Key takeaway: Chasing high-yield property can cost investors long-term growth, according to Julian Khursigara, Chief Executive Officer of Search Party Property. He agrees too many investors are hyper-focused on short-term cash flow, calls the social media push of apartments as investments a dangerous short-term view, and says capital growth is how he has grown his own portfolio over the long term.
In this episode of Geared for Growth, Mike Mortlock is joined by Julian Khursigara, Chief Executive Officer of Search Party Property, to unpack what the latest changes to the property investing landscape actually mean for investors, and where the opportunities may still lie.
With investors navigating major policy changes, shifting market conditions and plenty of doom-and-gloom headlines, Julian shares what he is seeing on the ground with clients and buyer activity across Australia. From Brisbane and Melbourne to Tasmania, Canberra and regional markets, the conversation explores why there is no single “Australian property market” and why investors need to look much more closely at individual suburbs, budgets, fundamentals and their own long-term strategy.
Mike and Julian also dive into the temptation to chase short-term cash flow, high-yield apartments and the latest “hot” markets. Julian explains why having more properties isn’t necessarily the same as building a better portfolio, and why the right strategy should start with the investor’s objectives, borrowing capacity, cash flow and risk appetite – not a particular property type or location.
Julian runs a full cash analysis of new versus established side by side, checking whether the client can sustain the repayments without negative gearing. As a rough example at around $750,000, he says a new property might cost about $150 a week to hold, versus about $350 a week for an established one. New suits higher-income earners more, but he avoids greenfield estates and prefers infill blocks built on by a panel of builders.
Julian says there is no such thing as a single Australian property market. Every suburb is effectively its own market, so investors need to look state by state, city by city and almost postcode by postcode. He looks for fundamentals such as demand, infrastructure spending and vacancy rates. He doesn’t expect the 30% crash the headlines suggest, particularly in investor-friendly markets under $1 million, with bigger falls more likely at the higher end.
Julian is positive on pockets of Melbourne, including the Geelong area around Lara and areas about 20 kilometres north of the city near freeways and rail lines, where his team buys around $750,000. He also likes the Latrobe Valley, Bendigo for subdivision and granny flat opportunities, and parts of Tasmania. Canberra still has good opportunities but needs about $1 million, and he likes the right areas of Brisbane because of Olympics infrastructure.
Julian says strategy comes first, starting with the investor’s objectives, borrowing capacity and cash flow rather than a property type or location. For a 30-year-old, he breaks long-term goals into 10-year chunks. He calls the number of properties an ego metric and would rather own three or four that achieve the goal than 10 or 15. He also warns that crowds of investors sent into one postcode can artificially boom small markets.
This is general information from the podcast, not financial advice.
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