really? wow. I suppose if I had invested in the entire all ords I would have done ok. Unfortunately I had the likes of coles, david jones, telstra, amp, fleetwood. prior to that were the real dogs such as annaconda and erg and a string of other losers. I made a little on the ups and downs of bhp. oh well, i have a nice fat capital loss that I can write off against my property gains.

This all comes down to sticking to what you know and more importantly, what you can control and influence. I’ll leave shares to the market makers and experts. If shares is your thing good luck. I will take further passive investments in shares though by equity draws against property appreciation. Just thinking about it, maybe I should reconsider that idea given my track record!! I think you hear all the hype and think you should be exposed to it?

John Carroll

I would prefer to keep the jobs in the country and buy a locally produced car. this country needs more industry than just building houses. just buy a commodore on gas if you are that worried about it.

John Carroll

people still need to live somewhere – I just see a value re-weighting from outer areas to inner city areas. I think we have all seen this coming for a very long time.

John Carroll

what is not sustainable is high levels of immigration and the strongest state economy in conjunction with the lowest median price.

the interview that i referred to above discussed the ramifications of the above factors and the added probem that the builders are at maximum capacity (to the point where they have virtually given up and said ‘enough is enough, this is all we can do’) – we have a huge demand for housing with a complete inability to supply it. this is quite unlike a bubble… bubbles are illusionary and are not based on genuine demand.

Amused – not sure what you would like examples of as you were the one making an assertion. Are you asking for examples of property that has sold quick or something? If so there are endless examples of that, along with recent sales which tell me that many suburbs are set for a significant rise in their official median price (as I know what the sales are before they are settled/reported). On the other hand, there are some suburbs that are slower (such as Canning Vale) due to the sheer volume of property available down there. Having said that, there has been a huge cap gain for those owners over the last 2 or 3 years anyway, so they are hardly losing if their home takes a little longer to sell.

Some cheap areas to consider: Meadow Springs, Rockingham, Madora Bay, Golden Bay, Singleton (can build a 4 x2 for well under value), Vic Park, Cannington (villa prices are on the rise), St James (seems to have been forgotten), Central Mandurah (these prices can’t last?!), Yanchep (substantial development to occur around it), Armadale (the next step on from the likes of Cannington, Kenwick etc and after all it is Alannah’s electorate).. pretty much throw a dart. I would only avoid places that are well above the median…. just my personal preference.

John Carroll

“A lot of listings on the market for more than 7 months”

WOW – that’s highly unusual…. where is that?

John Carroll

I am still out on an opinion on this interesting discussion, but some of my thoughts would be:

“$100K (5% capital growth on share). The shares are liquid so you can use the growth as an income.”

if you use the growth that means your real value of the shares is declining. I also wouldn’t want to rely on shares to consistently grow 5% per annum. maybe I have just had some bad picks in my time, but DJ’s for example went from $2.20 to $1.60 and have only recently climbed back to $1.90. I paid about $1.20 for annaconda and sold for 38c before they became worthless. telstra have been under water for years. ERG collpased on me as well, despite having some promising projects on the go. i had a few wins on the way as well but to average it at 5% is a very big assumption IMO.

Just some poitns off the top of my head:

– I note you have no allowance for property costs, which at 80% gearing there would typically be negatively geared.

– I see you are also banking on a steady 5% cap growth on your properties, which according to many on this forum, there is unlikley to be growth for a decade or so.

– how will you draw the LOC out of the growth (if any) without any job or income to support it? the income is already committed to supporting the loans (I couldn’t see the bank accepting projected grwoth to cover your ongoing loan commitments).

If I had more time it would be interesting to model all this on a spreadsheet with tax rates and cPI adjustments etc to see if it were possible.. .there must be a definitive answer

John Carroll

not only that but 12 months is not a stipulated time for a PPOR exemption… it all comes down to reasonable and making sure you are not in ‘the business’ of doing it

John Carroll

Wayne what sort of prices are the first release blocks going for do you know?

John Carroll

perhaps it was just a friendly dig – that was the way I read it.

John Carroll

presumably hospitals and infrastructure will follow… I know it was the deciding factor for my parents chosing Rockingham over Yanchep. Can’t go wrong with the price tho.

John Carroll