Hi friends,

Welcome to your November 2019 newsletter.

How uncanny is that? – In last month’s newsletter I predicted the trend of the RBA dropping its official cash rate in Australia this year would continue…

... And on that very day, they dropped it AGAIN!!

Australia now sits at 0.75% and in my opinion, we’re on our way to 0%... and below.

That’s why this newsletter is so important.

Recently I ventured up near Bribie Island, north of Brisbane, to meet our Commercial Property Investing Expert, James Dawson, on site at one of his current projects.

James walked me step-by-step through his deal, whilst highlighting the major 4 advantages commercial property investing has over residential property investing.

It was a most inspiring day, let me tell you...

And if you’ve only confined your property investing to residential so far, I seriously recommend you check out the advantages of commercial. They’re massive.

Of note, and possibly the biggest advantage, is the yield and how it’s calculated.

Whereas when residential investors say they are getting a 4% yield, they’re referring to a gross yield which only considers the annual rent received divided by the purchase price. It doesn’t factor in the running costs of the property, things like insurances, (water charges for apartments), agents fees, insurance etc.

And, when these very real running costs are accurately reflected, the true yield drops significantly, to maybe 2%.

In commercial property investing however, when we talk about yields, we are talking about net yields. This means the total annual rent received after all costs have been paid (excluding any borrowing costs in either case) divided by the purchase price.

Commercial yields can often by anywhere from 5% to 12% net yields, which is a heck of a lot better than 2% for residential!

This is achieved by a very powerful document called the Lease Agreement. The lease agreement stipulates that the tenant, not the landlord, is responsible for just about all outgoings imaginable. This not only includes things like power, water, rates, fit out, signage, upkeep etc, but often includes insurance and even the owners land tax commitments.

It’s a completely different ball game to residential investing and not many people understand the rules of the game – which is great, because there is much less competition!

With official interest rates so low and likely to go lower, savers are getting smashed.

Investors the world over are looking for safe, high-yielding investments and I believe commercial property investing could be one of the best, provided you can find a great mentor and learn the rules of the game.

My Gift of the Month below will help you do both, so be sure to check that out.

Also enjoy this month’s educational videos and I look forward to seeing you soon.

To Your Success.