Ideal first IP?

Hey c-man

I recently started myself and now understand nobody can answer those questions but you. Questions to ask YOURSELF should be more along the lines of:

–       What are your aims and by when;
–       What level or risk/debt are you comfortable with;
–       How much time can you dedicate to learning and improving;
–       What changes are you willing to make to your lifestyle to save more.

From house to apartment, you can make a profit on both. Personally I prefer houses that require small changes. I don’t do major renovations or any sort of special financing (flips, vf, etc). You may want to start with something simple by buying under-priced property which require minor renovations.You’ll be surprised how little you really know about the process until you take action. Everyday is now a learning experience wether it be negotiating with vendors, council, or my dad (who seems to know everything)

Again that is my opinion and everybody would advise differently.

IMO, start with 2 books:
1. From 0 – 130 properties in 3.5 years by Steve McKnight;
2. 20 must ask questions for every property investor by Margaret Lomas.

Theres dozens if not hundreds more books and articles you may read from there. Oh and network with people who know more, they will not only inspire you, they will also save you a few bucks by helping you NOT make a mistake.

As for structure, there's plenty of advice here, personally buying a couple under my own name to take advantage of land tax thresh-hold, rest will be in discretionary trusts.

Gluck!

They are around and you can get them in Darwin which is where i live. I bought mine last year right behind Fannie Bay racecourse with a 10 % return from day one and when i do the renos will be 21 % return plus 800k + in equity ( Units on block ) that will give me 80-90k pa after loan repayments. Theres my passive income right there. There is another property same set up that I have my eye on after that in Fannie bay.
On a smaller scale i recently bought another in Ludmilla at 456k 3 bed elevated house also run down but after renos and adding a granny flat underneath should be positive cash flow just but in area im still going to get equity up in too.

They are there you just have to keep an eye out.

Keenan

Question for experienced investors:

We are looking at buying an investment property in the inner city (Melbourne) such as St Kilda, Elwood.

How do we know if the property will be cashflow positive?
I have used Steve’s 1 % Rule but would prefer more specific real stories from anyone else who has invested.

At the moment, the apartments we have been looking at seem to be negative geared (once we include all expenses) rather than positive geared.

Also, how much of the expenses can we claim from a cashflow positive property?

Many thanks

You claim all expenses.  The rent goes on to your income and all the expenses come off.

To work it out just take all the outgoings from the incomings and see if it's negative or positive. Don't forget to take out depreciation. Which may make it look negative (and you'll get money back) even though it is putting money in your pocket.

Thanks for the feedback. I suppose we are focusing on CF because we want to make a positive outcome in the quickest amount of time. We are already leasing out our family home using negative gearing.

We are now looking at regional areas in VIC for positive CF, places like Corio or even Ballarat.