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The Long Property Show is now is now a weekly podcast!
Each episode runs for 10 minutes and offers unique perspectives on property, finance and money management.
We cover topical issues relating to our national property and finance markets, and we also discuss various investment frameworks/ strategies for wealth creation.
It’s targeted towards people who want to build long term wealth from property, not just get a cheap interest rate.
In today’s episode we discuss the difference between a borrowing strategy and a borrowing capacity.
A capacity is just a number, it’s an indication of how much the banks will lend you, and there’s nothing behind it, it’s fraught with risk. A strategy relates to your longer term goals… for example wanting to own an $Xm home with a certain level of debt, or having a $Y passive income from investments.
What will you buy and how will you buy it, how will it be structured, how will it be financed? These are the questions a good borrowing strategy helps answer. A good strategy aligns with realistic medium or longer term objectives.
There’s plenty more in the recording. Enjoy!
Time stamps for easy reference:
[1:05] meet Paddy – head of operations at Long Property (pardon the accent!)
[2:00] a transactional mortgage broking service, versus a strategic one
[3:05] the pitfalls of borrowing capacity ‘calculators’
[3:40] case study, seeking a 2m property with 1m debt – what to think about
[5:20] bull markets cover up mistakes, we’re no longer in this type of market
[6:35] the importance of having a specialist advisory team
[8:20] why new digital lending offerings miss the mark
[9:35] key questions all borrowers should be asking
Was your last borrowing experience strategic or transactional in nature?
If you have questions for either myself or Paddy you can comment below or email hi@longproperty.com.au. We will respond within 24 hrs. Thanks for listening!
The Long Property Show provides general information only and has been prepared without taking into account your objectives, financial situation or needs. We recommend that you consider whether it is appropriate for your circumstances and your full financial situation will need to be reviewed prior to acceptance of any offer or product. Nothing in the Long Property Show constitutes legal, tax or financial advice and you should always seek professional advice in relation to your individual circumstances.
