Forum Replies Created
HI Kay,
Blue Ribbons is right! Most are hellish in their price range and not generally considered t obe for beginner investors!It’s all for the groovie rich people (where I’ll be someday – groovie rich that is).
Cheers
C@34
Hey Wilanddel,
I’ve just been looking at the links above (just to have a look) – I’m not really in a position to purchase at the mo. and I noticed that a lot of the homes are Fibro/Weatherboard style homes. Is that the norm for established houses of there?
Of the few that were brick, they weren’t even the most expensive. I know you can modify the Fibros easily (half the Town I live in is Fibro) but I’d prefer Bricks. What is the norm now days? And, in the price bracket up to $260K there wasn’t that much available. Was I looking in the wrong area?Appreciate your feedback!
Cheers
C@34
HI all,
just a quickie – why do the properties state the “Capital value of $37,000” while it is on the market for $46K?
DO they want me to try to argue the price to the $37K? Can some one elicidate (…”Please explain!…”).sorry to be so goofy.
Cheers
C@34
Hi Bonnie,
just for personal interest, what Town did you buy in? I live in Hedland WA, so have an interest where you bought.
If you’d rather keep it low-key then PM me, I’m very curious!!!Cheers
C@34
Giday Luscious,
have you tried the local REAs? They all have instant access (via the internet) to that information.Cheers
C@34
Welcome to the forum TJ,
Does anyone have any suggestions with regards to the suburbs I should be looking at buying in (preferably around perth)? I am looking for high growth areas in the $260000 price range.If you check out other older posts, you’ll find that most newbies ask the same question, like me! In short, its up to you. There are some posts that mention and to some extent discuss different burbs, but it is really up to you. I know that doesn’t really help you (this reply always frustrated the heck out of me), but it depends on what you want to achieve, what you wish to do (buy-hold, flip, renos, etc) and that is where you need to start.
There are books on offer (also discussed ad nauseum on different posts) that will help you to formulate investigation questions and research criteria which you would use to pin-point the IPs of your specific choic! Try: http://www.reiwa.com.au for starters and get a feel for Perth and its areas. You’ll discover average (mean) prices and a description of a typical House for each different suburb and more. Look for the web pages of the REAs in the areas of your choice and see what they have to offer and just keep going.
Choice of good suburbs are like opinions, …….[cigar]You have a good price range for Perth, do a search and see what you come up with. Also check out the local Shire/Town Council web page for future events that might increase or decrease the value of any IPs you might be investigating.
Best of luck! Once you find something, you can bring it (with out address details) to the forum to get others input and advice.
Hope to hear from you soon.Cheers
C@34
Good Q Apprentic,
I have always thought that the money you spend to make money is tax deductible. That is why the mortgage on your PPOR for an IP is tax deductible and so are all fees and charges.
I cannot see there being a difference in travel and accomodation, as long as you keep all receipts and it isn’t via Disneyland with the whole family.
If I’m wrong then I’m sure it will be pointed out by others by tonight! Have you asked your accountant?
Cheers
C@34
Hiya Redwing,
a person you should ask should be KP (on this forum and also in WA). I believe he does similar things or has at least looked into this sort of field. I have discussed a situation like this with him once and he was quite knowledgeable.
I was looking at an IP in Hedland, block size 1381sqm front road acces and a small alley way out the back available for purchase. Zoning was R20/R25 which means I could have done a ‘Green’ title subdivision to split the block in half then build a douplex out the back and do a ‘strata’ title subdivision.
I was warned that the subdivision process would take up to 18 months and would cost me an extra $5K. The Douplexes (each unit) would require 440sqm each for it to be passed by the local Shire council.
Perhaps that is your best place to start! I managed to get the shire rates & Taxes, rules and regs, zoning info and a little bit more just by calling them up and asking. I tested the water to see if I could subdivide (or would the shire stand in my way – they liked this approach as they then after showered me with info rather than me asking for everything).I would probably put in for all three! The REA might then help pursuade the vendors to sell. I have found in the past (when I was first trying to get a homeloan) that it is often easier to go for more than one property loan at once than for individual loans because you can include the income of the different homes. This was in my case because I wanted to include a PPOR in the equation. The bank liked my spreadsheets (straight out of Steves book) giving LVRs and income and CoCR (which I had to explain – and made me look more professional). For me it worked, but the O&As fell thru and I didn’t get any of the houses I wanted. Cest-la-vie. Worked out in the end as my PPOR now is much better value for money then the other three would have been! Just to give you an idea of what I did.
I hope that helps you a little further! You are more experienced at measuring the return potential than I am (I’m sure).[blush2]
Cheers
C@34
I never had a mentor. Most people here probably did not have a mentor.You’re probably right, Yack, but, for once, I can say that I did/do have a mentor! It wasn’t obvoius at first but has turned into such a relationship. He is my former Boss! He’s fifty odd and I was taken in, off the street (so to speak – no previous experience) and made into his Operations Manager. The only thing I excelled in was customer Service and he wanted me to run his Bus Charter Company (I didn’t even have a bus license!). In a way I am living the Rich Dad Poor Dad situation.
I have since left his employment and our relationship has realy taken off. When we bought our first home (recently), I got his approval (kinda whimpy – I know) but it meant a lot to me to discover that he thought that I made a good investment. I help him now in the office (as I set it up and know it better than the back of my hand) and we discuss all manner of investments. He gets excited when he shares his newest idea and I share that and put my opinion accross which he then uses to evaluate the investement from my perspective and I have, by chance (being realistic), saved him from one investment blunder. So, although it is mainly one way, I do have the opportunity to give my perspective and look at his investment ideas.
I lean a lot from these forums, but he gives me the practical side of things that give me a better, wholly rounded education.
I find it unfortunate that there aren’t more mentors out there as they are an under rated resourse, by far!Cheers
C@34
we had this happen to us we signed with subject to finance the broker said woo hoo u got the loan then subject to morgage insurance then 15 days later the mortgage insurers said noCorrect me if I’m wrong here, but you DON’T have finance approval unless it is in writing. And in my experience (thru the last 5 houses we attemted to buy) the REAs don’t even tell the vendors unless they receive a letter of financial approval directly from the Bank!
Mind you, I live in WA and we seem to do things a bit differently over here, from comments I get from REAs. We generally do the negotiations before we do inspections (inspections are done once the Offer and Acceptance are signed by all parties). The clauses simply specify what happens to the validity of the contract based on the successful (or otherwise) satisfaction of the clauses with-in the O&A.
So stipulating “…subject to finance approval by Joe Bloggs Bank of WA” and “…within XX days of the offer…” means that the contract is null and void if finance is not achieved in writing within XX days!
Deposits are returned or you get an extension. Seems fair to me. Shurely this is also the case over east?Cheers
C@34
The block choices are a 400sqm rear block in Morley for approx $120,000, a 440sqm rear block in Joondanna for approx $175,000, a 600sqm rear block in Bayswater for approx $175,000 or a 550sqm rear block in Bedford for approx $160,000.
On each block of land we would consider building either a 3 x 2 house or a townhouse.What type of houses are standar for these locations? Also, the blocks are tiny! 400sqm? That is scary!
Have a look at this site and see what you can find in relation to your query. I find it good for things like median house prices, rental info AND a description of the TYPICAL houses in each suburb. You don’t want to build something that sticks out like sore toes (or something).
Have a look, you might find the answers to your question there.
http://www.reiwa.com.auCheers
C@34
Hi all,
doesn’t -ve gearing mean you have to loose and can claim back a max of 48.5 cents in each Dollar?! So that would mean, converseley, that +ve gearing means you pay a maximum of 48.5 cents in every Dollar?!
One you loose 51.5 cents/dollar and the other you keep 51.5 cents/ dollar.
I know this is basic, but in times like this, would this not be the main emphasis of ones investing? CG is great when the market gets up and boogeys, no denying that.Just thought I’d throw another cat amongst the chickens….
Cheers
C@34
NO, but my parents once bought a block thru ballot and then build their PPOR on it.
Judging by what you’ve said, it is a kind of lottery with a commercial lease bonus. Depending on the small print and you actually getting one, it looks like it could be a good business opportunity.
How long do they want to lease it?
What do they wnat to do with it?
What are your obligations?
How much are they going to pay?
Can you include any loan application fees, closing costs in the lease agreement (comm. lease = all outgoings to be paid by leasee)?
What’s the catch?Just some of the questions that popped into my head from what you’ve written. You probably had the same thoughts, and more, but it looks interesting as long as the numbers stack up! See what they offer before the horse bolts.
Bill is in the mail!
Cheers
C@34
As a tenant I’ve always had to pay for it all!
It depends very much on what you want to achieve though (within the Law of corse!). Like Steve has been saying, +CF deals are made rather than found. And in my case, where everything is cut off prior to me moving in (I then pay for reconnection) it is all a clean slate and I did pay for it all.
The last Land Lord we had, has another house for rent, and because the tenant did up the gardens for him, he agreed to pay half the water. We ended up doing the same and got the same deal in the end.
Worked out well for all.Cheers
C@34
Goe – same Tetris is good, now (or has been for a while) in 3D.
The others are more strategy game, War Craft I,II, & III, Starcraft, Age of Empires, Dark Reign one (didn’t like the second one!)Cheers
C@34
alwayscurious Posted – 15/09/2004 : 16:29:15
Go Calvin.. Remember – Family is what makes it all worthwhile! It’s no point earning much $ only to have no one to share it with…Go it in one! I have had to re-adjust my goals – that is change the priority. It used to be get the first house, then the next, then the next, etc, so that I can spend more time with my family!
WRONG!
Now it is more like this: First my wife, then my children, then come the investments and friends. I get confused with those two, I’d like to put my friends first (as you should) but a lot of them are anti-investment and that creates a problem, so I guess I have to keep juggling those two depending on the day.
Cheers
C@34
Young Hobnob,
I’ve been told by the Mortgage broker that I initially employed that to pay off the bad debt faster than you need to isn’t in your best interest to getting a house. We were discussing the purchase of a PPOR!
He suggested to me that I should pay the minimum monthly repayments and then put all else into a savings account (paying yourself first kinda deal). With the FHOG, and I think NSW has a special extra deal going at the moment of a further $5K (?!?!), you should be able to buy a house that for the initial FHOG period is your PPOR. Then rent it out once you’ve completed the qualifying criterion and rent else where. This will aid you in your Tax situation freeing up more of your money. If you look for cash flow and focus on that, all else will fall in place.
Yes I like CG! But whatching a friend of mine (a former Boss) who soley focuses on cash flow in everything he does, I can’t help but believe that it is more important than CG (shoot me now!). I mean focus on cashflow (hopefully +ve= into your pocket).
Yes it will mean that the $25K will take longer to pay off, but you’ll get into the investment “scene” (for want of a better word) a heck of a lot quicker.
Personally, we have refinanced a couple of times for better cashflow, and it has paid dividends. We now have our own house (two years ahead of schedule) and I can feel an IP comming on in 6 months or so.There is infinite good advice on this forum (and others) pick out the bits that fit YOU the best! Then act on it. It’s the only advice I can give you! Kick Butt!
Cheers
C@34
What an awesome article, Derek.
For Caleb this could mean that he could hire his fathers mower and start his own mowing round in his street. Isn’t that how Jim’s Mowing got going?
How’s that for an idea, young Caleb?Cheers
C@34
Cross colaterisation across a portfolio of 1 or 2 properties may seem to pose no apparent problems to an investor in the early stages of wealth creation,
In a lot of cases as long as the banks continue to approve requests for further funding the investor is content and usually oblivious to what lies ahead.Usually the problems of cross colaterisation only become apparent to the investor when a request for further finance is declined, the remedy is often a costly refinance of the portfolio to an accommodating lender
Thank you Steve, this is what I wanted to say. I hope I did?!?
The bank would have “chinese walls” against my own home because
A) it is not Xcollaterlised with the two IP’s on setup, and may not need to be.
it is ONLY in my name.
C) the IP’s loan is in both names (with apportioned interest to whoever ‘owns’ the IP, my wife or myself. <C was my broker’s idea>I don’t know if this works. I thought that when signing a mortgage, you sign a personal guarantee that you are liable for any financial losses to the bank. That is, whether the PPOR is in your name only or not makes no difference if your IPS need to be forclosed, they’ll still come and grab your PPOR! It’s in your name and you signed a guarantee and therefore they (the Bank) is entitled to take it to minimise their losses.
Please correct me if I’m wrong.[blush2]
Cheers
C@34
Big A,
my understanding of Xcoll is that it gives the banks MORE security. As we all know banks don’t like taking unnecessary risks, kinda like us! So for them to sell you out, the mud has to really fly as it is a last resort to protect them from loss. It gives all sorts of BAD publicity and that’ll cost them money – so they don’t like to forclose! Most of the time, if you don’t satisfy their “safety” requirements they just turn you down.
I have not considered the difference in costs, BUT have heard a lot of negatives about the ‘accesability’ of your equity thru Xcoll.
That is once Xcoll is in place, you have a more difficult time re-drawing (again this may have changed since I last looked into Xcoll). Basically it reduces your freedom!example: You have 3 properties (PPOR + 2 Ips), Xcoll. You do a valuation and if one of the houses has lost value (for whatever reason) they wont let you re-mortgage to buy a third IP (this just happened to a friend of mine).
So you can’t buy and so are stuck until this situation changes! Even if this doesn’t happen, you need to redo the whole lot (as in refinance everything) to buy another IP
If the loans are all individual for each house, then you could secure the one that has lost in value (simply re-draw from one of the other two/ or don’t tell the bank – depends on you) – problem solved, and, if enough equity is still available, you can buy that third IP. If none of the houses have lost any value then it is even easier to purchase another IP by drawing on the equity of any of the individual properties.In short. Xcoll is more restrictive!
Cheers
C@34
it is ONLY in my name.
