Finance advice
Peter Gianoli

6 ways to improve your financial fitness

By Peter Gianoli

Property investors want to create wealth and they want financial fitness. So do you need an overhaul to get there? 

Blogger: Peter Gianoli, general manager, Investor Assist and ABN Realty 

If you were going to attempt running a marathon for the first time, you wouldn’t just throw on a pair of sneakers and start running with the hope you are still alive at the end of the 42-kilometre race. Instead, you would prepare, train and ensure you were in the best possible physical condition before you approached the start line.

The same theory applies to buying an investment property. It is a serious commitment and not just a walk in the park. Often when purchasing an investment property, you will sign up to a 25- to 30-year mortgage. Before you do this, you want to make sure you are ‘financially fit’ and ready to face any challenges that might come your way in the years ahead.

If you are ‘financially fit’, you know you are prepared to run the long race. Your finances will have the stamina to withstand economic fluctuations or interest rate rises, you will have the strength to hold your nerve if times get tough and you will know your competitors to ensure you are getting the very best finance deal available.

Most importantly, if you are financially fit you will still have enough energy left to hold your head high when you cross the finish line, safe in the knowledge your investment property has earnt you money and stabilised your long-time financial security.

Understand the race environment
If you were to run a marathon you will be paying close attention to the race environment — the course, the weather, the obstacles and the competition. The same applies to finance and you need to understand the current ‘financial climate’.

Many experts believe there has never been a better time to borrow and this is true because the cost of borrowing money has never been cheaper. But on the flip side, you might also be hearing that lenders are being much stricter on finance applications and knocking people back who assumed they would have their finance approved.

This is not a negative scenario because lenders are showing greater accountability in making sure investors are capable of servicing a loan.

If someone says they can run fast they can’t automatically compete in the Olympic Games. There is a rigorous selection process and they must be able to prove their worth and ability. The same applies for finance. If you want to borrow money you need to prove your ‘financial fitness’ and show your lender that you have the ability to service your loan and are willing to make the financial sacrifices required to succeed. After all, great rewards rarely come without sacrifice.

Take it one step at a time.

When applying for investment finance, it can seem overwhelming as there are so many options to consider. The best approach is to take it one step at a time. A 42-kilometre marathon is a daunting prospect but if you break it down and just keep placing one foot in front of the other, you will be amazed at how much progress you can make.

Trim down
One of the best things you can do to improve your investment borrowing power and overall financial fitness is to trim down any of your existing debt. Existing debt impacts your ability to service an investment loan and is not looked upon favourably by lenders.

Lenders will assume your credit cards are maxed out so if you have two credit cards, each with a $10,000 limit, the bank will consider you to be carrying an extra $20,000 worth of debt that doesn’t exist. Reduce your credit card limits, clear any debts and sacrifice any luxuries you don’t really need each month. Remember that in the eyes of the bank — the trimmer your debt load, the fitter you are.

Tone up
To get financially fit you also need to tone up your loan-to-value ratio (LVR). The LVR is defined as the amount borrowed in relation to the property’s value and is usually expressed as a percentage.

Stricter lending conditions have seen the generally accepted LVR tighten at around 80% with fewer exceptions so the simplest way to tone up and strengthen your LVR is to save a larger deposit. Alternatively, your family members may agree to go guarantor on your loan but this comes with its own set of risks for all parties so it is a situation that should not be entered into lightly.

If you are using equity in an existing property as a deposit for your investment loan, make sure you are paying principal plus interest on the existing loan to build up as much equity as possible. A stronger financial position will only strengthen your application process and preparation is the key to success.

Hire yourself a trainer
One of the best ways to keep yourself motivated and ‘financially fit’ is to hire yourself a trainer. All the best athletes around the world have them because trainers or coaches have the ability to drive you, keep you motivated, share their expertise and wisdom, and provide you with encouragement when you need it the most. They are the experts and if you find the right person, you should excel under their skilled guidance.

A coach or trainer may come in a variety of different roles including a finance broker, financial advisor, accountant, mentor or property investment specialist. If applying for investment finance, be sure to find yourself an experienced finance broker as they have access to hundreds of products and funding arrangements that may suit your individual circumstances. Brokers are also best placed to steer you through the ever-changing market conditions as they have their finger on the pulse when it comes to lender policies and preferences so don’t underestimate the advantages they can provide. A financial trainer might be just what you need to keep you focused, disciplined and on track.

Don’t slack off
When working towards a long-term goal, fighting the urge to slack off is always one of the hardest challenges of all. If you are saving for a larger deposit or trying to strengthen your financial position before you apply for finance, don’t be disheartened or lose sight of the bigger picture. Set yourself goals and stick to them and avoid the temptation to blow money on unnecessary holidays, clothes, social outings and luxury items.

Help to keep yourself on track by always maintaining your book-keeping and budgets so both you and your trainer can closely monitor your progress from week to week and month to month. If you have a clear picture of your financials it will help you to stay motivated and will make the process easier when you are ready to step up to the start line and apply for investment finance.

NEWSLETTER
Be the first to hear the latest property investment insights
 

Contact this Blogger Immediately

About the Blogger

Peter Gianoli

Peter Gianoli

Peter Gianoli joined ABN Group in 2011 to establish Investor Assist. Peter has more than 15 years of experience in the property industry working across some of the country’s premier development projects and throughout his career has overseen the sale and settlement of properties worth in excess of $1bn.  Peter is also a highly sought after public speaker and has educated audiences throughout Australia and around the world on topics including property marketing and investment.

Email:
promoted stories

podcast

object(stdClass)#1249 (52) {
  ["id"]=>
  string(5) "18177"
  ["title"]=>
  string(51) "Boost for investors as app sets up off-site bidding"
  ["alias"]=>
  string(55) "boost-for-investors-as-new-app-sets-up-off-site-bidding"
  ["introtext"]=>
  string(144) "

Property investors are now able to identify and bid on auctions remotely using a new live-streaming functionality launched by Gavl.

" ["fulltext"]=> string(1540) "

Called “Request an Auction”, the new functionality enables users to watch and bid on any Sydney or Melbourne auction remotely.

Through Gavl, prospective buyers are now able to register to bid on their preferred auction. The platform will obtain permission from the listing agent and confirm within 48 hours.

Vendors can also request to have their auctions broadcast to a larger buyer audience.

Co-founder Joel Smith said that auctions streamed on Gavl attract 47 per cent more viewers than traditional ones.

He said that Request an Auction will be valuable for remote buyers.

“Buyers are able to have Gavl attend any auction they nominate, so they will never have to miss out on an opportunity due to logistical complications in physically attending the auction.

“Vendors, too, have the opportunity to directly book an auction with us, so they can open up their event to buyers all around the world. With more potential buyers, they’re giving their property the chance to receive more bids and maximise their sales result.”

Mr Smith said that prior to the Request an Auction app, buyers were limited to what they could achieve through the Gavl technology.

Gavl is a live-streaming and bidding platform for real estate auctions.

Mr Smith said that it has streamed more than 6,000 auctions, which have achieved 3.5 million views from 50 countries.

Gavl’s Request an Auction function is currently being offered in Melbourne and Sydney only.

" ["checked_out"]=> string(1) "0" ["checked_out_time"]=> string(19) "0000-00-00 00:00:00" ["catid"]=> string(2) "45" ["created"]=> string(19) "2018-06-19 04:54:31" ["created_by"]=> string(4) "1548" ["created_by_alias"]=> string(0) "" ["state"]=> string(1) "1" ["modified"]=> string(19) "2018-06-19 05:34:23" ["modified_by"]=> string(4) "1548" ["modified_by_name"]=> string(9) "Tim Neary" ["publish_up"]=> string(19) "2018-06-19 04:54:31" ["publish_down"]=> string(19) "0000-00-00 00:00:00" ["images"]=> string(318) "{"image_intro":"images\/intro-images\/839x487\/property-hands-spi.jpg","float_intro":"","image_intro_alt":"Property finder, bidding auction, boost for investors, property investment, off-site bidding","image_intro_caption":"","image_fulltext":"","float_fulltext":"","image_fulltext_alt":"","image_fulltext_caption":""}" ["urls"]=> string(121) "{"urla":false,"urlatext":"","targeta":"","urlb":false,"urlbtext":"","targetb":"","urlc":false,"urlctext":"","targetc":""}" ["attribs"]=> string(1002) "{"article_layout":"","show_title":"","link_titles":"","show_tags":"","show_intro":"","info_block_position":"","info_block_show_title":"","show_category":"","link_category":"","show_parent_category":"","link_parent_category":"","show_associations":"","show_author":"","link_author":"","show_create_date":"","show_modify_date":"","show_publish_date":"","show_item_navigation":"","show_icons":"","show_print_icon":"","show_email_icon":"","show_vote":"","show_hits":"","show_noauth":"","urls_position":"","alternative_readmore":"","article_page_title":"","show_publishing_options":"","show_article_options":"","show_urls_images_backend":"","show_urls_images_frontend":"","canonical_link":"","transcript":"","clientName1":"","clientDesc1":"","clientImage1":"","clientUrl1":"","clientName2":"","clientDesc2":"","clientImage2":"","clientUrl2":"","clientName3":"","clientDesc3":"","clientImage3":"","clientUrl3":"","clientName4":"","clientDesc4":"","clientImage4":"","clientUrl4":"","author_promotion_line":""}" ["metadata"]=> string(53) "{"robots":"","author":"","rights":"","xreference":""}" ["metakey"]=> string(42) "boost, investors, app, sets, site, bidding" ["metadesc"]=> string(200) "Property investors are now able to identify and bid on auctions remotely using a new live-streaming app launched by Gavl. Called “Request an Auction”, the new functionality enables users to w" ["access"]=> string(1) "1" ["hits"]=> string(2) "32" ["xreference"]=> string(0) "" ["featured"]=> string(1) "0" ["language"]=> string(1) "*" ["readmore"]=> string(4) "1540" ["ordering"]=> string(1) "0" ["category_title"]=> string(25) "Smart Property Investment" ["category_route"]=> string(25) "smart-property-investment" ["category_access"]=> string(1) "1" ["category_alias"]=> string(25) "smart-property-investment" ["published"]=> string(1) "1" ["parents_published"]=> string(1) "1" ["lft"]=> string(2) "47" ["author"]=> string(9) "Tim Neary" ["author_email"]=> string(30) "[email protected]" ["parent_title"]=> string(4) "ROOT" ["parent_id"]=> string(1) "1" ["parent_route"]=> string(0) "" ["parent_alias"]=> string(4) "root" ["rating"]=> string(1) "0" ["rating_count"]=> string(1) "0" ["alternative_readmore"]=> NULL ["layout"]=> NULL ["params"]=> object(Joomla\Registry\Registry)#1217 (3) { ["data":protected]=> object(stdClass)#1214 (95) { ["article_layout"]=> string(14) "spbase:article" ["show_title"]=> string(1) "1" ["link_titles"]=> string(1) "1" ["show_intro"]=> string(1) "1" ["info_block_position"]=> string(1) "0" ["info_block_show_title"]=> string(1) "1" ["show_category"]=> string(1) "1" ["link_category"]=> string(1) "0" ["show_parent_category"]=> string(1) "0" ["link_parent_category"]=> string(1) "0" ["show_associations"]=> string(1) "0" ["flags"]=> string(1) "1" ["show_author"]=> string(1) "1" ["link_author"]=> string(1) "0" ["show_create_date"]=> string(1) "1" ["show_modify_date"]=> string(1) "1" ["show_publish_date"]=> string(1) "1" ["show_item_navigation"]=> string(1) "0" ["show_vote"]=> string(1) "0" ["show_readmore"]=> string(1) "1" ["show_readmore_title"]=> string(1) "0" ["readmore_limit"]=> string(3) "100" ["show_tags"]=> string(1) "1" ["show_icons"]=> string(1) "0" ["show_print_icon"]=> string(1) "0" ["show_email_icon"]=> string(1) "1" ["show_hits"]=> string(1) "0" ["show_noauth"]=> string(1) "0" ["urls_position"]=> string(1) "0" ["captcha"]=> string(0) "" ["show_publishing_options"]=> string(1) "1" ["show_article_options"]=> string(1) "1" ["save_history"]=> string(1) "0" ["history_limit"]=> int(10) ["show_urls_images_frontend"]=> string(1) "0" ["show_urls_images_backend"]=> string(1) "1" ["targeta"]=> int(0) ["targetb"]=> int(0) ["targetc"]=> int(0) ["float_intro"]=> string(5) "right" ["float_fulltext"]=> string(5) "right" ["category_layout"]=> string(6) "_:blog" ["show_category_heading_title_text"]=> string(1) "0" ["show_category_title"]=> string(1) "0" ["show_description"]=> string(1) "0" ["show_description_image"]=> string(1) "0" ["maxLevel"]=> string(1) "0" ["show_empty_categories"]=> string(1) "0" ["show_no_articles"]=> string(1) "1" ["show_subcat_desc"]=> string(1) "0" ["show_cat_num_articles"]=> string(1) "0" ["show_cat_tags"]=> string(1) "0" ["show_base_description"]=> string(1) "1" ["maxLevelcat"]=> string(2) "-1" ["show_empty_categories_cat"]=> string(1) "0" ["show_subcat_desc_cat"]=> string(1) "1" ["show_cat_num_articles_cat"]=> string(1) "1" ["num_leading_articles"]=> string(2) "15" ["num_intro_articles"]=> string(1) "0" ["num_columns"]=> string(1) "0" ["num_links"]=> string(1) "0" ["multi_column_order"]=> string(1) "0" ["show_subcategory_content"]=> string(1) "0" ["show_pagination_limit"]=> string(1) "1" ["filter_field"]=> string(4) "hide" ["show_headings"]=> string(1) "1" ["list_show_date"]=> string(1) "0" ["date_format"]=> string(0) "" ["list_show_hits"]=> string(1) "0" ["list_show_author"]=> string(1) "0" ["list_show_votes"]=> string(1) "0" ["list_show_ratings"]=> string(1) "0" ["orderby_pri"]=> string(4) "none" ["orderby_sec"]=> string(5) "rdate" ["order_date"]=> string(9) "published" ["show_pagination"]=> string(1) "2" ["show_pagination_results"]=> string(1) "1" ["show_featured"]=> string(4) "show" ["show_feed_link"]=> string(1) "1" ["feed_summary"]=> string(1) "0" ["feed_show_readmore"]=> string(1) "0" ["sef_advanced"]=> int(0) ["sef_ids"]=> int(0) ["custom_fields_enable"]=> string(1) "1" ["show_page_heading"]=> string(1) "0" ["layout_type"]=> string(4) "blog" ["menu_text"]=> int(1) ["menu_show"]=> int(1) ["page_title"]=> string(53) "Finance Tips and Insights - Smart Property Investment" ["menu-meta_description"]=> string(91) "Financial tips for property investors, from mortgages to cash flow to saving for a deposit." ["secure"]=> int(0) ["page_description"]=> string(11) "sample desc" ["page_rights"]=> NULL ["robots"]=> NULL ["access-view"]=> bool(true) } ["initialized":protected]=> bool(true) ["separator"]=> string(1) "." } ["displayDate"]=> string(19) "2018-06-19 04:54:31" ["slug"]=> string(61) "18177:boost-for-investors-as-new-app-sets-up-off-site-bidding" ["catslug"]=> string(28) "45:smart-property-investment" ["link"]=> string(81) "/investor-stories-1/18177-boost-for-investors-as-new-app-sets-up-off-site-bidding" }
Boost for investors as app sets up off-site bidding
object(stdClass)#1228 (52) {
  ["id"]=>
  string(5) "18171"
  ["title"]=>
  string(68) "How a move to Hong Kong impacted Julia’s Australian property goals"
  ["alias"]=>
  string(66) "how-a-move-to-hong-kong-impacted-julia-s-australian-property-goals"
  ["introtext"]=>
  string(278) "

Having to split her time between Hong Kong and her original base of Sydney has not slowed Julia Tita’s goal of building a high-performance Australian property portfolio. Instead the resulting alterations to her strategy have positively impacted her investing success.

" ["fulltext"]=> string(3579) "

Having recently purchased her 6th property, Julia joins host Tim Neary to discuss her journey, share her ups and downs over the years, and reveal her thoughts on why some properties are better than others.

Julia also explains why she no longer makes a move without the help of a buyer’s agent, why working with a strong team of specialists is extremely important and discloses her long-term property ambitions.

If you like this episode, show your support by rating us or leaving a review on iTunes (The Smart Property Investment Show) and by following Smart Property Investment on social media: FacebookTwitter and LinkedIn.

If you have any questions about what you heard today, any topics of interest you have in mind, or if you’d like to lend your voice to the show, email [email protected] for more insights!

RELATED AREAS OF INTEREST:

Why is Australian property so unaffordable?
Brisbane infrastructure attracts international interest
Going global
Australia desirable to foreign investors

AREAS MENTIONED:

Eagleby
Charters Towers
Townsville
Brisbane
Paddington
Sydney
Orange
Melbourne 
Glen Iris
Bondi

" ["checked_out"]=> string(1) "0" ["checked_out_time"]=> string(19) "0000-00-00 00:00:00" ["catid"]=> string(2) "45" ["created"]=> string(19) "2018-06-18 03:15:56" ["created_by"]=> string(4) "1689" ["created_by_alias"]=> string(0) "" ["state"]=> string(1) "1" ["modified"]=> string(19) "2018-06-18 03:45:55" ["modified_by"]=> string(4) "1689" ["modified_by_name"]=> string(12) "Todd Stevens" ["publish_up"]=> string(19) "2018-06-18 03:25:07" ["publish_down"]=> string(19) "0000-00-00 00:00:00" ["images"]=> string(225) "{"image_intro":"images\/podcasts\/Julia-Tita-839-x-487.jpg","float_intro":"","image_intro_alt":"Julia Tita","image_intro_caption":"","image_fulltext":"","float_fulltext":"","image_fulltext_alt":"","image_fulltext_caption":""}" ["urls"]=> string(121) "{"urla":false,"urlatext":"","targeta":"","urlb":false,"urlbtext":"","targetb":"","urlc":false,"urlctext":"","targetc":""}" ["attribs"]=> string(1002) "{"article_layout":"","show_title":"","link_titles":"","show_tags":"","show_intro":"","info_block_position":"","info_block_show_title":"","show_category":"","link_category":"","show_parent_category":"","link_parent_category":"","show_associations":"","show_author":"","link_author":"","show_create_date":"","show_modify_date":"","show_publish_date":"","show_item_navigation":"","show_icons":"","show_print_icon":"","show_email_icon":"","show_vote":"","show_hits":"","show_noauth":"","urls_position":"","alternative_readmore":"","article_page_title":"","show_publishing_options":"","show_article_options":"","show_urls_images_backend":"","show_urls_images_frontend":"","canonical_link":"","transcript":"","clientName1":"","clientDesc1":"","clientImage1":"","clientUrl1":"","clientName2":"","clientDesc2":"","clientImage2":"","clientUrl2":"","clientName3":"","clientDesc3":"","clientImage3":"","clientUrl3":"","clientName4":"","clientDesc4":"","clientImage4":"","clientUrl4":"","author_promotion_line":""}" ["metadata"]=> string(53) "{"robots":"","author":"","rights":"","xreference":""}" ["metakey"]=> string(66) "move, hong, kong, impacted, julia’s, australian, property, goals" ["metadesc"]=> string(200) "Having to split her time between Hong Kong and her original base of Sydney has not slowed Julia Tita’s goal of building a high-performance Australian property portfolio. Instead the resulting alter" ["access"]=> string(1) "1" ["hits"]=> string(2) "75" ["xreference"]=> string(0) "" ["featured"]=> string(1) "0" ["language"]=> string(1) "*" ["readmore"]=> string(4) "3579" ["ordering"]=> string(1) "1" ["category_title"]=> string(25) "Smart Property Investment" ["category_route"]=> string(25) "smart-property-investment" ["category_access"]=> string(1) "1" ["category_alias"]=> string(25) "smart-property-investment" ["published"]=> string(1) "1" ["parents_published"]=> string(1) "1" ["lft"]=> string(2) "47" ["author"]=> string(12) "Todd Stevens" ["author_email"]=> string(33) "[email protected]" ["parent_title"]=> string(4) "ROOT" ["parent_id"]=> string(1) "1" ["parent_route"]=> string(0) "" ["parent_alias"]=> string(4) "root" ["rating"]=> string(1) "0" ["rating_count"]=> string(1) "0" ["alternative_readmore"]=> NULL ["layout"]=> NULL ["params"]=> object(Joomla\Registry\Registry)#1212 (3) { ["data":protected]=> object(stdClass)#1231 (95) { ["article_layout"]=> string(14) "spbase:article" ["show_title"]=> string(1) "1" ["link_titles"]=> string(1) "1" ["show_intro"]=> string(1) "1" ["info_block_position"]=> string(1) "0" ["info_block_show_title"]=> string(1) "1" ["show_category"]=> string(1) "1" ["link_category"]=> string(1) "0" ["show_parent_category"]=> string(1) "0" ["link_parent_category"]=> string(1) "0" ["show_associations"]=> string(1) "0" ["flags"]=> string(1) "1" ["show_author"]=> string(1) "1" ["link_author"]=> string(1) "0" ["show_create_date"]=> string(1) "1" ["show_modify_date"]=> string(1) "1" ["show_publish_date"]=> string(1) "1" ["show_item_navigation"]=> string(1) "0" ["show_vote"]=> string(1) "0" ["show_readmore"]=> string(1) "1" ["show_readmore_title"]=> string(1) "0" ["readmore_limit"]=> string(3) "100" ["show_tags"]=> string(1) "1" ["show_icons"]=> string(1) "0" ["show_print_icon"]=> string(1) "0" ["show_email_icon"]=> string(1) "1" ["show_hits"]=> string(1) "0" ["show_noauth"]=> string(1) "0" ["urls_position"]=> string(1) "0" ["captcha"]=> string(0) "" ["show_publishing_options"]=> string(1) "1" ["show_article_options"]=> string(1) "1" ["save_history"]=> string(1) "0" ["history_limit"]=> int(10) ["show_urls_images_frontend"]=> string(1) "0" ["show_urls_images_backend"]=> string(1) "1" ["targeta"]=> int(0) ["targetb"]=> int(0) ["targetc"]=> int(0) ["float_intro"]=> string(5) "right" ["float_fulltext"]=> string(5) "right" ["category_layout"]=> string(6) "_:blog" ["show_category_heading_title_text"]=> string(1) "0" ["show_category_title"]=> string(1) "0" ["show_description"]=> string(1) "0" ["show_description_image"]=> string(1) "0" ["maxLevel"]=> string(1) "0" ["show_empty_categories"]=> string(1) "0" ["show_no_articles"]=> string(1) "1" ["show_subcat_desc"]=> string(1) "0" ["show_cat_num_articles"]=> string(1) "0" ["show_cat_tags"]=> string(1) "0" ["show_base_description"]=> string(1) "1" ["maxLevelcat"]=> string(2) "-1" ["show_empty_categories_cat"]=> string(1) "0" ["show_subcat_desc_cat"]=> string(1) "1" ["show_cat_num_articles_cat"]=> string(1) "1" ["num_leading_articles"]=> string(2) "15" ["num_intro_articles"]=> string(1) "0" ["num_columns"]=> string(1) "0" ["num_links"]=> string(1) "0" ["multi_column_order"]=> string(1) "0" ["show_subcategory_content"]=> string(1) "0" ["show_pagination_limit"]=> string(1) "1" ["filter_field"]=> string(4) "hide" ["show_headings"]=> string(1) "1" ["list_show_date"]=> string(1) "0" ["date_format"]=> string(0) "" ["list_show_hits"]=> string(1) "0" ["list_show_author"]=> string(1) "0" ["list_show_votes"]=> string(1) "0" ["list_show_ratings"]=> string(1) "0" ["orderby_pri"]=> string(4) "none" ["orderby_sec"]=> string(5) "rdate" ["order_date"]=> string(9) "published" ["show_pagination"]=> string(1) "2" ["show_pagination_results"]=> string(1) "1" ["show_featured"]=> string(4) "show" ["show_feed_link"]=> string(1) "1" ["feed_summary"]=> string(1) "0" ["feed_show_readmore"]=> string(1) "0" ["sef_advanced"]=> int(0) ["sef_ids"]=> int(0) ["custom_fields_enable"]=> string(1) "1" ["show_page_heading"]=> string(1) "0" ["layout_type"]=> string(4) "blog" ["menu_text"]=> int(1) ["menu_show"]=> int(1) ["page_title"]=> string(53) "Finance Tips and Insights - Smart Property Investment" ["menu-meta_description"]=> string(91) "Financial tips for property investors, from mortgages to cash flow to saving for a deposit." ["secure"]=> int(0) ["page_description"]=> string(11) "sample desc" ["page_rights"]=> NULL ["robots"]=> NULL ["access-view"]=> bool(true) } ["initialized":protected]=> bool(true) ["separator"]=> string(1) "." } ["displayDate"]=> string(19) "2018-06-18 03:15:56" ["slug"]=> string(72) "18171:how-a-move-to-hong-kong-impacted-julia-s-australian-property-goals" ["catslug"]=> string(28) "45:smart-property-investment" ["link"]=> string(92) "/investor-stories-1/18171-how-a-move-to-hong-kong-impacted-julia-s-australian-property-goals" }
How a move to Hong Kong impacted Julia’s Australian property goals
object(stdClass)#1215 (52) {
  ["id"]=>
  string(5) "18159"
  ["title"]=>
  string(88) "‘Common’ referrer practice of being paid on both sides of the fence coming to an end"
  ["alias"]=>
  string(82) "common-referrer-practice-of-being-paid-on-both-sides-of-the-fence-coming-to-an-end"
  ["introtext"]=>
  string(246) "

The practice of property investment firms sharing undisclosed kickbacks among the supply chain involved in development sales will be outlawed in NSW on 1 July this year under the Real Estate Reform being handed down by regulators in NSW.

" ["fulltext"]=> string(2238) "

Property commentator and valuer, Suburbanite’s Anna Porter, said the reform will address conflicts of interest.

She said they arise when a mortgage broker, accountant or financial planner receives part of the commission from the property firm, who receive their fees from the developer or seller.

“This puts the broker into a position by which they are being paid on both sides of the fence,” she said.

“Until now this has been a grey area and there was nothing stopping this practice.” 

Ms Porter said this has been a common practice in the industry.

"Some well-known mortgage broking firms openly admit to receiving $5,000–$10,000 per referral in their pocket.”

She also said this process has been going on for decades.

"Property investment firms commonly pass some of their commission on to the mortgage broker, accountant or financial planner as a reward to them for passing on the referral. This means that many brokers or financial service providers are making significant amounts of money just to refer on to a property firm, often totalling hundreds of thousands of dollars a year," Anna Porter said.

Ms Porter said the Property, Stock and Business Agents Amendment (Property Industry Reform) Bill 2017 will be in force from July this year, and will prohibit this practice unless the broker or referring partner also holds a real estate industry license.

"Under the new laws, if the broker takes a referral fee from the property firm, they will have to be a licensed real estate agent and also hold a corporation’s license,” she said. 

“Subsequently, every transaction that they receive a referral fee from, they will be putting their license up against the transaction and taking full liability for the conduct, practices and outcome of that transaction, even if they have little to do with the transaction; they are a party to it financially and therefore take as much risk as everyone else in the transaction.”

Mr Porter said where a referrer holds a real estate license, and receives a part of the sale commission, they may find themselves in breach of the ethical requirements under the act.

" ["checked_out"]=> string(1) "0" ["checked_out_time"]=> string(19) "0000-00-00 00:00:00" ["catid"]=> string(2) "45" ["created"]=> string(19) "2018-06-17 20:00:00" ["created_by"]=> string(4) "1548" ["created_by_alias"]=> string(0) "" ["state"]=> string(1) "1" ["modified"]=> string(19) "2018-06-15 03:08:46" ["modified_by"]=> string(4) "1616" ["modified_by_name"]=> string(16) "Janelle Baguioro" ["publish_up"]=> string(19) "2018-06-17 20:00:00" ["publish_down"]=> string(19) "0000-00-00 00:00:00" ["images"]=> string(261) "{"image_intro":"images\/intro-images\/839x487\/money-going-down-drain.jpg","float_intro":"","image_intro_alt":"Money, cash, Australian dollars","image_intro_caption":"","image_fulltext":"","float_fulltext":"","image_fulltext_alt":"","image_fulltext_caption":""}" ["urls"]=> string(121) "{"urla":false,"urlatext":"","targeta":"","urlb":false,"urlbtext":"","targetb":"","urlc":false,"urlctext":"","targetc":""}" ["attribs"]=> string(1002) "{"article_layout":"","show_title":"","link_titles":"","show_tags":"","show_intro":"","info_block_position":"","info_block_show_title":"","show_category":"","link_category":"","show_parent_category":"","link_parent_category":"","show_associations":"","show_author":"","link_author":"","show_create_date":"","show_modify_date":"","show_publish_date":"","show_item_navigation":"","show_icons":"","show_print_icon":"","show_email_icon":"","show_vote":"","show_hits":"","show_noauth":"","urls_position":"","alternative_readmore":"","article_page_title":"","show_publishing_options":"","show_article_options":"","show_urls_images_backend":"","show_urls_images_frontend":"","canonical_link":"","transcript":"","clientName1":"","clientDesc1":"","clientImage1":"","clientUrl1":"","clientName2":"","clientDesc2":"","clientImage2":"","clientUrl2":"","clientName3":"","clientDesc3":"","clientImage3":"","clientUrl3":"","clientName4":"","clientDesc4":"","clientImage4":"","clientUrl4":"","author_promotion_line":""}" ["metadata"]=> string(53) "{"robots":"","author":"","rights":"","xreference":""}" ["metakey"]=> string(59) "‘common’, referrer, practice, paid, side, fence, coming" ["metadesc"]=> string(200) "The practice of property investment firms sharing undisclosed kickbacks amongst the supply chain involved in development sales will be outlawed in NSW on 1 July this year under the Real Estate Reform " ["access"]=> string(1) "1" ["hits"]=> string(2) "70" ["xreference"]=> string(0) "" ["featured"]=> string(1) "0" ["language"]=> string(1) "*" ["readmore"]=> string(4) "2238" ["ordering"]=> string(1) "3" ["category_title"]=> string(25) "Smart Property Investment" ["category_route"]=> string(25) "smart-property-investment" ["category_access"]=> string(1) "1" ["category_alias"]=> string(25) "smart-property-investment" ["published"]=> string(1) "1" ["parents_published"]=> string(1) "1" ["lft"]=> string(2) "47" ["author"]=> string(9) "Tim Neary" ["author_email"]=> string(30) "[email protected]" ["parent_title"]=> string(4) "ROOT" ["parent_id"]=> string(1) "1" ["parent_route"]=> string(0) "" ["parent_alias"]=> string(4) "root" ["rating"]=> string(1) "0" ["rating_count"]=> string(1) "0" ["alternative_readmore"]=> NULL ["layout"]=> NULL ["params"]=> object(Joomla\Registry\Registry)#1216 (3) { ["data":protected]=> object(stdClass)#1236 (95) { ["article_layout"]=> string(14) "spbase:article" ["show_title"]=> string(1) "1" ["link_titles"]=> string(1) "1" ["show_intro"]=> string(1) "1" ["info_block_position"]=> string(1) "0" ["info_block_show_title"]=> string(1) "1" ["show_category"]=> string(1) "1" ["link_category"]=> string(1) "0" ["show_parent_category"]=> string(1) "0" ["link_parent_category"]=> string(1) "0" ["show_associations"]=> string(1) "0" ["flags"]=> string(1) "1" ["show_author"]=> string(1) "1" ["link_author"]=> string(1) "0" ["show_create_date"]=> string(1) "1" ["show_modify_date"]=> string(1) "1" ["show_publish_date"]=> string(1) "1" ["show_item_navigation"]=> string(1) "0" ["show_vote"]=> string(1) "0" ["show_readmore"]=> string(1) "1" ["show_readmore_title"]=> string(1) "0" ["readmore_limit"]=> string(3) "100" ["show_tags"]=> string(1) "1" ["show_icons"]=> string(1) "0" ["show_print_icon"]=> string(1) "0" ["show_email_icon"]=> string(1) "1" ["show_hits"]=> string(1) "0" ["show_noauth"]=> string(1) "0" ["urls_position"]=> string(1) "0" ["captcha"]=> string(0) "" ["show_publishing_options"]=> string(1) "1" ["show_article_options"]=> string(1) "1" ["save_history"]=> string(1) "0" ["history_limit"]=> int(10) ["show_urls_images_frontend"]=> string(1) "0" ["show_urls_images_backend"]=> string(1) "1" ["targeta"]=> int(0) ["targetb"]=> int(0) ["targetc"]=> int(0) ["float_intro"]=> string(5) "right" ["float_fulltext"]=> string(5) "right" ["category_layout"]=> string(6) "_:blog" ["show_category_heading_title_text"]=> string(1) "0" ["show_category_title"]=> string(1) "0" ["show_description"]=> string(1) "0" ["show_description_image"]=> string(1) "0" ["maxLevel"]=> string(1) "0" ["show_empty_categories"]=> string(1) "0" ["show_no_articles"]=> string(1) "1" ["show_subcat_desc"]=> string(1) "0" ["show_cat_num_articles"]=> string(1) "0" ["show_cat_tags"]=> string(1) "0" ["show_base_description"]=> string(1) "1" ["maxLevelcat"]=> string(2) "-1" ["show_empty_categories_cat"]=> string(1) "0" ["show_subcat_desc_cat"]=> string(1) "1" ["show_cat_num_articles_cat"]=> string(1) "1" ["num_leading_articles"]=> string(2) "15" ["num_intro_articles"]=> string(1) "0" ["num_columns"]=> string(1) "0" ["num_links"]=> string(1) "0" ["multi_column_order"]=> string(1) "0" ["show_subcategory_content"]=> string(1) "0" ["show_pagination_limit"]=> string(1) "1" ["filter_field"]=> string(4) "hide" ["show_headings"]=> string(1) "1" ["list_show_date"]=> string(1) "0" ["date_format"]=> string(0) "" ["list_show_hits"]=> string(1) "0" ["list_show_author"]=> string(1) "0" ["list_show_votes"]=> string(1) "0" ["list_show_ratings"]=> string(1) "0" ["orderby_pri"]=> string(4) "none" ["orderby_sec"]=> string(5) "rdate" ["order_date"]=> string(9) "published" ["show_pagination"]=> string(1) "2" ["show_pagination_results"]=> string(1) "1" ["show_featured"]=> string(4) "show" ["show_feed_link"]=> string(1) "1" ["feed_summary"]=> string(1) "0" ["feed_show_readmore"]=> string(1) "0" ["sef_advanced"]=> int(0) ["sef_ids"]=> int(0) ["custom_fields_enable"]=> string(1) "1" ["show_page_heading"]=> string(1) "0" ["layout_type"]=> string(4) "blog" ["menu_text"]=> int(1) ["menu_show"]=> int(1) ["page_title"]=> string(53) "Finance Tips and Insights - Smart Property Investment" ["menu-meta_description"]=> string(91) "Financial tips for property investors, from mortgages to cash flow to saving for a deposit." ["secure"]=> int(0) ["page_description"]=> string(11) "sample desc" ["page_rights"]=> NULL ["robots"]=> NULL ["access-view"]=> bool(true) } ["initialized":protected]=> bool(true) ["separator"]=> string(1) "." } ["displayDate"]=> string(19) "2018-06-17 20:00:00" ["slug"]=> string(88) "18159:common-referrer-practice-of-being-paid-on-both-sides-of-the-fence-coming-to-an-end" ["catslug"]=> string(28) "45:smart-property-investment" ["link"]=> string(108) "/investor-stories-1/18159-common-referrer-practice-of-being-paid-on-both-sides-of-the-fence-coming-to-an-end" }
‘Common’ referrer practice of being paid on both sides of the fence coming to an end

Top Suburbs

Highest annual price growth - click a suburb below to view full profile data:
6 ways to improve your financial fitness
SPI logo