The price you pay for an investment property will only matter if you purchase the wrong asset. An investment-grade asset will, in the long run, mask any purchase price errors that you may have made. That is why focusing on the quality of the asset is easily the most important thing you must do when investing in property. Simple…
Over the past few decades, one of the most hotly debated topics has been housing affordability and the sustainability of annual property growth rates exceeding 7%, a trend that’s persisted for the past 45 years. Remove the impact of inflation A podcast listener recently asked me how a $1 million inner-city terrace home in an…
Tax isn’t necessarily a bad thing. If you’re paying tax, it means that you are making money (income or capital gains). But of course, there’s no need to pay any more than you legally have to. I discuss our common-sense approach to saving tax below. Minimising risk is often more important than saving on tax…
What drives you to build wealth? If I deposited $10 million in your bank account today, what would you do differently tomorrow? Do you think money will solve any (or all) of your “problems” and/or fulfil all your dreams? The answers to these questions will reveal how you think about money. And how you think…
The Federal Treasurer, Jim Chalmers, has publicly acknowledged that both state and federal budgets are under unsustainable pressure. He’s been clear that achieving budget sustainability cannot be done without both raising taxes and cutting spending. Chalmers has also spoken about the need to reduce our reliance on income taxes. Australia absolutely needs tax reform – reform that supports economic…
Almost five years ago, I shared evidence that pointed to investment-grade apartments entering a growth cycle within a few years. That prediction hasn’t materialised as prices have remained relatively flat since 2020. But could that finally be about to change? My past work on this subject As noted above, I published a report in October 2020 analysing…
Setting the right budget for a property purchase, be it a home or investment, is a very important financial decision. If your budget is too conservative, you risk missing out on potential capital growth or settling for a property that does not meet all your lifestyle needs. On the other hand, if you overspend and…
If you own a property that you suspect may not be investment-grade, how do you work out if it is worth selling and replacing it with a better-quality property? Risks and costs associated with replacing a poor investment Replacing an investment asset comes with risks and several costs: Asset selection risk: This is the risk…
A Goldilocks investment strategy means that you are making the most of your financial opportunities without overdoing it and taking unnecessary risks. That is, your level of investing is exactly right (i.e., perfectly balanced). Underinvesting means that you risk not having enough investment assets to enjoy a comfortable retirement. Overinvesting means that you have taken…
My personal philosophy on wealth building is simple: invest slightly more than necessary to achieve my financial and lifestyle goals comfortably, but no more than that! None of us knows how long we have left on this planet, so I think it’s essential to maximise enjoyment today or at least enjoy the wealth-building journey as…
