Hi Nats,

What you propose would almost certainly require a new application. It’s probably worth a try though. Two years is a lot of time to get a permit by the way, unless he has had to try a number of different applications.

Regards
Alistair

Hi Terebi,

A unit that small will be very hard to get finance for, and you have no chance of getting a high LVR. They will therefore eat into your equity. If you have plenty of equity and lack cashflow, they may fit into your strategy, but if not you will be placing an anchor around your neck in terms of moving forward.

Regards
Alistair

Have you had a look into finacing your purchase? Often these types of investments look good, in terms of cashflow, but if you cannot get financing at a decent LVR then you can quickly find yourself running out of equity for further investments. I’m not trying to put you off, if equity is not a problem for you such an investment might suit, but make sure you look at the whole picture and be sure the unit will help you reach your goals, not hinder you.

Regards
Alistair

Hi Jo,

Which State are you in. I have a strong knowledge of the planning system in Victoria and am happy to post answers to your queries, but different States have different systems.

In general zones indicate the type of developments that will be allowed on the block eg if the zone is Residential developmenmts such as factories or shops are prohibited. However, you need to go deeper and look at overlays and the local planning scheme to work out what restrictions there are in terms of residential development.

Regards
Alistair Perry

Dobby,

Quiggles is one of the pioneers in terms of investing in US residential realestate. You would do well to take his advice.

Regards
Alistair

I gather they are scared of adverse publicity from people such as Neil Jenman. Mortgage insurers also don’t like them for some reason.

You can certainly simply not tell the bank, but if they find out they will probably stop lending to you. They find out when you try to use your unusually large income per property to prove servicability. A broker is silly to put a ;oan for a wrap property through a lender that has a policy against them, it is a good way for them to lose their accreditation with that lender.

I understand that some wrappers have success with NAB and I am lead to beleive that Adelaide Bank sometimes do them also. However, this is only certain lending managers. We use some smaller mortgage managers for our wrap clients, who don’t have a problem with the concept.

Regards
Alistair

Simon,

It sounds like the developer is passing on the building costs, and therefore also the building risk, to you. I would want a massive discount to agree to something like that.

Regards
Alistair

Thanks Richard,

Is the structure going to be an REIT or some other form of trust?

Regards
Alistair

I think the main problem with Section 32 loans is that they are uneconomic for the banks. This is not so different to small loans in Australia.

The laws that effect commercial loans are not nearly as onerous and commercial lenders place a greater emphasis on the strength of the asset and its ability to pay for itself, therefore 9it is easier to find commefcial lenders who will deal with foreign nationals. It is not easy to find one who will offer attractive conditions though, with regard to either LVT or IR.

Regards
Alistair

Hi Soodle,

If there have been at least 3 sales in the last 6 months in the town, and it in a town (not farmland or acreage) you can get 90% LVR. I’m more than happy to assist you with this if you are interested.

Regards
Alistair