Hi all,
After spending months reading the posts on this forum as well as Steve’s books, I am interested in hearing any advise you would have for someone looking at moving into this type of property investment.
I currently have quite a number of negatively geared properties … all purchased in the ACT in 2004! Ideally I would now like to pursue positively geared properties with a view to balancing out my financial committments over time. I envisage buying enough positive properties to pay for my negative properties!
Finance is fine if I want to buy positive properties. I am going to book into Steve’s April seminar to increase my knowledge, but I ultimately think I will need to use a ‘bird-dogger’ due to time restraints of my family and business!
I would love anyone’s advise on this theory! Does this sound unrealistic???
Thanking you all in advance,
Anne
Firstly, refinancing most negatively geared properties in Australia into an Interest Free loan would make them positively geared. I would concentrate on this first.
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[withstupid]
The forumite formally known as Big RobHenry, is that all you do?
Enter a forum give an entire bunch of negative comments then leave?
Why don’t you give it a rest.
Anna, can you tell us more about these properties you have. Land size, what is on them etc.
YOu can PM if you like so we can discuss further.
Byronent
Adelaide SAHenry, firstly, my name is NOT Bob.
Secondly, I am giving qualified information. Why waste your time with a loan that attracts interest when you can get one without any? Nothing compares to it.
I thought Anne was looking to balance a portfolio or reduce expenses. My solution was given.
By the way, if you want mortgage advice, ask admin. I am just here to have some fun these days and make the odd comment about interest free loans. If I was to advise someone into a loan with interest, I would be doing them a disservice!!!
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[withstupid]
The forumite formally known as Big RobThank you so far … a little more of the story ….
We live in the South of Sydney and own our home (my life long ambition at 22 finally realised). We were able to build a dual occ here and hence our first IP. In 2004 I purchased 5 properties in a new developing suburb of Canberra. All properties were purchased on 80% loans … all loans are interest only loans.
Basically, the rents all cover the 80% loans and other fees, and we are responsible for the other money borrowed through our old redraw (approx. $30K a year).
I really don’t want to sell these properties as I have a 15 yr plan (now 14) on keeping them and selling them off for retirement! I do have the lingering thought of ‘a loss is a loss’…. but I’m so proud I bought them and finally did something!
One of my 4 children is disabled and long term financial security is of the utmost importance to us.
In simple terms I was wondering of anyone’s view to my situation?! Once I buy my first Steve Style IP … then I’ll be right! I’m a bit of a goer and like to do things whilst motivated! Would anyone advise to sell my Canberra places, or do you think I could move straight into Steve Style and do the balance?!
Thank you all,
Anne
Anne
Elite SportswearThere is no such thing in life as a mistake … mistakes are really just new learning experiences in disguise.
Anne,
I had two negativley geared properties when I read Steve’s book and decided on a change of appraoch. However, I was and still am happy with the growth these properties are giving so didn’t want to sell either.
So, I didn’t, one cost we $30 a week, so I went and found a +ve geared property that earned that amount so now the extra on one covers teh shortfall on the other.
The second negativley geared property was only -ve by $5 per week so rent rises over time has sorted that one out, it’s now neutral but give it a few more years and it will be +ve.
I have bought another since that is also +ve by only by $8 a week, but it does need a paint job that may improve the rent a bit and other than that, time will help.
So, yes, you can purchase +ve geared and still keep the -ve geared ones, you may not accumlate as many +ve geared ones as someone else who doens’t have funds tied up, but then if you are getting growth tat you are happy with then you may not need as many.
Work out your long term goal, what are you hoping to achieve and that may help. for instance the -ve one we have that is achieving good growth will eventually be sold to pay off the mortgage on our own home, but +ve geared ones will be kept to give us an income as we don’t want to be 55 or older whenwe retire.
THis is just my situation but hope it helps a bit.
PK
Great post Purple.
Anne, Factor in all the selling costs inc CGT. You might find selling becoming less and less attractive.
Perhaps an answer is building the portfolio further?
I believe there to be a lot of positives to ACT property and I personally wouldn’t be rushing out selling.
All the best,
Simon Macks
Interest Free Home Loan Agent
[email protected]
0425 228 985Please email me rather than using the PM service here.
Fully Accredited With Derivex LTD and IFHL PTY LTD
***Ask about our Interest Free Home Loan***
Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
Thanks so much for the great advise. I am very keen to hold on to these properties and I do believe in the capital growth of the area in which I bought. I can maintain the out of pocket expenses on the -ve’s, so I will now work on finding the +ve’s!!!
I’ve enjoyed reading your feedback and appreciated getting other people’s opinions.
I’ll keep visiting these boards, it’s a fantastic learning tool for me!
Thanks everyone …
Anne
Anne
Elite SportswearThere is no such thing in life as a mistake … mistakes are really just new learning experiences in disguise.
Hi Anne, this is an interesting topic.
We did the opposite. With what we learned from Steve’s first book. We bought 2 IP’s, both with P&I loans and both with 20% deposit, they are both +ve, in the country, but in areas where they are achieving growth also, slow but better than money in the bank.
As we don’t own our own home, or much super, we then bought a -ve geared property at $10,000 under market value. We did this as we can afford the repayments, there is nil vacancy in the area and capital growth is much better than in the country.
I know it goes against grain on this site,but also believe each situation is individual. For us finding another large deposit was going to take two more years and the area where we bought is a long established good growth area, that we have personal knowledge of.
Time will tell is this is wise or not, but having these properties gives us options also.
I wish you every success, dianeHI all, an “interest free home loan?” what is it? surely you get nothing for nothing?
Rocket,
Before everyone rips into you, look under the search function for Derivex… Big Rob/The Mortgage Adviser goes into great detail on interest free loans. Have a look, it will answer all of your questions.
Cheers,
Destined
I am a big believer in having a balanced property portfolio. At the moment I have 3 neg geared properties and I have subsidised the loss from them by purchasing + geared properties. Now when purchasing – geared IPs I then purchase a + geared
IP, so I’m not out of pocket.If I was in your shoes I wouldn’t be selling any of your properties if you can afford the repayments.
Financial Wellbeing Coach
W: http://www.pfsfinance.com.au
E:[email protected]
E:[email protected]Development Finance Specialist
Henry, my post did not call it a pyramid scheme. When I initially looked at the funding model, which I did not understand at the time, I said it looked LIKE a complicated pyramid structure.
Further investigation and discussion with the people at Derivex and IFHL addressed many of my concerns and I tried to relay the message. If this was a property investment, you guys would call it “due diligence”.
<edited>I have helped heaps of people from this website on and off the forums. I have been inundated off the forums and I never tell them to come to me for finance.
I challenge you to find a single person on this forum that I have pitched a sale to. I have no intention of writing any loans from people who contact me through this forum. <edited>
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[withstupid]
The forumite formally known as Big RobHi all,
I’ve always enjoyed Rob’s posts and his contributions; he comes across as a straight talker and not afraid to voice his own opinions. This is after all a forum and all readers (i hope) are able to read and decipher for themselves.
So lets not get so worked up and personal with your posts.
AND most important keep your posts coming, Rob! Some of us appreciate the effort and don’t see it as self advertising.
lee
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