Host: Make sense of that one for us.
Paul Glossop: Bit of a real one in itself. Look, I think first home owners grants across this country vary from states. So depending which, where, what and why. This probably comes into grants and stamp duty exemptions, depending on which state and where the incentive lies, depending on whether it’s established, or existing owner occupied for new and off the plan changes as well. Ultimately for me, does the question come into play that if you are looking to buy your home. If that home is going to be, personally then the biggest question I’ll ask is if it’s going to be your first property. If this isn’t going to be your forever home, treat it as investment. So if you are going to buy a home, that you intend on turning into a potential investment down the track or leapfrogging the property market at some way shape or form, that property needs to perform. So just because you got a grant that’s got to allow you to get into the market, does that mean it’s the right time to get into that market? Well that depends on what asset you’re buying. Just because you can get in, doesn’t mean it’s the right property type to get into. I would really want to see the same level of due diligence irrespective to the home or it’s going to be an investment and depending on what market. I think we have already talked about some of the fundamentals that you really need to look for irrespective. But for me, we are always very staunchy when buying a home. Ultimately, unless you’re absolutely 100% sure that that is your forever home or at least somewhat sure that’s your 10 to 15-year home. Please treat it as an investment because otherwise numbers will always stack up. That renting in that same market will no doubt out form you buying a dud owner occupier.
Paul Glossop: Hello guys, and welcome once again to Pure Property Investment one on one. I’m here again today with Tristan Scifo. Tristan, good to have you back in the studio. Tristan is a financial planner, also a wealth coach, does a lot of work with probably everyone from first time investors, people looking probably to set some goals, finances in place from the early stages, right through to retirement planning and everything in between, and that’s probably one part we want to discuss today, if that’s okay with yourself, mate.
With some of the changes to the May budget, one of the things we’re seeing come across the table for first home buyers is the first home super saver scheme, and there’s probably a little more detail yet, is there and we need an acronym for that, which I’m sure they do back in the backrooms of Canberra, but I’m hoping you might be able to share with our viewers a little bit about how that works and how that can potentially help first home buyers, and can they use that money potentially to invest as well, or is it a bit of a taboo topic?
Tristan Scifo: Great questions. Not taboo, it’s just that we don’t really have all the answers just yet, I’m sorry to say, but there’s some good news and some bad news. The good news is, if you didn’t know, Super, superannuation, is a great place to have money. Bigger picture, comparing it to having a property, sorry, comparing it to having a company, comparing it to having assets in your own name, comparing it even just to other trusts, it’s probably the best tax effective vehicle long term for holding any assets, so being able to, not just investing in your Super but being able to take money back out of your Super to use for a property is a really good idea, I think. It’s going to incentivize more people to save in Super and it will make it more feasible for first time investors to get their first property.
The bad news is I don’t believe it’s going to be usable for investment, so it’s only possible if you pull the money out to buy your own home, you going to have to live in it, and even if you intend for that to be an investment, there’s going to be a few boxes you’re going to have to tick off, and one of them is you’re definitely going to have to move into it as if it’s your own place, so it’s a bit of a win and a lose.
Paul Glossop: Yeah. It’s probably a word to the wise there a little bit about the fact that Super, as the vehicle it was intended on years and decades back is being utilized in a way that is quite useful , as a tax effective haven, giving younger people the ability to potentially look at sacrificing some of their wages, better their savings ability and probably set some good habits in place long term as well, which is another great opportunity for people even after the 2 years, where they can offset that cash, bring it back out, buy their home, maybe not from an investment perspective, but I think long term it’s going to allow people to get into the property market quicker whilst not having to pay as much income tax potentially along the way, so thanks for that insight, mate, and obviously there’s a lot of detail that goes below what we just talked about, top line, but if you do want to get in touch with Tristan to talk about how you might be planning to buy your own home in the next few years, months, weeks, whatever it looks like, and how you might be able to effectively use that new policy and maximize it for what it’s worth, his details are at the bottom of the screen.
Feel free to give Tristan and his team a buzz, and I’m sure he’d be happy to sit down and have a chat, and likewise, from outside, from a property specific perspective, we work obviously in the owner-occupied perspective and the investment property space, so feel free to give us a call if you have any property related questions and we’ll catch up with you. Cheers!
Interviewer: Paul what do you reckon?
Paul: Yeah, look, I think places such as Rhodes and Homebush, there’s a lot of supply in those markets from the apartment side of things and I think it’s a fair bit coming in the next probably year and half to two years as well. Ultimately, the Sydney market from the way I see it has got a lot of sideways movement and in certain markets probably a little bit of dipping to do as well.
So, I personally would not be rushing into that market. Take your time. Rent in certain markets if you do want to see that opportunity because rent comparatively from mortgage prices is absolutely dirt cheap.
So, I would be personally saying be looking down that pathway to really figure out where you want to live and take your time because you’ve got that on your side as opposed to what the last five years gave anyone in this market.
Interview: Yeah, how much time do you think they have? How long do you think they could wait it out?
Paul: Look, I personally think if anyone’s prepared to really I mean, crystal ball-gazing here but I think if anyone’s looking at intentionally buying into the Sydney market over the next six to twelve, eighteen months, I personally think we’ve got the best part of between two and five years because we see any significant changes to what’s happened over the last five years.
Interviewer: So, they shouldn’t feel so bad to having to wait the market out a little bit longer?
Paul: Definitely not. Definitely not.