In today’s ever-changing property market, it's never been easier to get lost in the sea of conflicting opinions.
If you scroll through social media or attend a property webinar, you'll find a new wave of so-called "experts" and buyers’ agents focusing more on their social media presence than actual expertise.
But here’s the problem—many of these individuals haven’t even invested through a full property cycle.
While they might appear knowledgeable with their slick presentations and big followings, the reality is they lack the depth and perspective necessary to guide you safely in the long term.
The rise of the so-called experts
The Australian property market is more complex than ever, and it’s crucial to be discerning about whose advice you take.
With the rise of social media, it’s incredibly easy to curate a strong online persona.
But just because someone has thousands of followers, or a glossy podcast doesn’t mean they have the experience to back it up.
Real investing requires much more than catchy headlines and trendy buzzwords.
I'm sure you've heard it said that “a rising tide lifts all ships”, and it hasn't been hard for even inexperienced “advisors” to pick a location that has enjoyed strong short-term capital growth over the last couple of years, making them look pretty clever.
Unfortunately, history is littered with stories of investors who followed the latest “hot investment “advisors” and, while obtaining short-term success, have found their properties underperformed in the long term.
So, the first thing you should do when presented with investment advice is to check the expert’s credentials.
This might seem simple, but it's a critical step that many overlook in the excitement of the moment.
Here are some questions you should be asking:
- How long have they been investing themselves - if they haven't been investing for over 15 years and lived through a couple of property cycles they haven't really got the perspective required to offer advice.
- Are they genuinely independent? Many so-called experts receive commissions, kickbacks, or other incentives to recommend specific properties. It's essential to understand if their advice is genuinely in your best interest or if it's driven by hidden agendas. The easiest way to do this is to follow the money trail if somebody else is paying them then you are the “product!”
- What’s their track record? Have their past predictions been accurate? It’s one thing to claim success stories, but are there tangible examples of their advice turning into long-term gains?
- What have they published? Have they written books, or are they regularly featured in reputable media outlets? Of course, it's easy today to get a phantom author to write your book or even AI to do that, so is their work insightful - do they have a point of difference?
The problem with "hot tips" and speculative markets
Let’s face it—when someone says, “This suburb is about to boom” or “Don’t miss out on this hot opportunity,” it often translates to marketing hype rather than genuine, data-backed advice.
These statements are usually based on short-term trends, rather than solid fundamentals, making them unreliable.
Infrastructure projects like new rail lines or shopping centres can indeed boost a suburb's potential, but only if they lead to sustained population growth and housing shortages.
Speculating on future demand based solely on planned projects is risky, especially when these projects can be delayed or cancelled.
Ignorance: the real enemy of investors
One of the biggest dangers for investors is advice based on ignorance.
This type of advice often comes from those who should know better, like real estate agents, property marketers, and some so-called mentors.
These people often tout past performance as a predictor of future growth, using phrases like, “This area saw 8% per annum growth over the last decade” or “It’s the perfect time to buy since the suburb is at the bottom of the property clock.”
But here’s the harsh truth: past performance is no indicator of future performance.
The factors that drove prices up in the past may no longer apply.
With Metropole, we look at historical data, and we recognise that this is really looking in the rear vision mirror and so therefore we pay much more attention to the future looking for things like local jobs growth, population growth, gentrification and housing supply, which are the true drivers of property prices.
Final thoughts: it’s not just about today—it’s about the long-term
As Warren Buffett famously said, “Only when the tide goes out do you discover who’s been swimming naked.”
The property market will inevitably face ups and downs, and it's during these downturns that the true value of experienced advisors comes to light.
Investing in property is one of the biggest financial decisions you’ll ever make, and it’s essential to surround yourself with people who have the knowledge, integrity, and experience to guide you.
Michael Yardney has written a great article here about How to choose a property investment advisor.
Please take the time to read it
Don’t be swayed by the noise.
Do your homework, ask tough questions, and make sure you’re working with someone who has your best interests at heart.