Positive cash flow in very poor towns. Ideas are:

Thankyou chan, as always for your input.

thanks qlds007. One query… wrapping properties in the areas I speak of is difficult. They are awesome for having a property pay itself off , but difficult to sell.. I.e a house on an acre of land in the middle of a town of 400 people. Sold for 14,000 and rent is 50 dollars a week. thus in only 5 years you have 14,000 with minimal effort, and a bank manager eager to lend you more money. BUT it took 3 YEARS to sell the property. See the dilemma.There are often no capital gains in the places I speak of.

Thats good sense every body, and your thoughts are interesting, but in the smaller towns, as Im sure you are familiar with, the peole come from the lower socioeconomic bracket. They live in the town as unskilled workers, i.e shearers, shopkeepers, mechanics, truckdrivers,the odd couple of teachers even full time wellfare recipients etc. These people do not have enough money to live a different lifestyle anywhere else, and they don’t have the mindset to save and afford their own homes, so they rent for the equivalent of 4 packs of cigarettes a week, generalising of course. (50 dollars) or if your lucky, one hundred dollars if you want to deprive people of thier alcohol and gambling. This is not a criticism of these people, just the way it is. These people are content with thieir lives and they gain pleasure from the things a very small town can give. They don’t mind staying in crappy accomodation, (again a different mindset) and they are not going anywhere, you often have the tennants for life and yes it may be vacant for a period, the max I have come across is six months, because there are always unskilled, unmotivated young parents wishing to move out of home to get away from mum and/or dad. These populations are static and thus there is no capital gain on the property, and vice versa, no loss, apart from the renovations you may need to do, and really, rennovations are as QLD007 put it, rewiring etc, not adding rooms or spas. these people don’t expect or really wish for that.I guess the challenge is to find the property in these places that will need renovation in 15 years time, use the positive flow from the last ten years (first five paid for the property) and then sell the property. The number of these types of places you could own is infinite. I.E. property buys itself in 5-10 years, you use the flow from the next 5 years to finance refurbishment, then you sell the property and all the others you own. your goals are set by the financial sum you wish to receive at the end. Noting that many people in the very small town are willing to undertake their own maintainence, i.e again its the mindset of rural, hard working people. Any more thoughts people, this is an interesting topic, very stimulating. NOTE: the only person who you could wrap with in these places is another property investor, I feel. Not may are interested in buying houses. People struggle to raise even half the funds needed for a 20G house and banks don’t want to know these people (unfortunately?) I guess, overall, we are considering the option of maintaining people in a state of hopelessness, but this is not an ethics string, its a business and investment string. More thoughts on dirt cheap property in these types of places??? this is good.[] NOTE most of these places are sold privately, thus no realestate costs.

thanks for the interest 007, chan and others, appreciated.Your thoughts make good logic…have a look at my logic.. maybe property investors could say “never invest in a town larger than 500 people”