What is the real estate monster?
I'll explain shortly.
But the press is at it again with all of their opinions about the real estate market currently in a boom.
I talk to lots of people on a daily basis and many are hypnotised by the press, believing that now is not the right time to get into real estate – because prices are too high.
I'll deal with whether it is or isn't shortly…
It's hard to sometimes go against the overwhelming tide of opinion, but that's what you have to do in order to become successful.
The masses are always wrong…. So this is the time to stand tall and profit like crazy. If you're willing to stand out from the crowd and go in the opposite direction.
There is a real estate monster out there, and let me tell you what's not. It's not all the B.S. and rubbish you hear about from wannabe economists, cleverly disguised as journo's.
In fact, those guys are trying to cut down to size this real monster that was created about two years ago and will continue to grow for maybe even decades.
You're curious now as to what I'm talking about…
Here's how the real estate monster was created…
First, we had a serious economic catastrophe. That is well known as the GFC. The government had to react somehow, all the smart guys in the world were literally printing money and throwing it at the problem – so why should we have been any different?
Amongst many of the resolutions for underpinning our economy was the boost to the first home-owners grant.
The government knew well in advance that when they released the first home-owner's boost there was already a real estate supply problem.
The only outcome when you increase demand and know that you can't possibly supply, the price of that asset will go up. That's exactly what happened, didn't it?
I saw this early last year, and we've been screaming it out loud ever since. Some listened and profited, others sat on the fence and missed out.
…and there are people who sent me long-winded emails on how property was going to halve, the sky was going to fall down and we should all fill our pantries up with canned food for the coming depression… Seriously.
The government created this monster and fed it on a diet of free money.
So the boys in parliament have got a problem now, don't they?
After putting all these people into homes for the first time, and knowing full well that the prices are likely to inflate – how do they go back now and unleash supply (which will deflate prices)?
There'd be blood on the street if this was happen and every new first home-owner would be a “lamb to the slaughter.”
Tony Abbott, who is probably not even across this basic economic analysis should be laughing right now if K-Rudd does the unthinkable and increase supply.
The housing market is now a political hot potato.
But to just increase supply is no easy matter. It doesn't happen overnight and it could take 2-3 years before we can get it right.
As an investor, you should know this and I'm doing what I can to put my perspective on it.
As people talk down the property market, I and others continue to make easy money, month in month out, simply because we have portfolios that just increase in value whilst we sleep.
The money you make when you sleep is the easiest money you'll ever make in your life.
Now let's talk about the future… The housing market will be facing some real pressure all the way to 2050. Yeah, I know that's a long time away but it's a trend and a timeframe that you have to consider when you're a long term investor.
The government is pushing for a population of 36 million by then.
…and by 2030, if this problem is not dealt with, the undersupply of houses is reported that it could reach a 1.5 million shortfall.
That can only mean one thing… Prices will go up, millionaires will be made. Are you in or out?
Now 2030 is a little bit more realistic for most of us, that's a good 20-year cycle, and you'd be foolish to sweep this information under the carpet and miss out on potentially 3 upwards cycles leading into 2030.
What I mean by 3 upward cycles is property doubling in value every 7 years from now till 2030.
Most people's thinking is too short term when it comes to property. I learnt this several years ago, that you have to think in cycles when it comes to property. I've been involved in only 2 property cycles and literally have made millions.
Back to the problem…
The government has a clear agenda to increase the population, whilst the state governments are scratching their heads as to where these people will live.
It wasn't long ago that Bob Carr, the former premier of NSW was saying that Sydney is full and literally making it impossible for future planning and growth.
There's a stock market saying called divergence… Usually when this happens we get a significant trend either way.
Here, all fact considered, the trend is towards the upside.
So what do you do?
Well, you can simply do nothing, sit on the fence and just take my view as another opinion – nothing more than that… Or, you can let the Federal and the State governments battle it out and buy as much property as you can in the next 5 years and take advantage of this unique time in Australian real estate history… and become wealthy beyond your dreams.
I know which road I'll be taking… Do you?
At this point, I would typically get excuses… Don't have a deposit, can't get a bank loan, bad credit, blah, blah, blah…
I can solve all that for you within 4 hours tops. How?
Just one of the presentations at our Cash Flow For Life conference deals with these problems and solves them. If they are your excuses, then you need to be at that event, don't you?
Anyway, I digress.
Have your say below, I'm interested in your opinion.
Signed with Success,
Jon Giaan
Knowledge Source
P.S. The real estate monster is real, and it can be your friend if you know how to tame it and use it to do good instead of evil.
Richard says
While your optimism is laudible, you underestimate the looming crisis. The GFC isn’t over, and the next leg down has already begun in the form of sovereign debt defaults. Yes, Australia is one of the very FEW countries that will not (probably) suffer directly from the Kondratiev tsunami coming (due mainly to our ‘special’ relationship with our friendly autocratic neighbours to the north, China), but nevertheless our banks will be very reluctant to lend money and will be tightening up lending standards dramatically. I mean, they already have been, haven’t they? But this trend will become even more pronounced in the wake of the massive sovereign debt defaults and hyperinflationary responses around the world. Mate, if no bank is lending~ there are no buyers. No buyers combined with an aging (dare I say it, deceasing) population (meaning more sellers)… well: you can see where this is going. Now I’m not saying Real Estate is a bad investment now. I mean if you have money you have to keep it somewhere, and a real house/property is a lot better than keeping it in cash in a bank, where the pitiful return won’t even hardly keep up with shadow infation. But, lets be realistic here: prices need to fall a long way in measured terms i.e relative to gold/silver.
lynne Wilson says
So , the govt knew all this and most people like poor old us for instance who didnt have the benefit of ‘ superior intelligentia ‘ knowledge of these now obvious to us matters and because we had already lost a lot of money and our house in earlier times trying to make our future secure ,trusting advisors and accountants and were much too afraid to trust again… stupid us.!!!!!
I wonder how many politicians on all sides now own massive portfolios of housing as it appears it was done deliberately to allow the ‘informed’ to make squillions at the expense of the ignorant. …guess we will never know as they will be very clever and have these assets very well hidden .
Now nearing our seventies …oh yes and still working but now having only the small unit we live in , albeit fully paid for, all we have to our name. I guess we have missed the boat again!!!!!!
Laurie Chalson says
Hi John
Are you coming to Perth with this presentation?
regards Laurie
Duncan says
Im sold!
Just can’t physically make it to the conference.
Which of your products covers this info?
D
Peter says
Hi Jon,
I was at the Novatel on Saturday and once again learnt so much about CFP properties.Unfortunately was unable to attend on Sunday morning on Vendor Finance which is of extreme interest to me at present.I listened to your interview with David but need more info.Is there some way other than attending in Melbourne. I will be in Melb this W/E to fianalise realestate.
I am keen to find out more detail so as to not get caught with limited knowledge.
Peter
tony says
unsubcribe
Brenton says
Jon,
Cant Adelaide be included in your list of venues: we often miss the circuit?
Brenton
Linda McGaw says
Property rises and plateaus out, rises and plateaus…yes the global financial crisis isnt over..but Australia is probably one of the best most resourceful countries to be in right now in the World. Australian wages are really high, people work very hard and are prepared to work 12 hour days, power is cheap…food prices are very reasonable, transport is cheap..ie trains trams…this country is dripping with fortunate opportunites that’s why I’m here. I say seize the moment with great gusto, and share some of your good fortune. It’s easy when you live in a country where you actually cant see just how good it is….get on a plane and check out New Zealand and you will understand why New Zealanders are flocking here. The grass is in fact much greener here. “Beauty fades”….but stupid lasts forever.
Jo Ryan WesternAustralia says
Hi Jon,
I have just become a subscriber to yor great newsletter a few weeks back and attended Armand”s seminar at the Sherton a couple of weeks back,made possible for me by you of course!, it was fantastic!! My husband and I have just had this change in our “ratrace” mindset and that we want OUT of the”ratrace” and create our own “cashflow for life”in this awesome new year of 2010. We want to leave a postive and wealthy legacy, not just for our 6 children ,but also for generations to come!
Now we would love to attend for your “cashflow for life” 2 day event, we see though it is only over in the eastern states.Will it be coming over our way, here in Perth?
Finacially it would be a obstacle to fly over that side of Australia, but it is just too good too miss.! We know it was not by chance we found knowledge source just at the very time we were searching for that very thing,knowledge and resources to direct us towards the great vision we have for us and our finacially free future.
Jon as our coach would you consider sponsoring us(my husband Che and I, Jo) over to this wonderful event if it is not making its way over here to Perth?!
You may think I’m bold or even rude,but Jon I’m looking for solutions not excuses for us to gain the success in acheiving a finacial free future and we know that this seminar will be the key to that success.
We will accept conditions or challenges if you sponsor us!!We just know we need to be there!!and we don’t want any obstalce to stand in way and your finacial help would be the stepping stone to that!!
We are seriously serious about becoming seriously wealthy!!
With much sincerity,Respectfully,
Che&Jo Ryan
Dan says
Brenton – its not going to adelaide because Adelaide is so boring
Sue says
Hi Jon,
Thanks for putting together this latest round of events to educate us. I am an investor with Cash Flow Positive properties and have no trouble finding other CFP properties, but I do have a problem with the banks financing us. Looking at our overall situation, I do not consider us a risk at all, quite the opposite, but the banks just seem to want their cake and eat it. I hope there is a lot in next week ends seminar in Melbourne (which we are booked in for) to cover these problems as it is this that is holding us back. We thought we had set ourselves up well, following advice given by Dymphna, but we seem to have hit a brick wall with getting finance. It is frustrating to spend so much time on researching CFP properties, finding them, just to be knocked back by the bank or LMI. I would be grateful if you could do more with regards to educating us on sourcing Vendors that would offer Vendor Finance, thereby avoiding the banks altogether. Still, we are grateful for the education that you do offer. Keep up the good work, it is much appreciated!!!
tony says
Thanks John, Great information about the state of the property market in Australia. Australia is on the road to having un affoardable real estate at all levels like London and most Capitals around the world…Get in whilst you can as the prices will truely only be heading North.
About Adelaide……Much Like johns article, go against the so called popular opinion and Profit from it…I have. Prices there can olny head north as well and its a bit cheaper to get in and heaps of tennants. Adelaide is a hidden Jem and I’m glad People from the eastern states think it no good as there is more opportunities for people like me that see it for how it really is and not conclude that its boring…un intelligent comment….like to see how brenton is fairing in the real estate game. probably boring.
sapian says
This is interesting. just to let you know that i am still reading : )
Dawn says
I live in SA and would love to attend, please hold a presentation in Adelaide.
Pilar Fox says
Dear Jon,
It is very refreshing to wake up every morning looking forward your highly inspiring emails I can’t think of a better way to start the day. The video of Wills Smith has to be the highlight of them all. Not only inspiring people to be free financially but also become better human beings and growth spiritually as well. Keep up the good work
Well done!!!
Chez says
Dear Jon, I have read what you said and am thinking….. ok you say I dont need money for a deposit and had trouble getting my last loan from the bank when I was working three days a week. Now I am working one day a week and going down hill fast with three mouths to feed. So, tell me how I get to be an invester. My dream is to own a number of blocks of units that I will own and manage. I have managed units before so I know that process but how do I get there. I half own my home at present.
I believe that housing is a far better retirment fund than super.
regadrs
Chez
Ronnie Naidoo says
Hi Jian
U have convinced me to jump aboard and get motivated in the property market. I own a property in and a block of land in Perth. Can u advise me whether it is better to deal directly with the banks or go through mortgage brokers. Banks are toughening up on their lending. What can i do to make borrowing more accessible.
Lastly can Aussie residents purchase property in USA.
Regards
Ronnie Naidoo
Vanessa says
Hi Jon,
I have felt the gfc first hand. My story starts last year when a bank told me I had to increase my income by $6,000 per annum in order to refinance units I own. I knew they had increased in value and I planned to use the collateral to buy again.
With in nine months I had not only increased my income by $6000, but $9,500. I paid to have an evaluation done, was told I could get another $96,000 only to be told my income was $16,000 short. What is it with income amounts. I’m only borrowing to 80% and I have a perfect credit rating.
Can you please guide me to a mortgage broker who understands investors. I may be a single mum, but I own over 1.7m in property with 950 in debt. I have always had what the banks believe is a lot of debt, but I always manage.
Thanks Vanessa
Brett says
Hi Jon and fellow bloggers,
You speak alot of sense about propety and the rising market, if only everyone else thought as we did. I am a property investor (real estate agent) in Melbourne and have been for the last 4 years, so i have seen prices skyrocket in my short career. In particular the Docklands. 3-4 years ago you could find a 2 bedroom for average $350k, nowadays i have the same 2 bedrooms selling for average $500k and the trend is not stopping anytime soon. If you are looking to buy a propety, i have over 1500 off the plan listings all over Melbourne including Docklands and South Yarra. If you would be interested in finding out more about the rising market and getting in while you can, contact me on 04222 60 424 or email to [email protected].
Thanks, Brett
Gabi says
Hi Jon
Just a quick reply to Vanessa’s query about finance on investment properties. If interested I can help. Just email me.
Oh anyone else needs some help can also email me.
Thanks, Gabi
Gabi says
Sorry here is the email – [email protected]
Thanks
Gabi