DomaCom Newsletter – February 2015

Understanding the self-managed super fund lifecycle and knowing how to use that knowledge to benefit clients is the theme of the 2015 SMSF Professionals’ Association of Australia (SPAA) National Conference taking place this week, 18th-20th February in Melbourne.

Come & visit us at SPAA!


Understanding the self-managed super fund lifecycle and knowing how to use that knowledge to benefit clients is the theme of the 2015 SMSF Professionals’ Association of Australia (SPAA) National Conference taking place this week, 18th-20th February in Melbourne.

Come and visit the DomaCom stand and meet the team to learn more about how DomaCom can benefit your clients as part of their SMSF strategy. We sincerely hope you will join us at this pre-eminent event on the SMSF calendar.


Listen to Alan Kohler on DomaCom


As a trusted source of investment advice to Australians for many years, Alan Kohler, financial journalist and business commentator on the ABC News and founder of Eureka Report and Business Spectator, recently interviewed Arthur Naoumidis, CEO of DomaCom, to demystify fractional property investing and the benefits of the DomaCom Fund.

Enough said, this video clip says it all!


DomaCom’s public bookbuilds

Many of our accredited financial advisers have expressed an interest in joining a bookbuild for clients but as they have not yet gathered enough client funds, they are unable to complete a private book build.

Our solution: DomaCom public bookbuilds – these can help you to get started in this new era of property investing.

A number of recent bookbuilds centred on student accommodation have been snapped up by eager advisers and their clients. These low value properties (sub $200k) offer up to 8.5% gross yield. We expect another group of student accommodations to come online shortly if this is of interest to your clients.

We sincerely hope you and your clients will be able to take advantage of these bookbuilds.  Click here to view our Public Bookbuilds.


Introducing Chris Benson as State Manager for VIC & TAS

We are pleased to announce that we have recently appointed Chris Benson to the role of State Manager for Victoria and Tasmania.

Chris is also currently a Conduct Review Commissioner with the Financial Planning Association (FPA). Prior to joining DomaCom, he had been employed as a Strategic Development Manager with AMP SMSF.

“We’re very pleased to secure someone with Chris’ background, particularly his knowledge of the SMSF market”, DomaCom General Manager of Sales and Marketing, Warren Gibson, said.

“Chris’ appointment comes at a critical time for DomaCom with investors’ growing appetite for property feeding into financial planning practices. Sales has taken the focus with 15 AFSLs having given DomaCom the thumbs-up and another 30 in waiting. Chris will be a great asset in helping to convert these initial interests and building DomaCom’s funds under management”, Mr Gibson said.

Chris Benson’s contact details at DomaCom are: chris.benson@domacom.com.au  or (03) 8609 7076.


What is Property Investment Advice?

By Rosemary Johnston of the Property Investment Association of Australia Inc. (PIAA)

All of us want our clients to be successful with their investments as it makes us feel good, and it drives our business referral stream. So how do we decide what to do when it involves property, which is unregulated as an asset class and for advice?

What business standards do we expect for our clients?

Real estate standards are based in opinion and therefore require strong knowledge of local markets. ‘Facts’ can become skewed as they are used to support the presentation of a property rather than the client’s best interests.

In comparison advisors rely on professionalism and transparency. They present information from a number of angles to ensure risk discussions are robust and comprehensive. They consider the ‘what ifs’ and create plans that have the flexibility to manage life’s changes over time.

Sustainability is the concept that holds the client’s values first and delivers the business values for long term success.

Client Focus

Strategy:

We need a client’s best interest business process that focuses on their exit strategy as well as their holding and entry considerations. Lower standards focus on how much money or equity a client has and how much they can borrow. These are holding and entry considerations only.

The strategy needs to address what do they want, when do they want it, and how can we add value to the exit to increase their returns. It is at the exit points that clients really make their money.

Trended Data:

Data needs to be trended over time to show the direction of the market; ten year average capital growth rates are great coverage but lack transparency on trends. This can be simply presented information so that your clients can appreciate it and ask meaningful questions.

This may also include population growth, economic growth, consumer confidence, infrastructure investment, and availability of money on a macro level; and days on market, capital growth, vacancy rates and other measures on a micro level.

Facts:

We need facts from reputable sources such as the Government Departments, Statutory Authorities or corporate governance documents. They need to be transparent about funding cycles so our clients are not speculating on infrastructure that has not been funded let alone scheduled for delivery.

Lower standards use local newspaper articles are generally published in proportion to advertising dollars spent. The headlines are emotive and may not be representative.

Risk:

Risk is a key part of strategy management. How do we identify the risks in their strategy to support their success? The holding phase is where many are vulnerable as it is over many years with changing market and personal circumstances. What management or mitigation plans can we implement?

This is where the advice process really shines and we discuss the pros and cons with the client.

Business focus

Reputation Management:

Our professional reputation is the backbone of our business: it attracts clients to us and gains us referral relationships. We also have Professional Indemnity insurance to take rogue clients off line from the media to support the management of our reputation.

We need the same business management standards from our property partners. They need to hold PI insurance for the advice – not just the real estate law piece as most vendors’ agents and buyers’ agents have. This gives us a silo of PI insurance for the property investment advice that is separated from our financial planning PI insurance and helps to mitigate our business risks. Some advisors may also offer referral PI insurance.

PI insurance only works with written advice, presented as an ‘SOA for property’. This document outlines the client’s needs, their current situation, their strategy, the optimisation of their property selection and considerations for the implementation of their plan.

From this foundation of sustainable business standards we have a much better opportunity to meet our client’s needs and deliver the results they are seeking through sustainability and quality of the property selection.

Disclaimer: This article has been provided to DomaCom by Rosemary Johnston of the Property Investment Association of Australia Inc. (PIAA). For more information, please contact info@piaa.asn.au.


In the press


Disclaimer: DomaCom Ltd ACN 153 951 770 is the holder of an Australian Financial Services Licence (AFSL) 444365 and is authorised to provide general financial product advice, to deal in certain financial products and to make a market in units in sub funds of the DomaCom Fund ARSN 167 020 626.The information on this newsletter is general in nature and does not constitute personal financial product advice. Any advice contained in this newsletter is general advice only and has not taken into account your objectives, financial situation and personal needs. You should consider whether the information is appropriate for your objectives, financial situation and needs. You should seek independent financial advice and read the relevant product disclosure statement or any supplementary product disclosure statement or other offer document before making any investment decision about acquiring. The information on this newsletter is intended for Australian residents only.