Wakelin are undisputably experts if you're after a good art-deco in Kew, Hawthorn or Toorak, and have some sound ideas on avoiding CBD marketeers.
However that's about where their usefulness ends.
When they go into investment strategy advice they are weaker. And when they rubbish areas they know little about (which they frequently do at the taxpayer's expense on ABC radio) they are speaking beyond their competence.
Agree totally.
I did speak to Wakelin about a year ago. I was shocked to find that he suggested I sell all my 12 properties (at the time ) in the West and North and buy 2-3 props in the East. He did not even suggest I keep the existing houses and use the equity to purchase future props in the east. Little to say that i did not take his advice.
Same here. Apparently I had ‘all of this equity’ tied up in a property and I should sell it. Whilst my ‘inferior’ (outer 30km suburban) property has ‘only’ doubled in the last 4-5 years, its growth was put to good use in securing additional properties. I do agree the next few years outlook is not that crash hot, however after factoring in CGT, selling agents costs then another round stamp duty and buyers agents costs (probably) I’d simply be losing too much in transaction fees. I've worked it out and it's just a tad under $50k!!
If I was going to spend another $50k it wouldn't be doing a one for one swap on a property that only grows at 5% with an equivalently priced one that grows at 7-8%, it would be to
own both of them!
Believe me, I have no emotional attachment to this property, I bought it whilst overseas and I’d be lucky if I see it about once per year. If the figures worked I’d sell the thing in a flash. My research has shown that outer suburbs will still have good growth over the long term.
In general I think their advice is good and with my interests best at heart. For example, I definitely wouldn’t be purchasing that property again today (like some people still are). For the same yield and price, it’s my view you can get something with much better growth in their target areas and this is why I am using them now. I did well in this area due to timing. The areas they promote are more ‘set and forget’ areas, where timing is much less relevant. In general, this is probably the best long term option for the average passive investor who can manage a negative cash flow for a few years.
When I was starting out I required a high yield as this was my first IP in my early 20’s. I had no faith in capital growth plus I was on a low starting salary straight out of university.
Personally I believe a more rounded approach a combination of high yield, high growth and some in between (similar to Jan promotes in her books) is the way to go. You’ll get there almost no matter which way you go; the only variable really is time.
I spoke to a few Real Estate agents about Buyers Advocates. They dont have a high regard for them. A few of them said they love buyers advocates because they have a vested interested to get the sales through. They did not think that a buyers agents find better properties or get them for "Bargain" prices. " It is a myth that buyers agents get bargains "What they do provide is insurance you dont end up with a lemon. They told me it was better if I spend a few weeks in the area rather than use a buyers agent.
The Agents I spoke to was in the Oakleigh area.
Again, I agree. Most buyers agents I spoke with did simply appear to be real estate agents. I do believe though that Wakelin’s are different, based on speaking with people that have used them repeatedly, the strategies outlined in their book and my interaction with them. Their long waiting list is testament to their stringent selection criteria. Having a long waiting list is bad for their cash flow, but you don’t see them move it in a rush if they can’t. I’ve also seen them not buy properties that are even slightly compromised (in a three story block of six they bought the street facing top floor, but were not interested in the one behind it for example (top floor back of block, I don’t think it had any views)).
When I was looking for a buyer’s agent I wanted to ‘purchase’
- time (looking one day a week wasn’t enough for me, plus I don’t even really want to do that)
- negotiation skills (especially for auction)
- asset selection advice
- managing agent advice and monitoring
- access to off market transactions by being on real estate agents ‘A-list’ - go into any real estate agents in the inner east/south east and they’ll know who the Wakelin’s are.
- knowledge of market (so I don’t overpay) – I could have figured this out myself but it takes a lot of looking around and a lot of time.
- emotional separation from the transaction
- the highest possible growth asset in Melbourne in my price range
- and paying the lowest possible price for it (I know I won't get a bargain, but I know I won't overpay $10k, which is very easy to do in these areas).
and I concluded the Wakelins were the best at providing me with the above at this stage of my investing career.
