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thanks for the advice guys.
The only reason my simple mind can figure the $120k is needed in your super to make it cost effective is maybe due to the average price of an investment property in aus.
If i have $40k in super, is there any reason why i couldnt spend $30k on the deposit, $10k on fees etc, then borrow at 80% for a $150k property (yes i know a $150k property is rare but there is plenty of options). With the rental and my future 9% compulsary super contributions, i can support the loan until it becomes cashflow positive, then purchase another property and so on and so on.
As far as you know, is this a feasible option?
oops! i forgot the auto signature. Sorry folks.
A 2001 Falcon SR wagon with 200k on the clock, picked it up for $6000 an absolute BARGAIN!!!!!! Great to drive, no funny noises just a big number on the odometer.
We also got an 02 Nissan PAtrol ST for the weekends shooting and for towing the ski boat to the river. Got it cheap too!!! my motto: like buying IP's "buy under market price" and we did: $22k.
My problem, i like cars but have to win the misses over before we do, therefore its as calcualted as the next move on the investment path.
One of my mates is building 350 homes in Ipswich. Its a pretty safe bet i reckon too.
hi all, I work in Craigmore and live in Blakeview. And yes, NORTHERN Adeialde is THE next HUGE thing.
Like all the areas out this way there are good areas and bad and unfortunatley its not a cut and dry and you cant say "this side of that street is good and the rest is bad". Craigmore has DEFINITELY got some dodgy areas but also some great new areas. I would be keeping to the northern end of craigmore more like near the somerset grove estate and the new Mormon(?) Temple rather than back toward craigmore shops and yorktown rd. The prices range a huge amount from high $100ks to even into the 400ks. The homes up high on Uley rd are expensive and the estate off uley road fairly high up has only large acre blocks There are not really good/bad areas as such but with a bit of legwork you can work it out. As i said nearer to somerset grove, and also as high up the hill as possible.
As i said i live in Blakeivew. Last year the median house price in Blakeview was something like $215000. this will work similar to craigmore. This is so NOT an accurate picture of the area. We live in Knightsbridge Heights estate which is all really new, the land was subdivided in 2003. Our area has homes going for mostly above $300 (4bed d/gar) with only a few between $250 and $300 but most are around $300. Ours is a 3bed double gar and it was valued at $275 12 months ago by our bank. Two homes down is a 2 storey on the market for $450 (a little bit sttep). If you go back down the hill towards main north road, most of the homes in this area of blakeview are from 70's or 80's and more owners are selling up.
My opinion is that the median house price calculated from the sales in the area is at the level it is, because lots of people who own older homes are selling them and cashing in on the boom that occured between 2003 and 2006 and building or buying something newer/bigger. Lots of my freinds are doing this.
There is NO doubt that the area is booming out here. Playford rise (which is above somerset grove) looks beautful with hundreds of new homes being built at the moment and most of them are good sized with large allotments of 600m2 upto 1800m2, and prcied from $100 to $300k.
If you go down the hill to smithfield plains, Devine are selling off 100's of blocks there as they try to change the Daveron PArk bronx mentality (and its working). The problem is that ALL the blocks are 300m2, (YES ALL THE BLOCKS) and all the homes will be shoeboxes built by people who cant afford anything but to go with devines no deposit finance deal. Have a look for yourself, do a google search for Oakwood estate. If you see the master plan i reckon you will be shocked like i was.
Hope this helps.
Excellent, thanks very helpfuol. Can you tell me what bank you are using? .At this stage we have had initial proceddings with Westpacs buisiness arm and they are (from what i have heard) reluctant to lend us what we want because we arent seasoned developers. We are now considering trying elsewhere.
My opinion is in line with your comments. The north of SA is REALLY HOT!!!! Up until the last few years the common comment that "nothing happens north of gepps cross" was true except for crime! I have lived all up the eastern seaboard and moved to SA in 2003 right before the boom hit here. I built in a new area in blakeview, not down near main north road but basically a stones throw from one tree hill (very nice). Where we are the houses are on average $300k plus with many two storey places fetching above 400k, but its still only 5-10 minutes to the MOST dodgy parts of elizabeth and daveron park.. As for daveron park, there is a lot of bogans there to put it simply, but the govt has launched a 10year $15billion program to weed out the areaas known as the "bronx" and redevelop the land. Ive heard rumours that the govt are even buying back SAHT homes for at a loss (to the them) so they can demolish as many as possible and sell the land to private investors to build new estates. BAsically the govenrment has finally worked out that areas with a high concentration of low rental properties inevitably go downthe tubes in terms of the whole area, which is what daveron park was for a long time. Really, on the upside, you cant buy an empty block of land anywhere in the north for under $80k so things are really going from strenght to strenght.
My prediction is that in 10yrs time, the north will be as unaffordable as sydneys west is now. And even wayout places like port wakefiled will start to bring in some more money. As for that place you are looking at, there are some REALLY dodgy bogans there and i wouldnt even be consdiering renting anywhere without landlords insurance.
From my end, i am doing a subdevelopment of 18 homes in murray bridge as i think also, that this area is going ahead in leaps and bounds, the same reason AVJEnnings has realeased a major new estate upthere and loads of small time developers are getting a piece of the action. The upside is for me that 4 bed homes up there are selling at anythign from $270k to $380k while land is still pretty cheap, ie: under 100k.
If you can get a good property manager, go for it. If you cant trust your property manager then i wouldnt. Make sure you go through a property manager anyway, otherwise if you have a tenant from hell, you will be a very unhappy investor! I woudl look around abit more, and see what else is availble for a similar price. That is good rent for the purchase price, but if you get a tenant that doesnt pay then good rent is worthless! I would however steer away from semi-detached also, as these dont really increase in value as much as free standing places do.
To summairse, if you wanted to buy that same place in 2000, you would have got it for $30000. Now that is a steal in anyones money. If its $139000 now, and you can maintain it for 10 years, it will be worth a lot more then.
hope I have been helpful.
As the final sale is an end of line sale in terms of selling from a business to a private, it was my understanding that in this end sale GST was not claimable. Is this incorrect?
hutch, do you have to then pay GST on the sales if it is all through your trust?
OK thanks, however do i need to pay GST etc if i buy the properties in a trust/business name? What conditions are there thatmake me have to pay GST on the sale then?
The other option is to go again with westpac but get a commerical loan called a EVL end value loan or Gross Realisation loan. This is similar to what Kim used but money is lent to a business name. The disadvantage of this is that GST is then required to be paid on the sale of the properties.
Kim, how did you get around having to borrow money on a commerical loan basis? It was my understanding that an end-value loan was really only able to be obtained for business purposes hence the end-value idea as for if you were buying a business or similar……
Currently we are (waiting to )go through westpac but with their commerical lending arm. Our bug-bear is that we will have to pay GST (as i said), which means on the sale of 18 homes we are building in Murray Birdge, the wonderful old GST cuts into the profits SOMEWHAT!!!!
I suggest contacting Steed and Phol surveyors in Norwood, speak to Mark Goedecke. I am using him for a development in Murray Bridge of 16 houses. He seems to be very reliable and thorough!
Ok thanks. I assume GR is gearing ratios?
I am not a bully, nor am i putting anyone down. Bullying is not allowed in schools, so why would it be acdpetable here? Bullying is for cowards,,,,,, not me. I just have spent a week going through the last 3 years of posts on this website and it SEEMS to me that there are a large number of people who think that they will be able to make a fortune by simply finding a heap of CF+ ppropertys, when REALLY it isnt anywhere nearly THAT EASY. I think there are HEAPS AND HEAPS of great postings here hence the reason i have spent so much time reading them all. THe ones i am referring to go something like this: "I am new to this PI stuff, but i need to know where i can find CF+ proprties so i can retire in 5 years". Do you get my drift???????
In repsonse to all the "know it alls" out there, well where do i start. I should begin with the comment "those who cant…. teach". Well i agree with one reply who said "how did you learn to read and do your sums on an investment property?" I disagree with the comment about teachers (derrrr obviously). I have a fun time talking to mates who arent teachers, and there is one thing i always say to them "well if you think teachers are dead-heads or have it easy…. how about we swap for a week" and EVERYTIME i never get any offers, FUNNY THAT!!!! I challenge you all, if you think teachers are deadheads, well you maybe right for a small proprotion, but probably less than the proportion of deadhead laywers, or plumbers or whatever! If you think teachers have it easy, wander into your local school and offer to teach for a week and see what its like! If you come out the other side after a week, and havent had an emotional breakdown because you gave back a maths test they failed and mum and dad came in and abused you, or you had some teenage girl not running in PE lesson who you kept back after class to talk to, who then contacts the police claiming you assaulted her, OR the principal got some phonecall from an irate parent claiming you cant teach!!! ALL in the life of a teacher! If you get through all this, i will listen to your comments!!!!! I have done many things in my lifetime and didnt just leave school, spend 4 yrs at uni, and go back to school for 40 years. SOme personal info. I spent about 8 years in the consturction industry, 2 years teaching in London (if you think thats a glory job, i have news for you) and also have done MANY odd jobs on the way and during my holidays. I certainly have life experiecne, and would chalenge anyone who thinks to the contrary. How many of you have had the initiative or abillity to pack up and go and work in your chosen career/position in europe or something similar. Life experiecnes come from getting out of your comfort zone and making a go of it, THIS is one thing i certainly am an expert in! I think i have enough experience to know that teaching isnt full of deadheads who arent any smarter than the 16yr olds they teach, but are in fact highly qualified and trained, and spend many many many hours doing their work. Even if they only have to be at school from 8-3, i GUARANTEE you that most teachers, me included, spend countless hours outside the classroom ensuring our teaching is the best that it can be. How many of you have the opportunity on many occasions to do a dodgy job with the knowledge that no-one will over know, you know comments like "what the eye doesnt see, the chef gets away with"??? try doing this just ONCE in the teaching game and see how many furious parents rock up at your door ready to blast your head off with something like "this is my sons education you know". Just remember, teachers are the ones who shape the next generation, and i am certain that some teachers in the past have been a little dodgy… hence some of you got through school!!!!!
Regarding investment strategies. Yes i am only a beginner but i have owned an IP before going overseas, but i have been privy to many investors strategies and successes and failures, as well as a few dabbles of mine from time to time. Even though i havent actually bought an IP for a few years now, i have folowed the papers, the forums, the magazines and being a maths teacher, the statistics, and feel i have a pretty good understanding of areas i am interested in.
Regarding comments on -vely geared properties. I think all you teacher-bashers would be surprised to know what "the humble" teachers wage actually is these days. It is a little more than $40000 these days for all you cynics, and if you dont know, do some HOMEWORK and find out, i think you may be surprised. As for how many investment properties you can hold if they each cost you $100 a week, well to put it simply, a few. However, knowing this, there are many more ways to make wealth from property including subdivisions, and developments, plus all the dodgy ones many dabble in, of which, these two are my passion, and i have followed many who have done these successfully, and i have learnt HEAPS! I dont have any success story yet, but as i said earlier, watch this space.
Another one of my favourite sayings "you will never know everything but the more you know the better, so if you go through one day without learning something new, you wasted a day"…. hence my knowledge of investing is certainly not beginning, but even more certainly no-where near the end.
I hope i have clarified my earlier comments.
what does God have to do with real estate ethics? I say EVERYTHING!!!! If your beleif in God is real and true then everything you do is governed by that beleif.
Regarding trusting people: As they said in the movie "The italian job" "trust everyone, just dont trust the devil inside of them". This is true, and in my experience it is unfortunate that many people proport to be religous and in fact simply use it for their own purposes. A true christian will use their God given wisdom and experience to help others, not screw others.
I have lived in Sydney and all up the coast to Coffs Harbour. I have watched the values rise right up and down the east coast, then i moved to adelaide 5 years ago. When i moved here i got a 600m2 block in a new estate in the north (yes the north) about 1min drive from One Tree Hill, equivalent to Dural in Sydney, and i paid $48000!!!! 6 months later these blocks were going for $100000, if only i had bought the whole STREET!!!!.
Personally i reckon Adelaide is a REAL DARK HORSE!!!! Everything i read points to adelaide as being the last city to really catch up to other cities, and it will over the next few years. SImply look what happened in the western suburbs of Sydney.
I also reckon that the northern suburbs, yes the north, and i know all those die hard adelaideans beleive nothing good comes out of anything north of Gepps Cross, but i beleive, the north is going to eclipse the south, and DEFINITELY be THE FUTURE of SA. All the SAHT homes are being demolished and new estates and homes being built all the time. Even in the dodgiest parts of Davoren Park now, blocks in new estates are going for $84000+. There is a new battalion coming down from north Qld and homes needed for those 3000 troops plus familys, and there is also something like 20000 dwellings going in in an area called Playford NOrth, and also there is Buckland Park where some multimillionare dude is spending up BIG!!!!
The north is NOT what was always known for ANYMORE. Yes there are still some VERY dodgy people and areas, as there are in Sydney, having the king of all dogdyness in Mount Druitt and Bidwill etc etc. WHo would have thought you'd be paying well over 200k for a dump in Bidwill 10 yrs ago??? The north is A-CHANGING and you all better HANG ON!!!!!
