to answer your questions. This is all about you this evening and these calls generally take place on the last Thursday at of every month at 8pm Melbourne time. So you know you've got lots to look forward to this year and there's a lot of information. There is going to be one exception to that and that is our March call. We're going to have that on the 19th of March so you can't stay around for the rest of this call. I just want to make sure that you know that you're going to get an invite about a week earlier next month. So of course you know you're going to get the email reminders as I said, and you're going to be told when the calls are approaching so you're not going to miss out. And with me as always, my co creator of the Ultimate Guide to Renovation, John Hubbard. Hello, John.

Hey Jane. Hey everyone.

How are you?

Very well.

Been busy.

Yes.

Tell us all about how that development's going.

You've been well we got back to work this week because we had, I think I told you guys about we hit gas on the phone first day we've got these big port bore piers that got to go in 4.2 into the ground. So really quite deep. And then we've got a poor basically do all these BS. They're 450 wide and they get filled with concrete and some Rio and then they go back and they drill all the in between ones and then after they do that they can dig out the basement and make the car park. So one of the. It's two townhouses side by side and one of them's got an underground car park. So we've been doing that anyway. First day of work the driller turns up with this big huge machine, does four piers and goes straight through the gas line which we knew was there.

But it's not quite there where it was.

No, it wasn't where it was supposed to be. So that kind of shut us down for a bit over two weeks and then we started back on Monday. So but it's all going. All going well now. So there's no. We haven't hit rock or anything like that. So it's all going pretty smoothly.

So touch wood, it's all good.

Yep.

So what's the end date plan? End of the year or like hello.

We've got. He's got the actual building contract once the drilling is done because he wouldn't put a time span on the. Or sorry. The excavation is done then it's nine. He's got nine months to complete it.

Nice. Two townhouses in nine months. Great. Well we're looking forward to hearing about all of those in the next couple of months. With pretty pictures I hope.

Yeah, that's the. Well, I've been so busy this week I haven't been able to get down there but I wanted to take some shots at the drills and all that kind of stuff.

You're talking about my old stomping ground being a drill and blast engineer for many years on the mines.

Yeah.

I remember looking into tungsten carbide bits and all the diamond crusted bits and all those exciting things. So geez, bring back memories. John, we're talking about pretty pictures. I've got some pretty pictures to share a little bit later on this evening. If no one asks any questions. That is. That's a little renovation that I've been doing. So. Ah, you know what? Really very good. It's. It's interesting. A lot of conversation for those in the Ultimate Guide to Renovation on the Renovator Network Private Group has been about how to manage a remote renovation. How to buy somewhere where you don't live and manage a remote renovation. So I've kind of been, you know, slightly blogging about this so people can get a bit of a view of what to do and how to do it. And I think it's, you know, look, I know it's possible I've done it before and I, you know, allow a little bit of timeframe creep into my schedules knowing that, you know, if you're not there on site giving people the one, two, sometimes timeframes blow out. So I don't wanna be booking things in when, when jobs haven't finished, previous jobs haven't finished. So essentially just a little, little renovation. I allowed $20,000 for this because I knew that I was gonna be paying a little bit of a premium on my bathroom because I wasn't there to bring all the trades in together. I had someone coordinate it and that was 12,600. So I think I could probably have done it with, you know, beating down some trades and not paying a bit of a premium to have a project manager there for about 8, 8, 600 maybe myself. So there was a bit of, a bit of a premium on that.

Just remind me, you're gutting the bathroom.

And doing, just gutting the bathroom, putting in carpets, wardrobes, curtains, cleaning it up. And basically we had a bit of rental objection in the last, last time the property was vacant around the bathroom. So when we did the initial renovation, which people have seen in the ultimate guide of renovation of this tiny or not tiny, nice little two bedroom unit in eastern suburbs Sydney, we actually stripped out the kitchen and we did the carpet, then the kitchen and painted and you know, made it, made it look great. And we didn't have the funds at the time to do the bathroom. So. Did I say we did the bathroom? No, it's just the kitchen and the carpet and so basically the bathroom, I changed the, the shower curtain and the toilet seat, painted it up, cleaned it up, took off an old ugly, ugly shaving cabinet and yeah, it was nice and bright and looked great and you know, we rented it really quickly and then, you know, 10 years on, time marches on. And this, the old generic eastern suburb Sydney, pink and blue bathroom, it was still pink and blue, so we went with a nice neutral color scheme. I'm going to show you a few of pictures. But I allowed three weeks for the entire bathroom to be gutted. You know, everything to be pulled out back to the, the brickwork and go in and render and waterproof and tile and put in the bath, shower, all the vanities. Fit out, etc and it came in in two weeks. So it took 10 days rather than what I'd planned. Planned for. So I had about a week in between the bathroom finishing and the carpeting that I turned to turn up. So we had a week downtime last week. So I had worked that into the schedule. Carpet went in on Tuesday, wardrobes went in yesterday, and I fly to Sydney tomorrow to paint the ceiling.

But you're not just flying to Sydney space.

No, I check on the work, paint the ceiling, clean up some things, organize some stuff. And I'm running a course in Sydney on Saturday through the community college at Sydney Community College. So I was heading up there anyhow and I thought, hmm, this gives me opportunity to do things. In actual fact, my husband has packed this suitcase for me and I have everything except the tin of paint, I think in there. I've got the tool kit and I'm washing windows and. Yep. So, you know, sometimes it's not a good use of your time to do all of those things, but if you're going to be on site and sometimes you get it to see and test a few of the problems before they happen.

Well, why don't you tell this story about Jan Summers the other day because. Yeah, about her on the site doing her renovation.

Well, yeah, as John said, we're having a chat to Jan the other day and I mean anyone who doesn't know Jan Summers, just, you know, Google her, go to the library, get her books. She's, I don't know, royalty of property investing in Australia. I'd say she, she's where I started my property investing. Yeah. And I think for most people, I don't know, put, put your, your thoughts there, guys in the chat area. But anyone who hasn't read Jan Summers, you know, she's a legend. She started 40 years ago and just that kind of thinking that being able to pull equity out and buy and buy again. And she shared her story with us and we had a really great chat. But she's on the tools again.

So she's believe that she's there patching up. She had water that got into a chipboard bench top. Yeah, a laminated bench top. And she was, she was there working out how to repair it herself and builders bog and all the rest of it. And what, she must be in her 70s.

Hey, I'm not, I'm not saying any numbers here. She looks like a lady in her 50s to me and she's doing marathon still.

Yeah. But I was interested to know that she does all the Renovation work on her own properties and she thought must be huge.

Yeah, and the funny thing is I've chatted to John Edwards as well and you know, you might be having lunch with him like, you know, where are you up to this afternoon? I'm going to do some touch ups on this apartment block. I got around the corner and he and Bob get in and you know, it's all elbow grease. So you know, I think it's kind of like that book, the Millionaire Next Door, you know, you don't. The people who are driving the old Kingswood down the road are probably the millionaires and everyone with the flashy cars are the people, people who, who are hoping to be there and living that lifestyle now without having the assets behind them.

So Vicky's offering you a hand on the weekend, Vicki.

I'd love a hand. I've got about three hours actually. My best friend's just flown in from London and I've said to her, I need you stepladder and I need you. And she's like, you know, I'm a partner in this great big firm. I'm like, I know. And we're off. We're going to be painting the ceiling tomorrow afternoon. We've got two and a half hours to do it in. So lucky. It's very small. But yeah, appreciate, appreciate the offer guys. And I think was, oh, now I forget. But someone on the private Facebook page also suggested that we're happy to check in on the tradies too. So this is possibly something that could happen in the Ultimate Guide to Renovation that we have people who are a bit worried about their Renault's happening interstate having, having some of their, you know, like minded people helping them out. So I think we could start off a really nice little network. So anyhow, well, let's get into more exciting things. So there's a lot of exciting things coming up for you. We in the course the Ultimate Guide to Renovation. We've been, gosh, we've been shooting more videos this week, last week, next week. I think John's had me in the studio pretty much every day almost.

Yes, we seem to be shooting, been shooting a lot of videos for a long time.

I know, I think it's like 150 hours. First up, when we first did a few videos and we're just now just doing it every time we can. So we've got some really great new videos for you. We've also. Oh, this is really exciting. John, you want to mention this about the spreadsheets.

Spreadsheets, yeah. So all of that, and I've mentioned it before, but all of those spreadsheets in or the main spreadsheet in module 2, the suburb selection, we've basically partnered with Jacob Field from Ripe House and he's supplying us with a lot of data and we're getting some data from other sources, all legal of course, and basically pre populating every, just about every capital city of Australia.

Yeah, there's a, there's a few that aren't included.

Yeah but we're told they're not good places.

So if you're from those cities and apologize.

But, but it's going to be huge because you can put your, basically you can put your criteria in and yeah, you're just starting with a short list of suburbs as opposed to having to go to the back of the magazines like we used to say and collect all this data yourself. It's a huge amount of work so you end up at the same point but it's just going to save everyone.

A lot of work. And look, this is the reason we've done this. I mean, as you guys know, you're part of the family. We're really dedicated to helping people achieve their property success and when we hear of obstructions and something that we can help out on, then we get involved and do something to get you to your success sooner. And one of the things that we were hearing last year where people were getting from their location kind of information and getting from the dot maps and the suburb selection down to the spreadsheets to do the analysis and the spreadsheets took so long and there was all this information they had to go and get it. And although I show you where to get it in all the different websites and information became a bit of a barrier. So taking it by, by the horns, we've taken that on and compiled it basically.

Yeah, so it's going to be good. I mean hopefully it doesn't have teething problems. When you send spreadsheets out there into the world you have to, to especially.

Because everyone's got different versions of things. But you know, take it for what it is. It's always a work in motion with us. We're always improving.

Things should be good. And I'm really excited about the Ripe House software too because he's, he's made a little custom version which really follows the steps of module two. So that's going to be really good.

Because it's about getting the suburb selection down to the streets.

But it's what's nice is a lot of that due suburb Due diligence, that, that takes a lot of time, particularly if you're doing the census maps, which are brilliant, but all that stuff kind of takes time to do. And you can now do some of that stuff in module two. So rather than when you get to module three and the actual suburb due diligence, you can jump in and out of suburbs with Ripe House, do a little bit of stuff and work and try and. And you know, do your short list that way.

And you know, it's so nice being able to work with people. I mean, Jacob attended one of my courses and, and I took, you know, he participated in seeing how we go about getting the information and obviously getting the information out of census. I know I'm the only one who seems to be able to have done it after taking three months and 18 calls and whatever, trying to. To work through it, but getting down to what streets and occupiers are in and rental people. He's taken that on board of something that we need and he's put it into the software and you know everyone's going to get what, three months.

Yeah, that's right.

Complimentary access to that customized version.

Three months for everyone. And then he does some kind of discount on the end. But I mean, the thing is, you're not going to be searching for houses 12 months round and that's nice.

You can, you can actually subscribe per quarter.

Yeah. And just come in and out when you need it.

So that's really exciting. So. And I've just sharing with John of talking to someone else who's a provider of information that we're hoping to get over the line and get their information on board as well into our spreadsheets and some more information. So.

That's right. I should just. I see Angela, she's just said, I didn't get the software. It's coming with the next launch of the. The course Angular, which is March. In March.

End of March. So. Yep. So it's going to come out and that's for the people in the Ultimate Guide to Renovation.

Yeah, you'll probably. People inside the Ultimate Guide to Renovation will probably get it a bit sooner as we start to just test it and, and see that it's working properly. But yeah, the. Basically the new, the new modules, the revamped modules will come at the end.

Of March, so we better get into the technical boring stuff first and get that out of the way so we can get onto people's exciting questions that I have tonight. We've got heaps of people here, so hopefully you guys have got some questions in mind because I'm here to answer them. If, you know, think while we're going through this, of, of what you might need to know, if you need me to jump into, I don't know, some suburb reports or conversations, things going on at the moment, I'm, I'm here to answer your questions as is John. So. Okay, so let's get into some quick housekeeping. If you are on your computer and you're experiencing any problems of hearing me or perhaps you can't hear the questions, there is an option to call, call in on the telephone. And the telephone number can be found in the sidebar. There's an O2 number there. So under the audio options dropdown, if you call from that landline or mobile or from Skype, so, you know, just use whichever methodology and that's great. Um, so when you do have a question, though, all you need to do is raise your hand by pressing the little hand icon. Now, it is in the side menu. You probably see it to the side, actually, but it's a little hand. It's. It's hard to see. I know people have found it on the iPad. Even so when they've been sitting on the bus.

It's different from PC to Mac. So that photo, there's a Mac and it's. We. For some reason, we missed out on our photo today. We actually took one to put it in and then the slide didn't save or something happened.

So look for the little yellow hand. He's there somewhere. So clicking the hand tells me that you've got a question and you're giving me an idea that I'm here to answer it. So I will unmute your line. And when I unmute your line, you're going to get a little recorded message that says, hey, your line's unmuted. Then you know you're on. Ask your question. Look, you can write your question in the question box at the bottom of the control panel, and I will try to get to those if we do have time available. But I do give priority to the spoken question, and that's because it's. It's a lot easier for me to understand fully what your question is and get to the bottom of it. And also in real time, you know, we can go backwards and forwards and I can, I can give you a little bit more clarity if I haven't answered correctly. So, you know, I really love you guys to have your microphones ready so we can do that. Excuse me. I guess the other thing is I just really want to state that there is no silly question. So you know, I know there's people on this call and I can see your names and I've had chatted with some of you that haven't bought even your own home yet. So you know, you're just starting to buy a home and I know that others of you, and I can see your names too have bought many of property and are very active. And the thing is, you know, we're here as a supportive community to help everyone no matter where you are in your journey. So you know, please make an effort, contribute. Your question, you know, is probably something that's on someone else's mind. So these mentor calls, look they usually go for an hour and a half so but if we run out of questions, well, you know, yeah, that'd be nice, come back for my trip. So look, for the sake of the group, if there is a lot of people with a lot of questions, I might just take one question and then I'll come back to you afterwards. Otherwise if you've got a follow up, you know, follow on. Now I guess it's I want to make sure that no one misses out. So if you do have a question or whatever, please make sure, you know, let me know if you have to. If you don't have a microphone, just type it in. So there we go. Lastly, just a reminder, this is not a tech support call. If you are experiencing problems with the video that won't download or whatever, I really am not the right person to speak to but if you do have these issues please simply email my team@supportourpropertysuccess.com it sounds like I've got 20 people sitting around making waiting, waiting for these problems. Not the case but you know, we will get the right person of fixing your problem as humanly possible as soon as possible. So without anything else to say, I am going to hand it over to you guys and I'm going to be looking for anyone with their hand up, which I'm just going to tell you no one's got their hand up at the moment so I am going to wait for someone to ask me a question. And when you do, we've got someone, Carl. Now I'm going to unmute your line Carl, so hopefully you've got a microphone and we can have a chat. Hello Carl.

Hi Jane, can you hear me?

Yes, we've got you. How are you?

I'm doing all right, thank you very much indeed.

Great. How can I help you tonight?

Question is about Vacancy of my rental. How long do I wait before negotiating on price? Is there any other factors that I can I guess get the renters interested in?

Great question. So just give me a little bit of background. Where is the property located?

So it's in the Newcastle area where I'm based. I noticed you mentioned earlier about all the data being available in capital cities. Again there doesn't seem to be anything for the rural areas but fairly near to university area. University and hospitals. I understand those are two key things that you look for. Yes, I love that three bedroom property. I think probably one of the things that might be people putting off is it's a 500 square meter block and the reason I bought that was because I've got plans down the back to put a granny flat on the back.

Great. So at the moment a lot of mowing to do, is that what you're suggesting or it's.

I'm thinking it might be a negative. I've been sort of trying to pump the property manager to say well look, you know, what feedback are you getting? What's the negatives? What are people concerned about? Two of the bedrooms are a little.

Bit small.

So it may put off university students looking to share a three bedroom house. But the yard again may be an issue. And I have included lawn maintenance in the price. I'm just thinking, well how long do I leave it vacant before I start bringing the price down again?

So when was it made vacant?

It was available just after Christmas. Then I had friends of mine move in for a month. So it's now been vacant for about another week. But it was still open, available over open houses while my friends were still in there.

Okay, and have you put the rent up or what was it before and what is it now?

It started at 400, I've dropped down to 380 and I'm sort of thinking by the 380 and including lawn maintenance or 360.

Okay, and tell me the, let me get an idea. So it's a three bedroom house.

That's correct, yes.

Near the University Hospital.

University, yes, near the uni.

And is it, is it, is it characteristic for the area like the other three bedroom properties that are being rented at the moment and are going, are they in that price range, that 380 to 400 price range?

Yeah, that's, that's round about the rise price range.

And have they got any features or anything that could be added quickly that would, that would kind of make them comparable? Or is it, is there something that's really can't be. Is it. Is it the fact that it's a lot of mowing and two small bedrooms or is it the fact that the other properties have security and Foxtel?

I haven't got any definite information about it. That's obviously something to ask the real estate agents. Things do tend to be a little bit. Seem to be a little bit slower generally this year and that's because the university's released more student accommodation.

So.

The shortage on the market that's been experienced in the last couple of years is quite as bad this year because of that.

Okay, so. And has the rental manager been proactive in giving your feedback on what have been objections from people who've been through it, or is this no one going through it?

There's been sort of one or two people go through each open house. So they've done two open houses each week for the last couple of weeks. So there hasn't been a huge number of people coming through.

Okay. Which is unusual for the beginning of uni.

Well, yes. With the traffic around here at the moment, you'd think there was thousands of students living around here.

Okay. So we might have to start right at the top. And it might just be the initial attraction of people to the property itself. And that is through good copy pictures marketing of the property. So is there a rental board out the front?

It is, yes.

And so everyone knows it's for rent when they go past, are they open for inspection times, times that are convenient for your target market?

Yes, that has been an issue because there'll be a couple at 3 o' clock during the daytime, which obviously doesn't attract your both husband and wife working situation. There is another one on Saturday, so that's obviously a better time for people.

Yeah. Would they run them at night? Is there a 6, 6:30 kind of option or is they just said 3 o' clock is our all we got?

I don't think they've done an evening one. That's probably a good question to go back to my girl and ask her about that one.

It's always good to have a girl and tell me, okay, these property managers.

Tend to be girls, don't they?

Yeah, yeah. I have to say that a lot of my property, I'm thinking about all of mine and I've got two men and four women. So yes, I would go with yes, those statistics are correct. So, all right, so top down is do people know it's for rent? So obviously out front of the building, is it open at times that are conducive to your Target market, I think you can go back to them and ask for an evening opening that could assist. Now what's on the webpage? So when they're doing copy for the webpage, which is often where people are doing these searches, some little tips might be. When you said that you kind of started at the 400 mark often one of the tips, one of the rental managers has said to me once was that I wanted, I think it was like 620. And he said, well what happens is people actually search between 5 and 600. So you're in the 600 to 700 range. So if you want to be just the property that rents quicker then bring it down just to under that kind of range that people would set so between the hundreds. So you may have been just being missed out when you're in the 400. Does that make sense? Yep. So now you're down at 380. You're probably in the right, you know, the range that people are searching for, obviously the upper end of the range. But that's the price for the market is what you've said a three bedroom is. The other thing is the actual copy. So a lot of rental or property managers I find talk about the features of a property rather than the benefits. So you know, the features are three bedrooms, a house on a 500 square meter block where a benefit, you know, might be, you know, within 10 minutes walk to the university across the road from the bus stop. You know, large, large house, lots of, lots of room to fit your cars. I don't know.

They tend to be the poor cousins of the real estate agencies. They don't get the really good copy like the sales. Do you often see some really crummy rental.

I know and, and just photos.

I'm quite happy with this but could I possibly send you the link and.

You could have a place, put it there. We'll, we'll pull it up and we'll pull them apart. Well, okay. We might have to hide the names. I don't know. We can't be that creative this time. So anyone, you know, we'll see how it is. But yeah, so let's, I mean, so I'd start at the really big stuff first of all, which is are we getting, are we getting eyes on the property and are we getting the eyes that are on the property? Are they, are they getting the right message? So first and foremost just put that, Carl, just put that in the question box and we'll, we'll go to that link and pull it up. Chat box, question Box. Can you see it?

Yeah.

Okay, tell me the. I will just pull up Domain and tell us the.

It's on real estate.

Okay. Real estate. Is it on Domain as well?

No.

Was that a decision that was made or just the fact the rental manager doesn't.

That's what the property manager uses.

Okay. And what's the address? Do you want to tell us the address? I guess we're going to see it if you pull it up anyhow. So say for privacy, maybe we can have someone on the call who needs to rent in Newcastle. You never know.

Hopefully.

Yep.

So what's the address? Yep.

King street in Shortland.

Okay. So while we're pulling that up, there might just, you know, it might be worthwhile to actually find out what it takes to get it on Domain as well. Or if that's why they've made that decision. We're just pulling up that property now. Immaculately presented interior. This looks good. Yeah, just put that one over. Okay. Hopefully. Yep. There we go. You guys can see that. So let's just have a quick look. It's available now. We've got a three bedroom, one bathroom, three car spot. So the car spot could be something that's really attractive, especially to university students, I would think, because I know having lived in share houses myself, there's usually only one car spot and there's usually people with cars. So that could be attractive. Let's just have a look at the images.

Oh, please appreciate the letterbox.

I'm glad you've done some effort there. That's great. This is. You've obviously painted and done some work here, the front of the property. Yeah.

I can send you a link to the before photos as well if you want.

I would like to see that. So I can see you've done some work. It looks nice and clean and tidy. You know, the landscaping doesn't look scary to anyone. Like if you're going to take it on in the sense that, you know, they're looking after the things at the front.

Too much maintenance.

Too much maintenance. Yeah, the things, we call them plates. Okay, nice. So there's air conditioning, there's clean, tidy, looks good. The pictures are nice and clear and light. You're getting a feeling of space. See that you've got some air conditioning. We've got what else we've got here? Wardrobes, which people like to see. Nice looking bathroom, bath and a shower. Okay. So the pictures showed that it's nice and clean and habitable, which is great. So there's nothing really. Johnny, got any comments There?

No, not really.

Okay, so we've got a three bedroom house offering an immaculately presented interior. This home has the convenience of being located just 1 km from the Hunter Valley Private Hospital and 4.3 kilometres from the University of Newcastle. As well as enjoying easy access to the new expressway with a direct link to the Hunter Valley and Sydney. So just this kind of kilometers, 4.3 kilometers doesn't mean much to me. Is that a 10 minute drive or is that a 5 minute walk or 5 minute walk? 4.3 would be pretty fast, but that'd.

Be a pretty fast walk.

Yeah, I've been exercising. Really not that much. So you know, it's kind of, I don't know, 1km, 4.3km. You know, this to me is a 10 minute walk to the hospital and you know, whatever that is. What did you do 4.3km in 10 minute drive, 5 minute drive to the.

You might do it faster than you.

Get to the, to the university. So just, just those just, you know, obviously this is just being really picky.

At least it did start with benefits.

Yeah. And that's, that's a really good thing that they have started with the benefit immaculately, you know, presented convenient and easy access. So that's great. Upon entry to their property. So we're getting a bit of a story here. So they are positioning it nicely. You'll find generously sized living. Polished floorboards, free fresh paint, new venetian blinds and air conditioner. Wide windows fill the room with natural light and there's nothing wrong with this exterior. Window awnings and tinted glass in the place for added comfort. The kitchen is well appointed and modern and has plenty of bench space and cupboard space which is what people are often after. For cooking. You have electric cooktop and under bench oven. So there are a couple of features rather than benefits. And there's plenty of room to fit in a large fridge which is always handy. Bee fridge for uni. Adjacent to the kitchen is a spacious dining dining room that's large enough to place a dining setting and has access to the rear yard via the backyard back door. There are three bedrooms all with freshly painted walls. Nice to know. New white venetian blinds, new carpeted flooring. Two of the rooms have built in wardrobes and all. Wow and all. Goodness. We jumped. Rooms have easily accommodated double sized beds. So that's great. So you want to make sure even though two of the rooms are a bit smaller, the fact that they can all get double sized beds in makes everyone kind of happy. Clean, fresh bathroom, nothing Separate shower, recess so they've got separate large spacious green grass at the back which is nice to know. Low maintenance garden along the front. Plenty of street parking is available with single garage and room to park another two cars off street. The exterior of the home has covered area where you could fit an outdoor setting. Public transport runs along the street and the bus is located nearby. Okay. I would probably. If your target market is the university students, I think this is a medium to good kind of copy. I wouldn't say this is bad copy from what I've seen. I think they mention features quite nicely. They go through and do some benefits as well. I would just possibly try to tighten up a bit of the benefits. The fact that there's public transport out the front and close as well as three car parks and only 10 minute walk to the hospital and 10 minute drive to the university. I think I'd be putting those right up front. Large three, sorry three bedroom, three double bedrooms to accommodate, you know, people gives them a fact that you know there's not going to be someone in the little dingy one out the back. So if you're going to be looking at share accommodation, I think that seat is a really good positioning as well. The lush green grass at the back, you know, is good for a family if you, if you're after family, good room. So there might be something around the fact if you wanted to have kind of a little twist in, in your target and say make it, you know, a little bit more targeted for mum, dad and kids as well. Could be that, you know, large, large area for. I don't know, what would you say?

Yeah, of course I'm always. If, you know, if you really know your target. Sure. Your target. Yeah. It is sometimes better just to focus on that one demographic because they then feel that they've really been spoken to for a rental.

Yeah, I think that I probably play up the fact that if there is there a fence, where's that fence? Is there a fence between the back and the house?

There's not. So down the side there, there's no fence.

Okay, so is it hard to get, Would it be hard to get in a fence?

No, that would be fairly, fairly easily.

Okay, so although your target, as John rightly says, although your target market is, you know, the students and you have from the sounds of it since Christmas had it available for open for inspection. So it's been about what, six weeks?

Yeah, about that.

Yeah. It has been available for people to let for more than that like maybe one week. But people have been looking at it the fact that university students often want, they come down from the country or whatever, they're looking for a property to move into quite quickly within two to three weeks. I don't know if there would have been much of an objection. The fact that people were there and they were told that it will be vacated in the beginning of January. I don't know if there was a time frame issue there. But although you're targeting the, Targeting the students sometimes, you know, as our low risk, fallback position, if, if the university has started or about to start and you've missed them making this a little bit more general and potentially having availability for pets and putting in a little bit of a fence, like if you could put a fence in between that garage and the back wall and it's, I don't know, five, four or five meters of nothing, potentially there could be the ability for you to do that and advertise it for, you know, outside animals allowed with a pet bond. Because it's really hard for people to actually be able to get rental accommodation with pets. So that in itself could actually help you out a little bit. But look, just looking at this and looking at the copy, I think it looks, you know, like there's, there's. They've done a pretty good job. It can tighten it a little bit, but, you know, there's no kind of obvious thing. No, there's. I'd say the time frames, when they're making it available for people to inspect could be a bit of an issue. So try to push for the evening, the evening as well. The small bedrooms, you know, if they're a bit on the small side and they're dark, then I would say, you know, potentially, if you get down to the stage where there's no one renting this place, then brighten them up. But just looking at the pictures, you've done a great job, Carl. They look light and bright and clean. And, you know, obviously you got the, the new venetian blinds and you've, you know, the paint looks great. And so, you know, sometimes I would suggest that the smaller rooms could be brightened up by making them a lighter color. But I think they look great. It looks low maintenance. You know, I think it might just come down to the fact that you might need to start considering you have already dropped it, but you might need to start considering other things. And the other things would be maybe the pet allowing pets and maybe the fact that, you know, every week that this is out of circulation or not being rented is costing you $380 or so in Rent. We want to make sure that you've got the ability to, you know, recapture your money straight away. So having a vacant property is always a stress for everyone. And I would much rather drop 30 bucks a week, you know, 1500 dollars a year than wait three weeks and lose, you know, three times 400 bucks then, then and have it not rented. So, you know, I have. I usually put my property on the market when I'm renting them out just a little bit below what the standard is. There's things you can't change. You can't change smaller rooms. You can't change the fact that it's on a big block. You can just optimize those. So, you know, if there wasn't. If all the other properties in that 360 to $400 price range had a secured front door or deadbolts or something, then I'd be saying, maybe you need to look at that and just go and see what other. Take yourself off on Saturday and look at what the other properties are doing. So, yeah, we've got some ideas.

Yeah, a few ideas coming in the question box, Gavin asks, can the property be partly furnished, for example, fridge and washing machine. What do you think of that one?

The other thing I considered was virtual staging as well.

For the photo.

Yeah, I'm locking people in through the door. So it's almost like the advert is not standing out enough. Have you got any thoughts about a vacant property against a furnished property?

I guess the. I haven't tried virtual staging. I know that one of our friends from When Jane has, you know, the virtual staging kind of thing that they can do. And Viv, the. I haven't seen it. And I have to say that without having seen it, I wouldn't be comfortable in saying whether it just looks like someone stuck some furniture in there or not. I personally like to have furnished properties, places furnished when I'm actually taking the photos so that, you know, people get an impression of what they. The property can look like. Having said that, if I had small bedrooms and I squished in a double bed, then I probably wouldn't want that. So, you know, you kind of have to play it by ear. If virtual staging is going to cost you, I don't know, what, $350. What is it?

Yeah, about 50 bucks a picture.

Something like that.

Yeah. So if it's going to cost you a bit of money, I mean, rather than trying something untested and a little, you know, out there, I would possibly be spending that money on something that is going to deliver a value which might be the secure front door, it might be the fence at the back, it might be Foxtel connection, it might be another air conditioning or another wardrobe in the third bedroom. Do you know what I mean? Like I'd rather spend my money on something that's going to actually add some value to it. But you know, but you know, as I think Gavin mentioned, maybe putting in the washing machine and the, the fridge could be a potential that, you know, if your target market is uni students and they don't have that, then maybe including that could, could work for you. I've got a property that's rented out with a washing machine in it, but I know that in the past I had a property that wasn't renting and I put together like a little furniture package said, you know, so much extra a week for the washing machine and, and the, I think it was, what else did I have? Washing machine and fridge. And you know, no one was interested in it but you know, I was trying it out. You never know. I'm a bit concerned though about your time frame now and your target market because I would think that the university students are in place. So I think that I would start looking at making potentially just as an aside, when you come to your next, when you come to renting this out, I'd potentially make it maybe a 10 month lease or 11 month lease rather than 12 months because you want it to actually finish to give you some time to get the next lot of uni students in. If uni students are your target market. Because if you make it 12 months and you rent it beginning of March, then next year when they move out, if they do move out after 12 month lease, then you're back in the same problem as that you're a month after the uni student service have actually moved into properties.

Okay.

Do you understand what I'm saying?

Yes, exactly.

So I'm jumping ahead here, but I just, I'd probably make. And I've done that. I've got a little unit in Bondi. It looks great during summer, it looks really bad during winter and you know, it's, it doesn't look bad, it's just, it's just blur, you know, it's not, it's not, doesn't have a Bondo beach feel to it. So, so we always make sure that lease corresponds with summer period when it ends. And so you can state you want an eight month lease or a ten month lease or whatever it is. And let's face it, most people go to Rolling month by month anyhow. But it just gives you that capability of if the lease is up then and they move out then you're in the right time frame. But look, you know, I'm hoping we've had some value here. I'd start at the top, I'd get eyes on the property, I'd make sure they're the right eyes. I'd go and check out other rental properties, see what they're offering. Definitely consider dropping your rent and you know, if there is, you know, not many one or two people going through on a weekend, it's either there's only that many people looking and there's not that many in the market at the moment. It could be that the ads now talking to the wrong target market or it could be, I mean you know, if you're that close to the hospital, 10 minute walk to the hospital and across the road from the bus, I'd be, I'd be really playing up that straight away to potentially getting some people from the hospital in and yeah, I'm hoping this helps but I would, I would definitely consider dropping my price. Got some more comments here.

Yeah, Nicole said I find it much easier to market a three bedroom property to a family rather than students especially with pets. So allowing pets, Gavin's just skip, skip that one. I would ask the PM how many they are renting a week and what, what is the vacancy rate at $380.

I'd be renting it to families, families as well.

And Gavin looks like he's had a.

Gavin's doing some research here for us. 5.8% vacancy rate so pretty high vacancy rate.

Yeah, that's very high. It was 3% when I bought.

Things change, don't they? I mean the university adding in that that student accommodation is a risk and you know, as I've said I've always bought new universities and hospitals but it's being aware and I know at one stage, you know, I was looking at buying having been in the mining industry and going to these towns, looking in mining towns and hearing that the, you know, Mount Isa and Olympic Dam, that these, the actual mine mines themselves were putting in their own accommodation. Everyone was flocking up there to buy the accommodation to provide to the miners without actually having the understanding that these guys a risk was that they could actually do their own accommodation which is what they did, which is, you know, what the universities are doing as well. So they definitely, I know down here in Melbourne they're doing the same thing, they're buying up accommodation.

So I must Admit that the fact that they were releasing 700 units this year didn't come up on my research.

Yeah. And I mean that's one of the things I think that is not. You really have to dig for that information. And sometimes we talk about doing the due diligence and doing the work and the research and you know, going through councils and looking at approvals and all of those kind of things but sometimes it's driving around and going okay, what's, what's being built here or, or what's happening. And I spend, when I go and buy near a university, I actually walk the university. So I'm always reading the, you know, for rent, one bedroom with the little pull offs and, and all of those things.

A couple of people have suggested go and put a note up. Both Nicole and Gavin suggested putting that up at the hospital.

Hospital, yep, absolutely. And you know one of my actually a little unit that I'm going to renovate tomorrow or finish off actually just paint. Someone else did all the work. But I always had a target market for university students and what I found is that the hospital has been my best tenants and in actual fact after a year and the tenants had moved out who were from the hospital, I went back to do a bit of an inspection and they still had the instructions for the oven in the oven because they never used it. So they're definitely low maintenance tenants.

Sorry.

But yeah, definitely I walk through university and have a look around. They usually, the universities usually have tenants have a like accommodation service as well. So I speak to them about what people are renting and find out a little bit more information about that. And the hospital, you know, trying to get something up on one of their boards or on one of the, the polls out the front could help as well.

Lee just said if the vacancy rate's high it might be difficult to dictate the terms of the lease. That is 10 months.

Yes, it could be, it definitely could be. Or it might just be that you could say hey we're so flexible, we'll give you a six month lease and know that they're going to roll it and you've got then some time to, you know, come back with whatever it is in your state, maybe 60 days notice for them to move out.

Beautiful.

Okay, I hope we helped.

Thank you very much indeed and thank.

You everyone for contributing to helping Carl too.

Yeah.

Okay, let's see if we've got some more questions. Well, I've got to tell you, not many people are putting their hands up but they're all Happy to jump and help out. So if you have a question, you're not just getting a couple of brains here on this side of the microphone. You're getting a lot of people at heart, a lot of people at home also helping out. So. So let's. Let's just see if anyone else has a question and just had one question.

It was about the kitchens. And I'll see if I can put it in the. I mentioned a crowd that I used for kitchens which do pre pack. They're kind of like a flat pack. They come over from China as flat pack. And then they put them together in the factory and. And send them out. How do you do that? I think I've got a clip on one first.

So John was saying that he has saved quite a lot of money in one of the structural renovations that he did by actually getting not a customized kitchen, but getting a flat pack to standard sizes and actually changing, I think, the size of the pantry at the time.

Yes, I like using. I tend to move the wall of the. I'll build a pantry, but I'll do it with like little stub wall or anything just so. I hate using custom sizes because it always costs such so much more. So I found that I could, if I could use kind of prepackaged stuff and I do it with vanities and, and wardrobes and kitchens and that. That's a crowd that I've used in the past. Now, I don't know if they're still as good because it's been probably two years since I've used them last, but they get the kitchens over from China and put them together in the factory and it's a huge saving. So. So I was doing. I think my last kitchen was around about 3,000 in cabinetry and the bench top alone was about 2, 400, so. And it used to be that kind of kitchen would be around the seven kind of mark. Six.

Seven mark cabinetry.

Seven, actually. That's. That's wrong. So it would have been. If it was three, it would have been around the five mark.

Okay.

Yeah.

And the bench tops you got separately, didn't you?

Yeah, I get the bench tops separately. Yeah. I found that although someone that's. You just used them not long ago said that their bench tops are changed and they're not too bad now, but they used to be a bit kind of not. Not very nice.

So we've got some. We've got New South Wales and Canberra there, but I imagine that there's. Since you did the last one in Victoria, there's probably Victoria as well.

Yeah, I can't see it there, but there's definitely a Melbourne one.

There's a Melbourne number at the top and they'll call us. Oh, there we go. Scroll. So there you go. So that's the, the people that.

And I just use the white, white two pack version which is just basic white shiny cupboards and then I didn't use the handles, just bought my own handles and I, I bought, you know, kind of bulky, square chrome handles. So look, you know, substantial handles and yeah, it looks, looks a million bucks. Looks just like a white two pack.

Just like I bought one.

Get made. Yeah, custom made.

Fabulous. Well, hopefully you just serve someone $2,000 off the next kitchen. Hopefully we're here to serve. Right, okay, so let's see, anyone else got their hand up? Anyone else have a question? Okay, well if you don't have a question, I will tell you a question that someone sent to me today which was someone had actually bought my book and sent me an email saying thanks for, thanks for the book. Loved it. However, I've got a question and I think I surprised them by answering which was their question was that they had a friend who was about to buy a one bedroom off the plan unit in middle ring suburb in Melbourne and they wanted to know how that fitted into the Trident strategy and how that fitted into is this a good thing to do? So I had a few, I guess not knowing anyone's specific details etc. I can only give some general kind of comments but for me, off the plan, I mean we've all heard about the fact that Sydney and Brisbane and Melbourne cbd, there's a lot of units going up at the moment and in actual fact the government's just announced the fact that they're going to penalize, not penalise, charge a fee for overseas buyers and there will be a penalty if they break that fee. So there's, I think it's $10,000 for every million that overseas buyers is it like an application fee that they have to pay and there's a 25% of the value of the property that they are charged as a penalty if they've bought a property with not following the Foreign Investment Review Board guidelines and they have to sell the property. So they're getting a bit tough on that. So there's been a lot of speculation that there's some issues around overseas buyers actually driving the market up. So the government's taking that on board. So we'll see how that goes. But off the plan in Middle Ring suburbs that the things that really I guess triggered my concerns was once again straight back down to what we always talk about John, which is target market. And a one bedroom unit in a middle ring suburb to me does not talk to a target market. Middle ring suburbs are generally families and unless they are, you know, like what we just talked about with Carl, near a large infrastructure and you might have some shared accommodation. Like I know there's areas that I know Middle ring, Box Hill, Box Hill, tafe, there's a lot of students associated Dulwich Hill, you know, there's some TAFEs, etc, so you know there, there are some middle ring suburbs that do have some exceptions to this. But even one bedroom units, although there's a large demographic move to single person living, most of those single person livings want at least a two bedroom property. So one bedroom, I mean I heard today, gosh, what did I see? There was a one bedroom, 23 square meter unit that someone inquired about and there was someone else who contacted me with a 46 square meter two bedroom unit. So you know, we know that developers are squeezing in the units and making the sizes of these properties smaller. But a one bedroom unit, I don't think middle ring is a target market. So I'd be doing my target market analysis first. And the other thing about off the plans, and I've had this conversation with John Edwards from Residex over the years and he thoroughly believes that, you know, because you're taking a bit of a risk in purchasing a property with, you know, sight unseen to some degree, degree and not understanding what could happen in the economy and predictions of growth, et cetera, et cetera, which is interesting coming from him, which is that off the plan properties should not be priced higher than their comparable current established properties, but possibly lower because of the risk associated. So you know, often what people think is that they're buying an off the plan property at say unit of $400,000 that you know, they don't have to pay for it for a year. It's fabulous. They might put down a deposit bond which is means that they don't actually have to put the cash out of their pocket for a year's time and they sign up for a property. And the thing is you need to anticipate the fact that you're taken out of the market potentially in your borrowing capacity for a year. And I'm putting my mortgage broker hat on here because you need to know that if rates change or something changes, you have to be able to commit to fulfilling your agreement in the contract that you've signed. So sometimes you can be out of the market. The other thing is a lot of the developers work in the future value of the property. So they're like it's 400 now as the comparable for other two bedroom units in the area. But this is a good growth area and it's brand new and whatever they say in their sales and marketing, buy it for 440, they've actually anticipated some growth or maybe 420. And the other thing with off the plan is often And Jing the GFC, sometimes you had to have 50% or even 100% pre sales, now it's back to 50%. So the marketers had to sell these properties before they even had approval from the banks to finance them. So you know sometimes when they get down to the end of the properties available, they're going to discount those. So that could actually work against you at the end because you know you've actually got these sale prices that are lower than what you've committed to. So there's all these off the plan things. Now I know people have made a lot of money from off the plan properties, I know people have lost a lot of money. But just be aware of the fact that how does this fit into the Trident strategy? Well, obviously buying below the market, you're not too sure of that. And sometimes as I said, the developers are factored in a higher price they might try to cover it up with. And I heard of someone today with a two year rental guarantee and really the banks from a servicing point of view are going to do a valuation and they're going to base that valuation on what the valuer says it's worth, not the rental guarantee. So you can't take that into account. Then we talk about the Trident strategy. Number two is adding value in the middle term by renovating. You can't really renovate a brand new property. And three, capital growth. So capital growth is driven by many, many things. But capital growth is driven by first and foremost a demand. And if your target market or the biggest market in that area does not demand that type of property, then you've missed the target market. So in actual fact, we could have ding, ding, ding, ding, ding, ding, ding fail on three points here on the Trident strategy. So I just want to, I guess make you aware of the fact that, you know, when we're looking at these opportunities, a, it could take you out of the market for a while, B, it may not be what you want. I just had evaluation back for a client on or off the plan that they're settling on this month in Brisbane. And the valuer made mention of the fact that the marketing development commission was a little higher than they'd expected at six and a half percent. So someone got six and a half percent for suggesting this deal which is okay in itself because you know, you usually are given that as a. You understand that they have to declare the commission. So you understand that suppose and so if you've done your research and know that the property is worth that then that's okay. But I know someone else who in Melbourne and went to you know, visit finally their off the plan purchase and there was a pillar in the middle of the lounge room because the, the contract said that they could change up to 5% of the floor plan without having approval and which included this pillar. So which you know, between the TV and the lounge is not really good. So just be aware that there can be changes, there can be great opportunities as well. You know, I've had clients who were buying in Darwin and they were buying you know, these beautiful waterfront units that almost doubled in value by the time they were built. So you know, there is opportunity. Just do your research. So basically I suggested that she has a chat to a friend about is the one bedroom unit right for the target market.

Question from Gavin.

Gavin. Gavin always asks the most interesting questions. They worry me a little because I wonder if I can answer them. Gavin, what's your question this evening?

It's more not a question but a statement. I went over to Perth, I live in Melbourne for those people who don't know. I went over to Perth to work with on my mates Renault for a week and we hired a spray gun.

Yes.

And I've done four other Renaults prior and I've never used a spray gun. And it changed my world and I needed to share it with everybody.

John can relate to this. He always convinces me it's a good thing to do. It's just, it's awesome.

It's just awesome.

We actually on the advice of a guy on my last Renault who was the Bunnings paint master and he suggested that you spray everything until your last coat or if you do spray your last coat you spray it and you chase it with a roller so that if you have to do any repairs later on it's easy to repair. And also if you really crap on the spray gun it, it really is a good way to hide being crap.

On the spray gun because the person.

Comes in with the roller and just rolls up any excess paint that you've put on the gyprock or anything like that. But it was just, we hired it for I think Thursday, Friday, Saturday, Sunday. And we painted. It was a four bedroom, two bathroom, a reasonably probably 20 square house. We painted inside and out and it was two stories and it was, it was just easy.

Two coats.

Two coats, undercoat, ceilings, exterior.

I did the same thing, rental property. And I think, I think I hired it for three days. But I did the inside, the outside and the roof. So colorblind roof, which I resprayed. So while the inside was drying, I went out and sprayed the outside of the house. Just changed the color, run a bucket of water through it and. And then also did the colorbond roof as well. So yeah, within had the whole color, the whole house inside and out, change color. But I was just going to say that, yeah, I've always done it the other way. So you, you run the roller through the first coat so you spray it on. And I had a painter that did it this way. He would have his apprentice run behind him with the roller just so you get that pattern on the wall. And then he would just spray every coat after that, the two remaining coats.

He was obviously a better sprayer than me.

Yeah, maybe.

I don't know. My, my husband sprayed a property that we had in New Zealand and he came home covered in little paint jobs and, and he said the, the prep in covering up the windows and everything that it took him like a day I think in doing the covering everything so that he could actually then let loose with the paint.

It does. It takes about a day to do the COVID But I mean you're still saving.

Yeah, exactly. And money.

Yep.

But you do use a lot more paint.

Yeah, for sure.

Yeah. No, great, thank you. Thank you for sharing that. Oh, here we go. Carl's did the same. He did his three bedroom house in 24 very busy hours.

It's just amazing how fast you can do it.

Yeah. And the painters did the woodwork. Nice.

The other thing it's really good for is if you've got a period property and you've got old Victorian cornice or something like that, or anything with coves or ceiling roses, all that kind of stuff is really great with a sprayer.

Well, I've got. Sorry, what was that?

If you have a cave in Coober Pedy, it's also good to spray those.

Yeah. Or vermiculite ceilings, which is one of.

The questions in the renovated or an underground mine. I use shotcrete so you know, it's very much Like Lightning Ridge.

Yeah. Or take it outside and spray the fence while you're waiting for the inside to dry.

Yeah, just watch the dog.

Yeah, that's right.

Yeah, you really do. Like you're swearing. Lise just asked how much it was for the four days, Gavin.

Because we.

Got it on a Thursday.

The Saturday and Sunday were free. It cost us 350 bucks. But you can buy these high end machines. The company we used in Perth was, I think it was Murphy's Spray and Blast or something like that. And they sell their X rental machines. For the machine that we use which is normally a 4K machine, they sell it second hand for 1500. So you know, if you're going to do a few like for me I'm looking to do some Renault Flips. Like I'm just going to buy one machine and off a go.

Nice. Excellent. Well, I think that I've got my tiny little roller for my tiny little ceiling tomorrow and I won't be spraying not on my new tiles. Thank you for sharing that. I really appreciate it because I think it's, it's always good to, to look at other ways cost effective and time savers and I think that one of the things as renovators is saving some time is really important and you know, sometimes you got to throw a bit of money at it and sometimes you got to throw a bit of elbow grease at it and make it work. But no. Great suggestion. Thanks Gavin.

Dane, I think that the biggest.

We just muted you. Sorry, Gavin, say that again.

I was going to say that the most surprising thing was that it made painting fun.

Okay, now you're having a lent.

Oh no, no, seriously, I had a good time.

Did you have the proper, you know, the rubber mask with the two filters and all that kind of thing?

No, we just pointed and shoot.

Okay, this is where you mute him. Mute him. Safety first, Gavin.

Oh yeah, yeah.

Oh yeah.

We had heaps of masks and stuff on. Stuff on the cat.

Okay, safety first guys. There's masks involved.

That's the only downside because you wear the gloves. Goggles. Yeah, it gets hot but you wear the goggles and the goggles get so covered in paint you can't see and then you take the goggles off and then you end up with eyes full of paint.

Good.

Yeah.

Okay.

Fun for the whole family.

Thanks Gavin. Okay. Does anyone else have a question? No. I might show you my little show and tell if you'd like to see my little, you know.

Oh, here we go. Tim's got a question.

Oh good. Hey Tim, how are you? I think congratulations are in order. Are they?

Oh yeah. Congratulations.

Not just yet. We're going to sign off on it probably on Tuesday once the building of Pest comes back.

Nice. So what is your question.

With this place that we're going to buy? We're going to get a builder in to do an extension and just spruce it up. It's a 1920s miners shack basically, but they've extended out to a four better just with the building contract. Is there any sort of tips and tricks you can give us that the builder tries to sneak one past you and add in a few little hidden surprises?

I'll throw this to you, John, While you think of that, I'm going to make a few comments from a finance point of view. And that is usually lenders will only finance what's in the fixed price building contract. So if you've got landscaping or the pool or some additional things that you might be able to get cheaper from someone else, some lenders will let you have maybe 1, 2, 3 invoices that you can put in, but others just want you to have one. So often putting as much possible into the building contract, which might mean some of the council approvals or whatever. I mean, sometimes I take them out, but having as much in the actual fixed price contract is really important. Some of the things I've added into contracts for builders who were doing renovation works was there was a penalty on loss of rent if it went over certain times. So slips my mind what I call that liquidation liquidated damages kind of thing.

Is that what you call it? Yeah, I know what you're talking about.

So basically if they've said, okay, we'll do this in 10 weeks, and I'm like, okay, from week 10 you're paying 500 bucks a week to me. So sometimes that kind of works out with the variances and variances is something that you really have to manage to be very, very specific in the contract about what they will do and won't do.

I think the more you can do up front in terms of every single detail, the, the tighter it is because inevitably they come, you know, that it gives them wriggle room. If, if you've just been a little bit vague about this or that or what fixtures or fittings are there, they'll come back and they'll say, oh, well, we've only allowed for this minimum. So that's a variation.

Yeah, there's always a variation conversation which has been a really nice change in this little bathroom renovation that I've done. In the project manager there's been absolutely no variations in actual fact he'd throw on extra things in. So you know, and just, just down to the. Don't make assumptions as John said, don't, don't assume that just because you, you're saying, yeah, there'll be down lights in the, you know, extension that you're talking 12 and they're talking five. So be very, very specific about what you want because that's what they're quoting on and that's where the variances can come into play.

Yep, yep, yeah but I can't really think of any, any gotchas. Just, just the, the details is the main thing.

Nicole's got a good, good comment here which just says make sure they're HIA approved member and it's an HIA contract, it's a applicable in your state or territory. Be specific on the specs for the state and what you want in it. Cheese Ben. Okay, maybe it wasn't a call, that was Ben but the I think that's a really good point is you know, just simple things about going and making sure that you're checking out your builder obviously making sure they're licensed, making sure they have the insurance and making sure lenders won't take usually anything other than an HIA contract with the set stages that are in the contracts, the payment stages. So with a renovation sometimes you might have to jump a couple of stages. It might just be, you know, you're not talking about a complete build if it's not a structural renovation. You've got someone with a contract, make sure they've got warranty insurance and you're covered for the warranty insurance. So and that's usually, other than Queensland, that's usually death and disability and bankruptcy. That is the only thing that really kicks in the warranty insurance. I know that because I had a chat with my warranty insurance person this week and they asked me if any of those things were particular to the builder that I had a six year in Victoria, six year warranty insurance. So there we go. I think Tim's doing some washing up in the background too. Tim, is there anything else, Anything else that. Okay, well do not interrupt that. So the plans are you've got a 1920 shack that you're going to be doing a extension on. So you're going to be doing what?

Well Basically it's a four bedroom 1920s miners place and it just needs a bit of tidying up. Like they haven't sort of one of those step back in time Homes and they haven't really done a lot with it. So it's just bringing it back to, you know, not the pink, blue and green type colors. Putting in a proper lounge room, a second bathroom and taking the laundry tub out of the existing toilet. Now sort of putting it in another area so that you've got a bit of room. You sort of step out of the shower and you almost bump straight into the laundry. That's pretty much it. Because apart from that. Yeah, there's not a whole lot to do. It's just a little bit of modernizing while still being sympathetic to the features and the period that the house is built in and going from there.

So tell me, what are your numbers? What do you think is going to cost you and what's it going to bring it up to? Is there the pricing disparity in the suburb to get you where you want to do and make a profit.

In the street? Two and four houses down. I got mine for 620. There's one four houses down that's on the market now for 895. There's another one a couple doors down from that that's going for 1.1.

Nice disparity. And are they comparable in the sense that if you bring yours up to the standard that you, you're talking about, is it comparable somewhat to the 895?

Yeah.

The only thing I'm doing is like they've done a bit more modern so they've sort of, they've sort of butchered it. So in the mountains people still like the, you know, the ornate fireplaces and ceilings and they've sort of gone a bit more with LED down lights and a bit too fancy. But mine will be a little bit more like keeping it original but just making it more beautiful. But, but from what I've seen of those other houses, there's not a whole lot to do. Just put in a few built ins, fix up the fires and again just put in a bit of extra room so you have a lounge room and you can entertain out the back if you wanted to. Because I was going to put a couple of bifold doors so you can just open it up in the summer and have a Barbie or whatever.

Tim, you sold me on the mountains. Yeah, you had me from there. You know that whole features really strong there as you say. So nice work.

And Tim, have you considered stackers instead of bifolds?

Yeah, it was just bifolds for the first thing because like that's the first thing came into my head. But they've got stack of doors at the moment and we'll just take that from where it is and transplant it out to the, what's now going to be the back of the property once the Renault starts.

And the reason John says that for those who aren't in the ultimate guide to renovation is that there's quite a saving.

Yeah, you probably save 30, 40% for going a stack because they don't work everywhere. If you've got a tight space, they don't work that well. What it is a stacker is you might have, let's say you've got three panels or leafs and one is fixed and the other two will slide back into where that one panel is. So you're always left with one panel. And the, so you know, if it's, if it's only two panels then only half of the opening is is open. If it's three panels, then you know, two thirds of the space is open. But yeah, you shave a whole lot off the, the cost of the bifolds. And because I used to use bi folds for all the jobs and I switched over to stackers just because it saved me a lot and it didn't really seem to worry the, the buyers anymore.

And it's more of a commercial technique, isn't it? Stackers?

Yeah, I mean there's, there's really crummy stackers that, you know, you used to see in, in the 1980s kind of house, you know, housing estates and then which are quite thin and they've normally got that kind of scallop shaped handle.

So the kids don't run into. Is that stencil across the front too?

That's right. But the ones I'm talking about are like more industrial looking. So thick. I, I tend to use black aluminium and so they're quite thick looking and if you're going with the spray and you've got a light color on the wall, it kind of works well. You get that contrast.

Nice. And where's a good place to pick up these stackers is a question.

There's a couple of places in, I think, I don't know if they're in Sydney as well, but A&L's a place that I go to and there's a couple more that I just can't think of now. I think we look because we're looking at the moment actually just to see if we can get a better supply. But A L, I think they're in Dandenong. That's where I get them from.

Nice. So. So yeah. And Tim, I had one other thing I was going to tell you. Oh, I know. Had a quick chat to John Edwards from Residentex last week and asked him about the impact of Badgery Creek in Sydney and he was like, watch this space for the Blue Mountains. He reckons that it will open up a lot of tourism because people can fly straight into Badgery Creek and go to the mountains for a weekend. So well picked.

Yep.

Yeah, nice.

Hope it all works out. All the best, Tim. Keep us updated.

All right, we'll do.

Cheers.

Excellent.

Stacy.

Hey, Stacey, how are you going?

Hi, good evening. How are you guys?

Great.

I have a finance question. I guess it really is at this stage, just not quite sure how to ask the question, but the scenario is an investment loan and if you can borrow, say, 480,000, but the property that's available is going to be less and you've got a good cash deposit and even with the renovation, it will still be less than that borrowing capacity. I've read about maximising the borrowing on a property, so you want to maximise it because you can only do that once for your tax purposes. So how does it work? I'm just sort of looking for a bit more information how it works. And does that mean that the excess borrowing capacity goes into the offset loan?

Good question.

Is that how it works?

Yes. So I'll try to reframe this for those that.

Yes, please do.

So, basically, good question, though. And this is really. It's quite an advanced technique in financing and structuring. And so basically, if we look at a traditional loan, most lenders will allow you to go up to 90, 95% of the value of the property for you to lend against. So the loan to value ratio, let's just say, is 90%, which means that you put in 10%, they put in 90%, they're going to charge you a bit of mortgage insurance for the little bit more risk. So if you put in a 20% deposit, they go, yeah, the market could go down a bit and our loan is always going to be less than what the value of the property is. So a normal lending would be you have a security, and in this case it's the property, and they will lend you 90% or 100%. Sorry, 90% or 80% against that security. Now you can add an additional security to that property and what you might be most familiar with seeing this done is in cross collateralization. So someone might add their home as additional security to an investment property. So let's just say the home's worth a million dollars. They have a loan of 500,000. They have an additional 500,000 in equity. They're buying a property worth $500,000. And, you know, so all up the value of the portfolio is 1.5 million, and the loan would be about a million. And bit of stamp duty, let's say, you know, 1 million, $50,000. So they essentially have a $1 million loan against a one $1.5 million asset. So it's about a 67% loan to value ratio. So that's the traditional way that you would say you're adding two assets together, securing the loan. What you're talking about, Stacey, in this quite kind of advanced technique, is adding an additional asset, which is cash, and the cash is the additional asset. Going back to your comment about the most that you can ever borrow against a property for the purpose of that property is your initial loan. So let's assume there's no renovation loans or improvement loans. So let's just say you buy a property for $500,000 at an 80% loan to value ratio. That's a $400,000 loan. $400,000 is associated with the purchase of that property. In the future. Your home goes up to make it easy for me a million bucks, and you go, hey, I want to pull out another $200,000 to go and buy a property down the road. The $400,000 is still the only loan that can be associated with that property. The further $200,000 is associated in the eyes of the ATO, with the purchase of the next property. So when we're talking about the initial loan that you get is pretty much the biggest loan that you can have associated against that property without having, say, a renovation loan or construction loan. But initially, for standard type of person buying a property, then maximizing that means that if you wanted to maximize, and this is usually for people who have a high income and negative gearing is a consideration as well. You might be saying, well, I've got a $500,000 property that I want to borrow, I want to purchase, but I actually want a $500,000 loan against that because I want to maximize my positioning against that property. Property. Now, a lender is not going to loan you 100% loan to value ratio, but what you might say is, hey, I've got a $500,000 property and I've got $100,000. And it doesn't go into the offset account, which means there's your transactional account that you can move. They need that as an asset. That they can control. So that would go in a term deposit, that $100,000. Now, the good thing about cash is that the loan to value ratio against cash is pretty much 100%. So cash doesn't devalue against itself. So if you've got $100,000 cash, then you can essentially have the $100,000 loan against it. So if we talked about the fact that you had now a $500,000 property and $100,000 in cash in a term deposit that you can't touch and they control, and depending on the lender, you may actually get some interest on that term deposit. You have now have $600,000 that you have in asset value. And you could have, for instance, a 500 maybe. Well, what? 600 by 80% is 480. So, like, maybe your loan could be maximized a little bit further. So you get to an 80% loan to value ratio where you have the asset of the property and asset of the cash actually covering the entire value of the property. So $500,000 the value of the property, then we would be talking about $625,000 in assets to secure that at an 80% loan to value ratio. So you don't pay the mortgage insurance. So you'd have a term deposit of 125,000. Now, the beauty of this is, let's fast forward five years. Your $500,000 property is now worth $800,000. And you can release the term deposit. So you can go back and say, can you please revalue my $800,000 property? They come back and say it's $800,000. And your loan to value ratio, if you take the cash out is down to 62%, 62.5%. So the $500,000 loan over the $800,000 value is less. So does that kind of. Am I on the right track? Am I answering this for you? Hello? Stacey, did we lose you? She's gone offline. Okay. I'm assuming maybe she can. Such a great answer, I thought.

Well, she didn't hear a thing.

Okay, what is this solution called? Jane? You smashed it, said Gavin, but Lee didn't hear it either. Oh, we've got a recording, which is a good thing, essentially. What would I call this? I would call this using a secondary asset to secure your loan, basically. Now, the important thing that you need to know about this is that there's only some lenders that do it. And they'd have to be like a deposit taking facility that has office term deposits. So, you know, Obviously they don't want their term deposit to be going sitting in Macquarie bank while their cba, you know, having having no control over that asset. So like the tackling the title of the property, they have to actually take the entire title. It is quite an advanced technique. It's not something I would be playing around. You do need a lot of cash. Make sure that you don't need to have the cash within the period of time that you think it's going to take for you to, to the property to go up in value for you to release the cash. But it is one way of optimizing and leveraging other people's money. So yes Vicki, just like the big four. So the big four all deposit taking facilities and unfortunately Stacy's still offline. Oh her hands up again. Okay, maybe she can type. Stacy, can you type? Okay. Lee, can you hear us? Imagine everyone else can hear us. We've got a quick question here, another finance quick question which is is it true that doctors can borrow up to to 90% without mortgage insurance? Oh, not only is it true that there's other professionals that will do as well. Most of the major lenders have introduced this. You do have to, if you were a doctor you like for instance, Westpac will do doctors. Westpac Premium banking will also do surveyors, geologists, mining engineers, lawyers.

Mining engineers.

Yeah, mining engineers. Anyone in the mining surveyor geologists and mining engineers. But you have to actually be a member of a specific industry body. So the funny thing about the mining engineers, they have to be a member of the Institute of Engineers. And most mining engineers are actually members of the AUSI M which is the Institute of Mining and Metallurgists. But I did recently do a loan for someone who was a pharmacist. Westpac doesn't do pharmacies but St. George does. So they could get 90%. So it depends. You have to actually be registered. Some, some lenders have even stretched it out to physios and others every now and then there is changes policies and we're monitoring these almost weekly at the moment. But yes, it is true that some professions do have a 90% LMI. No LMI.

But yes, the careers officer really needs to know this at school when you, you're going, you know, trying to choose what you want to do for a career.

Yes, absolutely. How to get 90. No LMI. Vicky says Oz. I double M counts. Abby, do you want to extend on that? I know with the CBA it. Sorry with westpac it doesn't with CBA that they will consider Some others physios. Yes, sometimes. Oh, Stacy's back. She's lost a connection but we could probably unmute her and just make sure we answered her question. Stacy, did we answer your question for you?

Well, you were halfway through when my iPhone that I hotspot from went flat because I was so engrossed in the call, I hadn't even checked if it needed to be plugged in. So I was running around the house looking for some other device to hotspot from. So I'll have to go, I have to go to the recording and get the second half. I've heard most of it avidly listening. So sorry about that. When you said to me you would.

Have probably said, does that answer your question? Nothing. I know, sorry about that. I was sitting there going, I often have this fear that I'll be talking to myself and there's people, they're going, we can't hear you. And I'm still so engrossed that I've missed half an hour. But I'm glad to hear me.

At least everybody else got it and I'll just do the recording and catch.

Up the other half of my answer.

Thank you very much for that.

And Vicki is confirming that WESTPAC now takes Ozi Mm. Which is fabulous because she's finishing up some final, some paperwork now which is good. But just be aware that every, every lender has a little, has a few quirks associated with some of their lending policy and I, oh gosh, I can only just, I mean I met with me bank today and just some of the tiny little quirks of how to get some of their, their, they've got the most competitive three year fixed rate in the market below 4.3%. But just some, you know, the, they can only have one offset account and they could never. Everything's always cross collateralized and packages and, and all of these extra little things that kind of for investors who are looking at multiple properties and packages and things just don't work. So just be aware that some lenders, although you know, sometimes you're not comparing apples with apples. So anyhow. But Stacy, I think I really, I got some feedback say I smashed it with my answer. So I hope you can listen to the answer tomorrow. But essentially the answer is that you are securing your against the term deposit as well as the asset of the property and it has to be with the same lender and it's a, and it's a deposit taking facility. Great, thank you. Can happen. Good.

All right. Nicole had a follow up comment on the Stackers. Oh yeah, she said that black aluminum is a stock color. Colorborn colors. Colors will be powder coated finish and an additional charge.

Good point.

That's a good tip.

Good pin. Yeah. Nice pickup. So we like stock colors. Can I show my little renovation? Yeah, it's boring. The thing is that, you know, everyone, everyone sees the flash stuff and this is like a little, you know. Well, this is not cheap, cheap, cheapy. But this is one that actually, you know, I think just gives you an idea what's possible in the time frames. And the other thing is that often this is the before photo, just in case anyone's wondering. See, I told you. I put up a shower curtain. Looks good.

Painted it, you know, that's the previous renovation.

Yeah, yeah. Shout Kun. What can we afford? Shao Kun? So, you know, it just gives you an idea that you don't have to renovate all at once. So this is the points that I kind of want, want you to hear here. You don't have to renovate all at once. And so, you know, we couldn't afford 10 years ago the bathroom renovation. No, no. Pride issues in sharing that with anyone. We all do things as we do them and can afford them. We can afford to add some value now and push up the rent, which is fabulous. Just to move along. See, now my computer's decided to stall itself. So you're not even going to see where we're going. But the interesting thing was, so I was working with, with this, it has actually stalled itself. I'm saying to freeze my screen for a second and try to do a reboot. But the. Yeah, here we go. Lovely. So basically I had a chat to the Vince, the project manager on this. He's quite experienced in doing bathrooms for landlords. I had spoken to a couple of project managers that I've used in the past and they came back and said they weren't available in the January time frame that I wanted. And so Vince sent me some pictures and said, this is kind of the look. This is the look that you're going to end up with something like this. And I was like, great. And he sent through this. I'm recommending this tap. And I'm like, fabulous. Here's the four same ones out of the course. Yeah, exactly. Here's the four tiles you can choose your color from. So I actually went with the darker tile because I wanted to match the carpet that I'd chosen as well. So this is like darker on the floor. Yep, darker on the floor. Whites long 600 by the 100 on the walls. So I wanted those elongated to give a bit of. Bit of space because it is a small little bathroom, let's face it. So this is kind of like this. Jane's selections of bathroom product products. We had a chat about the vanity. We knew that the vanity might not be the full width vanity with the drawers because there was some space issues there. I was going to have the shower over the bath as it was because I didn't want to have any objections that I'd taken the bath out or taken the shower out. I asked for the bath hobs to be in the middle of the bath. So if there were kids, et cetera, it's always easier with the glass fixed wall around the shower to. Rather than peering in and getting your head wet while you try to turn on your shower to actually turn on in the middle. So I'm not trying to think of, you know, making things a little bit easier. Then I got asked for photos as we went through. So day one, it's like, hey Jane, I've ripped everything out and here's the photos. So I was like, great. And this is where your bath's going to go. So we've rough.

Is it, what is it concrete? Is it a mixture of both.

Yeah, brick and concrete. And then he roughed in the plumbing. So we had like the rough in of where things were going to go. Then we worked on getting some rendering and board up and putting in the bath in position. And so I was just getting these photos daily essentially, you know, day one, day two, day three. Then we waterproofed it. It now waterproofing we needed to make sure unlike the block, I don't know how they do it in a week. But unlike the block we we waited to the waterproof actually dried. So it was important we had a couple of good warm days. So waterproofed everything as you can see quite high as well around the bath and where the showers are. And then we put the tiles in. Boring tiles. White, the nice black, the nice darker tile on the floor. I've got a bath. You know, I'm gonna be fixing up that curtain when we get back there tomorrow. And this is the after. So just sent me some photos. There's my paint job tomorrow night on the roof. But yeah, as you can see, you know, bit of a change from where we started from. And everything's pretty much in the same position. We ended up making sure the vanity, vanity didn't have the drawers to the side. This is the one that fitted in there. He added the cornice because There was no cornice up there at the time. Beige. Boring.

Yep.

Not, not a non objectable to anyone, you know. And this is what they said it was going to look like and this is what I got. So you know, two weeks start to finish, done in out and I'll be cleaning off the tiles tomorrow, painting the ceiling and fixing up the, the window dressing and. And yeah, should be good.

Great.

So that just gives you a little idea of good luck with painting the ceiling. Thank you for that.

Yeah. So how long have you given yourself?

We gave yourselves three weeks.

Paint the ceiling.

Oh, I've got a few hours on that. Yeah.

So you're going to do an undercoat and two coats?

Yeah, well no, I'm doing an undercoat and one coat and I'll be back possibly to do the second coat and fix it up later. But I'm using the antibacterial bathroom. Thicker paint and I'll be rolling. I've got the tiniest little roller so I can get around the, the sides and yeah. Basically a step ladder.

Type up your tiles.

Had to tape up my tiles. I've got my tape, I've got my jif, I've got my, my drop sheets.

Yep.

Everything's in the suitcase. So if there ever goes through the. And I've got my little tool kit just in case. Got a fish.

Careful with the ladder in the bath.

Yes, good point. So I'll have a three point contact and I'll have someone holding the ladder for me. So thank you. Oh, because Gavin scratched the bath when he put the ladder in the bath. Good point.

Tradies are pretty good at scratching baths as well.

Yeah. So just give you an idea. So I selected all the fixtures and fittings from those photos, from the emails. I got daily updates, got daily photos. This is where we are, this is what we're doing. This is what we said we're going to do. You know, this vanity didn't work. This is what we're going with, with got calls, managed it remotely, you know and hopefully I'll be posting some photos up on Monday of da da. The finish. So there you go. Just a boring little. Yeah. Renovation and that's, that's quick and easy. And we were a week ahead of the schedule. So everyone hung around for a week and the marketing has started and we've got open inspection of on Saturday.

Nice.

So carpet went in as I said this week and so did the new wardrobes.

So it was all pretty painless.

Yeah. Yeah. I kind of had my eyes on other things in the Last two weeks. So it's nice that went on. So there you go, guys. We've come to the hour and a half and I can't see any hands up with any bursting questions. So I guess we're going to wrap here and, you know, thank you for all your questions, Carl. I hope, I hope you keep us up to date with how you go with your leasing and let us know what you've done.

A couple of late comers. Lee, what was the rough costing?

The bathroom was 12, 600 and the carpet, I'm doing three. And I think at the end I ended up adding an extra $180 onto my wardrobes to get the old ones moved out. So I think that came to 1800. So it's well below the 20 that I just allowed to go in and do this. So. Yes.

And Vicky, what sort of rent increase you.

Vicky, you're really embarrassing me now because it was the conversation I was supposed to have and I wrote it down and then I had a conversation with three other clients after that. I had it with my rental manager last week and then I wrote down all these numbers with clients and I think, God, what did I. I think it's going up by 40 or $50 a week. So. And it's just about, you know, last time it was on the market, as Carl experienced, it was on the rental market for a period of time with vacancies. And the feedback from the agents was, geez, nice, nice unit, great location, great outlook, great space, but what a daggy bathroom. And the doors actually let it down as well. So last time we replaced the doors, didn't have time to do the bathroom. And this time they've done the bathroom. So it's all good. Yes. So I'll keep you posted on all of that, guys. So thank you. So we've been active this weekend with developments and renovations and good things all going on. Okay, so just to wrap up, terrific call. Thank you for your input. For those of you who are listening, delayed. You missed out, guys. We hope you're on next time because we would love to have your questions live. And look, if you really can't make it, send us an email. And if we've got time, we will definitely add it in there. This call will be up for recording in 24 hours. So, Stacy, you can listen to the rest of your answer. And that will be in the Investors Choice diamond members area and in the ultimate guide to renovation and into your property success, the Q and A call section. Yep. So, yeah. So all good. Look, guys, Just a quick reminder that next month it's not going to be the last Thursday that we have this call. It's going to be the 19th of March, 8pm 19th of March still on Eastern standard daylight saving time. So just put that in your diary. You will get a message a week beforehand. So don't worry. Never fear, we will be talking to you. And yeah, we've got some exciting things coming your way. Those people who are in the ultimate guided renovation going to get access in the next month or so to just a drip feed to Ripe House software. It's complimentary for three months and some.

Few changes you'll notice inside the course.

As well the first modules which is all really exciting. And those guys in Investors Choice Diamond I have got negotiated a fantastic quantity surveyors discount for you and someone who will actually update your depreciation schedule with changes that you send through without charge and they'll actually do a scrapping schedule if you send send through your renovation costings and pictures of what the property looked like beforehand. So check that out for those in Investors Choice diamond. And yeah, I think that's all for the month.

Yep, good enough.

Good on you guys. We're here to help you with your own property success. So make sure you tune in next month and we look forward to speaking to you then.

See ya. Sa.