Lunch Money Property Investing - Step 4 - Where To Buy


The fourth step to successful investing is knowing Where To Buy.  There are multiple property cycles happening at any time all over Australia so there are good times and bad times to buy in different markets.   Knowing how to pick the right markets so you know where to buy will set you up to get the best growth in your portfolio.

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Transcription

Hi, I'm Phil Anderson from LifeCorp, the home of street smart property investors. I've been a property investor for more than twenty years, and I've seen tons and tons of mistakes that most property investors make. One of the classic mistakes is getting it very wrong when they target where to buy a property. And I'm gonna show you today how I target the areas that I'm gonna buy next, why I'm targeting those areas, and why most property investors get it very wrong.

Now, my philosophy on how to pick the best markets, the best areas to invest at any time in the property market around Australia, actually is derived from my farm boy days. You know, if I was gonna plant a fruit tree- this may make a lot of sense, particularly make sense to a farm boy- if you're gonna plant a fruit tree, wherever you're gonna plant that fruit tree, you would probably be best served if you decided to plant that fruit tree in the best quality soil, and at the time of the seasons where the rain was about to come and it was ideal conditions for that fruit tree to thrive and bear fruit. The same rules apply when it comes to property investing.

With property investment cycles around Australia, most of the cycles that I've watched for more than twenty years throughout the Australian property market, I've noticed that a typical cycle, a typical property cycle in any of those markets- and we've got hundreds of these cycles all over Australia. There's not just one property cycle for Australia, there are literally hundreds of these cycles. And as I've watched property cycles, from the peak of the cycle, or, let's say the start of a cycle through to the peak of the cycle, I've noticed that in most cases, those property markets, about 2/3 of the time, not much has happened. The market's actually being quite flat. And in about 1/3 of the time, all of the growth has appeared. 2/3, 1/3. 2/3, nothing happens, the market's quite flat. 1/3 of the cycle, all of the growth appears for that cycle. All of the growth you're gonna get in that full cycle appears in 1/3 of the cycle in many, many cases.

Now, none of us have got a crystal ball. But this seems to be a formula that I've enjoyed and proven to get great benefits from over the years. And it's now part of my way to decide where will I plant a wealth seed. As far as planting a fruit tree, the wealth seed, the property. Where will I plant it, anywhere that I want to, all over these property cycles in Australia? Of course, it makes perfect sense that you would target here, what I call 7 o'clock in the market. And yet, most property investors get this very wrong. If they planted that fruit tree there, there's a very good chance in 1/3 of the time, you'll get all of the fruit appearing on the fruit tree, allowing you to pick that fruit, harvest the equity from that property, and go back to another 7 o'clock market, and potentially buy another one or two properties. It's a great formula, guys. And this is a formula I've used over and over again. Unfortunately for a lot of people, they'll buy here. This is where most people buy. Very high in the market. This is where, what I call C-grade investors buy. And the reason they buy so high is because there's a lot of proof. They're sitting back in their local market, kinda hearing how great the property market's going. Eventually there's enough proof of all the growth in the market, and a big, big percentage of C-grade investors buy here. B-grade investors are down a little bit further this way. They're usually professional people that are just too busy to really take advantage down at this stage of the cycle. But they get in around about here. Small, small numbers at the A-grade level at 7 o'clock. Growing numbers, as the retail market kicks off at around 9 or 10 o'clock in the market. But 11, 12, even past the peak of the cycle, most purchasers are buying.

Now, of course, this stage of the cycle would translate back to here as well. This is just 12 o'clock in the previous cycle. So, when you buy here, you tend to be in a situation- there may be a little bit of a drop off, but there's definitely a long, flat period to happen. And for most property investors, this is way, way too common. Of course, if I was gonna plant a fruit tree anywhere, I certainly wouldn't be planting in my own backyard thinking, "Well, one day the rain will come. One day it'll bare fruit." I'd wanna plant it in the most fertile soil. I'd wanna put that property in an area that's got great dynamics where this is about to come into play. Now, there are a lot of indicators that I watch and observe. Lots of drivers that create these, what I call, 7 o'clock markets, but that's a topic for another blog.

This particular step, how I target where to buy, is step number four in my seven step process. I've got a very, very precise seven step process that I use, from the front to the end of how to buy the best properties that will produce the best results, and create safe and efficient growth within my portfolio. I've actually put a copy of a seven step inforgraphic, it's attached below, and I'd love you to grab it. It's free of charge. It's something that I'm just sharing with people, a great visual way to be able to see the full seven steps. I think you'll get some great value of it. So click on the link below and grab that. That's a gift from me to you, free of charge. But inside of this particular step, step number four, targeting where to buy, this is a great element that pulls together so many great components that takes away a lot of risk, accelerates your growth in your portfolio, and it's produced some fantastic results for me over the years.

At the end of the day though, guys, don't forget- if you're gonna buy a property, if you're gonna add one of these investment properties, make sure you check the numbers. Because if you can't buy a property with your lunch money- as I keep saying, if you can't buy it with your lunch money, don't buy it.

Comments

  1. Tina Joseph says:

    Thank you for your insights of where to buy now. Brisbane is tooted as the next city to invest in property, but the QLD premier herself admitted that the QLD economy is in the recession. I do not think its a good idea to invest in Brisbane because of that.

    • Test2 Test2 says:

      Hello Tina
      Thanks for your comment regarding investing in Brisbane.
      Identifying cycles and market timing is an extensive process that draws on many inputs.
      With our model we start the process of identifying target location by looking at National and State level influences – political policies, economic performance, key industries, incentives and more.
      We will also consider data from various resources, like: RP data, SQM Research and more.
      More importantly, we get on the ground in target areas and talk with agents and developers and view first-hand the impact of drivers that we have identified.
      It is not anyone of these inputs that is key, but rather a balanced view through experienced eyes.
      If you would like to know more, please find the order form to the education program below:
      https://ro182.infusionsoft.com/app/orderForms/Lunch-Money-Property-Investing-System
      Leba
      Lifecorp

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