Finance advice

How this property investor achieved financial freedom in the face of divorce

By Bianca Dabu
Money

While getting divorced can bring a negative effect on one's finances, property investor and manager Lisa Indge used this unfortunate event as a motivation to start her business of creating wealth through property.

According to her, the divorce actually gave her more flexibility about what she did with her cash. However, instead of buying a principal place of residence for herself and her three children before starting her own investment journey—like most property investors—Lisa chose to rent in order to save money while continuously growing her assets.

"I love investing in property. Yes, it has been successful from my perspective. [The divorce] gave me a lot of flexibility at that time," she said.

"What I did was I rented. I have three children, so I needed to have a property that was perhaps larger than what I could afford to purchase.

"The fact that you can negatively gear and also use depreciation as a tax tool does enable you to invest quite well while you're renting yourself... it gives you the opportunity to build well without purchasing a family home."

Lisa had quite an advantage in property investment as a business owner and a property manager, and she made sure to maximize her capabilities for building a good property portfolio.

Now that she has spent years actively engaging in the market, she shared some of her wisdom to budding property investors looking into achieving financial freedom and stability:

1. Cash flow is important

Her first advice: Buy more property.

"For me, as a business owner as well—and I've been a business owner for 11 years—cash flow was really something I understood. Having more confidence in that sphere could have helped certainly," Lisa said.

"When I purchased the property in Glebe, I actually did that using my businesses as collateral. It was a much more complex scenario, but it did enable me to purchase that property and it rents for $1,200 a week so the yield on it is actually quite good."

2. Talk to advisers—several of them

All successful property investors are likely to credit their financial team for a huge part of the success, and Lisa is no exception.

"It's quite hard for women, to be honest, because they often haven't been in control of the finances and they don't necessarily understand the mechanism of building wealth. I think it's important to talk to advisers, and not just one, of course," she said.

It is vital to get different perspectives from field experts and professionals before ultimately making your own smart decisions.

"Talk to a number of different advisers and do the numbers yourself. It's important that you understand what cash flow you need when you purchase a property," she added.

3. Educate yourself

While advisers can always be at an investor's service, it is important that one understands the value of their assets and the steps they need to take in order to achieve their goals, both short- and long-term. After all, no one is more responsible of your journey that yourself.

"You need to educate yourself because, ultimately, you are the only person responsible for building your wealth so you need to have those tools, including the knowledge of... what sort of properties you can purchase, how much additional in the bank you may need to cover those unusual situations," Lisa said.

4. Watch the market—literally and figuratively—before buying properties

The property investor and manager made it a habit to study and watch the market closely six months before actually buying a property. This strategy, according to Lisa, has helped her gain more opportunities to move her investment journey further forward.

She said: "It's important that you don't go out into the market place and purchase the first property you see, or the second property. I really recommend that you start watching the market at least six months prior to your purchase so that you can get a feel for how properties are selling."

"You need to have that market knowledge and the only way to gain that is to get out there and go and see properties... You won't know when opportunities are going to rise unless you have the market info," Lisa added.

Tune in to Lisa Indge's episode in The Smart Property Investment Show to find out why she doesn’t manage her own properties, how she negotiates rent increases, and what she looks for in investments, both within and outside of her self-managed super fund.

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  ["title"]=>
  string(51) "Boost for investors as app sets up off-site bidding"
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  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.

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Boost for investors as app sets up off-site bidding
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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.

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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:

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AREAS MENTIONED:

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

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["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)#1214 (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.

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‘Common’ referrer practice of being paid on both sides of the fence coming to an end

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