Is property riskier than running a business?
Seb's answer is that it depends far more on the decision than on property itself.
He doesn't dismiss the worry. "You're not wrong in considering the downside of property," he said. What if the market falls? What if the business has a slow year? Those are fair questions.
But business owners already live with those questions every day. A business can be knocked around by a lost client, a new competitor or an illness, and you started one anyway.
Seb was also clear that nobody can guarantee a property will perform well. In his view, though, good research and the right team make ending up with a poor property far less likely, and less likely than something significantly disrupting your business.
That's the distinction I'd want every business owner to sit with. "Property" isn't one risk. A well-located property bought with research, sensible debt and buffers is a very different proposition to something bought on a tip from a barbecue conversation. The risk you can manage is the quality of the decision.
It also helps to be honest about what you're signing up for. Property isn't passive. It still takes input, just a lot less than a business. As Seb put it, nothing is truly passive, but it's more passive than working a nine to five.
What does waiting actually cost?
More than it appears, particularly for business owners.
Delay feels safe because nothing visibly goes wrong. Seb's argument is that money sitting still loses buying power over time. His example was fish and chips: the chips haven't changed, but the money you hand over buys a lot less than it used to. Savings still earn interest, and holding cash makes sense for buffers and business needs. But keeping everything in cash isn't free of risk either.
The less obvious cost is borrowing capacity.
During the conversation I put it to Seb that, for serviceability, you need to be investing while the business is producing income, not after. He agreed, and described a recent conversation with a man in his 70s. He had substantial equity in his home and was, by any measure, in a strong position. But without the income to service new lending, there was little he could do with it.
Banks lend on what you can repay, not what you're worth. Seb's point was that if your income doesn't show you can meet the repayments, lenders won't approve the loan, and under responsible lending, they shouldn't.
For business owners, that creates a timing problem that's easy to miss. Your strongest borrowing years are often the ones you spend heads-down in the business, which is exactly when property tends to get put off. Wait until you step back, and you may arrive with plenty of equity and far fewer ways to use it.
How lenders read business income matters here too. Seb explained that many lenders average your last two years of financials, while some will use the most recent year. If your third year was much stronger than your first two, that difference in policy can change what you're able to borrow.
When should the business come first?
Often in the early years. None of this means every business owner should buy property now, and Seb was careful on this. In the first year or two, he said, reinvesting in the business may be the better move, because the return on that money can be substantially better than what you'd get elsewhere.
His test is a practical one. If you can put money into the business and get more back, that's a reasonable place for it. Property comes into the picture once the business is stable and your financials support borrowing.
At that point, Seb sees property's main advantage as leverage. Instead of investing dollar for dollar, a lender might provide around eight dollars for every two you put in. The idea is to let the bank's money work in the background while you keep building the business. That same leverage is why the quality of the asset matters so much. It magnifies the result either way.
My own takeaway is that it's rarely business versus property. Business owners tend to reinvest, pay everyone else first and let their own wealth building slip down the list. A framework I've come across splits wealth across three areas: business, property and shares. The idea is to pick at least two. You don't have to do everything, but you do have to do something. That's the thinking behind Second Wealth Engine: building wealth beyond the business while the business is still doing its job.
What makes the decision less risky?
When Seb talks about reducing the risk, he keeps coming back to the plan rather than the property.
Start with the goal. Before talking about how many properties or how much borrowing, Seb asks what it's for: being able to retire, funding your kids' schooling or something else. Then you can work out how many properties you'd need to buy safely and how to fund them. In his words, the goal is "the North Star."
Get your advisers talking to each other. A broker, accountant, financial planner and property adviser can each be right and still give conflicting advice if they don't have the full picture. Seb said he'll get on calls with a client's accountant and is comfortable with some friction, as long as everyone is working towards the client's goal. Questions such as whether a trust or company structure makes sense belong with your accountant, early.
Buy property that can carry itself. This is where the property decision feeds straight back into lending. Seb explained that when a bank assesses a property, it discounts the rent and loads up the costs as a buffer. In his illustration, a property that roughly pays for itself in reality can look like it costs around $40,000 a year on paper. The exact approach differs from lender to lender, but the principle holds: that gap can decide whether you can buy again. Buy the wrong property, he said, and the whole strategy no longer works.
Protect your borrowing capacity. Seb's example was a $40,000 car loan at around $200 a week. It feels minor until it significantly reduces what you can borrow for the property you were actually working towards. Talk to your broker before taking on other debt.
The benefit isn't only financial. Once the plan, funding and budget are in place, Seb said, you "can live life and be guilt free about it." The dinner out stops feeling like a decision about your future.
What I'd take from this
Your best borrowing years may be now. If your business is producing strong, well-documented income, that's an asset in itself. It won't necessarily be there in the same form later.
An asset base protects the business owner, not just the portfolio. If the business slows, or someone gets sick and you can't generate active income, assets built in the background might be what gets you through. Eventually they can keep paying you after the business is done.
Do the groundwork before you need it. People who finally decide to act often hit friction, because the books, structure and borrowing position aren't ready. The sooner you have that conversation, the better.
Questions worth taking to your advisers
- For your accountant: Is my business at a stage where reinvesting still beats investing outside it? If I do invest, what ownership structure suits where I'm heading, and how do the negative gearing and capital gains tax changes legislated in 2026 apply to a property I buy now?
- For your broker: How would lenders assess my income as it stands today, and what would this purchase do to my capacity for the next one?
- For your property plan: What does this property need to do in rent and growth to support the plan, rather than block the next step?
Seb's best reframe came near the end of our conversation: "it's not whether I can, it's how do I get there." If you want the detail behind these ideas, the full conversation is worth your time.