Forum Replies Created
Hi Julee,
Commercial property is a whole different ballgame to residential properties. I've looked into it previously, and can suggest a couple of books to read to see if you want to go for it or not. These are;
How Investing In Commercial Property Really Works – Authors Martin Roth & Chris Lang, published by Wrightbooks
ISBN 0-7314-0293-6Good Commercial Sense – Author Karina Barrymore, published by Wrightbooks ISBN 0-7314-0633-8
Both give a good breakdown as to the different options, financing, strategies etc and cost around $30. A worthwhile purchase to let you know what's what.
Just received this from a property email I subscribe to (Terry Ryder's Hotspotting);
The idea that the first-home buyers market will stop on 30 June (the deadline for the First Home Owners Grant boost) is gaining traction in the media but it is based on ignorance and misinformation. A number of organisations have surveyed first-home buyers to determine what is driving the current strong activity at the bottom end of the market. The findings in each case are pretty much the same: the biggest single motivation for buyers in the current market is soft prices, and the No.2 inspiration is the low level of interest rates (about 4 percentage points lower than they were eight months ago). A third, relatively minor factor is the FHOG. In one survey, the FHOG was a prime factor for only 8% of first-home buyers. These findings suggest that the health of the market does not hinge on what the Federal Government decides to do with the FHOG after 30 June. It?s worth keeping in mind that the FHOG has existed since 2000 and will continue to exist after 30 June ? it may be pruned a little, or it may stay the same, or it may be increased. What is unlikely to change, however, is the low level of interest rates and the attractive home prices, which are far more important in the decision-making of first-home buyers.
What has been suggested is that the additional $7,000 added to the existing FHOG (or $14,000 for newly constructed homes) last November will be discontinued after 30th June, which was always the intention, not that the FHOG will be scrapped (some news articles I've read today seem to have blurred the difference a little…).
Like all temporary measures, it has to come to an end at some point. After 30th June, new home buyers will still be able to get a $7,000 FHOG, plus any additional incentives offered by various states, such as an additional $5,000 offered by the Victorian government. My feeling is that the FHOG doesn't do a huge amount ( a recent study I read suggested that a FHOG is the primary motivation for only 7% of new home buyers), the value of the FHOG is factored in to the asking price….
Hi All,
After just having an experience similar to michaela_alvares, I'd like to add mistake number 6; not having a good property manager !
We 'inherited' the property manager when we bought the property, and given that we were new to the area kept them for a period. The tenant's just moved out without paying the final couple of weeks rent, the place was filthy, broken windows, furniture left behind, bottles and cans of beer left in the garden. Our agent 'didn't know anything about it'. Not surprisingly, we went up to the area, interviewed other agents and have just appointed a new one…..
If you're investing outside your local area, and can't keep an eye on your investment, your property manager has to be your eyes and ears. Make sure they look after YOUR investment.
In early 2008 we bought an off-the-plan for approximately the same price and same period, the deposit required was 10% which equated to approx $53,000. We decided to use a deposit bond which cost us approx $7,400 instead. Our primary reason for doing this was because we decided we wanted access to the remaining cash for other possible investments. Obviously, this is simply deferring the remaining payment until completion. Here's a few other things that we learnt…
1. Do you want access to the money for any other purpose ? If so, maybe a bond would be better.
2. Do you have the $50,000 in other assets (I'm assuming that you do, but the bond company may ask for proof of this, as proof that you can meet the obligation when due. Obviously, just because you have the money now doesn't mean you'll have it in 12-18 months time)?
3. Check out the 'sunset clause' in the contract. This will say when the building must be completed, and may be longer than the 12-18 months you currently expect. The longer the clause, the higher the price of the bond. Our sunset was for approx 3 years, even though the building is due for completion in 2010.
4. If you decide to pay the full 10% now, the money will attract some interest on your behalf, but I suspect that this will be minimal given the current cash rates. Treat this extra interest as a bonus !
5. One other thing to consider in the current climate. Although highly unlikely, the developer may go broke before the property is completed. Check out the legal aspects of what would happen for both your options i.e. using your own cash or using a bond for the deposit. Hopefully, you'll never be in the position to find out, but it's better to do your research beforehand !I've just spent the day looking around Springvale, and had similar thoughts to most of the people above. I live within a couple of KM of Melbourne CBD and we've been looking to invest in Melbourne for a while. We mainly look for positively (or neutral) geared properties, and hadn't previously found a lot of value in Melbourne.
Crunching and analysing previous growth figures and the current vacancy rates in Melbourne suburbs threw up Springvale, somewhere I knew nothing about and wouldn't have normally considered. We haven't bought there yet, but what I'm tryingto say is :-
– Don't let your preconceptions get in the way of a good deal !
