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BLOG: Get smart and don’t worry about the market

30 NOV 2018 • By Phillip Tarrant • 3 min read • Finance

The current state of the market might have you believe the market is going crap and the banks are going to cripple loans, but as long as you have your finances in check, you should be fine.

man relaxing spi

I was speaking with my buyer’s agent Steve Waters, as I usually do, and I asked him if there’s any concerns about moving over to P&I from interest-only loans. It  can be a scary proposition for property investors. But if you’re savvy enough, it shouldn’t really be a concern for you.

Steve was saying that there’s a pretty obvious date when the IO loan is going to expire, so the smart property investors should be getting ready for that; getting your cash flow and buffers in place, as well as making sure you play it a few moves ahead so you’re not penalised when it rolls over.

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Now with our portfolio, I like to think we’ve got a pretty good handle on what’s going on. I’m a bit of a numbers man. I run businesses, and this portfolio is like a business too, so that helps me out to have a pretty good idea of what’s going on with it and what hazards are on the horizon.

I’m not in a rush here either to add to our portfolio, and Steve tells me that’s a good thing – that there should never be a rush. If you want to add to your portfolio, you need to have a plan for your portfolio, and to do that, there needs to be capital and the cashflow to be able to help support the next addition.

 
 

But we don't even have a pre-approval, so the buying intent is not there at the moment, especially in today’s market – and I’m satisfied with that position.

Some opportunities are likely to show up in the future and we’ll take them as they come. We don’t really know when they’ll come, but they will. To do that, we’re keeping abreast of what the media is banging on about these days.

Apparently, it would appear that property markets are going to fall through the floor and everyone’s going to go bust, that things are going to go broke because our financial system is backed and very much based on the the major banks lending mortgages.

So when property goes down 30, 40 per cent, that means all of the banks are going to start trying to get their money back, which is going to cripple loans, cripple property prices – everyone is going to be impacted by it (including the banks themselves). If you believe what you hear and read, anyway. I really don’t.

For now, things are pretty good with our portfolio and I don’t expect that to change anytime soon.

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Property refers to either a tangible or intangible item that an individual or business has legal rights or ownership of, such as houses, cars, stocks or bond certificates.
Phillip Tarrant

Phillip Tarrant

AUTHOR

Phillip Tarrant is executive editor – Real Estate at Momentum Media. He is also an investor with a large property portfolio.

He leads the content strategy and corporate growth for a range of market and business intelligence platforms at Momentum Media, including Smart Property Investment – the authoritative voice for Australia’s property investment community.

As head of the Smart Property Investment Podcast Network, he also steers the largest network of property podcasts in Australia, which collectively generates nearly 2 million downloads every year.

There are over 2.6 million investment properties in Australia, with over 2.1 million Australians (or around 8 per cent of all Australians) owning one or more investment properties. A vibrant and critical sector for creating wealth for Australians, the property investment sector is expected to remain a pillar to the national economy.

For nearing a decade, under Phillip’s stewardship Smart Property Investment has been informing and educating property investors on the tactics and strategies to create wealth through property.

Trusted by over 100,000 Australians each month as the turn-to independent resource for property market insights and information, the brand supports the mantra of "for investors", by investors’, drawing on the unique position that Phillip and Smart Property Investment share, warts and all, its own journey through property.

The Smart Property Investment Show, part of the Smart Property Investment Podcast Network, is one of Australia’s most popular podcasts, forming the keystone of an integrated digital platform delivering daily property updates, live broadcasting, insights, opinion and data to property investors across the nation.

Underpinned by a content team universally recognised for their knowledge of the sector and approach for clear and concise communication, Smart Property Investment has become a central part of Australia’s property community.

About Momentum Media

Momentum Media is a leading media and market intelligence company, and the business behind Smart Property Investment, REB and RPM.

Guided by a strong sense of purpose to support our communities, Momentum Media has forged its place as one of Australia’s most influential media and professional development businesses.

We have been equipping Australia’s corporate, investor and SME sectors with market and business intelligence for over a decade.

Across an integrated business supported by digital, events, broadcast, research, print and social platforms, we are guided by the purpose: Be Better informed.

This passion for informing, educating and inspiring drives us to build more engaged communities, delivering greater leadership to the markets we connect to and forging closer relationships with our audiences.

Being at the forefront of media innovation, backed by a pioneering spirit, has been central to Momentum Media’s growth.

We’re an evolving, forward-thinking business based on a purpose that supports corporate Australia and the markets critical to our nation’s economic prosperity and security. We’re also focused on delivering exceptional value to our commercial partners.

We adapt on a daily basis to rapidly changing market places; we’re a fluid media business, unanchored to any particular technology, channel or tone of communication.

With a reach spanning nearly 2 million professionals, high-net-worth individuals and SME business owners, we’re connected to the rapidly changing preferences and attitudes of our communities – and we’re making a positive contribution for our communities to thrive.

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