Forum Replies Created
Hi all,
further to your buying vacant lots, a friend of mine goes in as early as he can and buys the parking lot of a new development. He then rents it back to the Developer (minimal rent). The beauty is that these lots are generally with out requirements to build (ie: no time limit as to when he has to build) so he can do what some of you have also done, buy in early wait for apreciation and then sell or build and reap the rewards! Not only are the prices better than the rest of the properties but it has an income and the only down side is that he can’t use the equity straight up, it is more of a longer term investment plan. Heck, he’s been doing it since hes been 18 (now in his thirties)….Just thought I’d add another element!
Cheers
C@34
Hi all,
let me start off by informing you all, that I officially HATE moving! We worked out that, since being in Hedland, we have moved 1.5 times p.a.![grrr] [grad] – gotta learn sometime!
That is the only emotion I am currently experiencing (too weak for anything else).
Kay, my master plan is (at this stage) Buy and Hold! I know that there are more aggressive ways out there, but I’m a gentle giant and haven’t felt a need for the $1 million in 1 year thing. It’s just not me, thought I have tried (first property investment project was to buy two IPs and our PPOR in one hit – would have worked out cheaper that way than just the PPOR).
As for +CF, yes my that would be my preffrence. I would love it if my wife could stop having to work, but could choose to or not to; then, off corse, it would be my time to be able to choose!
If it doesn’t work out that way (all +CF) then there’ll have to be some -CFs in there – this could balance out the tax that we would have to pay. Kinda a mix’n’ match thing.Initially, there will be the PPOR and one other (IP) in Hedland, soon, say within 12 months. Then the next would be in Perth, maybe two or three. I would like to continue, thought, untill I get to a point where I am satisfied with where I’m at.
On the way I would like to teach my children early what it is that I have only learned now and may be give them a leg up and whatch them grow!I want to be free to be with my family! They are my top priority (and very -CF).[exhappy][inlove]
Wot can I say…..
does that answer your Q, Kay?
Cheers
C@34
Thanx all for your comments,
some took the focus of my worries, some were helpful.
The house is a good buy, so I’m not going to ‘sweat the small stuff’.
To tell you the truth, I believe that I actually put “to the purchasers satisfaction’ on the individual clauses! I’d have to go back and check! First real purchase and I’m all giddy. Wots that about no emotions?
As this is to be our PPOR and my wife has given it her stamp of aproval (and she’s keen to move in) I wont be rocking the boat. As for future investments, I’m going to have to be more on-the-ball. Should I be in the same situation then, well, they’ll have to come to the party. I haven’t repeated a mistake yet!I heard it will get easier as time goes on.
Cheers
C@34
Try the Valuer Generals Office.
Cheers
C@34
Why sell it if it is a good investment? SOme of us look for good investments to keep long term.
Cheers
C@34
Giday alwayscurious,
It almost sounds like you cross-colateralised?! How did you get 110% for your IPs? If that is so, you might have to sell ALL your properties, including your PPOR.
Hope I’m wrong, but I too would try to do all that is necessary to hold onto the IPs (its worth while in the long run).
There are several Mortgage Brokers on this site and others that deal with lending. Find them and give them all your info and see what they can do for you! You might have to refinance to change your situation from a down hill slide into a level plateau or even a climb.
If you’ve read Steve’s book, you’d have read him stating that +CF IPs are made not necessarily bought.
I’d like to encourage you to try before you toss in the towel, you can still do that after every other avenue has been closed off to you.
You’ll only ever know when you have a go.
Best wishes and keep us informed.Cheers
C@34
Doode, I applaud your enthusiasm,
I hope you keep it up (take notes because your book would be a winner) so that when you are at the stage where you can actually do this, you’ll have all the knowledge you need!
I envy you in one way, where would I have been if I had started at your age? Your challenge will be to learn patience until you can afford to developments!
Sorry I can’t be of help with your question, I’m a bit stumped to find you on this site.Cheers
C@34
I didn’t call it taking th ‘piss out of them’, but I have used Jenmans “expose” on REAs to do a lot of research in my area. It was good to get that info from a book as I soon discovered which REA I would use to sell and which I would stay away from!
His book, I think it is called ‘Real Estate Mistaches’ or something. Got some good questions and pointers on the purchase side (I haven’t read the sales side of the book as yet).
A lot of the questions you mentioned appear in this book, ‘..who set the price….’, ‘…would you pay this much fro this house?…’, etc. Surprising the info you get from a BAD REA!I guess I did.
Cheers
C@34
Great Scully,
@ 80% of your PPOR (no mortgage insurance) you could draw you loan to $320K (less $264 to go) gives you around $56K to invest. Using 20% deposit and 5% as closing fees you could be looking for an IP upto $220K.
Not too shabby. It’s an amount you could start looking arround for.Cheers
C@34
Welcome Scullie,
more info on your situation would be helpful to give more specific advice, like mortgage amount – house value (equity), any savings you might have, how much the new place would be (approx). This is the kind of info most of the forumites work of to see if the risk is accepteble to them.
Something to help you make up your mind is, that interest on PPOR (you home, you live in) is NOT TAX DEDUCTABLE where as tax on any investment (ie: borrowings for investment purposes) IS TAX DEDUCTABLE!
So from Yack:Get off the fence. Ok, If I could afford the interest only payments a new investment property and was on the highest tax bracket I would buy now and dream of the tax refund you get at the end of each year.If you income is high (therefore pay lots of Tax) it might be in your interest to purchase an IP and use it for Tax Consessions. A strategy that you might want to consider.
If your income isn’t so high, you might want to put off buying an IP until you are more flush with funds (ie:equity or savings).Hope that helped some
Cheers
C@34
Sorry Ceza, but what is a S&P?
I know what an O$A is but you have left me in the dark. Still learning I guess.Cheers
C@34
Yack, Kay Henry,
both of you sound like my wife (a good thing in my eyes).
I guess you’re right, not too shure what I was expecting. I would like to be BETTER next time I buy a house! So knowing the true facts on the Laws would be an advantage. I feel a bit blind-sighted by the REA. It allmost feels like he humoured me by taking these clauses.Made me feel stoopid – there you go. I’m not just a piece of meat! I have feelings and emotions, you know….. ooops, wrong forum, sorry.
My reason for asking you is to see if putting these clauses in is just another avenue to escape a purchase or whether they actually hold any water!? Should these things be done before the final price is agreed upon? When do you do your inspections? During negotiations, after, when ?
Cheers
C@34
KayCode:Blue and green is the new black :)I loveit, got anymore like…
‘Positive gearing is the new negative gearing’
‘obesity is the new anarexia…’ etc ?[biggrin]LOL
Thanx WallFlower, I got a good chuckle out of that, even if you had a go at a FELLOW forumite!For the book, i’ll anticipate its release. I hope it will add to my limited knowledge that I have gained so far.
Cheers
C@34
Good morning all,
Firstly to Yack:
Is Sons of Gwalia there? Did they not just go under because they underestimated their gold reseves.Sons of Gwalia have their main operations in Wodgina, way up north. That is not to say that they aren’t in Kal., though.
Secondly to Francois:I like to know if this area will attract some capital growth in the future.I currently work with two guys that come from Kal. and they have indicated that over the past 4 or so years, they have had NO capital growth, nor have their rents increased. Both bought houses to live in while working out there. Since meeting up here, we’ve got a small investment group-thing happening here, where we explore different investments (mainly in our area). Perhaps it will grow stronger, who knows.
So, you need to check out the local shire to see if any new developments are due to come or take a chance that CG will come within an acceptable time frame for you before you invest in Kal.. Look at the East Coast, their prices went thru the roof, sooner or later WA has got to catch up!
Do the research and let us know. Sorry for the not-so-good-news.[blush2]Cheers
C@34
Posted – SuperTed
Has there been a labour goverment that has actually left the country in a better financial state then when it took over office from the liberal party??I agree with Super Ted and Anubis, on this one. My judgement has been coloured by my experience with my parents in business. If their business was doing well, so were the employees and us.[lmao]
If things weren’t going well, then neither did we. Looking back over the years (to about 1983), when has Labour EVER produced an economic climate that is as good as that of the Lib/Nat parties? Granted things look better when you get Gov assistance as Labour used to throw money arround, but then all these other wonderful things happened to us like ” the Depression we had to have!” Why? I don’t like being depressed, and I’m sure that the nation as a whole didn’t much like it either! Record numbers of businesses failing and families loosing all – they probably didn’t enjoy that much either.
Listening to all of you experienced and prosperous investors – you all manage your money well to get a head! Why would you think running a country be any different? Would you run your investment portfolio like the ALP ran our country?I don’t thinks so Tim ][withstupid]You can’t save the environment or increase spending in schools without money. If you don’t have it, then you’ve got to borrow it! Who ends up paying? You and I do! How do we get there? Using our money as best as we can, and cash is still cheaper then Loans. Once the coffers are full(er) then we pay for improvements.
Makes sense to me…..O.K. my ‘barrow is ‘pushed’, over to you.
Cheers
C@34
Love it!
Sent it to my wife AND mother-in-law!
Keep your chin up, even if the neck is dirty!
Cheers
C@34
Welcome to the forum llewtanner,[thumbsup2]
from memory, Steve initially used saved capital and at a later date was able to use both equity from the purchased IPs and his own home to continue buying IPs. The +cashflow that resulted from these houses allowed him to borrow more money (as he never outrightly paid for a property, just a deposit). Hence the leap-frog expression comes from using what you have in equity (own home, other saving or capital) to put down a deposit + closing costs and borrowing the rest for each house.
For example, you inherit $100K, you could buy one house at $100K and own it outright (no tax consesions) and then pay tax on any of the income from that property, OR you could use that money and buy 5 x $100K properties with a deposit of $20K each- borrow what is left and rent them all out. This gives you Tax consessions (if -ve geared) and the income (rent) would , hopefully cover the running costs of these houses. This is more or less what Steve did (I simplified it) but he ensured that all the properties were +ve geared (income is greater than expenses).
Clear as mud in a beer bottle! Hope this helped.[biggrin]Cheers
C@34
Is some-one able to explain why the two different measures? Why have sqm and squares (@ sqm/9.2)?
Sorry to be so slow.Cheers
C@34
Thanx Miek
welcome to this forum.
So is the term squares and square meters interchangable (as in the same)?Cheers
C@34
I would definitely advise combining the mortgages into one.I hope you have forgotten a word here, luckyone :”NOT”. Cross-collateralisation (auch) is a dirty word IMO! It gives the Banks/lenders far more equity than is required AND they can, if the mud hits the fan, force you to sell both properties!
From the rest of your post, luckyone, it infers that you don’t like Xcollarteralisation and it’s a typo, but I just wanted to clarify that.Tass, if you use your existing PPOR, and as you say it is paid off in full (or mostly), there should be enough equity in it to use as a deposit and closing costs for any future houses, be they PPOR or IP’s!
As per other posts:-
https://www.propertyinvesting.com/forum/topic/12514.html
https://www.propertyinvesting.com/forum/topic/12515.html
https://www.propertyinvesting.com/forum/topic/12492.html
If you cobine all these answers into one and still have questions it might be better to pool all the mind capital of this forum onto one post and get the combined effort to discuss you situation. Sorry for being blunt, but spreading the different aspects of your question out doesn’t allow every one to work of the others ideas to give you a better WHOLE picture. So far its prety disjointed.
I wish you well. Read on!Cheers
C@34
