Forum Replies Created
Hi Liam,
I LOVE every aspect of what I am learning and I am eager to discuss with everyone I meet being family and friends etc. I am repeatedly faced by scoffs and warnings and head shaking. IT DRIVES ME NUTS.
First thing I would suggest is that you don’t give them the power to affect you so badly. There is an old saying – something like “No-one can make me feel bad unless I give them permission to”. Often, the permission you give is tacit (unspoken). It is up to you to revoke that permission and claim your right to your own views without feeling bad because others don’t agree.
Like you, they have a right to their opinions, and it is likely fear on THEIR parts (and thus concern for you) that has them “warning you”. See, everyone has a story of someone who tried (insert favourite subject – let’s say, property investing) and met a bad ending with it.
Your family/friends know no different unless THEY have also tried the Property Investing path themselves. And yes, there have been plenty of media reports over the decades about “sharks” ripping off people by selling them over-priced property. So you don’t have to look far to see “danger signs” around property investing.
On the flip side, you will get to read of many in here who have created their own successes. There are also those who can become part of your team that you gather around you to grow your success. Lots of hints and tips and warnings in here too – to keep you safe. Make the information yours, then formulate your plan based on you and your goals (not family and THEIR goals).
Stick around grasshopper – much to learn there is…. :p
Benny
Hi Kennedy,
Welcome aboard the good ship PI.com. You have come to a good place :)I wish I had been as driven as you at the age of 20. I didn’t find out about this stuff until I was in my 40’s !! I had an inkling, but I didn’t chase it back then. You’ll be sweet, because you are starting early.
I like @knightm‘s ideas – main thing I would add is that many of those books are likely to be available in a Library (i.e. no cost!!). And you can always buy your own copy if the book appeals, and you want to make notes all through it.
When meetings are logged on the forum, do make an effort to go attend – you see, it is when mixing with others who have already done what you wish to do that you will learn heaps, and get a shot-in-the-arm from their comments (and even some “how-to” hints from them). For now though, read, read, and read…..
Maybe start with this one (DO follow all of the links) and soak it all up:-
https://www.propertyinvesting.com/topic/4410491-the-big-picture-for-new-readers-especially/Benny
About 20 minutes.
Very droll, Jamie !! Well done – put a smile on this dial…. :)
Benny
Hi Moggy,
I found some of the story a bit difficult to conceptualise. In particular, this bit :-The other half decided to bridge between the two in the hope that the first property would sell in one year.
That “bridge between the two” comment means exactly what?
See, straight off from your words, I thought the other half had taken out a bridging loan (i.e. probably higher interest, and a personal loan rather than against a property, but usually only for short periods – weeks, not a year). That later comment of bridging between the two sounds more like cross-collateralisation – but that would make little sense if wanting to sell one….. ???
What IS really happening? Can you add more words around the actual structure?
It may be better to seek out a Broker or Financial Adviser who can go into it chapter and verse with you.
BennyHi Moggy,
I will not be fooled into borrowing to buying property as this only makes the banks richer …. You can try to out run the debt, but lose your job and the bank comes knocking for the keys. Never let emotion rule your head. Don’t buy anything unless you can pay cash for it including a house. Renting suits me just fine. The sharemarket is one source of passive income so long as you can amass a huge share portfolio. But risk is there too. You can combine the two sources of passive income but still problems will come….. It’s all about income….
Wow, that is an interesting take on things. I have heard of people who only ever rent, but also own IP’s or shares to offset the rent. In your case, you are saying “only pay cash for a house” – and I was wondering how you go about that? Are you looking to grow a share portfolio until it is large enough to sell to buy a house?
I do recall a time (about 10 years ago) when one could buy a house on a credit card in Broken Hill – there was even a story where a widow bought her “first home” with the Owners Grant (then $18k) AND GOT CHANGE !! But that is a long time back now.
Anyway, I am interested to hear your side of things Moggy – care to share?
Benny
Hi Azalia,
I am sure the learning that has already happened will pay back dividends as you go on. Good to hear that this is not a bad purchase…. Just one comment of yours has me scratching my head a bit :-I am actually happy to go through with it, improve it and sell it in the near future
It might all come down to your definition of “near future” – but my thoughts went like this :-
1. You are wanting to get in a tenant – OK
2. But you are also wanting to “do it up” (improve it) and sell again soon.Based on those two, why would you not renovate it first, THEN put a tenant in at a HIGHER rent, keep it for a year to cut any CGT in half, and then sell it? Just a thought !!
Benny
Hi Lea,
and welcome to propertyinvesting.com I feel for you with fly screens NOT being a “given”, and the RE agent seemingly reluctant to provide them, I am gobsmacked. I would certainly want to provide them in my rental properties, especially in the Northern Territory.Have you tried checking with other RE agents in your area? Maybe phone one or two, to see if they think fly screens are mandatory in their area.
I hope other forum members with a bit of knowledge might pop in to add some more ideas for you too, to help you out
Regards,
BennyHi MattH,
What are your thoughts on Logan? such suburbs as slacks creek, Woodridge, marsden. There seems to be some movement happening recently and still some really good cash flow properties.
As per BuyersAgent’s post above, look for the area that DOESN’T have lots of land nearby that is able to be developed. e.g. North and West of Woodridge have land available, but it also has the train line going right thru that North Western portion, so that is a positive offsetting any negative.
Slacks Creek is somewhat land-locked with just a few small pockets of land still available (e.g. Paradise Road).
Kingston has some land to the East, locked to North and South, and little to the West (but with Industrial operations taking hold further West – so, jobs??). Large lots within “settled” Kingston are being sold off to build units once again (like in the early 1990’s).
Marsden is a worry in that, land that was under water in the 1974 floods remained as large rural lots until about 10 years ago. Suddenly, these lots are being built on – so Marsden has quite a lot of land suddenly “available” for development. Just watch WHERE you buy though, especially in the low-lying 2nd and 3rd Avenue areas.
Crestmead is one that has been heavily developed more recently – and with huge acreage to the SOUTH (Park Ridge), I wouldn’t be expecting much growth in values for some time there.In all of those cases, it depends WHERE within the suburb that you look/buy – location is still key, and the above generic comments would not apply to all of each suburb mentioned. Certainly, these parts of Logan are more likely to provide +ve cashflow.
Benny
Bump !! Please help out newer investors who might have been bitten by the “Just Do It” bug.
Do you have a story to share where you (or someone else you know….) came off second best by being a bit too “Gung ho”? Moving too fast to be able to mitigate risk, confirm finance, or to complete due diligence, etc.
e.g. Did someone you know end up “buying at auction” without having had their finances pre-approved, only to find that they are struggling to complete as their finances were not as robust as they thought?
Thanks,
BennyHi Kev,
So what am i missing here . I am not happy that this bank now has 3 of our proprieties under hold but more so that all the extra collateral is tide up in there .
Any help or suggestions would be good . We are currently asking the bank to revalue correctly but again some stupid policy saying we don’t do within 12 months but we may wave this . We are awaiting a response to this.
Unfortunately, much of what you have written seems to me to be “the way Banks work”. i.e. Banks will RARELY value a property at an amount higher than the contract price, no matter what its true value.
It sounds like you have finalised on what seems to be a really good buy – congratulations.
Re what can you do? I’m sure our resident MB’s will come through with some ideas soon enough…. but in my view, I’d be looking at the option (with a Mortgage Broker’s help) of taking out new loans with ANOTHER Bank. They will be looking to get your business rather than keeping your Equity locked up because of their “rules”.
Of course, there are lots of things to consider in doing that – and that is where the MB will be necessary. Doing that without checking for any consequences would not be a good idea.
Then again, maybe just the THREAT of going to another Bank might have this bank decide to “waive their 12 month rule”….
Well done, and good luck,
BennyGood on you !! The first one is always exciting, if a bit knee-trembling too…..
Re vacancy rate, when I have put the question to RE agents, several needed an explanation of what I wanted. In essence, it is a percentage. Suburbs are said to be “in balance” at about 3% Vacancy Rate (3 out of every 100 rental properties are available for rent). So, if an agent has a rent roll of 200 properties, and 6 are available for rent, that is 3%.
If there are only 3 available out of 200, then that is 1.5% vacancy rate, and it indicates an area that renters want and like, and it can follow that rents are higher because of “scarcity”.
But if vacancy rate is (say) 5%, then landlords may even have to DROP rents to get a tenant. Knowing the vacancy rate for Waterford West would perhaps answer one of my earlier questions.
I notice your comment re Buyers Agent – they may have found you a “good little renter” and have already answered many of those questions, so yeah – go have a chat with them.
Good hunting,
BennyHi Liana,
Are there any other things I should be considering?
Hey, it is a good start – the rent return sounds good, but why is it above average? Are the figures “fudged”? What is the vacancy rate for the area (your RE agent should provide that info)? Maybe 4bd 2ba 2g homes are at a premium there (?) and can command a higher than average rent return….
Is the vendor “motivated”? i.e. have they bought elsewhere and MUST now sell this to be able to settle on the new place? Or is there another (hidden?) reason for the lower price. And no, that doesn’t have to be sinister – but it helps to be as sure as you can be. Oce you have bought it, it becomes yours, warts and all – good to find out about any warts right upfront.
e.g. Houses next to a school, or on a busy road (with restricted driveway entry/exit), or with a bus stop right outside, or next to shops, or….. (insert other “Eww” thoughts re houses) can see their prices lower than usual. Maybe nothing wrong with the house itself – just its location? Anyway, answers to those questions help you to KNOW why a price is lower than expected. If any “problems” are no big deal to you, then this might be a good buy.
Due diligence is all about “finding out stuff that may be glossed over, or not mentioned” that could affect your decision to buy if you knew it (e.g. was someone murdered in the house?). Hehe – I sound a bit morbid there, but hey, it happens. Would YOU buy a house that had such a history? It is an open question – no answer required.
I am not trying to put you off this place – it COULD be “a good little renter”. But that has yet to be determined….
Regards,
BennyHi Liana,
Personally I like what can be available in WW. It is an area that has more than its share of quite large blocks, along with good, solid homes at affordable prices. The train line is sort of handy (about 1 Km North for those that use it).You don’t give away much in your question re the property ;) but my questions back at you would be these :-
1. With the median being around $350k, is the lower price reflective of the condition of the house?
2. What is the house’s “makeup”? Give more description
3. What is the land size? (I am seeing NEW houses for about $330k, but as a “cluster home”, perhaps with 200m2 of land – eerrkk!!)
4. Is the land potentially subdividable at a later date?
5. What is your priority/goal? Income or growth?
6. What appeals to you about this property?Benny
Hi Mohib,
Welcome to you and your wife – I hope being a member here, reading and contributing, will ease your path into property investing. Certainly there is a wealth of experience to draw upon, and none better than Steve himself. Are you in a position to take in either of his (very rare) seminars n Sydney and Melbourne this month? If you are, I would highly recommend making the effort. More than most others, I find Steve has a very entertaining yet thorough teaching style (much like his books – no big words, no fluff, just good ol’ commonsense!). He recently did an update where he touched on “which areas he saw will do better than others (at this time)”. I don’t know, but I imagine he will fit in a bit on that somewhere in the two days.
Also, do read this thread – https://www.propertyinvesting.com/topic/4410491-the-big-picture-for-new-readers-especially/ – and look near the end of the second page for a post re “Is now a good time to buy property?”
I can’t help you with Spring Financial Group, as I don’t know the name.
But, with ANYONE (or any group) “guiding” you toward buying property, use this checklist:-
If they cold-called you, they have checked that you have lots of equity in your own home, are marketing only new property, they have their own band of merry men that they point you towards (solicitors, financiers, valuers, etc) and they offer to fly you somewhere to check out the properties….. RUN A MILE !!Any group that keeps you from checking values of properties against other sources, push you to “sign up today or your children will never get to college”, and don’t want to let you leave without a signature, BEWARE !!!
Don’t become a victim of any group like that,
BennyHi Ryno,
Welcome to this great place !! ;) And good for you for having #1 up and flying. It really is a great thing to celebrate.
Re what to expect from property managers? First, I have noted that payments between States seem to be wildly different, so why not share where your IP is, and the amount you ARE paying. That way, others might drop in with a comment based on THEIR property managers. I have had both good and bad.
The good ones just have everything ship-shape. They call you only if they need to – but will have already been in touch with you re “What $$ amount can they spend without having to check in with you?” Most of the time (with the good one) I would receive a 3 monthly “tour” letter – he had arranged an inspection, conducted it, took photos, wrote me a letter, and commented on his findings. The rest of the time, tenants money was in the bank, and the PM paid the Rates on my behalf.
The bad ones seem to be forever calling you, and, when they do, often with “bad” news. Seems they can’t handle anything without input from you. Give me someone who CAN DO property management, even if it costs a percent more.
Benny
Hi Harry,
And welcome aboard the good ship PI.com :)
As there really aren’t too many simple answers to your questions, I though I might share a thread that could well hold worthwhile knowledge for you :-
https://www.propertyinvesting.com/topic/4410491-the-big-picture-for-new-readers-especially/I think I know what your friend is suggesting, and that is certainly one way that can work – but then, there are MANY ways that work. The MAIN thing is to choose the right one FOR YOU and your situation, and your aspirations. The thread linked to above talks to some of the “risks” that could be an issue, so do read all of the threads linked within that thread – it will provide a good cross-section of subjects that you will need to become aware of.
It always helps too, if you give us a clue about WHERE you might be looking to buy. With friends and family saying “wait a bit longer”, they could be right – but in some suburbs they could be quite wrong. Share it with us, and let’s see what the thoughts are that come from the members,
Benny
Hi Kev,
orrect me if i am wrong but at this late stage there is not much i can do . Settlement is next Friday . But i will know better after it settles and we look at other options .
Depending on what “next Friday” means to you, you may be able to do some worthwhile things. To me, “next Friday” would be Friday the 11th Sep – if you mean the 4th, then yeah, it will be tight !! So, what can you do?
Hopefully, one of our amazing Mortgage Brokers might come through and say “We may be able to rush something through” or “I might be able to arrange a brdging loan”, or even “My solicitor says you might have recourse at the bank that has brought this on”.
Hey, I don’t know – these are just thoughts. For sure, with the numbers you are quoting, it is very worthwhile throwing the kitchen sink at the problem. Good luck with it, Kev
Benny
Hi all,
Today I wanted to direct you to a thread that has so many good posts, all to do with HOW to gain finance to allow someone on a modest income to grow a serious portfolio of IP’s.
The thread itself is called “30 properties before 25, finance???” and its link is here:-
https://www.propertyinvesting.com/topic/4404268-30-properties-before-25-finance/As expected from the title, there are many posts re the financing of such a venture, the pitfalls, the “how-to’s”, etc. Well worth a look to help gain more background knowledge re financing IP’s. Who knows, it could be the catalyst that sets YOU on the road to financial freedom !!
One post in there is from Nathan Birch who has made an art-form of buying properties that need love, doing them up, renting them, then going again – this post is a depiction of how someone can approach the building of a similar portfolio, and the likely outcome(s):-
https://www.propertyinvesting.com/topic/4404268-30-properties-before-25-finance/page/3/#post-4652561As Nathan so aptly reminded in his opening remarks: This may not work for you – it is simply an example of how it MIGHT work for someone. Everyone’s situation is different.
The basic theory behind his words is worthy of discussion though, hence the reference to it. I hope it holds some benefit for you !!
Benny
Hi Harry,
This is what I love about this place – we all get to share the “things that happen to us” and have a laugh. I think I have had my share of “Bank people who really don’t know what they are doing”, but I have also come across some really knowledgable bank staff.
What can I say – some are way better than others. In your case, I believe you ran into one of the “not so knowledgable” members of a bank’s staff. It happens. That just sounds so WRONG to me, though I can see how point 3 could have some merit – but 1 and 2? Nope !!
I hope some of the Mortgage Brokers get to share some of the really “interesting, funny, strange” things they encounter from time to time.
Or, I could be TOTALLY wrong, and everyone can have a laugh at me (gasp!! :o )
Benny
Kev,
Richard just made a VERY important point that those dealing with finance daily (like Richard and several others on here) confront on a regular basis. Read this bit again (many times) as it is THAT important:-Applying to a number of credit unions willy nilly is likely to FRY YOUR CREDIT FILE and could result in a total decline of any potential loan restructure.
Go talk to someone BEFORE taking action – perhaps PM or phone Richard, or another Mortgage Broker on here, to get some background information before you do something counter-productive that could slow you down for some years !!!
It IS that important, truly.
Benny
