Forum Replies Created
That’s a great idea Richard, thanks for the advice!
Good to hear that they’re an option – PM incoming Richard :)
Anthony
Hey Richard,
I wasn’t aware of Loan Market’s connection to Ray White, thanks for that tip.
Regarding loan type, I’ve read about professional loans which allow for a 10% deposit with no LMI, but taking into account the recent changes in lending practices post APRA, are these an attainable option? If so, do you know of any brokers who specialise in this? I’ve found one guy from Genius Loan Solutions so far that appears to specialise in this area, but happy to take any other names that people might have dealt with in the past. My plan is to keep the remaining portion of my deposit in an offset to start saving for my next property.
Cheers,
AnthonyHi Hans, I’m in the same boat at the moment and I’ve thrown most of my savings into an ING Savings Maximiser. It’s 2.8% return without needing to lock your money into a term deposit for a similar rate of return :)
Hey Tony, thanks for the heads up. All signed up, looking forward to it mate!
All good, I’ll just grab the latest revision of that particular book, I’ll have to come across it at one point or another when I read it. Thanks for the heads up :)
Good point. I was thinking from the point of view of saving every cent possible to save for deposits, but that’s a bit short sighted of me. I’ll suss it out, thanks for the prod in the right direction Benny!
Hey Benny, would you happen to recall which of Steve’s books refers to that rule of thumb? I’ve just finished reading 0-260+ and I’m thinking I might grab a couple more of his books if they’ve got any additional useful insights. It was a great read (albeit slightly depressing considering I was liking the idea of a buy and hold strategy).
Thank you for the link to the course by the way. I’ve taken a look and although it looks awesome, a 2 year course isn’t really going to fit into my timeline. I like getting my hands dirty and doing things myself :)
I’m not sure whether 9-10% is attainable at this stage Tony, however that’s my initial benchmark. Once I start drilling down on particular areas I’ll refine that number if I can see that it’s unreasonable – I do still want some degree of capital growth after all. Not sure what number to set as my annual capital growth target though :\ But I definitely agree on those last few tips, they’re definitely part of my selection criteria when buying!
Hey Ethan, thanks for your input mate. Definitely going to speak to an accountant, I’m just trying to figure out a game plan so I have a rough idea of what I’m after before speaking to accountants/brokers/solicitors etc.
Yep I meant over 80%, shouldn’t have been writing questions late at night after reading a stack of books! That’s exactly the scenario that has me worried. In the few books I’ve read they’re all very vocal about the fact that banks will come knocking asking for more money, I’d like to be prepared for that eventuality.
You will also need some tax advice on the loan structure. Borrowing and parking in the offset wil create another mess and the loan interest won’t be deductible – even if it is eventually used to invest.
Hey Terry, slight sidetrack here (sorry OP) but you’ve piqued my interest (no pun intended), would parking sleep at night funds (savings) in an offset account also result in loan interest not being tax deductible???
Hey Peter, is there any reason that you want to buy in the Melbourne area? Have you considered widening your search to other states which would enable you to choose from a wider range of properties?
Hey Benny, I’ve taken a look over the link you provided, few more goodies in there, thanks for that. I’ve got the beginnings of a plan forming up nicely :)
Just read your news article Tony, wow. Talk about great inspiration that it’s doable for someone like me who’s just starting out, good on you mate!
Terry my 9-5 job as a consultant is actually a work from home job so I think I’ve just about maxed out as many deductions as possible on that front :P The way this bloke was talking, he seemed to think that he could claim his rental expenses based purely off the fact that he owned investment properties.
Hey Benny, I thought I’d read every single post on these forums but looks like I’d missed one! I’m really liking that idea, having the extra money in the offset account if things do go pear shaped would be a great peace of mind for me.
And scarily enough I was told that idea by a friend of a friend at a dinner – they were going to try and claim their own rent too – not sure what dodgy stuff they’re up to!
Thank you to everyone for your contributions, I’ve definitely got the strategy starting to form up nicely now. Lots of research to go!
I was told that by some so-called “property investors” – it sounded suss to me and my research backed that up, I just wanted to be 100% sure before I ignored that advice and moved on, so thanks for clearing that one up :)
That’s great to hear that it is doable Tony, I’m aiming to buy a positive cash flow property under market value and use capital growth to fund the next purchase. I’m a little up in the air about LMI at the moment, I can definitely see the many benefits, however having a 20% equity buffer if the property were to depreciate would help me sleep a little better at night. Happy to be convinced otherwise!!
I probably went a little too nuts on that one, couldn’t help myself, bit of a sore spot for me :P
Hey Liam,
I haven’t actually bought my first property, I’m jumping into it for the first time and learning as much as possible like yourself.
The one thing I’ve noticed about life in general, not just property investing, is that when you engage in a concept with which people aren’t familiar, an innate fear of the unknown leads to them hurling a whole host of negative comments your way to try and get you down. In their eyes, they’re “helping” you because it’s the “safe” thing to do, they don’t want to see you go through tough times because of perceived “silly” decisions. Thing is, when you make it out the other side having kicked ass, they sing praise to everybody they know about how successful you are etc.
I’m an asset management consultant/engineer in my day job, and I’m carrying that mentality into property investing (whether it works or not – I’ll let you know in a few years!). Build up a business plan identifying your tangible goals and how you’re going to achieve those goals within your given timeframe. Include a risk matrix, which identifies all possible risks, how likely they are to occur and what measures you’ve got in place to mitigate those risks if they look like they’re developing into a real issue. Proper planning prevents piss poor performance! If you conduct your due diligence and consider the advice of the great folks on these forums you’ll definitely reduce your chances of falling into a nasty situation. At the end of the day, we’re still taking an educated guess – things could still go pear shaped due to factors out of our control – that’s just life :P
People are going to criticise you when you break the mould. I love proving them all wrong and reaping the rewards!
If you’re in the Sydney area hit me up and we can bounce ideas over drinks if you’re keen.
Anthony
Thanks Tony, looking forward to it!
Many thanks for all the responses guys. Benny, that link you provided is a gold mine! I’ve got a list of questions I need to research into and this thread pretty much answers the majority of them. I’ve got my reading cut out for me today though :P
Hey Terry,
I’ll admit I haven’t really looked into any other ‘asset protection’ methods however now that I know there are in fact other ways I can do some legwork. Thanks for the heads up!!
Regards,
AnthonyHi Corey,
Thanks for your reply, I can definitely confirm that I fall into the “text book educated” category.
I’m an engineering consultant, however I don’t run my own business so I’d say my risk of being sued is quite low. I agree with your comments on cost/benefit – I just assumed that due to my thinking being opposite to what practically every book has told me I was missing something!
Once again thanks for taking the time to shed some light on this, it’s much appreciated!
Cheers,
Anthony
