John: So, one of the first things I get anyone to ask is to cover off really three questions: (1) where do you want to go?, (2) when do you want to leave?, and (3) what do you need to get there?

[intro music]
Going once... Going twice... SOLD! You're listening to The Property Pod!

Aaron: Hi, guys! Welcome back to The Property Pod, your weekly engagement here into real estate in the Hobart marketplace. I'm your host, Aaron Horne, and I am joined at the desk this week by two superstars of real estate and brokerage. Last week, I broke his intro but this week, I will not be breaking it.

John: Oh that's a real good wave... What a pun there, mate.

Aaron: Yeah, thank you so much.

John: Beautiful!

Aaron: I won't say I thought about it for a long time, but I sure did. I was like, "how can I make it up to Andrew Leggett for breaking his intro last week?" But welcoming him back this week, how are you, my friend?

Andrew: Very good, thanks for having me again.

Aaron: Not a problem. It's so good to have you as a team member now basically. I know Paul was joking that you don't have a key to the office yet or do you have a key to the office yet?

Andrew: Haven't got that key. I'm still waiting. So, hopefully, we get that sorted soon.

John: Yeah, well. Just keep an eye on the way out, mate. There may or may not be something accidentally falling out of my pocket onto the floor.

Andrew: Sounds good.

John: Just yeah, we'll leave it there.

Andrew: I'll keep my way. [laughter]

Aaron: Well, the good bit is we kind of I put together or John put together the show notes for today's episode and I looked through them and I was kind of like, "ah, I don't know if there's much there for Leggett to talk about but I know he really wants to come and be on the pot again and I know I really enjoy having him in the studio." So I flung through this thing. I said, "hey, mate! Do you want to join us?" and response was a resounding...

Andrew: Affirmative.

Aaron: Yeah, without a doubt. [laughter]

Aaron: Might not be a heavy finance or brokerage-related episode but it's good to have you here, my man.

Andrew: No, I love coming along. Thank you!

Aaron: Not a problem at all. So John, run us through where we're at this week. You've kind of put together a December checklist or something like, you know, everyone's getting their naughty and nice list together. [John agrees] You wanted to talk to some people about what's happening out there in the world of real estate.

John: Well, it had been a while since we've looked at the idea of... there's a very simple question: what am I supposed to do to my house to maximize price? [Aaron agrees] But one of the things that we've sort of been changing the conversation with our clients, both buyers and sellers actually, because it sort of works on both fronts and I'll explain why a bit later. If you are gearing up to do something next year, people are trying to ask that question so: "what am I supposed to be focusing my attention on?" and often, they'll be presented "what I would do in my house?" then instantly, they'll just get dumped like a hundred point checklist [Aaron agrees] and like do all that. Now, that's too many goals.

Aaron: Yeah, so I've got on my fridge a handwritten list from Sarah of basically jobs we wanted to have before Jack was born [John agrees] and I got really close to the end. Like it was just like the little kind of things to make sure the house was safe and just a few wish list items.
We've had a new one since the next bub's on the way and we're ticking off a fair few of those things. It's kind of getting to the point where now I'm trying, hopefully my brother can come back from Canada in march, so the list has extended to March. But I look at it and I get so overwhelmed at this idea of like, "man, there's so much stuff on this list, like where do I start?" So I feel like looking at your notes, like this might be a really good thing to say like December, the market's probably going to slow down based on everyone kind of ramping down for Christmas and everyone settles in, but these are kind of like let's start looking at some of these things so that you might be ready to go 2022.

John: Yeah and I like the idea of having the mindset and the framework to build your own list rather than just grabbing one. I mean, obviously, grabbing one off the Internet's useful but obviously, it normally doesn't address the key questions that are fundamental to actually explaining why you're wanting to do that and I don't know about you, guys, but if I've got a list and a compelling reason to do it and a time frame, most importantly, I'm much more inclined to do it.

Aaron: Oh definitely, yeah, you've got to have that deadline. [John agrees]

Andrew: I went through a list with my wife and we split it in an excel sheet and split it into different regions and rooms and then marked it as 'urgent' and 'important' and I've not really done much on it. [laughter]

John: There are more other urgent important things to do.

Andrew: Yeah, that's right.

John: Well, I think if you're... I mean one of the biggest challenges, too, at the moment is if you're looking to buy and sell on the same market, that's really hard because if properties aren't either you're needing a bigger budget to purchase something you want or you need to move quicker or there's no available to buy, obviously, there's so many small elements to this that will be very specific to a person's situation. So, what I thought would be really useful is to give people a bit of a framework that we advise that enables you to take control of the process rather than relying on ten hundred different checklists hoping that one of them is going to fit you. So, one of the first things I get anyone to ask is to cover off really three questions: (1) where do you want to go?, (2) when do you want to leave?, and (3) what do you need to get there? So if the idea being is you don't know where to go yet, you may not know what the price is... let's just assume that you're buying into a new area; you might be selling on your own. So you may not have established what your budget needs to be yet. When you need to go is really important obviously, too, because if you've got 30 days versus six months, obviously, you've got a lot more time to be able to consider what could be done and lastly then, what do you need to get there? Well, some people will ask, "what should I do?" no, not really sometimes asking what they want to do. They're really asking, "Can I not do anything?" and I always ask that well, look if you don't need a specific price to... if the property is in a condition that's comfortable to get you where you want to go the time you need to get there, fine. However if the strategy is I really need to leverage as much out of value out of this property that I possibly can or I need to get this in order to get there, well then okay, then we've really got to start to get into the finer details about what then work you need to invest both in your time and money that's going to obviously ensure that you've got all the resources behind you to get to you to where you need to be.
Aaron: From having many conversations with you, probably over a hundred are recorded and many in the real world, I've always heard you talking about removing the ``BUTs" like I know you're a BUT man; you love yourself some of them love big round juices 'BUTs'...

John: Yeah yeah, it's big juicy 'BUTs'.

Aaron: But you're all about removing the 'BUTs'. I've heard you talk on the phone a few times. Can you kind of break that down a bit more? Like we're we're having some fun with some 'butt humour' [John agrees] Yeah, hit us with some buttons…

John: ...slapper switch and BUT knowledge? Yeah yeah cool. Well, I might preface that a little bit first because one of the things that's really important is about understanding what is in your control and outside of your control. [Aaron: okay...] So why that's really important is... the good thing about 'BUTs' is that it can be in your control. What is outside…

Aaron: There's times when your BUT's out of your control... [laughter] I'm just saying...

John: It depends if you're going to be put in the work.

Aaron: Depends on what you had for dinner?

John: Yeah yeah, or squatting… With the idea, though, is that what is outside of your control realistically is the location of your house and the market that you're in at the time. So if the market's really hot--well the market's really hot, but if the market's on a downturn, you can't sit there and put out a press release to The Mercury and all of a sudden change the influence of the state.

Aaron: Oh man, imagine if you could…

John: That would be amazing! Just like a doge-coin and [ __ ] you know, to the moon baby, but it just doesn't work unfortunately. So then, what is actually really in your control now, we're only going to be focusing on one. The five elements are your (1) presentation, which is the appeal of your house, (2) the promotion, which is the marketing of your house, (3) the process, which is the strategy of selling or buying, (4) the person, which is the way in which it's going to be negotiated, and lastly, (5) your pricing expectations. So, right now, what we're going to be focusing on is primarily... if you are looking to do something next year, you've got a bit of time up your sleeves for your presentation. [Aaron agrees] So, what again we're going to say is, "look, we're going to use this time to maximize the appeal of your home to be able to present it as best as it can in the market."

Aaron: And so my theory from there would be that that would maximize your price so you're kind of wanting to minimize your time on the market so that you can maximize your price later down the track because, though you've said you can't control what the market's doing, I guess we could kind of throw to Andrew to kind of let us know that the market probably isn't going to dip between now and January, February, March, you wouldn't...

Andrew: I would vision so no, not in the short, looking sort of forward a few more months, it's so hard to go. [Aaron agrees] My opinion is I just can't see that they're being a dip. You know it's going to happen, it will happen. But the crystal ball, I've got no idea.

Aaron: Yeah no, well like we've spoken a few times with Simon Pressley's and stuff and there's still stats out there saying that yeah, there could be growth through to 23, 24. [everybody agrees] So yeah, so basically what you're kind of saying, John, is we're going to try and work on the presentation side of things across December, January. [John agrees] So that maybe once everything's kind of everyone's got over there, Christmas hams and they're ready to go and the world's back in order.

John: Well, this is the thing. One of our investors was saying, "oh look, should we do it before the end of the year or should I wait six months?" and I said to her what she was going to do was move her daughter out of the home and then into a unit temporarily then move her again and I said, "Well, look. What you're trying to do is you're trying to time the market. We're trying to think that we're so smart that we're going to pick the peak." I said, well in the end, if that is as important to you as basically the stress that it's going to put on your family by moving three times, what do you mean, well look... Let's just take the worst case scenario. Let's just say we can get10 grand more today than we can in six months. Is that $10 000 really worth all that time? She's like, "no". No, who cares? Why don't we just sell in your cycle? So it's that... don't sit there and try on the market sell when you need to sell based on your family's needs. So, then she's like, "okay, cool" then we started talking about presentation [Aaron: yeah, for sure] because then, what we were doing is we're taking back control of that which she has control of, which is the appeal of a property. Not trying to time the market hoping that she's going to maximize the price by picking the peak. So this is where the BUT comes in, because there's another question I like to add, too, is that there's two things first says look, are we addressing a question or are we addressing a BUT? And I've sort of expanded the BUTs because it is quite useful in that sense because when I think of a question, you'll walk through a home and go right, see things that are odd--it's not really a BUT, it's just odd. So it's like, "why is there a crack in the wall? Why is the powerpoint loose? Why is there exposed wires?'' Why is this... why? why? why? why? and they're raising questions and it's that thing where the more questions that are raised in the property, the more that they're pulling on the street, and the more worry they have about it. So the more concern and the more worry people are going to have, if you think of that as a buyer as well about the property, you're going to be less engaged with it. You're going to be... your guard's going to be up, you're going to be more defensive, and not as willing to, I suppose, engage in that property with that you might otherwise like.

Aaron: Or you're mentally kind of coming up with that checklist of like, "oh well, that's like a thousand dollars, I'm going to take off my offer... oh that's... I'm going to keep my offer going lower and lower because I know I'm going to have to fix all of these things."
John: And this is sort of a thought of the priorities moving forward is it, first off before you worry about anything else, is what if you walk through your house, what questions are people going to arise? And you may be like, "oh no, don't worry about that" like that's just like... well yeah, worry about that now. It's like these are the small money fixes, generally speaking, that eliminate all the questions.

Andrew: But there would be things you could also do that aren't small money, not big, as in no money like one percent is like removing clutter. [John agrees] If you've got so much furniture in the lounge room, open the space up, it's going to look more attractive.

John: Yeah, absolutely.

Aaron: Mate, you're speaking my language so much. The amount of times I'm just in a property getting the photos ready, like, "please, just move your things" like just "please..."

John: Yeah yeah and again, it's why is all this stuff here? Is this related to the person or is it related to the fact that there's just not enough bloody storage in the house? So there are so many elements to that. So, think of the questions like, yeah, maintenance generally speaking, but it's like, why is it the way it is. So, the next thing when I'm talking about a BUT is that something a person might say, "Look, I love the open plan but I really don't like this kitchen." Okay, so the other thing is take your personal preferences out of it. We're really trying to appeal to the greatest market, so you might love the purple walls in your house and that might work to a tea. Challenge is that you're a very small percentage of people and we want to appeal to the 99%. So, if someone was going to walk in there, "I really love this house but, oh my god, this deep purple is just too much. I can't deal and I need to walk out." Some people are like that, some people can't visualize and will emotionally walk away from a property before they will be prepared to fix that BUT for themselves. So, all those elements then, you know then this is another really long conversation, like what other BUTs, you know: bathrooms, kitchens, paint, the types of flooring, room layouts, size, garages, car spaces--some you can fix, some you can't. And what then the thing is that's why it's so important about that question at the end which is how much do you need at the end? [Andrew: Let's get it done] Yeah, what do you need to get there's like well, then we're gonna... so if you need more money out of this property, when you are gonna need to address these BUTs and the questions and the then there's again, one last few little framework is are you protecting your value? Are you enhancing your value? or are you genuinely over capitalizing? And that's the biggest question that people ask, so that you want to sit there and go, "If I spend this money, am I going to get that money back?"

Aaron: Yeah see, I feel like that's got to be like such a fine line to walk and I'd really like to know I guess it's like bringing in you, guys, first before you even start those things like talking to a real estate professional because I just feel like you can dump 120 grand on like say your purple wall or something but you're doing up the bathroom and you're putting like this really elaborate mermaid water feature or something like that it's the most beautiful thing I've ever seen like everybody's going to love it. And then it's just like as soon as I come in, I'm ripping that out and like you're definitely not getting the value for like this crazy thing you've got or...
John: Yeah, multiple like a couple of thousands and tap fittings. [Aaron agrees] Even if you could sit there and describe the nuance of the artistry of this tap, another person's gonna, "I hate the gold, it's a gold tap, I hate it. I have to replace it." So that's why the over capitalizing is a really really hard one to navigate through especially, too, if you... I mean, look, I'm not a handy guy, I could do some little bits but in the end, I do need professionals to do the work [Aaron agrees] and there's obviously a premium that comes with that quality of workmanship. So, if you've got the skills and the trade, you can obviously leverage your time and the money a lot more effectively than someone like myself, so I have to price it out. And then the real biggest thing is ensuring that you're going to be... you know, it's that 80- 20 rule, the Pareto distribution, it's like the biggest bang for your buck. And also then, sometimes, trades that are the most easily accessible because obviously, especially in these markets where there's just such a lack of availability of professional trades people, if you need to move out a certain period of time and you can't get anyone to fix that work, well again, we've got another problem, don't we?

Aaron: Yeah, it might be unfeasible to even approach that.

John: 100 percent!

Aaron: Speaking of over capitalising, I don't know if this is something to throw your way, like when it comes to valuing properties and stuff like that, is it always done from just data like a crunching numbers of like this is the suburb? Or is it like people coming in to check out the place and being like, "oh yeah, they have done this up" and... can you over capitalize and can you just go in as well? Big mistake, buddy or like, "yeah, old man. You've absolutely like nailed it."

Andrew: Look, I've seen people do renovations and I've thought to myself, "well, are you gonna over capitalize, you'll never get your money back." But because of what the market's done, it's enhanced potentially, yeah… particularly in Moonah--I won't name names but dad spent a bucket on his house and they purchased that house years ago.

Aaron: This is the one up the top of West Moonah?

Andrew: No, not that one. Another one right down the bottom, just off Albert Road. And at the time, I thought that that was a huge huge mistake and look now, I've spent and they have they've spent an absolute bomb on it. But they're going to get every dollar about... [Aaron: --a bomb price...] Yeah yeah of course. Now, in terms of finance and valuations, it's a tough one. What we generally do is we put the property address into our evaluation software and then the software sort of figures out a strategy as to what sort of valuation the property needs. So it might just be an instant valuation where it just comes back and says the customer's estimates acceptable to use or it might be a desktop valuation where the information will go to the valuer, they will just look at the data and say, yes that that's acceptable or the third strategy is full inspection.

Aaron: Yeah and that's going to the property and checking it out and then getting a report back saying... [Andrew: that's right] yeah, for sure.
Andrew: Someone, I might say, I've got an automatic valuation that's come in at 600 and they're going to say, "No, no, it's worth a lot more than that, I've spent so much money on it." And then of course, we've got the lever that we can pull to get the value to go and inspect.

Aaron: Yeah, sure.

John: Especially because the data is not going to back up what you need, so it's like you need to see this house to understand why it's at the price that it is that makes sense.

Andrew: Yeah, because the data is not there for someone that might have just recently done a big reno out of the bedroom, added a living area, that sort of thing.

Aaron: Yeah, for sure.

John: I remember when early in my career, I was basically--and I still do it-- I constantly ask questions of all the experts that I catch up with. One of the interesting ones that he'd said early on learned with valuations, though, he said not a lot of emphasis gets placed on landscaping. So what he meant by that was... we'd just use your dad's house for example, all those internal renovations that he's doing, you can comparably measure that against other sales, so quality finishing of kitchen, how many bedrooms, how many car spaces, etc. but just because you've got a forty thousand dollar bird feature in the center of your front yard, has zero factor or I would say almost zero factor in the eyes of the valuation in the bank. So, one of the real key elements to, I suppose, when it comes to the idea of landscaping has a huge impact on the selling for appeal purposes but not from the bank's perspective, for the most part. So it's a really interesting one where you can easily over capitalise by going way too far with excesses of landscaping especially if you are just looking to move on, not for the purposes of your own enjoyment, [Aaron agrees] that can put you in trouble, not so much you will get it back from the appeal from the market, I would say, but sometimes, it can be you may not get it from the appeal from your bank. So, say if you've just been, "Oh, but I spent 40 or 30 000 dollars landscaping my house," so I got it re-valid from the bank and they said it didn't make any difference.

Aaron: Yep, fair enough. That makes sense.

Andrew: Sorry, I'd say some landscaping is better than none [John: Oh yeah] and I've had that conversation with values before particularly on completion like new builds where there's been no allowance for any landscaping and that has affected valuation but yeah, if you're going to engage someone to design an amazing landscape, and that's going to cost a hundred grand, I just can't see it adding a hundred grand of value. [everybody agrees]

Aaron: Yeah and I guess that's where this over capitalizing kind of conversation goes is it's talking to those people beforehand and yeah, it's handy to know that that's kind of an area where it's like, "yeah, make it nice." But don't go like don't build a Japanese garden like the botanical gardens.
John: It's a really good one to get in a professional to give you some advice before you start because again, look if a person is going to stand there you know spend the next 10 years of their life there is like, "do what you want." However, it's that look we're intending to do this landscaping because we want to sell in six months, like well okay, now we're going to have a really serious chat about maybe trimming the fat a little bit, so we're creating the peel that we want for the market and not because you want it. And that's a really good thing you remember is like what are you trying to do? Are you doing it for your own ego? Or are you doing it to appeal to the market?

Andrew: Yes, of course.

John: That's the thing where sometimes, people can get generally offended. I did all this stuff and you know he's like, "yeah, but no one wants it." [Aaron agrees] You may love it, but no one wants it. And that's a really hard conversation for us to navigate through for someone to slowly help them break down that wall and help them basically psychologically be prepared to move on because they're trying to defend the emotional attachments they have for this thing that they thought was a great idea which realistically wasn't. And when it comes to that idea when you are looking for your own home, it's a really hard one to detach yourself. I can't do it; we're all emotional... We talked about it.

Aaron: We talked about it last week with you. Actually, speaking of that, your jacket is looking really sharp this week like I know you came in on Monday, I was like, "damn, boy, like you're wrapping some nice jacket today."

John: Thanks, my man.

Andrew: I like the pocket hanky.

John: I've been... actually, there was one that we got when we're in Scotland so that's that...
I'm making myself sound way cultured right now. [laughter]

Aaron: I actually only went there to get the pocket square. Yes, I'd heard that this one specific store was the pocket square capital of all of Scotland.

John: Oh, it was worth it. It was a long flight but oh my god, it's paying off. It's paying off [ __ ]compliments, but thanks, boys. But I've been wanting a nice summer jacket so it's kind of nice to represent it.

Aaron: It's funny because last week, you were very casual, John, and now, you're back in yeah, stylish John so yeah, you're not over capitalizing on that body, baby.

John: No way, man. There's no...

Aaron: It's all about presentation.
John: Yeah yeah, I've got to appeal to the market. Well, I mean the market has won at this point. [laughter] But you know, it's going to make an effort... [laughter]

Andrew: If you do it, yeah. I've made no effort today. [laughter]

Aaron: Yeah, all right, boys. Well, I think from there, we probably need to wrap up. Do you have any kind of summation or any closing points you'd like to throw at us, John, just so that we can
really really tie a bow on it and send the people home on a bang?

John: Yes, here's the framework. Okay, so the first thing is you're going to ask yourself: know your goals. Where do you want to go? When do you want to get there? and what do you need to get there? Okay so then with that said, there's two things you are gonna be doing some work but there are two things to be mindful of that are outside of your control, which is the market and the location of your property. So you can't physically change that and you can't influence the market so if it goes up, when you sell, oh well and good if it goes down, all well and good. But what you do have in control, though, are five things--we've only covered off one. But the five things are your presentation, which is your appeal; promotion, which is your marketing; the process, which is your strategy; the person, which is the negotiator and lastly, your expectation of the price. So, when it comes to the appeal or the presentation, we talked about today we're doing two things: we're eliminating the questions which is why is that like that? That makes me nervous.

Aaron: Getting rid of those big fat juicy BUTs.

John: --getting rid of those big fat juicy BUTs because then and on that basis, you were saying to yourself, "Am I protecting my value?" which really comes into the questions because protecting your value is getting rid of those or why is that the case, but if you fix the crack on the wall, you don't enhance it but then, are you enhancing your value or you're over capitalizing? So, we touched on it really really briefly but mostly, if you're really unfamiliar and you haven't done it before, now is a really good time to have a conversation with an expert in that, be an agent, be it a designer, whatever, because then, they're going to help you build your strategy to really maximize your biggest bang for your buck or that 80-20 rule. So, there's your framework.

Aaron: Your beauty. Excellent! Thank you so much, my friend. Thank you for putting all that together for us and a big thank you to Andrew for popping in once again--filling in for Pat's feet.

Andrew: Thanks, chief!

Aaron: Always a pleasure having you here. I believe there's some news coming that we may be getting some sponsorship for the podcast from a company that you may work with?

Andrew: Correct! Yeah, some exciting news there.

John: So, just like am I getting some merch?

Andrew: Do you want some merch?

John: Always. Just give me all the merch. [laughter]

John: I used to go--when I'd go to a bottle shop and I'd ask the guy at the can or the girl, have you got any just merch that's left over? I've ended up with a tent like I was like a soul soul beer tent like, "oh, here you go. This was here for ages." I was like, "thank you!" I stopped doing that because you know…

Aaron: Do you have to buy the actual product like it was like a wild turkey tent and you're like, "oh, he's got a wild turkey..."

John: That was just because it was that thing where they've always got leftover stuff and it's kind of like they'll look under the can and go, "oh yeah, that was supposed to be gone, there you go. Have that." It's a beer coaster, a tent hat I know blew up palm once. Yeah, anyways…

Andrew: No, but yeah, very excited to announce that RAMS Tasmania will be sponsoring The Property Pod in the new year.

Aaron: Yeah, so yeah, looking forward to 2022. We've roped him into enough shows that now he's willing to throw some money at us and yeah, take us to the next level. No, mate. It's an absolute pleasure having you in; it's always enjoyable even throwing something at you and saying, "Hey, mate! We don't know if this is up your alley, but do you want to come and have a yarn?" Always good to have you here.

Andrew: "I'll do it"

Aaron: Yeah, exactly. [laughter] No hesitation. Awesome! Thank you, guys! Thanks for once again for listening and we'll be back next week with more Property Pod.

John: See you, gents!

Aaron: See ya!

[extro & disclaimer]
You have been listening to The Property Pod, recorded and edited by 4one4 Media House in conjunction with 4one4 Property Co. This podcast is general information only and the thoughts and views expressed are the opinion of our panel and listeners should always seek to use their own investigation into any topic we discussed to ensure they fully understand their own situation. It does not constitute and should not be relied on as purchasing, selling, financial, or investment advice or recommendations, expressed or implied, and it should not be used as an invitation to take up any agent or investment services. No investment decision or activity should be undertaken on the basis of this information without first seeking qualified and professional advice.