Forum Replies Created
Hi,
Your Body Corp fees will cover insurance on the exterior of your property only, not internal fittings or contents. You will also need landlord’s insurance to cover any loss of rent or damage by tenants and their guests. Remember that tenants tend to stay longer in houses compared to units so you could have more vacancies. Banks don’t like lending to people who buy a whole block of units because they believe that if you become a distressed seller then the value of all the units will drop. The banks prefer not to lend for more than two or three units in a larger complex. Yes, BC is body corporate. As explained before, you will have to pay the fixed water charges and, if there is only one meter between several units, the individual water usage charges as well. If each unit has its own meter then you can charge the private usage only back to the tenants. Don’t forget a maintenance budget. There’s always a toilet to be fixed or a blocked gutter or bees in the roof cavity or a broken heater etc.
Good luck.Hi Sark,
I agree with Ethan and Corey. If you take the 80% loan on IP3 then you will have access to the surplus funds (equity) of $80K for your next investment when needed. An offset account holding the surplus funds linked to the new loan will keep your paperwork neat, alternatively, you don’t have to draw down on the full loan. Have you remembered to factor in your purchase costs such as stamp duty, bank fees and conveyancing? It’s roughly around 5% of purchase price.
Good luck,
AnnHave you asked your broker about a tentative on completion loan? If you can give clear details of the completed reno ( example of kitchen with materials to be used etc) the valuer should be able to give you a final “on completion” valuation which will save you having to apply for a new loan or loan variation later. Don’t forget to factor in your purchase costs which usually come to around 5% of the purchase price. In your example it would be about $25,000.
Good luck,
AnnThank you Steve and your wonderful team for the 2016 Mega Conference.
The message I received loud and clear was that we all need a mentor who keeps us on track and accountable. We are responsible for our own successes but it’s much easier when we have a support team around us. Your negotiating skills which you generously shared with us are invaluable gems. Thanks for the timely reminder of “Labour Omnia Vincit” – Find a way or make a way. The conference was a great networking opportunity and I met many inspiring positive people there with whom I’m keeping in touch. Thanks again for your honesty and generosity through sharing your investing experiences. Your guest speakers were a breath of fresh air who all offered invaluable advice and insights. The two Daniels were amazing, Lisa was a breath of fresh air with a real message for all of us and Brendan has it all worked out. Recent apprentices told me that Jason has been invaluable to them and I’ll attest to that and I always need to hear what Peter and Mark have to say.
Thank you for an inspiring three days and the chance to meet experts in their field,
AnnHello Touchingcloth,
My son is in a similar situation to you, but in Tasmania. Because he didn't fulfil the six months residency he has to repay ALL of the FHOG and stamp duty he received. But because he didn't inform the State Revenue Office (purely out of ignorance which they acknowledge) he has also received a 25% fine. The only way he could have avoided the fine was to let SRO know that he was not living there for the full six months, but then he would have had to still repay the full FHOG and stamp duty he received. If SRO believed he was trying to use the system he would have received a fine of 100%.
Read through your FHOG literature to see what you can and can't do in your state. You might be losing your current FHOG and be ineligible for it again.Best wishes,
Ann
Hello Guitarchick,
Good luck with approaching banks for a mortgage. If you know what your borrowing capacity is, it’ll make the searching for a property a whole lot more fun.
If you have difficulty obtaining a loan because of low income, consider this:
In Tassie the State’s Dept of Housing has a program for home owners who find it difficult to get a conventional mortgage. It is called a HOAP loan (Home Ownership Acquisition Program?). The Housing Dept helps you obtain a mortgage through a bank at usual mortgage interest rates. I’m not sure, but I think they act like a guarantor. It’s designed for low income earners. You can use the loan for any property, it doesn’t have to be a government house. It might be worth checking out if you find banks difficult.Good luck
Solutions,
You could approach investors such as those who use this site to partner you in a joint venture. Other sources are solicitors, accountants etc who are on the lookout for profitmaking ventures for their clients. If you have a good idea, let people know.
[gossip]
Something to consider:
Set up a trust before you buy the property (in the name of the trust), and consider selling one of the properties on stratum title. I’d recommend the older house because of the maintenance issue plus you’ll probably get better rent for the new unit. How do the numbers look now? I expect your cash on cash return just might improve!Ann
Any manager of a Caravan Park could easily buy all the sites. They sell them for a reason. They can maipulate the tenancies in those sites they do not own. Why wouldn’t they keep their own sites full and only rent yours out when there is nothing else left? There are quiet times in tourist areas as well!
Hi bmcg
I looked at buying an onsite cabin in a caravan park. The investment was small and the returns great javascript:insertsmilie(‘[fez]’)
Fez [fez] – until the park owner decided he wouldn’t allow me to rent it out. javascript:insertsmilie(‘[angry2]’)
Angry [angry2] He owned others and said my renting out would reduce his income (true). If the owners of the park change, this is a possibility. It’s still a good way to start small if you can overcome these obstacles.Keep doing the sums
Ann
Hi Ajsov1
We tried an offset account for 12 months. Our loan was quite small and the interest saved was identical to the additiional fees. I also found that i was spending more at the supermarket than previously because of using a card. Used to running a tight budget with seven kids, but kept losing track of weekly spending at the supermarket. Probably good if you have a reasonable sized loan and keep track of spending.
All the best
Ann
What have the locals been saying about the market in Darwin? Have you asked any real estate agents for their opinion? I’ve been wondering if the slower growth rate means a longer period of growth or just that the market has reached maximum capacity. Just interested too.
Ann [whistle]
If you’re thinking of renting the land to a farmer, usual return is 6% of land value and they can flog your soil if intensive farming with potatoes, poppies etc. (I’m from Tassie.) If you’re going farming, the best farmers in the country average a 6% return on their capital. The national average is only 2%! If this is a lifestyle decision, GO FOR IT!
Ann [baaa][baaa]
Former sheep farmer
