Forum Replies Created
Hi Benstone,
Depends on who you are targetting as a buyer. Is it in a well-to-do suburb, or lower end of the market?
An investor will go for the extra bedrooms if they can have doors that lock and put in 5 students or whatever.
A family of 4 will probably like a bigger room.Ask at the REA’s and see what is selling well in the area and then you know your targets…
Cheers,
JBBanks here will lend up to 80% on residential property, over that they will ask u for Lenders Mortgage Insurance…Costs a few grand, but can be cheap if the deal on the investment Real Estate is right! Just ask a home loan lender at your Bank, they will tell you all the figures.
Cheers,
John Bradshawgoosehead wrote:Hey guys,This $3000 fee is that for the finnancial plan as apposed to just approaching them for refinancing? What other Planners have you approached? I have had 1 group approach me over the phone that have some good ideas but I have not had a chance to research yet any one else been in this situation? They have a similar structure to Destiny from what I have learnt so far.
Destiny is good if u need a push to get started in investing in property. After your first couple of IP's you will probably go it alone….
JBBrendan Irwin wrote:i would like to buy a property with 2 other friends. The banks and other lenders want a 20% deposit. We are unable to come up with this amount. We have negotiated a good price for the property but we need someone who can finance it for us. Is this possible to be done under a wrap? And is there someone out there that can help us?If the Banks are unhappy with this loan it may be a warning bell…..Be extra careful with your due diligence.
JBWow! 5K and never heard of him….There's a LOT u can lean from 5K of books……that's my 2c worth
JB
seank wrote:hi,Also a critical question I ask if anyone can help , which suburbs will benifit from the proposed motorway upgrade/ bypass, and which suburbs may lose value???
any help appreciated
Hi sean,
The suburbs to benefit will be those next to the motoway and one suburb further away, along it's whole length. Just be careful about noise when buying very close. But improved transport will always attract people, and so demand for property will increase. Just buy in the areas where you can afford it, after doing your homework.Cheers,
JBHi Pirate,
I think you need to have some practical questions to ask any broker/financier.
eg Do they have their own Company, explain company tax rules ? How long has the co. been running? What formal credentials do they have in the Finance Industry?
Also, get them to explain to you what the differences/weaknesses/strengths are for setting up Trusts/Companies or buying/selling in your own name. Whilst they are not accountants, they are advising on some crucial money matters and they should be able to give informative answers with REAL figures based on your situation.
I guess what I a trying to say is: Don't take vague generalities for answers. That is Sales talk, not brokering. You need to have specific, real numbers to discuss with them and then decide based on the real numbers they give back to you how you should structure your loans.
At the end of it, you may decide to do it all yourself with one of the Banks etc anyhow. A good broker will give you scenarios that you will not have thought about, but so should a good accountant who understands investing. I have used brokers in the past and at present deal directly with a Bank. Why? Because I have found this guy buried inside a bank that, for me, is the best informed lender I have come across, ever. He is accountant/broker (sort of ) /developer all rolled in to one. He comes up with great ideas on financing over lunch or coffee.
Just go out there and start meeting with some of them. You will quickly suss out who knows their stuff and who is swinging the lead………
And don't forget, if a broker/bank recommends something, then always pass it by your accountant and perhaps solicitor. They again should be part of your team to give you extra guidance/warnings. Work them as a team, rather than disjointed individuals. It will prove very valuable.
Cheers,
JBBuy a copy of HomePriceguide (better than RPdata, I think) of the last year's sales for the area to see what actual price you can get for a sale. Don't just take what the agent(s) tell u. Once u have the report (cost about $50), map out the kind of townhouses (eg 3bed, 2 bath) that you are thinking of building and go and take a look at them from the outside. Imagine u could build it and sell it in a week. Would u make a profit from the real sales figures of the area?
1.5 yrs for completeion? Average good builder is about 16 weeks per property, or are u building yourself as owner builder??
Don't forget to factor in selling costs like tax on any cap gain and agents selling fees etc. They are not insignificant sums.
It's great that u r trying to redeem the situation, but do the sums first….
Cheers,
JBduckster wrote:Some lenders have a scheme where you can transfer the loan to another property when you sell your development and are buying another same priced property as the loan security at the same time. So you are not closing the loan just changing the security the money is secured against.
This is know as substitution of security
see
http://www.nabcapital.com/downloads/public/22210_0.pdf page 10 and page 24 an example not a recommendation
http://www.ratebusters.com.au/products.asp has this facility as an example not as recommendation
http://www.emortgage.com.au/mortgage_products/LoanFeaturesBenefits.asp see third feature.. as an example not as recommendationThx, that sounds good. Shall give NAB a call….JB
Terryw wrote:Bank West's exit fees on some products are only $300 (approx).There may also be the opportunity to keep the loan open and just switch securities – but this can be a lot of mucking around.
Great ideas. Thankyou very much.
Thx for the lead on Bankwest…Shall look in to them.
JBMmmm,
thx guys for the thoughts.
Appreciate the caution of going with the majors and also the idea of using LOC.I value the advice,
JB
NonnieE wrote:Thanks JB. I am considering it seriously and appreciate your comments. We have already used them for brokering to refinance, so thats a start. Did you get them to do a financial plan for you and if so do you find it useful?
Yes, the Financial plan came with it. It was OK. We were shown how we could re-structure loans, which for complete novices was good. Not much more value than that. But they got us on our feet, which was invaluable.We are going ahead now mostly on our own steam, but always reading and chatting to other investors….
If u can't seem to get started, or need a hand to hold, then I would recommend them. The $3k is not a lot to get the juices flowing and hopefully get started in investing wisely.
JB
My wife and I have been with Destiny for just over a year. The guy who leads our section is very knowledgeable (to us) in property, always willing to help and guide.
The real benefit comes from the Focus sessions, where as the name implies, other would be property investors gather together to learn and share stories under the guidance of our mentor.
Along with lots of reading and going on to forums etc, these Focus groups got us started with our first IP and now we are on to a second one.
No, they don't find properties for you and I guess the financial resturucture is common sense (which we did not have), and we found it helpful.
Was it worth $3K for us? I would say so…..It got us moving in the right direction and helped us change our mindset. I think it is the mindset change which is the most valuable thing in all of it as it turns you from a non-investor in to an investor, albeit a novice investor.
2c worth,JB
Excellent list Mark.
Thankyou for the in-depth reply.
Kind regards,
JB<<<<Whilst saying this there are a number of key reasons why Adelaide and Brisbane will continue to see signifigant growth.>>>
Hi Mark,
What would u think the "Number of KEY reasons" are for these two areas, as opposed to say Sydney/Melbourne/Darwin?
Thx,
JBHi Kum,
This info has been VERY helpful.
1. Do u build remotely, or do u live in the area you are building in?
2. How did u choose a builder?
Thx,John
What about Alberta, Canada, where the oil and tar sands are.
Places are BOOMing there. Seems like mining towns are going crazy lately…Must be the China syndrome.What do others think?
JB
Quote:Originally posted by KJK51:This resulted in an ungeared IRR of 9.02%; before tax geared IRR of 13% and after tax geared IRR of 16% at eh end of the 10 yr investment period. However at no time throughout the 10 year investment period did the property return +CF so the IRR was based solely on the capital growth aspects of the property!>>>>
Quite right…The DHA property I own will never turn in CF+ over 10 years by my calcs, with an Interest Only loan.
And with prices dropping over the last 18+ months in Sydney, the -ve gearing story is getting very hard to believe in.
JB<<<If anyone can shed further light on this and re-affirm that I could buy-and-build or buy-and-subdivide, even with a loan on this basis, that would be so helpful……or even buy-and-renovate.>>>>
Pls be careful not to bite off more than you can chew. Read Steve’s books and also books by Jan Somers and Margaret Lomas before getting in too deep. The idea of doing a property development as your first entry into the Property market seems like running before you walk to me. For every marvellous stroy where it worked there are too many that have regretted it.
Go slowly my friend, increase your knowledge and make decisions based on real figures you work out, not on hype and emotion.
JB
Gr8 story and solution Skippygirl
Thankyou!JB
