[On-Demand Webinar] Finance Fundamentals- Hints, Tips and Strategies

Property Investment Finance

Fundamentals

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• Property investor for the past 10 years

• Supports 500+ members

• Personal experience with renovations

• Great amount of industry experience

Dennis Wong

• 7 years broking experience

• 12 years experience within the commercial & general insurance industry

• 4 years leading a credit team for a nationally recognised non-bank lender

Paul Da Silva

We help investors build and manage

their property portfolios

This presentation contains general information only and does not take into

account your personal objectives, financial situation or needs.

You should consider whether the information is appropriate to you before acting on it.

Before acting on any information you should consider seeking advice from a qualified

financial adviser and / or accountant.

Our mission is to provide property investors around the world with the best advice,

guidance, products and services to enable them to create wealth through property investment.

• 2,800 current members• We help simply Real Estate

Investment• Mix of personal users, brokers,

buyers agents and accountants• 250,000+ members use us for

market information, calculators, investment news and updates

Real Estate Investar

ASX:REV

• Heavy investment in product• Public company governance• Strong and focused board

• Simon Baker – Former CEO of REA• Anthony Catalano – CEO of Domain

In Partnership With…

1.9m Australians

1 Property

2-4 Properties5+ Properties

• Pays shortfall for 5 years+.

• Eventually sells and pays down personal debt.

• No retirement income.

• Strategy & numbers.

• Self funding portfolio.

• $100-$250k+ passive income in retirement.

• Has high income or buys every few years.

• Freehold in retirement.

• Min. retirement income.

Source ATO/ABS

3 Levels of Property Investment

1.9m Australians

1 Property1.4m73%

2-4 Properties470,000

25%

5+ Properties30,000

2%

• Pays shortfall for 5 years+.

• Eventually sells and pays down personal debt.

• No retirement income.

• Strategy & numbers.

• Self funding portfolio.

• End up freehold• $100-$250k+

passive income in retirement.

• Has high income or buys every few years.

• Freehold in retirement.

• Min. retirement income.

Source ATO/ABS

What Level are you Aiming for?

Poll: How many properties do you own?

• Mortgage Broker is working for you.

• Have the same goal – your success.

• Banks won’t help you maximise LVR as you grow.

• Banks are limited in the products they can offer.• Banks are limited by their lending policy.• Mortgage Broker has dozens of lenders and

hundreds of products at their disposal• Mortgage Broker – your partner, facilitator

Bank or Broker? What’s the Difference?

What do you need to determine to ensure your finance is structured right:

• Review your current financial position • Assess the property being acquired• Need to consider your future objectives and

goals

Importance of having the right finance structure

• Is a Bank relationship important?• Cross collateralise or stand alone? • Is having the cheapest deal available the right

strategy?• What product is right for you?• What if you get it wrong?

Importance of having the right finance structure

One lender or multiple?

• No right or wrong answer

• Becomes more important when your portfolio grows

• Both have advantages and disadvantages

• Ease of extracting equity

• Ease of administration

• Negotiating leverage

One Lender Advantages

One Lender Disadvantages

• Changes in lending policy

• Restrictions of a single lending policy

• Maximum exposure limits

• Spreading risk• Pick the lender with the best lending

policy• Take advantage of specials• Make use of capacity criteria

Multiple Lender Advantages

• Can be tougher to extract equity from multiple properties

• New lender may have a higher assessment rate for debts not held with them

• More administration and possibly costs

Multiple Lender Disadvantages

How lenders assess your application

• Character

• Collateral

• Capacity

• Current Conditions

Lenders look at what they call the 4 C’s of credit:

• Credit history

• Stability of employment

• Good asset position

Character

• Is the property in a good area• Is it in good repair• How much are you borrowing against the

property (LVR)• Can it be easily sold

Collateral

• Assess if you have the income to meet your repayments

Lender policies disadvantages property investors. Why?

• Rental income is discounted• Interest rates are assumed higher• Tax benefits can often be ignored

Capacity to repay

• Local economy factors are considered

• Local employment situation

• National and global conditions

Current conditions

Arrange a Free Finance Check Today at

info.realestateinvestar.com.au/finance

Poll: Would you like a free financial check?

Introducing Premium Membership

For the hands-off investor who wants an easy way to purchase their next investment property. Using a six step, strategic approach we help:• First time investors purchase their first property• Existing investors grow their portfolio

Six Step, Strategic Approach

Which property is right for you?We’ll work together to determine your property investing goals and the investing strategy you intend to use. For example:

1. Boost or replace your income with passive cash flow

2. Generate equity for retirement through renovations or subdivisions

We help first time and existing investors purchase

• Existing houses and units in growth markets

• Brand new off the plan apartments, dual occupancy property and duplexes in growth markets

Recent member purchases

Advantages of Premium Membership• Transparency on any opportunities we recommend to you

• Recommended new and / or existing properties• Dedicated Portfolio Manager • ASX listed business• Exclusive access to stock • Leverage our experience, professional ties and partners • Receive a $5,000 cash rebate on settlement for off-the-

plan

Do you have?• A well-defined investing strategy in place?• An acquisition plan to find and research your next property

investment opportunity?• The time or know-how to implement your investing goals to

create sustainable wealth?

If the answer is no, don’t worry, many other property investors we connect with are in a similar position

If you want some help…

• We find out your current situation• The outcomes you want to achieve• Challenges currently standing in your way• How we can help you purchase properties • Next action steps

Register at info.realestateinvestar.com.au/premium-membership-consultation

Poll: Would you like a free consultation?

Q&A Session