Forum Replies Created
Bronny,
I certainly saw that program on ACA. Good luck with your property.
Shirley,
I wouldn’t be withour landlord insurance. If the tenant trashes the house or skips, you are covered, to include non payment of rent. If the tenant has a party and the guests cause damage, you are covered for the damage.
Our rental manager for our Queensland properties arranged this without us having to ask, and we have arranged L/L insurance ourselves on our NSW properties. The average would be say 70c a day, not much for even multiple properties when you consider that you could have $10000 of damage and no cover. As you said, it is tax deductible.
Anna
We’ve bought a few properties, sold one, in Queensland this year and settlement was 30 days. Our Qld conveyancer said it is usually 30-45 days providing there’s nothing unusual in the contract.
All our NSW properties have settled in 42 days or by negotiation, except for the last because the vendor’s solicitor forgot to notify the tenant that the property had been sold. We didn’t settle as we did not want the problem of giving notice to the tenant which would have been 60 days as owners, and maybe having problems if he had not moved. A nuisance as we should have finished the renovating by now.
Anna
Hi Evo,
Have renovated both houses and units. Found that fresh paint and floor coverings are a big improvement, floor coverings being whether polished boards, carpet, laminated flooring, cork, tiles, but all done to suit the property, area, type of tenant.
Also we have changed light fittings in a couple of units and houses and this has also made a difference, plus the switches, often change single power points to doubles too. Also changed internal doors on one house to panel doors, eg. 5 doors @ $55ea.
We like a tidy kitchen and bathroom as well and have replaced doors and retiled, replaced tap fittings, toilet seat.
We go for medium cost, not the expensive stuff, but not cheap looking. We have similiar ideas to Fatboy in that we renovate to what we would be happy to live in and it has certainly paid off.
We also buy things at builders/renovators auctions and sales, specials, end of range tiles, etc and save a lot of $$. Sometimes end of roll or remnant carpet.
Anna
Hi Mikeej,
I would certainly speak to an accountant who knows property investment. It depends on your strategy too, whether buy/sell or buy/hold. We had a meeting with our accountant only last week and realised a couple of our properties would have been more beneficial to have been in partner’s name only as highest earner, wrong advice from a previous accountant. We are just selling a 99/1 property which was correctly set up some years ago.
Anna
Hi Gengis,
The S/D is a big expense for sure, even bigger when there are multiple properties. And we all have to pay, but you have taken the plunge and become a property owner – congratulations. Maybe a review of S/D that we hear talk of from time to time will happen but we wont hold our breath!! S/D is less on Queensland property purchases.
Anna
Well said Mus and Wil. We also don’t have the time to manage investment properties ourselves as there is a huge amount of paperwork/computer work in just keeping things up to date so next year’s tax is ready on time.
Just my thoughts, but even though I work casual in property management, I am more than happy to have all our properties professionally managed. A few of the reasons are some are interstate, time, don’t want to have such a raport with the tenant that should things go wrong, I would not be able to evict them, nor would I like to have to go to the tribunal or do 3 x monthly inspections or review the rent. When the time comes, ask around and see what you get for your money from several agencies and negotiate your rate.
Anna
If you ring Cameron Bird they will send you their latest project with estimated income for the property and what depreciation can be claimed, etc. resulting in the cfp. You can get on their mailing list. We’re going to Cairns soon and will probably have a look at what they have there.
Anna
Go to the newsagent and buy the project and kit homes magazines. They have heaps of designs and prices for all types of homes, single, split level, 2 storey.
And yes, they do give their web sites. This particular mag is called Build Home and the web site for it is http://www.buildhome.com.au. They have a WA advertising manager.
Just looking at a couple in a best project and kit home book – 2 storey looks fantastic, 31 squares, from $136,000. They usually give the basic price, it’s what you add or any changes you make. Another, $206,000 – 35 squares, yet another $286 basic price, for 45 squares.
Anna
Hi Actube,
Welcome to the forum. I spent about an hour on the net last night, realestate.com and found a few properties under $80,000 and as some of the other properties in the area stated what the rental return would be, I would have a reasonable idea even though it might not always meet the 11 sec rule. I usually then ring the agents and ask. With some of the property profiles, if you click on the agency in the top right hand corner, you might also get other info, such as rental listings, area profile. I have done this and found it helpful when buying in Qld.
Don’t forget to invest in Australian Property Investor magazine and Steve’s book of course. Read all you can.
Anna
Hi Jmskim,
I also recommend you read everything you can on real estate investment and possibly a good idea would be to invest in three of Robert Kyosaki’s books, Rich Dad Poor Dad; Retire Young and Retire Rich; and Guide to Investing. They’re a great start and really motivating. You might even catch one of his seminars in the US.
Also pick up all the real estate listings you can by calling into the real estate offices. Take their free brochures of listings and you will have
a guide of prices of properties in the areas you are looking at. We spent a little time in the US and Canada a few years ago as two of our kids were living over there, one in Seattle and one in Calgary. We did a lot of travelling and I’ve still got the real estate magazines I brought back to Australia.Good luck with your work and investing.
Anna
Hi Abbee,
We have used KRG Conveyancing, Gold Coast Branch, and service is excellent. They keep in touch with everything that is going on by phone as well as by mail.
I would go with a broker from this forum, they’re very helpful and willing to answer any questions uou might have. And I guess they are investors themselves, so know what you want to do.
Anna
Hi Nathan,
We have a 2BR holiday unit in FNQ from which we get pooled income. It is managed by a good onsite manager who paid considerable money for the management rights – it is his income and he is there working you may as well say, 24/7. We paid $95000 for the unit (includes all furniture, whitegoods.) The income is seasonal and can range from say $500pm to currently $1500. Not all the units in the block are in the ‘pool’ and we have just let ours our through the onsite manager for $250pw. With the pool, you have other expenses such as I think 17% commission, room cleaning, linen hire & clean, electricity, Pabx hire, advertising, audit, Austar, etc. It’s quite a lot and of course as well as the income from the units that are rented, all these other expenses are divided among those unit owners in the pool.
Income goes down from around now, is big in winter, that is up north where our unit is. Even though ours is OK, I would not recommend this type of investment as it is surely better to get a consistent income. The onsite manager would not be impressed if the unit were to be let by an outside agency either as he would lose income.
On top of the expenses, you also have B/C and rates.
Anna
Everdine,
Mightn’t be a bad idea to weed and mulch the garden area so it looks good and fresh. Then the tenants can put their own potted shrubs around and take them when they leave.
The last place we did was neglected all round, so we weeded and tidied the garden beds which were edged with bush rocks. We ordered a big load of cyprus mulch which the people at the landscaping place said was a deterrent to weeds and white ants. It cost about $65. It looked really good and the managing agent commented as well.
We also trimmed most of the other plants as we have found that some tenants don’t have the time for gardens or aren’t interested. Then the ingoing condition report says that the grounds are tidy etc. and we expect them to be in similiar condition when they move out. I mention this because the agent said that the grounds were bad when the previous tenants moved in and so they would not do any garden work at all. Her mistake initially.
Anna
Hi Lee,
It would be a great way to go, to renovate and flip a few. We have some acquaintances who have done just that, and they have done very well over several years.
We’re located in Hunter Valley – prices have gone up here like anywhere else & it’s getting harder to find locally. Missed out on a house about three months ago, was going for $80,000 and yesterday I saw a sign on it, rang the agent and it is back on the market for $162,000 renovated. Looked good too. As far as finance is concerned, that is loans, I think the best idea is to have that LOC so you can buy when you see a property and renovate it, then sell or refinance and rent it out, and pay back the LOC, then go on to the next. The moving wouldn’t be a problem then. I’ll be searching again as soon as this next unit renovation is finished.
Anna
Hi Nathan,
I agree with Bill in that size of the unit may be a problem for future sale or refinancing. But on the other hand, our daughter has had a similiar size unit in northern Sydney suburb for about 7 years, never untenanted. Good block with heated indoor pool. She recently sold a smaller 1Br with 2 balconies which were a great advantage, on market less than a week.
We also have a couple of units that are less than 50sm internally but we found that some lenders take into account balcony as living – which it is – and also garage/carport as well. These two are great little units in FNQ always rented & cfp.
And yes, as Bill said, why not offer $130000. We did just that – from $159000 and will be starting to renovate the 1BR unit in a week or so. I kept seeing it in the paper and thought there must be something wrong. It is bad inside, old chipboard cbds literally falling apart, needing paint, light fittings and floor tiling upstairs, carpet downstairs in the bedroom but it is in a trendy area, eg. the cafe set area and near beaches.
As you say, the unit you’re talking about may be a good start into the property market and even if you later rent it, there’s not much to rent under $200 a week in the outer Sydney area where I guess you are. Anyway, do all your searches and inspections to be sure.
Anna
Hi Alf,
I remember at one of The Investors Club meetings a few years ago, someone said something like ‘I rent my son’s property, he rents mine and we both have an excellent tenant’. Seems to make sense if it is where each wants to live and you can always change back if it isn’t working out.
Anna
Hi Steve,
Our accountant claims for all of the above. We have a wide enough margin on most properties that they are still cfp after taking such costs into account.
Anna
Thanks Lee,
I would really love to do some renos in rural towns after research etc. Sounds like Montrose is doing fantastic work. The only thing would be that we would have to live/camp in the place if it was some distance away and also it would have to be done quickly, the sooner it is finished, the sooner it rents. The house we renovated a few months ago took 8 weeks which was too long but we both worked in between. It was very shabby and we did increase the rent by $40 a week though.
I do like the thought of say 3 lower end of the market renovate and sells a year, making even $20000 after costs and CGT. Two of our houses have cost round $8000 to renovate, both 3 BR places. In one we put a good second hand kitchen for $500 + benchtop, made bathroom larger and laundry smaller by moving a wall, took up carpets, polished floors, new tiles & tap fittings, new floor in 1 bedroom, repainted inside, new internal panel doors, cleared yard of a lot of rubbish. The one we did recently was painted inside and out, landscaping redone, most of floors polished, left the cork tiles in the kitchen and family, new light fittings, verticals, new rail round the large entertaining deck, extra cupboard and small pantry as well as 4 of the kitchen cupboard doors replaced, new handles, new bathroom incl. vanity, tiling, etc.
Anna
Hi Gracey,
You certainly don’t appear stupid – there’s a lot of learning in property investment – most of us learn something every day whether in property investing or life in general.
When you click on the I Agree when you sign into the forum, you will read what the Moderator does, in other words, moderates or oversees what goes on the forum, can delete/edit if not appropriate.
Also some of the books relating to property have a Glossary in the back, same as study text books, that is a list of words and their meanings to do with the subject of the book. A couple I have with such a list are The Property Investor’s Handbook by Graham J. Airey and How to Create an Income for Life by Margaret Lomas.
You will also learn as you go and read more. Good luck.
Anna
Hi Lee,
just wondering what you mean by rural properties. Are they properties on say 2, 5, 10 acres or more. Came across a property on 5 acres which needs fairly cosmetic reno, that is painting and carpet, and the grounds tidied up, old sheds removed, driveway improved. There is such a demand for rural property at the moment. We live on a larger rural property – always something to do!!
Anna
