Yeah.

And we also need to be mindful of now that the dust has settled from the headlines of negative gearing, whenever I'm in conversation with people, a whole heap of them don't actually realize that the negative gearing is actually deferred.

It's not gone, it's actually deferred.

So understanding that y- in the front end you're not able to claw your so-called losses, and if you- if the property turns positive or, uh, when you sell, you're able to claw that back-

Mm

...

so three times their repayment amount, and they would have been able to sustain that for a year, 18 months before, you know, reality hits to say, "We can't do this anymore." So your bigger priced for that area, right, for that suburb, your, your higher priced properties are probably a lot more stressed.

And the way you'd pick up the stress, uh, we were talking about the, um, the list- number of list- days it has been listed.

Is that a good strategy in this market, Victor? Yeah.

It is.

You do have to look at the moving parts.

So obviously if you've owned the properties before budget night, it comes in with negative gearing.

So that's one side of it.

But then how much negative cash flow are you really carrying is the other part of the equation.

And then third is, okay, Maybe it's done its job for that part of your journey, not the property's journey, your journey.

So the prices come off a bit.

Mm.

Is it because they were a volume-driven business, so now they're trying to keep up the volume because the volume, uh, naturally was underpinned by a large number of staff, right? Or is it quality, and are they actively telling you not to buy and, uh, and also at the same time pushing you to do X, Y, and Z in, within your portfolio? Yeah, so need to be really careful for the, at least for the next 12 months, where the advice is coming from.

Mm.

And most people, unfortunately these days, are, uh, especially when they're starting out, are investing via headlines, not through fundamentals.

So if we, when we look at the closest comparable we have, it is the GFC.

And then the next comparable we have is the 2017 APRA clampdown, right? So at that time, the market did compress.

It became harder to buy.

Uh, during the GFC, money was hard to get, which is hard to get now, right? Vendors were heavily motivated back then.

Mm

... because they haven't paid attention to the fundamentals of their portfolio, the fundamentals of finance.

And once you revert to the fundamentals, all of this noise dies down because now you are really looking at it from a ground level that's not dressed up with all of the fluff that's around at the moment, and you're working towards a financial goal and a wealth goal, right? So, and, and the two can be slightly different.

Fi- the financial goal could be, uh, more of a cash flow play.

The wealth goal would be more of your equity play that can be intergenerational, right? And both can go hand in hand.

Mm.

The second are the people that want to take action, they've just pulled the trigger without taking into consideration their fundamentals, and therefore they end up buying something that is based on headlines as opposed to fundamentals.

They're based on emotional decision as, as opposed to logic decision.

No.

So what happens when a market changes, when everything becomes newsworthy? you find that people get drowned with the amount of information, the negative sentiment, or the rapidly changing playing field or the rules of the game.

And so they sit back because they're stunned they can't handle the change because they haven't paid attention to the fundamentals of their portfolio, the fundamentals of finance.

And once you revert to the fundamentals, all of this noise dies down because now you are really looking at it from a ground level that's not dressed up with all of the fluff that's around at the moment.

And you're working towards a financial goal.

And a wealth goal, right? And the two can be slightly different.

The financial goal could be more of a cash flow play.

So is it resonating with people you saying, this is probably the only property you're ever going to buy?

Yeah.

Yeah.

So you will be still buying at the same price, if not slightly more, slightly less, but the quality of your properties would be different going forward, right? So you're better off getting into the market right now as safely as possible.

Now, how is it safe? You don't speculate.

You work on the worst-case scenario of cash flow.

So if I look, uh, look back at the graph during the GFC, there was value drops, right? So the maximum value drop was around the 8 to 15%, depending on which data sets you look at.

And-The value drop did not cause people to lose property.

Yeah