The Property Opportunity Most Buyers Are Too Scared to Take

George Markoski Most expensive words in property investing is let’s wait and see. But you know what? One thing I know for a fact, the market has never waited for someone to feel ready, has it? 2008, People froze. 2020 People panicked. property boomeded. Today, fear is back. Because fear feels different in the moment when you’re in it. And the reason people ask why do this is when I’m investing in an area, a lot of times it doesn’t look that good to the average person. Right. George Markoski But to the trained eye, the trained investor, we know what’s good before other people can see it. Hello, this is George coming to you live with the Positive Property Show. I’ve got my beautiful co-host Christina Markoski here and today we’re going to be talking about the property opportunity most buyers are too scared to take. And I’ll tell you what’s happening at the moment. There’s a lot of Negative Nancys out there, especially in the news, because the news love sharing negative news and what they’re doing is instilling fear in people. And when people are fearful, they don’t invest. But the thing is, by the time the market feels safe, the opportunity may already be gone. And that’s what you’ve got to realise. So let’s get into it. George Markoski A lot of people are talking about buying a house for $2 in Italy. George Markoski Sounds like a real good deal, doesn’t it? Christina Markoski Sounds like a bargain. $2 To buy a house. George Markoski Exactly. Christina Markoski Unheard of. George Markoski Yeah, totally. I mean, where do I sign up? Get me lots of them. Right. Surely the median house price more than $2. Christina Markoski There’s got to be a catch though, surely? George Markoski Yes. So buyers have been going in there. Right. But what happens is you’re required to renovate. It’s going to cost you between $40,000 to $163,000 alongside council bonds of $16,300 and you’ve got a strict three year timeline to make them happen and liveable. Right. So what you’re going to do is you’re buying a dilapidated home and you gotta renovate it within three years, spend all the money and if you don’t finish it in time, you lose everything. Christina Markoski Aha. Wow. Even the money you’ve sunk into repairing the house. George Markoski Yes, yes, that’s right. So that’s why they’re selling for a dollar, because no one’s willing to spend money to renovate these places. A lot of these places are in these little villages and sure they’re cute, but you need to be willing to live away from where it all is. You Know what I mean? Christina Markoski They sound like a money pit. If all you’re doing is putting money in to repair and fix the place. George Markoski Up, well, they’re dilapidated, so that’s why they’re so cheap. And yes, they’re a money pit. And if you want to retire somewhere in the middle of nowhere and you’ve got the money and the time, they make good sense. But if you want to get a bargain and you think you’re going to invest and make money out of it, not a good idea. So the Australian news. Rental disorder. Nation’s largest property manager backs warning on 30% rise. Ray White. They manage over 2$50,000 rental properties and they warned Jim Chalmers that the budget tax changes could contribute to rent hikes of almost a third, as Labor policy rejects the analysis. So what’s happening? Industry experts warn that proposed federal tax reforms targeting property investors risk backfiring on renters, as they always do. George Markoski If higher tax burdens force landlords to sell off properties or pass on holding costs, there’s going to be a shrinking rental supply and that’s going to trigger steep double digit price hikes across the housing market. It’s already happening. Rents are going up. Christina Markoski So what’s this graph on the left here, George, where you’ve got 29.6%, 27.3%,. George Markoski That’s these properties, actual properties, and what they’ve gone up. Christina Markoski The rent or the price of the property? George Markoski The rent. The rent. And that’s Jim Chalmers going, holding his face, going, oh my God. Christina Markoski Watching the rent go up. George Markoski Watch the rent go up. Right. But he doesn’t care because he’s getting paid a lot of money and he’s a treasurer. It’s the average Australian that’s suffering from this. That’s the problem. Right? Because what happens is Labor in the infinite wisdom, what they do is they try to get as much money as they can out of the middle class and landlords love it. And then what happens is they actually end up hurting the people they say they’re helping, which is the average Australian. Christina Markoski They’re the people that are actually renting. Yeah, people that are renting from them. George Markoski That’s right. And who’s renting? Young people are renting. Because when you’re young, that’s what you do when you first start. I think all of us started renting. No one just left home and bought a house. Unless, you know, you’ve got really rich parents, so you’ve done really well. Right, next news, major rental change proposed for millions of Aussies. So the union proposed for two-year rental leases, right? So the ACTU wants a national rule requiring landlords to offer a default of two-year leases. This aims to protect tenants from frequent moving costs and sudden rent hikes. The plan also demands boosting public housing builds to 10% of new homes. Property investor groups argue the policy is going to reduce rental supply and force higher starting rents. This is an interesting one, right? George Markoski The two-year lease. George Markoski Because usually you can get a six month or 12 month at the moment, right? That’s normally the typical thing. And I’ve always wanted the longer lease as a landlord than the shorter one personally. Christina Markoski Because do you like a two-year lease? George Markoski Look, there’s one issue at the moment with a two-year lease which is not normal, right? So for the last 25 years, the reason I like long leases is because then I’ve got certainty I don’t have to pay my property manager to advertise the property. Cause every time you advertise the property and then you’ve got to pay a lease fee and you got to go through it all, there’s a lot of work, right? It’s a bit like getting a new employee takes a lot of work. Much better keep the same person working for you than getting a new employee. Christina Markoski You like the certainty that the two-year rent. George Markoski I like the certainty. Now this is the issue though. When you’ve got rates that are unstable and when you’ve got rents that are going up, this is the time that you don’t want a long lease. And that’s why they’re starting to offer. Christina Markoski It now, because it’s more flexible. George Markoski Because as an investor, if rates go up, I want to have the agility to actually up my rent sooner. So I’d prefer at the moment, if you’re a landlord at the moment or investor, you want a shorter lease, not a longer lease, because it makes you more agile. In the past, the longer lease was always better, except for the last five years. So for 20 years straight, a longer lease is always good because rents didn’t go up that fast. Because typically what used to happen is property prices go up and then rents would lag afterwards and take a while, but you wouldn’t get rents going up year after year after year, dramatically only a little bit by little bit. George Markoski And I was thinking, well, my rents used to only go up $5, $10, $15 a year. And I thought, you know What? George Markoski For that $15, who cares? Get a longer lease, you’ll make it up anyway. But at the moment this is not a good idea. Also They’ve got a plan to demand boosting public housing to 10% of new homes. Now I’ve only got one thing to say about that is hilarious. They can’t even reach the housing accord with private industry. How would government do this? Government’s not pre organised. They’re never going to be able to do it. This is not China. So their ideas are silly and I think two-year rental lease is not a good idea at the moment. So comfortable isn’t the same as safe because the market always feels safest after opportunities already become obvious. Right, so what happens is we’ve got the property clock. George Markoski Now what do you imagine in your mind? George Markoski The big clock, 12 o’clock at the top and 6 at the bottom. Now usually at 11 o’, clock, 12 o’, clock, 1 o’, clock, 2 o’clock and 11 o’clock is nearly the peak of the market, 12 is peak and 1 is actually after the market’s dropped during those times is when people are talking about how good the property market is. And that’s when most people invest between 11 and 2. No one invests when it’s down the bottom that six or seven or five. But that’s where the opportunities are, the opportunities at the bottom of the clock, not at the top of the clock. And recently, you know, we’ve been doing lots of property deals in Melbourne and a lot of people saying, george, why would you buy in Melbourne? George Markoski Well, guess what? George Markoski When I was doing deals in Perth, that’s what people said. When I was doing deals in Brisbane, people asked me why Brisbane? When I was doing deals in Adelaide, they were saying the same thing. And now people are saying why Melbourne, right? And the reason people ask why do this is when I’m investing in an area, a lot of times it doesn’t look that good. To the average person, right? The untrained person, it looks like it’s bad. But to the trained eye, the trained investor, we know what’s good before other people can see it. And that’s what investing’s all about, being able to see something before everyone else. Because if you see it when everyone else has seen it’s a bit late, isn’t it? Christina Markoski You’ve missed the boat by then. George Markoski This is the same thing. You know, people want to get comfortable, they want to hear lots of good news. They wanted to go to barbecues and everyone’s saying, yeah, property is awesome and that’s where they want to buy. And this is what’s happening. There’s people that bought the last three or four years at the peak in Sydney and Melbourne that have got these four, $5 million properties, $2 million, $3 million properties, and now they’re struggling because they’ve dropped in price. That’s what’s happening. So risk versus discomfort, they’re not the same thing. See discomfort, falling prices, negative headlines, low confidence, market uncertainty, that’s discomfort. But people actually equate this with risk. Right. When people see headlines about falling prices, they see all these negative headlines. George Markoski The market’s uncertain, people are going, wow, that’s risky. No, that’s just discomfort. You know what’s risky? George Markoski Weak fundamentals, poor asset selection, unsustainable cash flow and buying without a strategy. And that’s risky. And people need to realise what is good, what’s bad. But the fact of it is, an uncomfortable market can give you a very good investment. Christina Markoski You’ve just got to know where the opportunity is. George Markoski That’s right. That’s exactly right. So what the data is saying right now, well, national home values have dropped 0.7%. Chicken Little would be saying, the sky is falling. Oh, my God. But it’s not falling. The sky’s not falling. None of our properties have gone down. Auction clearance rates are down. And auction clearance rates, they do track with prices. So what happens is, as they go down, usually prices go down as well. But what sort of things sell at auction? More unique places, more expensive places. Right. So when auction clearance rates are low, don’t buy something that’s going to sell at auction because it’s not going to really maintain its value. But if something’s not selling at auction, it’s something different. Look at rental yields. 3.56%. They’re the highest since 2019. George Markoski Right. George Markoski So when rental yields are high, as they go higher, it’s going to attract people to invest. But what’s the buyer sentiment at the moment? Pessimistic. People believe property is not a good deal at the moment. And I’ll tell you one thing, I’ve made a lot of money when people thought property wasn’t good. Most of my money was made then, not actually when people thought it was good. When did I make money? Back in the GFC, I made a lot of money back when APRA clAMPed down and everyone got negative. I made a lot of money during Covid I made a lot of money and now I’m making a lot of money at a property. Why? Because people have got negative sentiment. So I’ve seen this move before. 2008, People froze. George Markoski 2020 People panicked. property boomed. Today, fear is back. George Markoski The Outcome is still being written because fear feels different in the moment when you’re in it. But the pattern isn’t new. So the government changed the rules. They expected behaviour to change. The data says otherwise. I want to talk about this Hanson. She wants to slash cigarette prices by $30 a packet. And basically One Nation proposing a 75% cut to the cigarette excise and a three year indexation freeze, aiming to make legal tobacco more competitive with illicit alternatives. So let’s talk about the story and see what happened here. Higher tax didn’t kill demand, it just moved it. Right. So what happened was Australian tobacco excise equivalent, Customs revenue, have a look at this graph. And from 2000 onwards, the tax on cigarettes kept going up. George Markoski Then what happened was 2020, it hit this spike right here. So now look at what happened though. George Markoski They put so much tax on it that an estimated 60% of Australia’s tobacco market is now legal. Authorities have seized over 509 tonnes, a fraction of the estimated illicit supply. And the actual tax on tobacco has fallen 72%. So higher taxes didn’t remove demand, it just changed where the money went. But not only that, the government makes less money now off cigarettes because they charge more tax. Isn’t that something? Well, this is the thing. If you try to strong-arm the argument and you try to like, look what happened in 1920s in America. So what they did is they made alcohol illegal in the whole of the United States. What a crazy idea. George Markoski But there was people getting drunk and they didn’t like people getting drunk and they thought it was bad and they stopped it. Did it stop alcohol consumption? No. George Markoski All it did is build a massive criminal network that is still there today. And I don’t know if you’ve heard the. There was two people killed in Bali. There was another guy killed in Vietnam on holiday recently, some guy in Melbourne got gunned down. There’s people getting gunned down left, right and centre in Australia. Christina Markoski And all of this over cigarettes? George Markoski Over cigarettes? Yes. Christina Markoski Wow. George Markoski There’s cigarette shops getting burnt down, there’s people getting killed, bashed, bombed and everything. It is terrible. There’s all these underworld now figures that are billionaires because of cigarettes. The government used to get $16 billion at the peak and now they get $7 billion. There’s $11 billion dollar gap there. Where do you think that $11 billion dollar gap’s gone? A lot of that $11 billion dollar gap is actually in the hands of criminals. So they’re financing tomorrow’s criminal gangs. So what Pauline Hanson is proposing is not a crazy idea, but the horse is bolted. So it’s going to be very hard because now these gangs have got lots of money and they’re going to put it into coke and other drugs and you’re not going to be able to stop them. George Markoski They’re not going to just stop now. George Markoski They’ve built all this massive chain of supply and distribution and everything else like that and muscle. You’re not going to be able to just stop them by getting rid of the product. They’ll find a new product. Christina Markoski We’ve got a full organised crime syndicate going on now. George Markoski That’s right. They’re very organised. Exactly. So you’re not going to be able to stop them by stopping one product, because they’ll find something else. Unfortunately. They shouldn’t have let them start in the first place, unfortunately. But that’s what’s happening. When policy changes the rules and the market adapt. That’s the story we’ve got to learn from. This tobacco story isn’t really about cigarettes, it’s really about incentives. So you change the economics and the behaviour changes. And the same principle applies to property investors when governments change the rules. That’s why I wanted to talk about this, because they tried to predict what investors would do. Treasury, they had 35,000 fewer homes, 22,000 fewer homes over five years. Westpac Investor new build loans up 45% now. George Markoski So the government changed the rules with tax, trying to help the rental crisis. But what do they do now? George Markoski We’ve got less homes and now investor new build loans have gone up. So different forecast, same assumptions, policy would change investor behaviour. Look at this. In June quarter of 2026, a record high of investor loans approved for new construction. 8,468 Properties. Christina Markoski That still seems very low to me. George Markoski That’s high. So what’s happened now is the strategy we’ve been using for many years because it’s so tax efficient and works so well for cash flow. Now everyone else wants to do what we’re doing. Luckily we’ve got 20 years on them because we’ve got a lot more experience at doing this, because it’s not that simple. So investor lending hit a record high now. Now, you know what also made this go higher? Everyone jumping in last minute to finish off their SMSF deals. So investors didn’t stop. They adapted policy, changed incentives, investors changed their behaviour. Instead of construction lending collapsing, it climbed to record highs. Changing rules doesn’t remove demand, it changes where demand goes. The opportunity belongs to investors who adapt first. So define over your super. George Markoski Your money today, your retirement Tomorrow, who gets to decide? George Markoski Jim Chalmers is vowing to defend compulsory superannuation. Pauline Hanson has called the system broken. There’s a big fight over your super at the moment. See Pauline Hanson’s challenging Australia’s compulsory super system, arguing Australians should have a greater control of their money. Jim Chalmers has vowed to defend compulsory super, warning that weakening the system could undermine Australia’s retirement savings. This is a very interesting one and I’m going to talk about my opinion about this. So these are the facts. 12% Of your earnings go into super. And now debate is going about whether Australians should have more control over their money. What I’d love to do in the chat, if you’re watching on Facebook Live, you’re in the chat, in the zoom. Tell me, what do you think? George Markoski Should we keep it in super or should we have more control? Type in control or super. George Markoski Let me know what you think. I’d love to know. A bit of a survey. Your money now or more money later? That’s the real question. Use it today for house deposit, mortgage pressure, cost of living, more personal control or keep it invested in super. Decades of compounding large retirement balance, less reliance on pension, more wealth later. That’s the real argument behind the superannuation fight. And you’re going to be surprised by what I say we should do because a lot of people will be surprised about what I’m going to say. I consider this the marshmallow test. Do you want to talk about the marshmallow test, how that worked? Christina Markoski So basically it’s like delayed gratification. So you’re taking one now or two later? George Markoski Yeah, we’re going to test our son out when he’s old enough. So what they did, they got these kids and they put him in this room and they said, would you like one marshmallow? The kids obviously saying yes. They said, we’ll leave the marshmallow here and if you don’t eat it, when I come back, I’m going to give you a second marshmallow. That was the test. And guess what happened? Most of them, like over 70% ate the marshmallow. They couldn’t actually hold themselves back, but a percentage of them waited for the second marshmallow to get more. And guess what they found. Those kids that had the self discipline to forego pleasure now for the future were much more successful in the future. So the marshmallow test is real. George Markoski And delayed gratification is one of the most powerful things you can build within yourself to get there. Right. And you think this whole super things about delayed gratification. It is, but it isn’t. So let me explain. Basically, on average $50,000 today, if you didn’t touch it, would be worth $271,000 over 25 years. So that’s a 7% annual return before taxes, fees and market volatility. The real cost of withdrawing super is the growth you give up, right? You know, imagine this, you get $50,000 now, but you’re missing out a total of 71,000 over 25 years. This is an interesting question because what should people do? See, super is big in retirement though. Australia’s got a $4.4 trillion super system. George Markoski It’s the world’s fourth largest pension market on track to be number two. George Markoski So we’re the one that’s one of the biggest pension markets in the world. Basically what super funds is Australian businesses, infrastructure, property shares, government corporate debt. So there’s a lot of money, there’s a lot of power there. And now people have discovered it and everyone wants their hands on it. And we’ve already seen what’s happened. We’re not allowed to borrow money in self managed super funds to buy property. And that’s because the big fund managers want their hands on your super. They want you having your own control. So what should we do? So this is my thoughts. Having control of your super is both good and bad. It depends on the person. Now this is the problem. George Markoski The average Australian has got no idea how to save or invest or do anything. George Markoski So I think that compulsory super for the average Australian forcing them to save and have money in their retirement is actually very good. And that’s why I think we should keep it. However, I really believe that if you’re an educated investor, you’re so much better off taking that money out. I mean there’s $50,000 there and in 25 years going to be $271,000. Now I’ll tell you, we’ve done that with our clients in one year. Let me say this again. You know what someone can get out of $50,000 in 25 years of super? Our clients can achieve that in less than a year. We’ve got an exAMPle of that. Christina Markoski The return that the super funds are getting is not that good. George Markoski Well, exactly. So our members would be much better off taking their super money out and investing in property because they know what they’re doing. But 99% of Australians are better off not touching it because they’re going to blow it. But it’s a bit like debt as well, right? I mean good debt and bad debt is Debt good? Is it bad? Well, good debt’s really good if you invest it. The debt that we get to invest in properties is great, you know, and people go, oh, but you’re going to pay 3, $400,000 of interest over the lifetime of the loan. Yes, but you know, we’ve got exAMPle of clients making two or three hundred thousand in just two-years. George Markoski They’ve paid off the interest and the rest is all profit, so it doesn’t matter. But bad debt’s bad. George Markoski And, and you know, you get, the average person, they get debt, they buy a jet ski or they go on holiday, get some plastic surgery, buy a car, that sort of stuff. No, but if you invest it, if you invest your money in education, mentorship, you invest it in property investing. That’s different. So the cuts that aren’t really cuts, the government says migration is coming down. The numbers tell a different story. So look at this. Australia’s still an outlier in migration. This is our net migration share of population. Our net migration is over 1% a share of population. We’re higher than Canada, New Zealand, Norway, usa, uk, France, Germany, Italy, Japan. Christina Markoski Wow. I’m surprised that we’re higher than UK. George Markoski We’re three times the developed world and we’re two times Australia’s long average. 400,000 Net overseas migrants per year average under the Albanese government, nearly two times the previous long run average. So normally we get around 200,000. And 200,000 is a good number because with 25 million people, you’re spreading them out, you’re not putting a lot of pressure on infrastructure. We’re getting skilled migrants in that can do really good value and add value to our country. Migrants are very important to Australia and add value, but going overboard is going overboard. So Australia’s migration story runs through its universities. So 27% of Australia’s university enrolments are international students. So you gotta understand, universities make a lot of money and they make a lot of money of international students that are migrating. George Markoski So I’d imagine that they’re friends with a lot of politicians. George Markoski I think they’re friends of a guy starting with a. What’s his name? Albanese. Right. I think they’re good friends of him. Right. And they like immigration. They love it because they make a lot of money. Christina Markoski I can see why they love it now. 27% Of their business is coming from it. George Markoski Exactly, exactly. So there you go. So the rental crisis is no easy exit. Rents are up 50% to 2020. New supply is stacked, the pressure is going away. This is the thing you look at wages up 26%, rents up 55%. Christina Markoski Wow. Rents have risen twice as fast as wages. George Markoski They have. And that’s the problem, Right. Christina Markoski That’s why it’s so expensive to live in Australia. George Markoski It is. It is. Why? New rental supply won’t fix the problem anytime soon. Well, falling property values, low end values, make new developers harder to stack up financially. They’re not going to build the properties if the property prices drop. So what you do is you look at land and the cost of building and then the developers profit. If property prices drop, they won’t develop, they won’t make the properties. How weird is that? So therefore that will push prices up. Christina Markoski Got to be viable for the people doing it. George Markoski Yes. And because of that, literally, properties, if they drop, will create an undersupply which will make property prices go up. Let me say that again. If property prices drop in Australia, with our only supply being new properties because we don’t have enough used properties, then property prices drop, supply stops. Property prices go up because there’s no supply, it’s impossible for them not to go up. Is that amazing? Do people need more certainty than that? It’s just numbers, just inevitable. It’s just an equation. It’s like F equals ma, you know, force equals mass times acceleration. You can’t escape that equation. High interest rates. Financing is more expensive for developers and for investors buying new property. Construction costs are still too high, building costs remain elevated, leaving many projects financially unviable. George Markoski New supply is skewing premium. George Markoski The projects do stack up increasingly at the premium end, not where affordable rent supplies need it most. The problem is in the lack of projects. As we keep saying, there’s too many projects no longer make financial sense to build if the property prices drop. Melbourne, the opportunity hiding in plain sight. You know, I’ve been poo-pooing Melbourne for a long time, haven’t I? Christina Markoski You’ve changed your tune now. George Markoski And I always will. And you know, this is the funny thing, right? I say, look, don’t buy in Melbourne and everyone’s like, well, now you’re saying, buy in Melbourne. Make up your mind. The property market changes and you need to adapt. You can’t be a dinosaur sticking to the same story over and over. So the fact of it is that every property market goes where it’s good and where it’s bad. Christina Markoski Well, it’s all going through different stages of the property clock. George Markoski That’s right. Christina Markoski And you’re looking never going to stay at 12 or 6. It’s always going to go around. George Markoski Yeah. But look at these numbers. I’m really excited about it. Look at this, look at this, right, Melbourne’s barely moved at all. So the last five years, what has Melbourne done? Nothing. It stood still. What have Capital City averages done compared to Melbourne? Christina Markoski It boomed. George Markoski Yes. Now when I show these graphs a lot, I’m talking about population supply, even the tobacco showing excise. What you got to look at when you look at these graphs is when you look at Capital City and you look at Melbourne, you see that gap. I see that gap as an opportunity gap. That’s where the opportunities lie. And I do this with every suburb in Australia. So just so people know how I look at things. So I’ve literally got 15,000 suburbs and all this gap put in the database. So we can see. And then what we do is we find the top gaps because that gap shows where the money is. George Markoski Now this is the thing, Melbourne’s got a lot of suburbs and some suburbs haven’t got a gap and others do. So this is the macro picture. George Markoski But you can see there’s some good buying in Melbourne. That’s why we’re buying in Melbourne. Now look at the long term average as well. Melbourne compared to the other capitals. It just moves in and out. And what I do is you look at this 1982, right? 1982 Was a great time to buy in Melbourne. I was too young to buy then because I was 12, but it would have been a great now 1990, when everyone’s buying in Melbourne, bad because it was overpriced compared to everything else. Then you look at 95, great time to buy Melbourne. Then you look at 2018, really bad time to buy Melbourne. Terrible, look at now. Christina Markoski At the bottom of the market again. George Markoski Is it at the bottom? It’s going to drop more. Is it going to go up? That’s the question. So Melbourne’s GROSS Rental yield is 4%. If you look at this right, you look at the graph of the price of property, when it hits the bottom, that’s when the rental yield goes up the most. So the highest of any major Australian capital city. After years of weak price growth, Melbourne is now offering a combination investors haven’t seen for some time. Relative affordable prices. Strong rental yields. So you look at gross yield per capital city. Melbourne’s 4%. Perth 3.7, Adelaide’s 3.5. Brisbane 3.3. Sydney 2.9. Melbourne was there recently. Melbourne was the lowest out of all of them at one state. Now Melbourne auction clearance rate versus national rate is actually higher. George Markoski Used to be 51% and national average now is around 51%. Christina Markoski So has that just gone up over the last couple of months? George Markoski Month after month is going up because what’s happening is there’s some cheap good buying there. That’s the fact of it. So most expensive words in property investing is let’s wait and see. But you know what? One thing I know for a fact, the market has never waited for someone to feel ready, has it? Christina Markoski And it never will. George Markoski Last time I checked, I don’t think it happened, did it? No. George Markoski So the investors playbook four forces one opportunity. Basically there’s a vendor pullback listings. There’s a lot more properties now available and yield and growth are growing. This is the thing though, right? Investors now are looking at brand new property and brand new properties becoming more and more scarce because a lot of them don’t stack up. So there’s more people bidding on the same property. So rates are restricted for longer. So rates remain high while inflation is brought under control. Opportunity positioned before eventual cuts reprice the market. Immigration demand remains elevated even with proposed cuts. Migration remains historically high. Implications housing and rental demand stays structurally supported. Rental crisis supply can’t catch up. Rents are up 55% since 2020 while new rental supply remains difficult to deliver. What does that mean? George Markoski Existing stock retains strong rental pressure and the new builds the new rules favour new property policy settings are pushing investments towards new construction. So new builds that not only can preserve investor incentives while adding desperately needed supply for Australians. So the opportunities are there. If you’re looking now, August 2026, restrictive conditions estimate. Then you’ve got November spring Selling season 2027 Inflation moderation late 27 RBA inflation protection reaches target midpoint. So this is the positioning window we need to be in right now to position ourselves for the future. So there’s basically two types of people in this market. Those who see falling numbers and they’re running and those who see falling numbers and start asking why only one of them ends up owning anything. That’s the fact of it. George Markoski So time for our case study and then we’re going to go to a private group and do our Q&A. Okay. Chelsea and Klara, they got investment Property in Raceview. 3 Bedroom, 2 bathroom, 1 car. $452,000. 20% Cash deposit $90,000. Settled in October 2023 for $452,000. Current market value $695,000. Current profit $242,000 right now. Remember before we spoke about super how you can invest 50 and get $271,000 in 25 years? They invested 90 and got 240,000 in one year. How much better is it? 12 Times better. Then they got Caboolture, three bedroom, two bathroom, one car. $544,000. 20% Deposit, $108,000. Settled in July 25th of 544. Market value now 7$50,000. Current profit 2,206,000. So total profit $448,300 in three years instead of waiting 25 years to make $271,000 in super. George Markoski And now they’ve got their third property in Melbourne. George Markoski Funny enough, we’ve organised this before my little presentation. So just proving that Melbourne works. Okay. Hello. Klara Kertes Hi. Chelsea McKenna Evening. George Markoski Good evening. How are you? Chelsea McKenna Very good after seeing those numbers. Christina Markoski Congratulations. Klara Kertes Thank you. Chelsea McKenna Very happy with those decisions. George Markoski Yes. And it’s pretty good. I’m wondering if you’re wondering why is he investing in Melbourne? Hope I explained that now tonight. Chelsea McKenna Well, look after the first one. Was that successful? We don’t question you anymore, George. George Markoski Okay. Excellent, excellent. Great, great. I appreciate that, but well done. So I just want to talk a little bit about Klara and Chelsea. Where are you from? Chelsea McKenna I was born and raised on Sunshine Coast, Queensland and Klara was born in Hungary and now resides here in Australia, about to get her citizenship. George Markoski Nice. Congratulations. Well done. Klara Kertes Thank you. Christina Markoski Excellent. Whereas in Australia? Dialling in from. Where are you from? Oh, beautiful. Excellent. And just to get a bit of background, what got you onto property? When did you decide property was the thing for you? Chelsea McKenna It’s something that Klara has looked into for quite a few years, but she’s definitely the type of person. She’s a bit of a perfectionist, so she. She can be a bit nervous about taking risks. So eventually when we came across your method, she delved back into it after Covid. So she was looking into investments in Hungary and then after coming across some of your videos, she started pushing me again to say, you know what? How about we do? Especially since she started learning about all the benefits that Australia has in the. In the tax department. George Markoski Yeah, I know. Pretty amazing. Exactly. Chelsea McKenna She was like, you know what? I think Australia is where I should invest. So, yeah, that’s kind of where I’ve. George Markoski Heard in some places in Europe you actually pay extra tax for being an investor because I know in Belgium or something, you do. So it’s crazy. Klara Kertes Yeah, it is. Yeah. It’s definitely much more positive here. George Markoski Yeah, absolutely. Well, I guess we’ve got a housing crisis. We need properties here, you know. Chelsea McKenna Well, we. We rent as it is, so, yeah, we know what the housing crisis is. George Markoski Yes. So you’re a rentvestor. Chelsea McKenna Yes, we are rentvestor and unfortunately our rent has gone up about 38% in two-years. George Markoski Wow. Yeah. Okay. Klara Kertes $100 Each year, approximately. Yeah, 900. George Markoski Lucky, I suppose, that you’re also investors so you can rent where you want to live and invest where you can make some money. Chelsea McKenna Exactly. George Markoski Yep. Because I know I rentvested for a long time and I loved it. It was good. Chelsea McKenna Well, yeah, at the moment it works for us, it works for our borrowing capacity. So we’ll stick to that for now. Until Sunshine Coast keeps getting more and more expensive. George Markoski Yes, until everyone just comes. Chelsea McKenna Oh, it’s crazy. George Markoski I remember when we first started investing in Sunshine Coast, you know, we’re getting properties there for like $300,000. It was like. And everyone’s like, why are you investing in Sunshine Coast? And now look at them like crazy. Chelsea McKenna It’s the place to be. Klara Kertes After Covid, it has boomed a lot. Yeah, it’s almost doubled. Chelsea McKenna Almost doubled. George Markoski Yep. So Klara and Chelsea, what do you do with yourselves work wise? Klara Kertes I am a travel agent currently. Four years now. George Markoski Okay, nice. Chelsea McKenna And I’m a key account manager for a liquor wholesaler. George Markoski Okay, excellent. And you’ve been in Positive Property for a couple of years now, I think. Two or three years. Chelsea McKenna Yeah, three years. May 2023, I think. George Markoski Yep. And how was your journey? Chelsea McKenna It was definitely a lot easier than I thought it was going to be. I mean, that was kind of the point of us going with you is it’s very. The whole structure. Yeah, the whole thing is quite overwhelming. So when we found you guys, it just made things a lot easier. So lots of look, honestly, we can’t complain. We signed up with you in May 2023. We already had our first property in October 2023, so it couldn’t have gone more smoother than that. Really? Klara Kertes Yeah, we’ve been very fortunate with the first one, that’s for sure. But even Caboolture 1 was also like maybe a year or so was pretty smooth as well. Now on the third one drawn here, which is delayed a little bit, but that’s our first land and house-and-land package. The other two was townhouses. So yeah, we’re waiting for the land registration which was delayed from now. Maybe just October now or maybe next year, so we’re not too sure yet. George Markoski Yes, yes. Now I’m curious. What was the big challenge before you joined us when it came to property investing? What held you back from doing it? Chelsea McKenna I think it was definitely all the work. Like it’s very overwhelming. There’s so much information out there and you, like, just trying to figure out, like, even the tiny little loopholes that you don’t quite know about. Like, I’m not going to lie, Tax is, has zero interest in my brain department, so to actually, like, look into it and try and figure it all out, it’s just very overwhelming. So the point was to just try and make the process more simple for us. George Markoski Yep. And that’s what we did for you, I suppose. Chelsea McKenna Absolutely. Klara Kertes I guess it just also needed a push, to be honest, because, yeah, I was always trying to avoid risk and hesitant and not to easily make the first step. But then after we signed up, it just all made sense and it was just. Chelsea McKenna Yeah, yeah, just, yeah, put. Just push her over the edge. I’m just like, just do it. George Markoski Nice, nice. What gave you the confidence once you joined? I’m just curious about that. Chelsea McKenna You’re probably going to laugh at this because you wouldn’t measure it, but honestly, I’m pretty good with instinct. So after we had our initial meeting with Stacey and look, Klara’s always looked into, you know, money-making, passive income type of things, but it’s never felt right for me. But after that first talk, I was like, you know what, it just. The vibes are right. I’ve got a good instinct, so let’s do it. And thankfully, I wasn’t wrong. George Markoski Great. Absolutely. I mean, now you’ve been investing for three years, you’ve got three investment properties, you’ve made. How much was it? $448,000 In equity. You probably couldn’t save that in three years, could you? Klara Kertes No, no. Chelsea McKenna Gosh, no. Klara Kertes Well, no, I’m good at saving, but not that good. George Markoski And, you know, earlier on we talked about, earlier on we’re talking about super and how, you know, $50,000 in super is going to get you $271,000 in 25 years time and you’ve done $448,000 in three years. What sort of impact is that going to have on your life for your future, knowing where you’re going? Klara Kertes Well, definitely the future looks much brighter and we love to travel, so. And love the freedom to travel, so. Definitely looks much more positive and brighter. Chelsea McKenna Yeah, it’s definitely changed, like the way we talk about the future as well. So, you know, say five years ago we would say, oh, you know, wouldn’t it be good if we won the lottery or, you know, maybe one day we could do this. So instead of being, you know, if, if it’s more like when we do this, like when we can go and that. So yeah, it’s definitely, it’s changed the way we look at our future for sure. George Markoski That’s great. That’s awesome. Just one final question. What would you say to people watching this that are thinking about Positive Property? You know. Chelsea McKenna Trust in the process. Klara Kertes Do it now. Christina Markoski Yeah, yeah. Chelsea McKenna I mean, you know the old saying, safe as houses. Like it’s just, it’s the way to go. And you know the best time to buy was yesterday, so. George Markoski Excellent. Thank you. I really appreciate you both. Thank you for joining me tonight. Chelsea McKenna Thank you very much, George. George Markoski Thank you. Okay, we’re going to do a quick Q&A, read up some of the comments, the questions and then we’ll go to our private group after we do this. Christina Markoski As a retired person, I like super because it’s tax free income for me. Also while I was working I did salary sacrifice which also saved tax. George Markoski That’s Michael Beale, isn’t it? One of our clients? Christina Markoski Yes, yes it is. Yeah. George Markoski Michael Beale, you’re a legend. Thank you for watching. Michael Bealee joined our programme quite a while ago. It was good. So super comes in handy. Definitely. I like Adrian saying keep it in super. Make sure the government keeps their grubby mitts off it. I like that one. True. Christina Markoski I heard recently AMP Bank, I think announced a 40 year mortgage product. What are your thoughts on something like this? George Markoski Oh yes, the 40 year mortgage. Okay, great. I want to talk about this. Yes. AMP have just recently released the 40 year mortgage and there’s been a lot of controversy online because people are saying, oh my God, 40 year mortgage. They’re going to charge you an extra $200,000 to $300,000 of interest because of the extra time. And a lot of people are focusing on that. But what I want to focus on is the actual mortgage the AMP are doing is 10 years interest-only and then after that principal interest is 30 years because normally you can only get 5 years interest-only. I think as an investor getting a longer loan is always better. Right, because we’re doing arbitrage here. Right. That’s what we’re going to look at. Because what is arbitrage? George Markoski Well, you get a loan for 7%, but you’re getting growth that’s higher than 7% and that’s how you make your money. That’s the arbitrage difference. So if you’re doing arbitrage, you’re making more money than your loan. Having it for longer is better because then you got the option if you Want to pay it earlier or longer. Because if you’re a longer loan, that means your borrowing capacity goes up, you can get more properties. Because the biggest issue of investing is borrowing capacity. That’s your biggest constraint, right? Really at the end of the day, you know, everyone that joins our programme, they join our programme to get access to the right properties in the right areas and the right systems and everything else. George Markoski And that part we’ve already got down pat, you know, we know how to structure it. George Markoski We get you the right property, you’re going to make money out of it. But there’s two other things that we work on constantly and that is mindset. Getting your mindset right so you can buy more property. Second, getting your borrowing capacity up. Because borrowing capacity is the hard thing. The mindset, borrowing capacity is what you got to continually work on because that’s the two things you’ve got to get better when it comes to investing. And if you get a 40 year loan and get a better borrowing capacity, I’m up for it. Because over 40 years that loan is going to be actually easier. You’re going to get more money than a 30 year loan. Christina Markoski Did you say the first 10 years are interest free? Christina Markoski Yes. Christina Markoski Wow, that’s amazing. George Markoski I mean Robert Kiyosaki, right, he loves long term loans and I’m always jealous of him. He’s getting 40 year loans, interest only for 40 years, that he’s buying buildings and stuff like that, like, you know what I mean? And they were just not available in Australia. Now we’re suddenly getting some availability. The marketplace in America is so competitive that there’s always some financier willing to finance you no matter what you’re looking for. Whereas in Australia we just got the four big banks and a few other companies. It’s harder. Christina Markoski Well, at least we’ve got AMP now doing the 40 year mortgage. That’s great. George Markoski I think it’s great. Christina Markoski Hopefully the rest will follow. George Markoski Look, I think that the more products out there that can help us, the better. Christina Markoski Yeah, absolutely. George Markoski There you go. Well, look, this is what we’re going to do. We’re going to go to our private group. Thank you so much for joining us. See you next Thursday. It’s going to be a good session as always. Bye bye guys. See you.