Chapter 1: What is the main topic discussed in this episode?
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And welcome to another episode of The Real Estate Podcast. We're talking to Jane Slack-Smith from Investors Choice Mortgages.
Thank you, Craig. Thanks for having me.
Hey, nice to have you on. I guess the first thing I'd like to find out a little bit more about is the Investors Choice Mortgages. I think that's probably a great place for us to start. Jane, tell us all about it.
Well, it is a great place to start because obviously finance is the vehicle that allows you to buy the properties and properties are the vehicle that allow you to have your financial security. So it all works together beautifully.
So just how much has this grown and over what period of time your investors choice mortgages?
Yeah, well, look, I guess it all goes back to the start and why I started Investors Choice back in 2005. So it's hard to believe, like, you know, 16 plus years I've been doing this. And it really came from the fact that I had really wanted to understand the property market. And as an engineer, you know, I was a mining engineer myself.
I was a specialist in explosives and I thought, you know what, I can hack this. I'm sure there's a way to understand the property market. So I looked at all the suburbs in Australia. I looked at the data on what suburbs had outperformed the others over the last 10 years. I then put in some low risk factors because I didn't want to get it wrong.
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Chapter 2: What is the focus of Investors Choice Mortgages?
So things like, you know, percentage of renters, vacancy rates. And out of that popped a number of suburbs. So my husband and I started investing. I was a bit of a scaredy cat. I had a three prong attack, you know, buy below the market to make money when I bought, buy in a capital growth area to make money in the long term, but also then renovate to make money in the short term.
increase the equity in the property to be able to do it and do it again. And this just worked for us. So I taught my friends and it worked for them and they created multi-million dollar portfolios. And I was like, I need new friends. And the only way I could get property indemnity insurance to tell people about how and where to buy strategically was as a mortgage broker.
So I didn't wake up one day thinking, hey, this is the best job in the world. I woke up one day and how can I get this message out there? And mortgage broking allowed me to do that.
And what have you found over, let's say, the last five, six years? Because the market has changed so much, and particularly now where we've still got the pandemic going on, the way that the prices have escalated so rapidly.
Yeah, look, it's a really interesting time. And I'm a student of history, so I like looking to the past to help me predict the future. And I have to say, when ASIC and APRA came in and started putting some constraints on the market, 2017 onwards,
that felt really hard because you know we were going pretty hill for leather and you know they pulled back the integrity of the market and really allowed people to have the time and consideration of making really good decisions because I was seeing at that stage you know a lot of people making very silly decisions and there was that whole fear of missing out and so when I was doing
You know, my team would do the borrowing capacity for the clients and then I would do the strategy session and bring in the integrity of where they could buy and if they were agnostic looking anywhere in Australia for the best suburbs and then, you know, giving some education around how to risk that. People were coming with, you know, one-bedroom units in the middle of a block of flats.
2,000 of them, I was like, oh, this is not really going to get you the growth and the vision that you want. So a lot of the conversations turned around that really strategic where to buy and what to buy.
And I found that the integrity of data and the democratisation of data has allowed people to have on tap, better quality information to ask better quality questions of agents, buyers, agents and themselves about why they're buying. So it's been very exciting. And I can really see
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Chapter 3: How did Jane Slack-Smith get started in property investing?
Absolutely. And even something, Craig, just as simple of being, I read people's fact finds all the time. It's like reading a story. And I'll read, you know, I've bought in Logan, I've bought in Middlemount, I've bought, you know, in Western Australia. And I'm like, oh, so you follow this commentator and you follow this commentator and this is the buyer's agent you've worked with.
And I can read someone's portfolio. and understand exactly what they're reading and who they're listening to. And, you know, they haven't always, you know, been of service to their long-term strategy. And I know when I speak to someone, you know, when we do that strategy session, you know, let's just put the properties and the mortgages and all those things aside. What's the vision?
What do you want? And for those people who say to me, I want five properties, I know that they're at the beginning of their journey because five properties in Lithgow and five properties in Toorak is a whole different retirement plan, right? But... When I look at then people who say, look, I want a passive income of $80,000 a year, we're getting towards what they really want.
And I know when I really dig down and a lot of intimacy with my mentoring clients and we're like, tell me what you really want to do. And it might be spending more time with my kids. I want to be able to go to the sports carnivals. You know, when we really connect with that real vision and then see property just as the bridge to let them get there, that's when magic happens.
And when you ask people what they want, sometimes that's really an open-ended question because you're actually making somebody stop and think, what is it that you really want? Like wealth, yes, but it's such an open-ended statement. I just want to make all this money from all these properties. And you bring up a really interesting valid point.
Passive investment is something that they haven't necessarily thought of.
Warren Buffett said something like, if you're investing is exciting, you're doing it wrong. What is what people want? They actually just want to have the time to do what they want with who they want, when they want. And, you know, property investing, if you get a number of properties set up right that are just, you know, working for you, going up in value, looking after themselves.
And, you know, there might be a bit of money you have to put in each year until they get, you know, neutrally geared or whatever. But, you know, if you set it up right, you can just get on with life. And that's my intent for everyone is so that they can just, you know, park those investments, they grow, look after themselves while they get on with life.
I don't think this should be, you know, something that makes people wake up at 2 o'clock in the morning and go, oh, my gosh, you know, are they changing the oil in the lounge room?
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Chapter 4: What strategies does Jane recommend for successful property investment?
You nailed it. And you can say it, so you can use it.
Jane, great to talk with you. We'll no doubt catch up at another time and thanks for coming on to the Real Estate Podcast.
Absolute pleasure. Thanks, Craig. We connect you to the best real estate information across Australia, the Real Estate Podcast.