Forum Replies Created
Thank you Richard.
When I purchased the block, is the start of the period for CGT purposes the contract date also (not just when I’m disposing of it?). It was unclear in some other documentation I was reading whether the contract date was used for CGT only during the selling part of the transaction – and that the actual settlement date might be considered the start date for the purchase leg of the transaction.
I may be able to offer the purchaser a small further discount (obviously less than our savings from the 50% CGT reduction) and see how that goes.
The issue is though, that they claim to pay you market rent appraised by an “independent” valuer. Independent no doubt means valuers that would do anything to keep their contract to value DHA properties…
They certainly aren’t paying market rent here.
The fear of ‘getting less than you could have’ is one agents use all the time to make vendors feel uncertain of themselves.
This annoys me. If an agent sells your place for $10k less than it was worth, they stand to lose $250 of their commission. You stand to lose $9750. It is not in their interest to get you the best price, it is in their interests to sell it as quickly as possible.
I’ve even been ‘sprayed’ by an agent before after declining to sell through them – i.e. having them call me and tell me “…that I could’ve gotten more and its too late for you now”.
Adam
I’m aware of the need for a real estate agents license, education and indemnity insurance.
It’s an idea I’m researching – if I don’t feel there is demand then I won’t go much further with it.
Originally posted by Terryw:
There are a few lenders out that that will let you go over 80% slightly. If you haven’t tried them, then that is a possible solution.This is exactly what I have been looking for with this thread. Can someone name these lenders?
This is a full doc loan.
Sorry to post again.
As mentioned previously Westpac said no go and the phone monkey wouldn’t even pass me on to a senior lender to assess it. I said ‘so I can forget Westpac for my business then?’ and he agreed.
We can’t gear up any of the others. The only one available for that is the paid off block of land. This would be taking money from a deductible investment (the new property that has a 6 year rental agreement) to a non deductible one (vacant land).
Its a complex situation, but I seriously thought there would be a creative broker out there who could resolve this. I’m really surprise lenders are so apathetic to gaining $1mil of new business + they can probably persuade me to bring my company accounts over.
Adam
The settlement date can probably be extended (its a DHA property and they have been very flexible) if I can find a solution to this issue.
Unconditional contracts have not been exchanged yet.
Thanks to everyone for their insights.
Sad to see a mag like API publishing something like that – I’m sure I’m not the only one who freaked out a bit after reading that paragraph!
Derek – Glad to hear you were able to help them! It could definitely have a huge impact on cash flow getting that wrong!
Originally posted by westan:
On a personal note i don’t think you should be investing with nothing down, unless you are buying something with instant equity. As Robert Kiyosaki says “the profit is made when you buy not when you sell”.Can you please elaborate on this further? To me it seems as though borrowing as much of the value as possible is always a good idea – if you are -ve gearing it seems like the most tax effective thing to do. Why use your money and tie it up when you can use the banks?
I have just started building an IP borrowing 100% + costs – only cash i put down myself was a $1,000 deposit. The property is 700K worth. I know this is the home of +ve cashflow, but I’d like to hear why the above is a bad idea.
Adam
While I agree with what HB is saying and think mitchy has done herself a good thing by changing tact, I struggle to see why age needs to be brought up in these sorts of posts?
I make more money than my dad ($120K in an average year) at 25. I’ve been making that sort of money since I was 18. We are both investing together now and will have a portfolio of a combined $1.5 million worth of property. I was in a similar position to mitchy in regards to my parents not being able to give me a head-start as they simply didn’t have the money at the time so I had to do everything myself.
Which leads me to what I think is the smartest thing to do with your time & money — education. Being the best at something is what makes you money, regardless of your age. Find your niche and hit it hard. I’m a software developer myself.
Thanks a lot.
Can you explain to me how it works? Do they just lodge another Mortgage dealing on the title certificate? Or do they physically have to do something else?
Hopefully the other land comes in at a little higher than $120 so we end up with an 80% LVR (we really shouldn’t be paying mortgage insurance). They can probably mortgage something else if that is the case.
Forgot to mention, I have gone through the figures with my accountant and he agrees it is a good move, and that our affordability is a breeze. He was unsure about the 100% borrowing but suggested it is quite likely they’ll do it as long as they can grab another 20% or so security from another property.
A 10% return? Wow.
I haven’t seen any places yet where I could get that sort of return except at the very low end of the market where the quality of tenants is questionable.
I’ll keep searching…
Adam
Hi Adam
The one on Nathan Ct is actually built by the same builder I have been talking about. Also the one we are renting on Gosse Cct is his too (we’re on the corner of Buckingham and Gosse – you can’t miss it).
The one on Nathan Ct has not actually been up for rent long. It’s the builders display home – he is renting it back from the buyer. It was bought for $365,000 a few months back. We were offered it at that price but were keen on building our own. It has a tenant ready to move in shortly at $440 a week.
The other one I think you are referring to is the blue one. It’s asking $400 a week but I think that’s pushing it.. it doesn’t look particularly nice.
Regards
AdamOriginally posted by Beanie:Adam
Yes i am refering to the gas line and lng plant.
I am also on Gosse cct two houses have been completed and trying to rent out for about 4 to 6 weeks (one is on Nathan ct) Raine and Horne are the rental agents.I would ring them and ask what rents they are trying to get and how long the properties have been untennanted for.Hope this helps you out regards AdamLive every day like its your last.
Learn how to create enough passive income to retire using shares,property and the internet.
http://www.renovateyourfuture.comLive every day like its your last.
Learn how to create enough passive income to retire using shares,property and the internet.
http://www.renovateyourfuture.com
[/quote]Dazzling,
The Darwin market is interesting like that. Land is very cheap here, but building a house is extraordinarly expensive due to cyclone coding etc. Distance probably doesn’t help either.
To build a really basic, 3 bedroom box you’re looking at $200,000 + land. You can get 600m2 of land up here in a less-expensive new estate for about $60K.
The home we’ve just built we spent $90K on land and $360K on house + landscaping.
I imagine the price of the land is largely due to the fact that there is so much available. There are new estates in Rosebery, Farrar, Gunn, Durack and now Lyons.
If you only considered 70% land value here, you could spend $400,000 on a marina waterfront block in a premium spot (800m2 of land, 200m2 of water title) and you’d only be spending $570,000 in total which is $170,000 on a building. You cant build anything at all for that here – you wouldn’t even be doing the land justice by spending less than $500,000-$600,000.
Adam
Beanie: When you say ‘construction’ do you mean the gas pipeline etc? The investors who our builder has built houses for seems to rent mostly to DHA but also to companies like Bechtel. Thanks for the heads up on that – Gunn is certainly a rapidly expanding place. I’m living in Gosse Cct at the moment and just around the corner are some new streets just developed.. all sold.
MIKALA: Thanks for that.. that’s awesome!
Anyone else? Am I dreaming of doing this on our income and with minimal cash at hand (about 5K – but we save about 3K a month)? Should we wait until we’ve been in our new house for a while and watch the market?
