After reading Steve’s book i am looking forward to what is ahead. I would like to get started ASAP. I have began searching for properties and when the right one appears what is my next step?…do i use my first home owner grant??? even though i wont be living in it.
Would be nice if you could! -Unfortunately you cant use the FHOG for investment purchases… I think you have to live in the proprty for at least the first 12 months (am I right?)
Get stuck into it mate, and good luck. I think property is great, theres so many ways to make a profit!
Luke [^]
a relative of mine believed you had to stay in the property for 12 months, but then rang to find out about it, and it just had to be proven that you had lived in it for a period of time, a couple of months after buying the place, he rented it out, and everyone was happy. examples given to him by the FHOG ppl that he spoke to was that you had all your bills forwarded to your new address, etc.
he checked first to make sure he wasn’t breaking any laws, and they were happy, now it’s his first IP. and he moved back in with his folks.Matt – you aren’t are certain EDRUFC person are you?
‘Eat rich food, barbeque a yuppie’
Matt, your first step is to contact a mortgage broker, and work out what you can borrow, and what you have for deposit etc.
I believe NSW has changed the laws so that you must live for 3 or 6 (can’t remember) months to keep the FHOG, but check it out. If it’s an IP, you can’t get the FHOG.
However, buying an IP, and NOT living in it, you can still get the FHOG when you buy a PPOR.
Cheers
MelOriginally posted by melbear:However, buying an IP, and NOT living in it, you can still get the FHOG when you buy a PPOR.
Hi Guys,
What Melbear, said is correct. As long as the persons, interest in the property have not had an interest in any property prior to July 2000. Or any person July 2000 post. If so, you will need to get the property in the name of the person who has had, no interest before.
Cheers,
sisHi there….I was in your boat a couple of months ago…I wanted to buy my first house/unit. I ended up buying a unit and using my FHOG for legals and renovations. But you have to live in the place for a couple of months, you also have to make sure you change your address with department of transport and electoral roll, all your bank details basically everything needs to come to new address. I am about to rent my place out and I have been there for 5 months now. But I can show that I really lived there but had to move out coz my circumstances changed. Best of luck
[
]Check the Office of State Revenue website for your particuar state, but as of January 2004 in NSW you have to live ni the property for 6 months within the 1st year to be eligable for FHOG.
Have you read any other books on property investment in addition to Steves. There are many good ones out there. My first ever books on the subject were Jan Somers. My advice to anyone after they buy their PPOR is to read her stuff. She has been investing alot longer than 3.5 years.
Originally posted by yack:Have you read any other books on property investment in addition to Steves. There are many good ones out there. My first ever books on the subject were Jan Somers. My advice to anyone after they buy their PPOR is to read her stuff.
Or why not before they buy their PPOR for that matter? [
]I notice that your own investing philosophies favours cap growth whereas McKnight’s emphasise yield.
Your above point implicitly assumes that Somers and McKnight are diametrically opposed on the question of yield versus growth.
I have not found this to be the case as the diagram at the URL shows:
http://www.alphalink.com.au/~parkerp/invbook.htm
Even though Somers may sometimes be associated with heavy negative gearing and growth strategies, when you actually read her work, she is very even-handed between the merits of growth and yield.
Her article in the July/Aug 2003 Wealth Creator ends any doubt on her stance. For instance she cites examples of investors doing equally well by investing in Hobart (high yield) and Sydney (high growth).
Your own perspective seems to be much closer to Wakelin/Fitzgerald than Somers. No doubt this approach works and is perfectly appropriate for some people. But I find Wakelin extremely one-eyed, even though it is quite clear that her strategy is inappropriate for some (especially on lowish incomes or due to retire soon).
McKnight, though a strong advocate for positive cashflow, does see a place for growth type investments (not always property) whereas his opposite does not for yield investments.
My own personal view (prejudice?) is close to the Somers line in that both yield and growth oriented strategies can be made to work. Also that people have different incomes levels and ages and one of the other, somewhere in between or a mix usually works out to be the best choice for them.
Regards, Peter
peterp
Well summed up. I suppose you could say there are 3 different styles.
McKnight – rural/postive geared. High Yield.
Somers – middle ring surburbs near your house. Combination of yield and growth.
Wakelin/Fitzgerald – closer to city, mostly negative geared, high capital growth.My personal thoughts on the following
Mcknight – the positive income on rural properties not worth the effort/hassle in the long term. Too far from home, travel, historically low capital growth.
Somers – I favour this. Invest close to home for growth and yield. But properties probably are negative geared.
Wakelin/Fitzgerald – acquiring properties in innner city is too expensive, and having a young family, the high negative gearing is not for me.
Hi Yack,
Another good person to add to that list, i think is Margaret Lomas,
Shes a more in between Jans Somers and Wakelin/Fitgerald… her strategy involves purchasing -ve geared property, that can be highly depreciated but at the same time returning +ve dollars back in tax rebate. You could probably say she is also an all rounder, which i honestly feel is better, as you have more balanced but more diversed portfolio.
Though each of these 5 people mentioned, you could easily say, they have a strategy, they stick to and it works for them…
so really, maybe there is a strategy out there for everyone, its just knowing which strategy works best for you…
Cheers,
sisOriginally posted by Still in School:Hi Yack,
Another good person to add to that list, i think is Margaret Lomas. Shes a more in between Jans Somers and Wakelin/Fitgerald.
On my diagram I put Lomas midway between McKnight and Somers.
This is because:
1. McKnight insists on positive cashflow before tax
2. Lomas insists on positive cashflow after tax (but negative before tax is OK)
3. Somers insists on neither but is always saying that ‘the recipe can be varied’ to suit circumstances.However both Somers and Wakelin are insistent on 1. buying & holding and 2. buy at any time.
This is in contrast to older commentators like Austin Donnelly who say that time of purchase is most important. Fitzgerald takes a different tack by saying it’s OK to buy most times, but avoid the couple of years near the top of a boom.
Though each of these 5 people mentioned, you could easily say, they have a strategy, they stick to and it works for them.Yes they do all have a strategy, but they are insistent on different things. McKnight/Lomas and Wakelin occupy different points between YIELD and GROWTH and peddle their line very firmly in their books.
In contast Somers is more ‘all things to all people’, saying that several approaches can work. She has strong stances on some things (notably buy and hold and timing is NOT important) but not yield vs growth. Anita Bell is another who doesn’t have a particularly strong position.
Wakelin is sloppy on cashflow, while McKnight is less fussy about property construction style and location provided cashflow is OK.
Jim McKnight’s Ordinary Millionaires book features Somers and says that many of the people profiled spoke well of her approach and ‘buying as much as you can afford to hold onto as soon as possible’.
Regards, Peter
I have read most of the books by those mentioned, including Paul Clitheroes (a few) and many are property focussed
But there are many investment types and these diverse classes should not be overlooked in your portfolio. Note the old saying, dont put all your eggs in one basket!
Start somewhere even if it isnt in property, you can alwasy move sideways….
I found Margaret Lomas’ books very general or maybe I had read too many! I have to be in the mood to read Robert K’s, but found the Babylon book easy to read but with a message.
My library is full of how to books…get rich and stay rich by 40- types Wealth creation….to the point I give up, because they all have their own style, but are all saying a similar thing, and making money on it at the same time….I gave up reading and went out and did something about it.
cheers
Elves
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