Well it’s been quite a year of growth and lessons with Covid-19 around the globe and today I spend a few minutes taking time to share my thoughts on what this pandemic has taught me about the world of property investing. Below is the a transcript of the video.
Christine Williams from Smarter Property Investing.
Today I’d like to talk to you about the three things that I’ve learned during COVID-19 whilst investing in property.
The first thing I’d like to talk about is investment properties. I feel that investment properties themselves. These are the safest asset class in Australia. Why? Well everyone has to put their head somewhere every night. But the space that I work in between the $450,000 to the $850,000 mark (new only) for the investment properties in townhouses, house & land, and some apartment space we find that there at the price itself hasn’t retracted during COVID-19 nor has it retracted in any other issue that we’ve had. Such as, let us talk about the year 2000, millennials. Let’s talk about pre and post GFC. Let us talk about pre and post GST. Let us talk about pre and post Royal Commission.
Investment properties have become the safest asset class. Yes, we have people that are self-funded in their retirement and shares in their superannuation have retracted. Its retracted slightly or in some cases quite moderately. But in the $450,000 to $850,000 purchase price in investment properties it hasn’t retracted. There has been retractions around 1% from an overall Australian perspective. But overall, it really hasn’t done anything and this is a long term strategy isn’t it so we’re not going to sell, we are going to buy and hold that’s because that’s what it’s all about.
The second thing I have learnt, is thinking about how do we choose a tenant, and what would a tenant look like and how can we make sure that our property is going to be tenanted with the right tenant.
Well COVID-19 has probably taught us something that, I had not realised that it was something that I was probably doing subconsciously anyway. When I think about a tenant, I think about their employment status. Because as a landlord we are in this as a business, we are in this to create wealth. So we need to make sure that our tenant is employed, and so when I think about COVID-19 and I think about the employment status of who still working during this crisis we have our medical sector, we have our construction sector, we have our essential service sector, and we also have our government sector so and education. So, if we have a tenant that is working in those areas in that we know that they are employed in starting this stability of our tenant is actually secure. This is something sub-consciously I had always been thinking about and doing regardless but it’s come to play in COVID-19.
The third thing that I’ve learned, is how we appreciate money and how we think about money. We have really had to look at our income coming into the household, and how our expenses are leaving our household. For the most people that are living in Victoria and most parts around Australia with lockdowns, we’ve actually started saving money by cooking at home, we are not traveling as much, we are not putting petrol in our cars as much, certainly not dining out, and we certainly not enjoying entertainment. So there’s been a whole shifting with the mentality when it comes to money, what is, what does money mean to us, and what we’re doing with money.
So, to recap the three things that I’ve learned during COVID-19. During this crisis, there has been opportunities. Investing in property has kept my income stable, I’m comfortable with my income coming in and I’m certainly comfortable with my expenses going out. Oh, by the way I did check my expenses, I’ve actually reviewed my insurance, I’ve actually reviewed my home loans, I’ve actually refinanced. So, it’s giving me some time as well to rethink about money coming in and money going out. Asset class investment property, yes it works. Of course the next thing was tenant; choosing the right tenant and understanding their employment status and how that’s going to affect you when your income coming in. Of course, the third thing was budget, thinking about money. So, I hope these 3 three things that I’ve learned, is going to help you, that you can keep investing in property, and understand it’s a wealth creation. At any time you can call me and have a chat on 1300 736 754 and I am happy to answer those questions.
Tell me what have you learned during COVID-19?