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For Kelly Cameron, helping property investors access finance starts with a clear understanding of the client’s goals – an understanding she can certainly add value to.
As an established property investor herself, Cameron knows a lot about the market, as well as all the costs and risks that an investor can incur throughout their journey.
The Director of Get Real Finance in Fortitude Valley says an insurance issue has thrown a major spanner in the works for investors wanting to purchase new properties during the current slowdown.
Unable to give advice, even with her experience
Cameron took an interest in property investing from a young age; purchasing her first property when she was 23. Over the course of the next 18 years she went on to build a portfolio of 27, making her first million by the age of 25.
As an investor, she understands how important it is to have clear goals and a thorough knowledge of the market.
“I’m in it every day, so I can get a pretty good understanding and I’ve been through a few market cycles,” she says.
While she knows a lot about investing, as a broker, Cameron can’t give advice about property. She says it is essential to ask questions that can enable clients to understand the nature of the transactions they are looking into.
“You really have to be thinking much broader than just selling a loan product,” she says.
“For people doing property investment, you really want to make sure that they’ve got a long-range projection and that they adequately understand their cashflow needs and the things that will change for them over time.”
She says you have to think about whether the client will have any land tax implications, how long they want to keep the property for, what entity they want to purchase under as well as an awareness of the market direction and the client’s motivation – all without giving them any advice on the matter.
“You need to make sure they are getting all their advice from their accountant or solicitor,” she says.
“Really, the broker has to be so knowledgeable.”
COVID-19 has brought a fresh risk to the market
Property investors have long used landlord’s insurance to cover themselves against loss of rent, but for new policies, Cameron says this is currently not possible.
“At the moment, there’s an embargo on getting landlord’s cover. So, you can’t even get insurance to cover loss of rent in the current market at all in Australia,” she says.
She says since loss of rent is a major risk in the current market, what she has been doing is enabling investors to release equity from existing properties so that when the market starts to recover they can take advantage of that with further acquisitions.
“If the market’s falling and the people don’t take their equity out now, their equity will be diminished too,” Cameron explains.
At least half of Cameron’s revenue comes from trail income, so for her, the new client is just as important as maintaining her existing ones. She is currently doing a lot of repricing work for established clients despite new purchase contracts dropping from 10-12 per week to just one.
While COVID-19 has seen Cameron and her team working long hours to help existing clients through the crisis, it has come with some positives.
“It’s actually brought about some efficiencies to the business,” she says, explaining that working from home has enabled them to fast-track to a paperless system.
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