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Michael Yardney Podcast

Insightful, educational and always interesting

Listen and learn from Michael Yardney, Australia’s most trusted property commentator and a group of experts as they discuss Property Investment, Success, Money and Finance to help you multiply your wealth.
While Michael is best known as a property expert, he is also Australia’s leading authority in the psychology of success and wealth creation. You’ll enjoy the way he challenges traditional finance advice with innovative ideas on real estate investing, personal finance and wealth creation. 
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  1. All Episodes
  2. 010: Know which properties to avoid | Buying 10 Properties in 10 years | Wealth Accelerators

Oct 9, 2017

In today’s show I'm going to talk about which properties to avoid if you want to be a successful investor.

While it’s important to understand what properties make good investments, it’s equally important to understand which properties you should not buy.

I’m also going to share a number of Wealth Accelerators the rich use to become richer in my mindset moment. These are things that you may not have thought of, but are important for property investing, life and success.

And  as I answer a listener’s question “Is possible to buy 10 properties in 10 years?” I’ll share my thoughts on property accumulation.

Know Which Properties to Avoid:

  1. Properties you shouldn’t buy are properties that banks don’t like and on which they’ll lend a loan-to-value ratio.
  2. If the banks are wary of a property see it as a warning sign.
  3. Services Apartments leave you dependent on one particular operator and they have a limited resale market.
  4. Department of Defense Housing has a long lease and no ongoing maintenance, but they have expensive property management and other fees. And they’re not located in investment grade locations.
  5. Small units, studio apartments and student accommodations - an apartment needs a flexible floor plan with at least 40 square meters and preferably 50 sq meters.
  6. Off the plan large apartment developments - they are in oversupply.
  7. Poor locations or even the worst part of a good street.
  8. Properties with no or limited parking
  9. Apartments in suboptimal locations.
  10. Avoid main roads and secondary locations.
  11. Rental guarantees are there because that is the only way the seller can find a buyer.
  12. Holiday locations. It’s better to build your asset base in sound investment grade locations before buying a getaway property.
  13. Mining towns – enough said.  

Mindset Message: Wealth Accelerators:

  1. Leveraging and using other people’s money in a strategic way.
  2. Using other people’s time.
  3. Understanding how to legally use the tax laws to your benefit.
  4. Using the right ownership structures - own nothing in your own name.
  5. Having a sound network and building a great team around you.
  6. Having mentors and belonging to mastermind groups.
  7. Having a wealthy mindset. Your reality is what you think is real. Your perception is your reality.
  8. Owning the right assets.

Buying 10 Properties in 10 Years

  1. It doesn’t matter how many properties you own – it’s the size of your asset base and how hard your money works for you.
  2. Don’t focus on the number of properties - focus on the size of your asset base.
    1. Accumulation stage - build a portfolio of properties that outperform the averages
    2. Lowering your loan-to-value ratio.
    3. Live of your cash machine
  3. Understand the 3 phases of wealth creation:-

Links and resources:

Favourite Quotes from this episode:

“I often see investors exhibit confirmation bias  - this is where people just want confirmation of the decision they have already made.” Michael Yardney

“Investors buy with their calculators. I like to sell to owner/operators who buy with their hearts.” Michael Yardney

“Properties need to be liquid. You need to be able to resale or refinance. ” Michael Yardney

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