Ten with Ty - Veronica Morgan

About The Guest(s):
Veronica Morgan founded Good Deeds Property Buyers, a buyer's agency, and co-host of the podcast "The Elephant in the Room." With over 20 years of experience in the property industry, Veronica is known for her expertise in property investing and her ability to cut through the noise of the market.

Summary:
Veronica Morgan, founder of Good Deeds Property Buyers and co-host of "The Elephant in the Room" podcast, shares her insights on property investing and the mistakes investors often make. She emphasises the importance of making sound decisions, understanding risk, and focusing on quality assets. Veronica also discusses the value of holistic advice and the need to look beyond location and data when investing in property.

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Key Takeaways:

• Property investors often make the mistake of overemphasising location and neglecting the importance of asset selection.
• Relying solely on data can limit investors' understanding of a particular area's nuances and potential risks.
• Stretching oneself financially without considering long-term implications can lead to forced property sales and missed opportunities.

Quotes:

• "If a property is easy to buy, it potentially could be hard to sell."
• "Good decisions are pretty boring. It's understanding fundamentals and making solid decisions."
• "Recognise risk and where risk really lies. The risk is in the asset you buy."
• "Investors often stretch themselves too much financially, forcing them to sell a good asset."

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Tyron Hyde is the CEO of Washington Brown Quantity Surveyors

Chapters

• 0:31 Meet Veronica
• 1:20 Becoming a buyer's agent
• 4:44 Advice for first time buyers?
• 7:33 Q1: Your best investment?
• 11:33 Q2: Your worst investment?
• 14:06 Q3: Most valuable investment advice?
• 16:20 Q4: What’s your ideal portfolio mix?
• 20:39 Q5: How to invest $20K as a 20yr old?
• 22:29 Q6: How to invest $500K as a 50yr old?
• 24:55 Q7: Advice to your 20yr old self?
• 25:52 Q8: What legacy do you want to leave?
• 29:03 Q9: What does success look like to you?
• 33:02 Q10: Best strategy NOT to lose money?
• 36:36 Bonus Q: Worst mistakes property investors make?

Transcript

(Tyron Hyde): Welcome to Ten with Ty, the podcast, where I ask the smartest people I know the same ten questions to unlock the key to their success and hopefully leave a playbook for my daughter and your family, too, about investing. Now, before we get started, this podcast is general in nature and not intended to be individual financial advice. We always recommend you sit down with your accountant or financial planner before making any financial decisions. Now, let's get on with the show.

(Tyron Hyde): Hello and welcome to Ten with Ty. My next guest is Veronica Morgan. She's the founder of a buyer's agency called Good Deeds Property Buyers. She's a TV presenter, co host of a successful podcast called The Elephant in the Room, which I believe has just had 1 million downloads. Wow. Which cuts through the crap of the property market. But I first met Veronica 20 years ago when she was working on the other side of the fence, and she actually sold my first investment property.

(Tyron Hyde): Welcome to Ten with Ty, Veronica.

(Veronica Morgan): Thank you. I had forgotten that.

(Tyron Hyde): Have you? Yeah.

(Veronica Morgan): Fancy forgetting that. Yeah.

(Tyron Hyde): God, 20 years ago. How does that make you feel?

(Veronica Morgan): Well, it makes you feel good because it reminds me how long I've been doing something inside the property industry for. But also, it's nice to be still talking to clients from that long ago.

(Tyron Hyde): Well, that's right. And very wise to stay in the industry for that long. Hats off to you. But you are one of the OGs of the buyer's agency space, right? Original gangsters. What made you originally jump from the sell side to the buy side back then?

(Veronica Morgan): Oh, gee, I thought it was old girl! No.

(Tyron Hyde): Original gangster.

(Veronica Morgan): Hilarious. Original gangster. So, what made me jump? Actually, a couple of things. For starters, I was a sales agent for six years, and I was at the top of my game for four of those years in the sense that I was a top producer in my office. And I enjoyed that, and I enjoyed mastering it. But by the end of that fourth year at the top of my game or the 6th year in the business, I was getting bored. I really needed some more mental stimulation.

(Veronica Morgan): I was thinking about going to business with my principals to open a sales agency, but I also decided I wanted to try having a child. And I managed to get pregnant. So therefore I took a year off. And in that year, I was able to, I guess, step back and just look at what it was I really enjoyed about the property industry because I really enjoyed it, and I was good at it, and what did I want to do with those skills next? And I guess having that benefit of that time, that time distance was great. And so at the end of that year, or towards the end of that year, I was approached by somebody that I'd done an appraisal for as a sales agent, and they had actually moved. They never sold that property, but they moved overseas, and then they wanted to buy another property and wanted to know if I'd represent them.

(Veronica Morgan): So I looked into it, and I thought, look, I could do this. I could do this. And I thought of it as being the other side of the coin. It's a hell of a lot different to just saying that being on the buyer's agent side is just the other half of the equation. There's a lot more involved. But in terms of being, I guess, a little bit bored with the selling Groundhog Day thing now it's been, what, 16 or 17 years?

(Tyron Hyde): Wow.

(Veronica Morgan): And it's really given me a fabulous opportunity to continue to learn and absolutely expand my knowledge and my learning day by day. Still, I will never know it all.

(Tyron Hyde): The Elephant in the Room with a million. podcast, you must have learned so much hosting that for what, five years now?

(Veronica Morgan): Yeah, that has been a gift that I really didn't fully anticipate or appreciate what that could do for me personally when we launched it. So Chris Bates and I just sort of knew each other from LinkedIn, and we understood that we both liked the idea of the psychology of buying and the psychology of property. And so that was like a common. Hence, you know why we went down the path that we did.

(Veronica Morgan): And I really thought, yeah, we'll interview people, but I'll be just imparting my knowledge, the arrogance that comes. But instead, what has actually happened is that my mind has been blown apart. I've learned so much from every single guest. Whether I agree with them or disagree with them doesn't matter. I've learned so much, my knowledge of property and data and inputs and economics and just so many related things, and behavioural psychology as well. Behavioural economics as well, has just expanded incredibly, and I'm now just on this sort of massive journey of lifelong learning. It's exciting.

(Tyron Hyde): You also host a podcast called Your First Home Buyer's Guide. Now, sadly, we've ended up in a situation of a two-tier society the haves and the have-nots haven't with in terms of real estate and owning real estate, especially in Sydney and Melbourne. What advice can you give someone trying to or struggling to get into the market for the first time?

(Veronica Morgan): Well, we give a lot of advice on that podcast, of course, but one of the key things I would say is that a lot of first-home buyers get really caught up with listening to the wrong people, and that is Dad. Quite often. How many properties has Dad owned or bought over his lifetime? And dads do tend to be a little bit more like you. You're a dad. You're doing this sometimes, Mum, but more, Dad. So, by listening to people who might be well-meaning but actually are out of touch with the market and the way things are. So that's sort of the first thing. The second thing that I would advise first-home buyers to do is to look at who they get advice from and what advice they get from those people. Like, for example, mortgage brokers. We absolutely recommend that people use mortgage brokers, but a lot of mortgage brokers will give property advice for free, and they are not property experts.

(Veronica Morgan): So you have to be very careful. You take finance advice from the mortgage broker, not property advice from the mortgage broker. And another thing that I would say to all first-home buyers is to be very careful about the grants that you look at taking from the government because government grants for first-home buyers have a lot of objectives around them, a lot of reasons for existing, and very few of them are really about helping a first home buyer buy the right property.

(Veronica Morgan): And what they are, in fact, very much about supporting the construction industry and making sure that developments go ahead with presales, et cetera, et cetera. And they're a lot bigger. The impact on the economy as a whole is a lot bigger than it is for one little tiny individual, first home buyer, to make the right decision. And yet that is encouraging first home buyers to buy into the riskiest segment of the market, and that is the brand new or off-the-plan segment. So you just have to be very careful about free money from the government.

(Veronica Morgan): Feels compelling. You want to grab every dollar you can but have to think about false economies here and perhaps if it's going to cost you in the long run because it's forcing you to buy a type of property that you might either outgrow too quickly because it's too small in the form of an apartment, or might actually lose money over time, and you're going to get stuck with that, and you get stuck on that first rung of the ladder. You have to be very careful.

(Tyron Hyde): It's funny, when I asked you that question, I wanted to say something along the lines of, it always seems that the developers seem to get the grant more than the purchase. But you kind of said that already without me needing to. All right, you ready to play ten with Ty?

(Veronica Morgan): Ten. Go.

(Tyron Hyde): All right. I've got a buzzer here. I'm going to press before I ask you the first question. You ready? My world-famous buzzer. Here you go. All right, Veronica, question number one. What has been your best investment?

(Veronica Morgan): Well, I'm a property person who believes in investing outside of property as well as in property. Right. So, I've owned a number of different properties over the years, and I still own some of them. In terms of property investing, probably excluding my own home, because I think buying your own home is a very good investment decision. So, excluding my own home, it would be a semi-detached house that I bought in actually in Alexandria, in one of a very small part of Alexandria, which is more houses than apartments and is very, very well connected and has done very, very well for me. And one day in the future I'll probably renovate it. So it's got potential for capital uplift, improvement in that sense, but it's ticked away very nicely. It's always been tenanted, and there's a value-add opportunity there.

(Veronica Morgan): And in the non-property side of things, I invested in a venture capital fund, which is allied with the real estate industry in terms of its real estate Proptech, and that's done very well for me. But it's a totally different way of evaluating the performance of an investment. Obviously, I didn't borrow any money to invest in that one, as opposed to borrowing a heap of money to buy the house. So you have to measure them differently. That's had an immediate return, fairly immediate short-term return, which has been very good.

(Tyron Hyde): Well, there's a lot to be said for owning your home capital gains tax-free. There are not many countries other than Australia that have that. So it's a bit of a no-brainer for us Aussies. Actually, one of the best investments I ever made was that one that you sold because what happened was I was actually the project Quantity Surveyor on behalf of the bank for that job. It was a Balmain RSL, if you remember rightly.

(Veronica Morgan): Yeah, I do remember.

(Tyron Hyde): And I put it down $1,000 on that unit, and the builder went broke halfway through. And as the project Quantity Surveyor, I had to project manage, in essence, the finances on the way through, and it took a lot longer. And so I think it took about three years to finish. And by the time it took that long, the $1,000 that I invested, I didn't actually have to put in any deposit because, back then, you could borrow. They actually valued it. Okay, well, and I didn't have to put any deposit down.

(Tyron Hyde): And then when you sold it, I think we pulled out. There was actually Owen halves with another, with a partner, and we both pulled out $200,000 or $100,000 each from our $1,000 investment. So, as a return over, I think it was like five years, 1000 in, 100,000 out. Pretty happy with that.

(Veronica Morgan): That's fantastic. And interestingly enough, what you've touched on there is a way to measure return on investment that a lot of people don't do with property, and that is to look at the actual capital that you've put into it as opposed to the total value of the property when you've bought it because you put your deposit. Or like with my Alexandria house, for instance, I didn't put any cash into that, I used the equity in my home. The cash, obviously, was on an ongoing basis until it got to be neutral.

(Veronica Morgan): That was my investment effectively. Yeah.

(Tyron Hyde): I think property investors sometimes, or the media as well, have problems actually understanding profit. Right. I often see in the papers XYZ person buys a property off the plan for 600. Six months later, they sold it for $700,000. That person just made $100,000. No, they didn't. They had to pay stamp duty. They had to then pay the selling costs, marketing costs, legals. Right. And then on top of that, because they sold it within a year, they have to pay 50% capital gains tax. They didn't make $100,000, Veronica.

(Veronica Morgan): No. And it annoys me. And often yelling at those stories as well. And I'm like, or they talk about a renovated property, and they haven't factored in any of the cost of renovating. I'm like, God, what? The renovation would have cost more than they made. Give me a break.

(Tyron Hyde): That's The Block's fault. Some of those costs, as a quantity surveyor. I'm like, you're kidding me.

(Veronica Morgan): I know. Yeah, it's a joke.

(Tyron Hyde): All right, question number two. What has been your worst investment?

(Veronica Morgan): So, the very first property that I bought, before I knew anything about real estate, I made every single wrong decision. I bought a studio apartment, and it was in a great location. It was sort of on the border of Newtown and Erskinville, but it was a studio. And I lived in it for a year but outgrew it in 2 seconds. And then I rented it out. Rented out very well. It was actually positively geared or positive cash flow, and then sold it. And it gave me the deposit on a house five years later. Okay, so it did its job in that regard.

(Veronica Morgan): But where I totally failed was, A, the banks changed their lending requirement, their lending criteria so that it was less than 50sqm. In that intervening time, things had changed. So there's no way in a million years I could have held onto it, even though financially I could have held onto it because the rules all changed. But actually worse than that because people could say, well, it did. Well, it gave you enough gain in order to be able to buy a house. Yes, it did do that, but that was luck, not good management.

(Veronica Morgan): I never even looked at whether I could have afforded a bigger place that I could have lived in for longer. I didn't even ask what was my borrowing capacity. I just bought that because it felt safe. In terms of dollar numbers, it felt cheap enough to feel safe. It never occurred to me. The risk isn't so much in how much money you borrow, assuming that you can afford to repay it, but the risk is in the asset that you buy.

(Veronica Morgan): And there was a huge amount of risk that I took with that, completely unwittingly. And if I bought a better asset, A, I wouldn't have outgrown it so quickly. B, I may not have had to sell it. There's a whole raft of things that could have been different, and C, it probably would have made more money because there would have been more buyers able to look at it, whereas because the rules changed, it ruled out a whole bunch of other people just like me when I came to sell it. Those people were not even in the mix because first-time buyers couldn't buy it. So I would say that's my worst investment.

(Tyron Hyde): A cheap dog of an asset. Still a cheap dog, isn't it? Really?

(Veronica Morgan): Yeah.

(Tyron Hyde): I thought you wrote something like that on LinkedIn the other day. And one of the keys, I think you're right, is when you actually buy an asset, one of the key factors should be how quickly can you sell it if it goes pearshaped and if you end up buying somewhere in a rural town that, yes, the growth looks good. How quickly can you offload that asset if things are going pear-shaped? Should be part of the criteria, I reckon.

(Tyron Hyde): All right, question number three. What's been the most valuable investment advice you've ever received?

(Veronica Morgan): Well, I'm just going to follow up on what you just said because I'm first of all saying the most valuable advice we give, and that is if a property is easy to buy, it potentially could be hard to sell. And buying something that's hard to sell is a bad idea because you are totally reliant on market conditions at the time to be favourable. So that it's going to be easy for you to sell, right?

(Tyron Hyde): Yeah.

(Veronica Morgan): And so what you want is an asset that's always going to be easy to sell, and those properties are hard to buy because everybody wants them. Right. So that's what we give in terms of valuable investment advice. And I really do think that's valuable, but in terms of what I've been given, is to look at property decisions holistically. And so that means that you need to get advice from, as I mentioned earlier, for first-home buyers, have people in your corner that give you advice on the things that are relevant. As an investor, you need an accountant who understands property investing and is not going to tell you that you need to buy a property because you need to get some negative gearing happening.

(Veronica Morgan): You need to have a good mortgage broker who would talk to you about borrowing strategy, not just about chasing the best interest rate. You need to have. I think, ideally, a buyer's agent, but if you don't have a buyer's agent, if you do, either way, you need to have local expertise to be able to choose a really good asset in an area. You also need to have a good lawyer on hand who also is a property specialist. And particularly if you're buying strata, you need to have a strata specialist. So it's really about that, holistic, having a good team.

(Veronica Morgan): And those people are all experts in their field, and they don't step out of their lane. So that's sort of great advice I was given. And the other thing, too, is not to make decisions under pressure. We don't make our best decisions when we are stressed or feeling like we have few options. And so that, to me, has been amazing advice. Haven't always taken it, and sometimes, but it's really good advice.

(Tyron Hyde): But that's what you would do, wouldn't you? When a client comes to you, you'd show them your team and share that team with them, wouldn't you?

(Veronica Morgan): Yeah, of course.

 (Tyron Hyde): Cool. All right, question number four. What's your ideal portfolio mix?

(Veronica Morgan): So, once again, I'm one of these rare property people who doesn't just believe in investing in property, right? An ideal portfolio mix has your own home in there, and maybe you've got two or maybe three investment properties. And if you have three, don't compromise on the quality of any of those so that you can have more. It's about quality. And if you can only have one, have one. It's better than having two B-grades. If you could have one A grade, it's better than having two B's or three C's. So your home plus a couple of residential investments, if income cash flow will allow. Also, you want to have, I think, shares in some form or other, right? So I think it's important to look at other investment classes. I think also, potentially, your superannuation. That's obviously very, maximising the opportunities with superannuation and looking at some alternative investments as well. It's a bit like I mentioned with the venture capital fund that I had invested in. That's an alternative investment. So, looking at, that's a holistic portfolio mix that isn't purely reliant on property because property is a lumpy investment. So you sort of do need to diversify.

(Tyron Hyde): I really like that you are suggesting that people have shares and property. Because I think there are a lot of buyers, agencies or some advisors out there that just want to help themselves to a certain degree, see how much the property has gone up and try and access that equity and go into the next one. Not giving financial advice to. You guys aren't actually licensed financial advisors as buyErs, are you?

(Veronica Morgan): I didn't mention financial planners, but I should have added that into the holistic mix. You need to get appropriate advice, particularly with superannuation, from appropriately qualified people. And we're not financial planners, but what we will do is say, you know what? You need a whole plan, not just a property plan. And you need to work with advisors that respect property and how property fits in with the whole picture. But absolutely, we'll recommend that people would go down that path of getting that advice.

(Tyron Hyde): It definitely should be a bit of a mix. And I would actually say rebalanced, if you can, every two or three years because asset classes go up in different years and periods. And if one asset class has risen so much, it started at 50, it's gone up to 80, maybe it's time to rebalance that portfolio.

(Veronica Morgan): Well, the problem is with property. It's really impossible to have a balance. Yeah, well, even with one or two in Sydney, for argument's sake, you got a couple of properties in Sydney. My total investment portfolio is completely and utterly unbalanced because the properties just far outweigh what I can leverage to get into property that I haven't done to buy shares. So I know you can, but I haven't. I figure I've got enough borrowing in property, but some people would.

(Veronica Morgan): But even if you did borrow to get into shares, for example, you're never going to borrow the same proportion. So therefore it's quite difficult to have a balanced portfolio the minute you have property. So my big thing there is you need to really focus on your property investment. Assets need to be bloody good because there are opportunity costs in terms of having a balanced portfolio. You can't have it, so therefore, you want to make sure it's as good as you could possibly get it.

(Tyron Hyde): I've had a lot of experience in borrowing shares, leveraging into shares, and it didn't work out well twice. The problem with borrowing money for shares is that. margin calls. Right? The problem with borrowing, what happens is you might have some good stocks, but when the market goes down 20 or 30%, and that might be your equity, you start chasing your tail, and people are just making crazy decisions. Whereas in property, it doesn't occur like that. And so you end up getting squeezed right down to you either got to come up with a lot of money to put it in, to stabilize it, or you got to sell stocks. And I made a decision twice to not put any more money in. I had enough in, and I just had to sell the stocks and then end up with nothing. Luckily, I never cross-collateralised my properties with my shares. That would have been a huge mistake.

(Tyron Hyde): Do you own an investment property? Washington Brown has helped over 250,000 property investors pay less tax with the depreciation schedule. Visit washingtonbrown.com.au to pay less tax today. 

(Tyron Hyde): How would you invest $20,000 as a 20-year-old?

(Veronica Morgan): Once again, I'm not a financial advisor or financial planner, so I can't advise. But if it was me and I was 20, or it was my daughter, and she is 20, and she had 20 grand? ETFs.

(Tyron Hyde): Just straight up. What, any particular one? Just on the ASX?

(Veronica Morgan): Yeah, I look at probably Vanguard or somewhere like that on the ASX. Stay in Australia, you could go to America, whatever. But at the end of the day, I would just look at whatever. I'd look at industry indexes, as opposed to sort of strange, weird and wonderful out-there weird indexes. But I would choose what do they call it, the market indexes. And that's what I would advise my daughter to do. But I just will couch that by saying I am not a financial planner.

(Tyron Hyde): This is generic advice.

(Veronica Morgan): Not advice. This is just what I would do.

(Tyron Hyde): Yeah, just so people know, an exchange-traded fund represents basically the basket of all the stocks on the ASX. But you can get different exchange-traded funds for different categories. For instance, there's one that I've invested in recently called Roblox, which invests in AI. They generally target chip manufacturers and stuff like that. Or you can get it in some, as Veronica said, some weird and wonderful things. It might be farming, or it might be. I'm trying to think of some of the weird ones. And also around the world, you can get ones that just focus on Asia or Japan, et cetera. So that's what an exchange-traded fund is. 

(Tyron Hyde): Okay, again, not your personal investment advice, but let's say you're 50 years old today, Veronica, and you've got no money. You've just inherited $500,000. How would you invest that $500,000 as a 50-year-old?

(Veronica Morgan): Well, and so much of this depends on your situation. So in my current situation, because I have a property in my self-managed super fund, plus some shares, I would probably pay down 300 grand. I think that's how much you can put in. So whatever it is that you can put in as a lump sum on your super, whatever the rules are at the time, I would put a big chunk of it because I am over 50 now. And so that, for me, is becoming more important to have no debt. For me, that's my personal plan.

(Veronica Morgan): So, therefore, I would aim to get that debt down and pretty much pay off the debt on that property, actually, so I wouldn't have much left. So that's 300 of it. And the rest of it? Well, you could potentially look at funding a property investment, depending on how much equity you've got in your own home. Or for me, I might look at using that 200 grand to renovate that house in Alexandria I was talking about before because that's ready for an update, that house.

 (Veronica Morgan): So I might use that to uplift a property that I already have. That's probably what I personally would do. In terms of a general approach, some people, if they were given 500 grand and they paid their house off, for argument's sake, they got nothing.

(Tyron Hyde): Let's say they got $0. 

(Veronica Morgan): Buy a home. 

(Tyron Hyde): Okay, and live in it?

(Veronica Morgan): Yeah, and live in it.

(Tyron Hyde): Not two investment properties?

(Veronica Morgan): No way. Not in a million years. The thing is that as you get older, I don't think you want to go into retirement, not having your own home. Personally, I just think that it's a very risky place to be. And it's very easy to become homeless in this country, as it turns out. So I'd be looking at security. If I was 50, had nothing, and was given 500 grand, I'd buy myself a home. And if I could obviously borrow, because it's a good chunk, but I'd look at what could I borrow maybe with a 15-year mortgage, maybe 20, whatever the banks would give me, I'd look at that. But you think, well, I'm paying rent now if I don't have anything. So, I'd be looking at investing that money into it as well.

(Tyron Hyde): Yeah. Good. What would you tell your 20-year-old self about investing? If you could go back in time and see 20-year-old Veronica tap you on your shoulder? Veronica, listen to this. What would you say?

(Veronica Morgan): Compounding. The magic of compounding and the dollar cost averaging, right? Start small and do it regularly. That's what I'd be saying. Watch this thing grow. Watch this snowball. It's amazing. It's a modern-day miracle.

(Tyron Hyde): And I guess on that, I would have reinvested. I would have bought a lot of bank shares because banks never lose money. We've got this society of the four-pillar society, in which banks in this country are protected, right? I reckon I would have just invested in a lot of banks and reinvested those dividends. The same principle as compounding interest. Right? Dividend reinvestment.

 (Veronica Morgan): Well, I reinvest all my dividends, so, mind you, I could probably do debt recycling, but I haven't done that, and that's something I want to look into.

(Tyron Hyde): Okay, question number eight. What legacy do you want to leave your family or your community? Veronica?

(Veronica Morgan): Well, this is interesting. My legacy. I really want to be known as the truth seeker, right? And I get that there's often more than one truth, right? But the thing is, in the property game, there is so much spin, there is so much self-interest, there is so much blowing the trumpet of recent decisions, recent acquisitions with no track record to back it up, no evidence to show that these were good decisions you made on for your clients or whatever.

(Veronica Morgan): There's always the latest and greatest new fad in terms of what investors on the forums are chasing this year. You go back ten years, go back 20 years; you'll find the same types of conversations, the same types of thinking. It's all the same, right? And there's always going to be charlatans, the snake, all salespeople that have always got the latest and greatest, the silver bullet to making heaps of money, blah, blah, blah. My legacy is that, really. It is not that complicated. But it's boring, right? Good decisions are pretty boring. And there's no flash and cash and dash with it. It's understanding fundamentals, and it's just making good, solid, sound decisions, right? And so that's what my legacies would be to help people who want to make good decisions actually know that there are ways to learn about doing things, a way that will help them with good outcomes in the long term because that's what property is all about.

(Veronica Morgan): And I'm not one of these flash, dash, cash, grab type people. That's my legacy. But I get that the vast majority of people want an easy way out. They want it to be easy. They don't really want things to be difficult. They want things to be quick. And I get that my message will not appeal to them. But for those who get it, for those whose little antennas going off, going, you know what? It just seems too good to be true. It seems to be something a bit off about it. My legacy is to be there for those people.

(Tyron Hyde): Because I think you can certainly get sucked into some of the stuff I see in my feed, right, from certain people. And it'll be like, bought a property for 200, market value, 300. Current rent, 600. Contact us now. I'm like, hang on. You paid 200 for it. It's worth 200. And prove to me that the rent is 600. I just don't believe it. But I can see how people get sucked in.

(Veronica Morgan): Instant equity uplift.

(Tyron Hyde): There's a word.

(Veronica Morgan): Really? No.

(Tyron Hyde): You paid 200. It's in Shitsville, and it's still worth 200.

(Veronica Morgan): Right. And you paid 200 because it was easy to buy. And that's why these charlatans, these snake oil salespeople, can help you buy so many of them because they're not hard to buy. That's why they haven't gone up 100 grand or 50 grand or whatever, because at the end of the day, would someone else pay more for them?

(Tyron Hyde): No. Exactly. All right, question number nine. Now, for the outside world, you do look successful. You've got a successful buyers agency. You're an incredible podcast host. But what does success look like to you, Veronica?

(Veronica Morgan): Good question. As I do get older, I realise that really, for me personally, deep connections with people that I care about, that is success, like deep personal relationships. And I've got, obviously, my family, my loved ones, my close friends, but also in my business, I've got some clients that have become friends over the years, and we actually become their family buyers, agents. That's deep. And then we get to understand so much more about their lives and add to that. But just generally speaking, authentic connections are so important to me. So it doesn't really matter whether it's business or whether it's personal.

(Veronica Morgan): I'm just not into fluff and bullshit. Hopefully, I can swear on this.

(Tyron Hyde): Absolutely.

(Veronica Morgan): So that, for me, is success, right? And therefore, really knowing at the core of me who I am and, what I stand for, what my values are. And it doesn't make life necessarily easy all the time, but it sort of does simplify things a bit and a satisfied life because I do a lot, and people often say, how do you get so much done? I'm interested in what I'm doing. I'm not doing it because I feel I have to. I'm on the hamster wheel. I'm doing it because I'm invigorated by it, and I'm interested in what I do.

(Veronica Morgan): But I also have passions in life as well. And so I'm actually literally at the moment I'm rereading this book called Design Your Life because I want to incorporate some of those passions into more of my work as well. So, like sustainability, for argument's sake. Food. I really enjoy cooking.

(Tyron Hyde): Okay.

(Veronica Morgan): So it's around doing what I love. And I'm fortunate enough that in my work, I'm able now to spend a lot of time thinking about sort of coming up with new content or more ideas or different ways of looking at things, different ways of helping people make decisions and frameworks and stuff like that. So yes, it's time to think. That's certainly something that I look at as being the hallmark of a successful life.

(Tyron Hyde): No one's actually said, oh, XYZ money or whatever. A lot of the answers that I've got from this have been family and connections, and it makes sense. Especially, I guess, as you get older, once you've got money, it's more about your family and friends. Like, I've got a group of friends, believe it or not, still from school, which I'm pretty proud of. And there's about 40 of us once a year, and that's from like high school. And one of our friends passed away recently from suicide. So we've made a pack that every first game of the NRL, we're going to get together, and it's just going to grow and grow and grow, and it's just all school friends, and that's for me, a sign of success. Just having that many school friends still as friends.

(Veronica Morgan): Yeah, that's pretty impressive. I'm actually going to a wedding this weekend. A school friend and his husband-to-be and with two other school friends, and yeah, same deal. We had a trip down to Beechworth, a gang of us back in May. It was wonderful to have that, and we're all very different, but we laugh. Oh my God. It was the most joyful weekend. It was fantastic. But I think too, it's funny what you say about the money. It's pretty hard. I mean, part of the ability to enjoy these things is by making good decisions and working hard younger. And so some of this stuff we do take a bit for granted. And I think that having money does make it easier. I'm certainly not rolling in it, but I'm not uncomfortable. You know what I mean? It does make it easier to step back and to be able to be less, I guess, panicked and frantic about trying to make ends meet.

(Tyron Hyde): Yeah. And it gives you the opportunity for freedom to do podcasts as well, to travel and to go to Europe for two months, et cetera.

(Veronica Morgan): Two months. Exactly.

(Tyron Hyde): Now, the next question is, I guess part of the reason why I started this podcast is because my father lost all his money. And seeing that was pretty painful. So Warren Buffett is quoted as saying, rule number one, never lose money. Rule number two: never forget rule number one. Veronica, what's your best strategy to not lose money?

(Veronica Morgan): Recognise risk and where risk really lies. Right. So, with property, there's a lot of myths around. For example, people say you've got to diversify. So then they'll be buying three C-grade properties rather than one A-grade property. A bit like with my first property, they think the risk is in how much money you borrow, but it's actually in. The risk is the asset you buy. So, when it comes to property, people are chasing hotspots. They're trying to find the next place that's going to take off because it will make them feel good about whatever decisions they're making. But the problem is they're not recognising is that you're only buying one property at a time. 71% of property investors in this country, according to the ABS, only have one investment property.

(Veronica Morgan): If you're going to buy one, it has to be the best bloody asset you can possibly find in the safest location you can possibly find. And that means not speculating. And this is the problem with property. People speculate far too much. And this is what it gets back to, that being boring. There's boring things to look for. Boring is good when it comes to property. I don't mean homogeneous and boring property. I mean, boring in terms of finding a property in an area that has demonstrated its ability to provide sustainable growth over time. It has the elements that mean people are always going to want to live there because it's not a hotspot or a ripple effect type suburb. It's got its own reasons. The reasons people want to live there.

(Veronica Morgan): People who live there can afford to buy property there, right? And they want to buy property there. And when the market tightens up, the type of property in those areas where there's always people that would want it, where there's always demand for quality property. And this is the thing: the art is being able to cut through these areas, any suburb you decide to buy in, like a hot butter through knife. Sorry, knife through butter. To understand an area well enough to be able to identify the type of property that will always get buyers, and that's not risky, but people think, oh, it's risky going to auction and competing for a property. Now, it can be risky if you pay way too much for it. But if you've done your research and you've chosen a good asset, and you've priced it, and you set your limit before you go to auction, et cetera, et cetera, you can mitigate those risks because you know you've got confidence you're buying a really good asset. And so that's the one thing.

(Veronica Morgan): Back to Warren Buffett's quote, aiming never to lose money. I think people, one of my favourite reports is CoreLogic's Pain & Gain report, right? So that comes out every quarter, and it reflects how many properties resales were in that quarter and how many of them sold at a loss. That's a nominal loss. It doesn't even take into account holding costs and stamp duty and renovation costs and stuff like that. And so, like in the last report, it was March 2023. I think, off the top of my head, it was something like 9% sold at a loss. That's nearly 10% of properties that sell at a loss. Right. So it's hugely risky. And I think that's the problem with property, is people aren't understanding what it is that's risky. And it is in the asset selection. If you don't know how to select a good asset, you are taking way more risk than you probably need to.

(Tyron Hyde): That is a good segue into my next question. I know it's Ten with Ty, but I always ask a surprise question based on your experience, and I think you might have just answered either one or two of them. But my final question to you was, what are the three worst mistakes property investors make? 

(Veronica Morgan): Yeah, I think number one is that they put too much importance on location. And look, location is important. It is. But if you only go for location and you don't understand that within every single location, there are underperformers and overperformers, you're missing the biggest trick in property investing. So, if you can combine those two things, and this is where people rely too heavily on data. First thing is their overreliance on location. Without understanding that within a location, even in a great location, you can lose money, right?

(Veronica Morgan): The second thing is that they over-rely on data. And that's a little bit like saying, right, well, only believe one form of transport exists and you should use it. And it's a train, right? Love a train, but the train will get you to the station in a suburb, and then once you get off that train, you're limited with what your two little legs can get you in terms of how far you can go. Whereas if you think, okay, well, I'm going to think holistically here, I'm going to use the data, the train, to get me to the train station. But I'm also going to think about maybe ride a bike for a bit, or perhaps I'll get an Uber, or maybe I'll even get in a car, whatever. But you're adding some local knowledge and the nuances that you will gain from getting away from just as far as the data can get you. The data has its limitations and people.

(Veronica Morgan): Property investing is risky. People realise it's risky, and so they will put over-reliance on data and not understand that you need to know the nuances of local areas to make good decisions on assets. So that's the same thing. And thirdly, without thinking, with a long-term lens, some investors really stretch themselves far too much financially so that if things get tough, they're forced to sell, and that is not a good idea. You want to crack an asset, and you want to hold onto that thing come hell or high water because you know it's a cracker asset, so you don't want to have to push yourself to the limit. And so then you're forced to sell a cracker asset. Now, if you've got a dud asset, get rid of it, right?

(Veronica Morgan): If you've got a cracker, do everything you can do to keep it. So I think that's something that I see a lot in property investment forums. There's all this idea of the minute they got a little bit of equity, go and borrow more money, and then they go and borrow. They buy shit, they buy lots of shit.

(Tyron Hyde): Say what you really mean. That's good. Off the cuff. What a great answer. That comes to the end of Ten with Ty, Veronica.

(Veronica Morgan):  Well, it's been a pleasure. Thank you.

(Tyron Hyde): I've really enjoyed it. Thank you for imparting your knowledge to the audience. I've really enjoyed it and thank you. And if anyone would like to get in contact with Veronica, just head to veronicamorgan.com au.

(Tyron Hyde): If you own an investment property, then Washington Brown can help you pay less tax with an ATO-compliant depreciation schedule. Visit washingtonbrown.com.au to pay less tax today.