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should you ignore growth in the Perth Property Market

A couple of days ago, I wrote an email to our membership about the importance of income, cleverly disguised in a story about the common and flawed approach to owning property investment(s).

One of the replies I received from a valued member went like this:

Hi Brodie,

Just wanted to shoot back a quick comment regarding today’s email scenario. Are you factoring in capital growth for say the next 5 years in Perth which I’m sure many experts agree will be quite significant. I’m 100% for responsible lending and advice. I just hope we are not dismissing leverage in gaining financial advantage.

After a second read of your email to check I have not missed anything, are you using this scenario to promote your ‘property advice consulting’? If true I can see how this would be missed by the average punter. FYI I really respect the blog articles and mostly agree with all that is said.


I’m going to give this a respectful bullet-point response.

– Thank you for the mail 😉

– The points below do not relate to a home. Completely different. One should want to own their own home (outright) to have control of where they live, for the sense of security that brings, for the feeling of having YOUR home. This is entirely emotional and nothing wrong with that. There is a reason why they are called ‘homes’.

– Market-driven capital growth is absolutely out of anyone’s control. We can hope for it, but we can’t guarantee it, nor rely on it. My opinion is that the money is made when you buy. You must either find value (a mis-priced opportunity) or create value, i.e. a subdivision. The market is the herd, you never know in what direction they will run or when. Growth is the glace cherry on top, that sometimes gets pinched before you get to eat it. 

– Unless you’re a professional investor, you must remember the fundamentals of what investing is: finding a way to replace your earned income with non-earned income. (By now you should know that my opinion of passive income is that it’s a myth. A pile of BS peddled by idiots and spruikers. Imagine subscribing to a passive marriage or passive health concept. Dumb as. You’ve gotta put in the work to get the outcome which is income and this must be managed and nurtured on the regular.)

Yawn, maybe this is boring you? You may have thought investing was the 10-bagger that’s eluded you? If you’re asking me (and I didn’t force you to sign up to these emails) it’s using your hard-earned in such a way that at some known point in the future, you have a choice whether or not you want to work.

I won’t discuss net yield here, but you know what I’m going to say.

– Sale entails costs and taxes and potentially the replacement of the asset. This is what professionals are geared up to do. Not most people. 

– Don’t listen to the experts. They don’t know either. They’re full of shit. And if they do know where the market is headed and what’s going to happen, why is most of the world in a quantitative-tightening induced period of stagflation (recession with inflation)??  Look back to the umpteen cock-ups caused by experts starting with the Great Depression. 

– I believe the role of the investor is to become a humble expert, surrounded by experts that have passed the bullshit-detector.

– Without leverage, there is no monetary system. Remember please that excess or free cashflow is the most powerful type of leverage in this conversation, not that which is borrowed. Big difference. See Warren Buffet and leveraging insurance float to parlay into the next thing.

– Property Consulting? Yep, caught me! And if a small (possibly tax-deductible) investment of $299 to safeguard hundreds of thousands and years of stress isn’t too much to ask, use this easy scheduling tool to request a free, 10-min initial consultation. ​


Brodie Brown 

Professional Mortgage Broker