Hi Sunhero,

Depending on how new the subdivision is, it may be that the pegs are in the ground and it is a simple matter of walking the block to find them.

These are the square pegs that are driven into the ground to signify where your boundary is. If these have been newly mapped out (i.e. a new subdivision) then they should be in place and easy to find.

Perhaps your builder is asking, simply because they haven’t been onsite yet, thus they don’t know if pegs are in place. If they are, tell him so – he might want you to draw up a rough map for him. No harm in asking, eh? Don’t pay $750 without checking with others first….

Benny

• This reply was modified 7 years, 11 months ago by  Benny.

“and in a falling market you could lose 10%+ and that could be all your profit……”

Those I have heard who develop won’t get out of bed for 10% return. Usually 20% minimum and climbing.

Still, if they got caught badly, even if just a 10% drop in values they might hold, leading to higher Interest costs which could erode their profits even further…..

So, yes, even a 10% drop could prove to be significant. Still “falling knife” stuff – one can only hope that they are smart enough to “cut their losers dead”. A small profit after a 10% drop is way better than holding, and paying ongoing Interest (into the red?) over the next year or two!!

;)

Benny

Hi Ozboy,

I can’t help with any re-financing ideas – but you did say you would appreciate any comments, and I wanted to say that I gasped when I read how much you were about to spend, and simply wnated to ask whether you weren’t over-capitalising majorly???

Of course, there are units and units – and locations that lift some values way above others too.

But to be spending $330k on ONE unit (one million on 3 of them), you would be wanting to create some equity with that, hopefully WAY more than you spend. Some say, aim to add $2 value for each $1 to spend on a reno – so, are you expecting to add $660k in value to EACH unit? If so, how? What are their starting values, and expected end values?

Making each one strata’ed would add some value for sure. And maybe the units are in Mossman Sydney, or Toorak in Melbourne…. which would see them at a PREMIUM price compared to most other units.

Care to share? ;)

Benny

Hi Storeybuilder,

I accidentally piled stacks of cash into my redraw as if it were an offset. This is normally a bad situation, but because I haven’t withdrawn any money from it, and I intend to use it for interest payments the cash will actually be able to be freed and eventually I will be clear of my mistake. This is one way to fix over paying into a redraw account.

That “sounds” like it is ready to be used. Perhps as a separate loan ONLY for IP expenses.

That could mean for paying Rates, Maintenance, Insurance, and Interest too (though I will leave you and Terry to finalise that one – i.e. re interest, and interest on interest). The main thing (I believe) is to keep each account separate – so if you withdraw via an LOC and ONLY use the $$ in it for IP expenses, then it “should” all be kosher, and all deductible. Maybe have a separate one for Personal??

But I am no adviser – so listen to Terryw and other advisers re the right way to do this.

Benny

Hi BClarke,

This is useful from you, but it leads me to more questions (sorry):-

There are key points to this that in my opinion are non-negotiable items when it comes to landlord insurance, these include inclusion of Accidental Damage rather than just Malicious Damage, no excess on loss of rent claims (huge impact on claimable amounts), and a number of other features.

From what I am reading of 5c1’s case, just the fact that a Company “covers” Accidental Damage is not enough. Like for Malicious Damage, it could be that Accidental Damage has a limitation on it somewhere in the back of a PDS too. Could this be so??

Why can’t Insurance Companies be directed BY LAW to state their exclusions up-front and out in the open (a bit like Banks and that “Comparative Rate” that puts the lie to their screamingly LOW Interest Rate). Isn’t there something called “Truth in Advertising” that would direct these Companies to be up-front with their exclusions?

Benny

Hi Storeybuilder,

Fixed interest so easy to calculate. By easy I should say possible.

Don’t try to calculate it – call your Bank and ask when you are “closing in” on paying it out. I had only one that I wanted to pay out (others have gone full term, and saved me heaps) but my calculations were WAY UNDER the final Break Cost. It was a long time back, but I recall paying about 2.5 times the amount I had calculated using the Interest Rate, and adding their fees for an early settlement of the Loan.

Things that I believe impact these – if you are breaking a Fixed Loan that has an interest rate HIGHER than the current Variable, they wll sting you for huge amounts. But if the current Variable is HIGHER than the Fixed Rate you are breaking, their costs will be minimal (they get their money back and can re-invest it at a BETTER rate, so they are gentle with you). The time left to run will have an effect too….. the earlier you break it, the more it will cost you (obviously).

The only way to really know is to call and ask (and then get the answer in writing, as well as over the phone). Be sitting down when they tell you the number… :p

Benny

Hi RY&F,
Good on you for asking such a good question. As several have said, education is the key. See, whether you use a BA or not, a MB or not, buy in Bne, Syd, Mel, or country Aus (or not) are all just tiny parts of one huge subject.

I would love to know how to get them myself but I’m not too confident with that at this stage – I’ll get better in time.

One bloke I heard of asked a couple “If someone can take you through the A to Z of how to make $100k on one property purchase, what would you be prepared to pay them for that knowledge?” The husband of the couple said “Hmm, I dunno – maybe $20k!” The wife said “I’d be prepared to pay them $100k – because then I could go out and do it myself, over and over!”

What you choose for an answer is almost immaterial – but what the wife said held a nugget of gold.

so I wouldn’t wanna buy his program if I cant use the info.

Fair enough too. Nothing wrong with some healthy caution. The best way to get an idea of how this all works is to talk to others. On here, face-to-face at Investor meetings (usually monthly in major centres), reading the stories of “those who already succeeded at this”, learning from your “team” (your MB, your accountant, lawyer, RE agent, etc)

Read what others thought of the Apprentice program shoe-horned into a 5 Day Boot Camp – here:-
https://www.propertyinvesting.com/topic/5016755-the-verdict-on-steve-mcknights-5-day-bootcamp/

The networking was an oft-mentioned positive for attendees:-
“Leaders attract people who resonate with them. Steve is generous, courageous and authentic, so you get to spend five days with 70 other people who are also generous, courageous and authentic.”

And the revelations were manifold:-
“For years my wife begged me to meet Steve McKnight and be part of his training and Apprenticeship program. But I thought I knew it all. In fact, little did I know! If only I had listened to my wife, we would be Job free, Debt free, & Financially free today.”

RY&F – you are in the right place – make the best use you can of it. Your future self will thank you.

Benny

his stove has been blocked due to food and he has tried to open it to fix it.

Jerry is right – how did this happen, whatever it is? If he is the one using the stove, and food is blocking something, guess who might have made that happen?

Has he sent you pictures? How has he been using the stove?

Let me tell you of a young man who shared accommodation with me for a week as we were attending a training course for our employer. I arrived on the Sunday to find my new sharemate digging into a toaster with a knife, trying to dislodge a MESS !! I asked him what happened…

He had arrived earlier that day and wanted to make toasted sandwiches for lunch. He bought bread, butter, cheese and pineapple – created a cheese and pineapple sandwich, then JAMMED it into the toaster and pressed down the lever !!! It made one helluva mess – but that is what happens to some people who haven’t yet learned to live on their own – they make mistakes.

Could this tenant be making mistakes with your appliances?

Benny

Hi all,
As I don’t know/use QBE, others will need to answer this…

What I wondered is if perhaps cheaper offerings are cheaper for a reason? e.g. a Bank can offer a Basic Loan, or a Standard Loan. The Basic one is cheaper, but it offers far less options – it really is Basic, but enough for many people in most situations.

And then, playing Devil’s Advocate, $20k of cover for “malicious damage” would probably cover 90% of all malicious damage claims – only the extreme 10% (as with 5c1) that would be left wanting. Anyway it will be good to read more once things are resolved, 5c1.

This is such an important subject, and one that we all can do with knowing extra about. Thanks for starting it – let’s see where it ends…. (hopefully with some good news for you, and thus for others reading later).

Benny