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Bryce Holdaway Blog post by Bryce Holdaway

Bryce Holdaway’s answers to Five common Property Investment Questions

Question: Bryce, coming from a financial planning and accounting background, how do you think investing in property is different from investing in other areas?

In a word – Leverage! I love the fact that the banks are prepared to lend up to 95% of the value of a property to invest in property. The ability to control a larger asset through leverage and get the returns on that larger value is the key to financial freedom. No other asset class lets you leverage to that level – even blue chip shares only getting 50% of the value and then you are subject to a margin call if the value drops. Don’t get me wrong, I think investors should have a balanced approach to asset selection and I still embrace shares, business and cash as they are all important options… but leverage is the reason I love property and is arguably Australia’s greatest wealth creator!


Question: What do you think stops the average Australian from investing in property?

Debt! I think most Australian’s want to reduce their debt as much as they can as quickly as they can but investing in property means you are getting into more if it!! I think it helps to know that there are three types of debt – horrible, tolerable and productive – of which one you should totally avoid, one you should minimise and one you should embrace! Horrible debt is consumer debt – credit cards, store cards all for one thing… consumer items that go down in value! This type of debt should be avoided at all costs. Tolerable debt is the mortgage on the family home. You’re the only one paying it off so it can be a burden at times but at least you’ve bought an asset that can increase in value and increase your nest egg. And Productive debt is the stuff you should get as much of as you can as it’s the debt you use to buy income producing assets. The richest men and women in this country actively embrace productive debt and know the key differences between the three types.


Question: The book ‘Building Wealth through Investment Property’ inspired you to work in the property sector. What book or resource would you recommend to anybody considering a career in property?

Hard to name just one! But I would say the following books have a had the biggest impact on me in my career in property:
i. Rich Dad Poor Dad by Robert Kiyosaki
ii. The Richest Man in Babylon by George Samuel Clason
iii. How to Win Friends and Influence People by Dale Carnegie
iv. Building Wealth through Investment Property by Jan Somers


Question: You’ve sold and bought major property in each state and territory in Australia. What are some quirks in different parts of Australia that a budding investor would be wise to know?

a. Cooling Off period timeframes are different in each state with some not having any at all
b. Contract Exchange processes are different – if only we had a uniform national framework that would make life so much easier
c. Auctions – QLD and NSW require you to register as a bidder whereas Victoria this is not the case
d. Land tax rates are different across borders
e. Stamp Duty rates differ across different borders
f. The country is made of a 100’s of market with 100’s of sub-markets so it’s not just one big market i.e. houses vs apartments, 1 beds v 2 beds, regional vs. city


Question: How would you recommend a person with a young family should approach property investment?

Conservatively… I have a young family myself and there is never any spare time!! So nothing too intense on the first one or two (i.e. no renovations or subdivisions for example) and once the kids get older and your experience grows you can look to try more advanced strategies. And it is essential that you build a cash flow plan that models real life events not just the properties themselves. I would say this is the biggest mistake I see investors make where they don’t have a modeled cash flow plan and when their household cash flow is attacked – maternity leave, new baby, kitchen renovation or maybe a job loss – they sell in a panic and this is never a good position to get best results for your hard work and efforts.


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