Hi Steve/Julian,

Thanks so much for the input and advice. I’m going to re-read sections on the lease option in the book ot try and gain a better understanding of how it works.

Re the property being negatively geared. When I bought it (2000) it wasn’t for investment, but to be my main home. Mum and Dad emigrated from the UK shortly after and have been living there ever since. With work being bad, I’ve had to come to the mainland but will go back there perhaps at the end of 2004. The girlfriend and I won’t live there (we want somewhere with more land), so in effect, it has become an investment property. Captial gains have been good, but Steve is right, it’s a really awkward situation – I can’t sell it from under my Mum and Dad (they’re retired and love the place/area). They would buy it if they could, so I guess ít’s a question of waiting for the visa, and in the meantime trying to either reduce the drain on my income or hopefully turn it into a positive cashflow situation.

One of the advantages I have is that it’s on 13 acres, and set up for horses, so I could provide an ajistment service to gain extra income.

Re negative gearing – Steve, I’m with you. I’ve recently starte studying financial planning (passing exams etc with credits!), so I understand the limitations of the strategy. FP is not my background, but I’m interested in it, if nothing else than to improve my financial position through greater knowledge.

Julian, you’re right about the 100 properties. It’s just a figure we thought we could achieve in a reasonable timeframe that would provide us with the income we want, but we’re flexible about it. We know it won’t happen overnight, and are prepared for a mix of residential, commercial, and perhaps overseas (I used to own a house in the UK and Europe, and know some of the areas well).

So, next steps for us is to look in to the lease option strategy, investigate areas such as ajistment, try and get me a job back in Canberra to reduce the weekly outgoings, bang the pennies away in the offset account, and look for properties.

We’re not doing too bad, as Supers are taking care of themselves (most of mine is in the UK and not subject to tax), and we ALWAYS pay off the credit card monthly without fail. The balance is virtually always nil, which is great, and we dont impulse buy ever. We don’t have any store cards and have nothing on the never never. Plus although we own two cars, they’re cheap to run and we paid cash so owe nothing.

We just need to get started on this strategy of replacing job income with passive, and clearing up the house situation in Tassy is the first start. Thanks for your advice. I may get back to you with some questions about the leasing option.

A quick note about horror tenants after reading your book Steve. I owned a property in the UK and rented it out to a young Mum – one kid. The agent vetted her for me and everything seemed fine. I trusted the agent with the vetting, plus inspections, andanyway, I felt sorry for the girl! Months later I got a phone call from the agent “saying that I’d better go around there. I provided the property furnished – she had put my 3 piece suite out in the back yard which was enjoying the UK weather (read rain), demolished 2 new beds and mattresses, kid had scribbled everywhere, she had wrecked the garden and taken things out of it, and the new cooker I provided was as useful as a chocolate billy. Kept all the bond but still didn’t cover all my losses. I learned from that!!

Cheers
Phil