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I saw one on the net on the weekend. It sounded cheap (in Sydney) and had a granny flat and a big block. Must admit I was getting rather excited. It mentioned a power easement so I looked at Nearmap and it has a power tower IN the front yard. Searched RPdata and they've been trying to sell it for years. Didn't bother going to the open home.
Oh well I'll keep looking.
Good advice above.
I have never seen a bank take a pre auction offer.
Pro's- you may get it cheaper.
Cons you may pay more. You won't know unless it goes to auction. I have seen people get properties cheaper than their limit.
Con- you have shown your hand (if you put in offer and it's not accepted). My experience is that agents just want to gauge the market and don't often encourage vendors to accept pre auction bids. They now know your max and may put in a vendor bud to raise it to your limit (if the auction stalls). I would not put a pre auction bid in at my max price.
Personally I would always go to auction unless I put in an abslute crazy bid (meaning very low).
I guess it comes down to knowing what the vendor is after. Sometimes you can negotiate around that. But at auction they get lots of attractive terms- no pulling out, quick settlement etc.Most people don't like auctions so unless the place is unique there is a chance you'll get it under market price.
advice not advise
Where are you getting the $14K? Out of your equity? So you put $10K rent in and take $14K interest out? plus other costs?
I doubt you can make just one payment a year. The interest would keep getting added on each month so it would be more than $14K in the end and you don't have enough equity in the investment..I don't see the point if your PPOR is interest only.
I know some people divert the rent to their PPOR and use a LOC to pay the interest on the investment property. Thus reducing non deductible debt.
Maybe I have misunderstood?
Email Scott (website below). Send him details of your property- age, type of building, whether any renovations have been done (details). He'll tell you whether it is worthwhile. He doesn't recommend depreciation reports unless you get your money back the first year.http://depreciator.com.au/
matt_decat wrote:rFinally, how do YOU go about selecting a property. Is it a case of picking a random area with a certain type of house (ie. brick 4 bedroom home in a random area) and then try suss out which are of the suburb to buy into. Do you pick a random suburb that and then analyse it to see if there is any potential. Do you do an analysis which then leads you to a certain suburb. Also, why do you do what you do, how do you come to your conclusion and what are the 5 or so basic/important/first/favorite analysis that you undertake when first investigating an area.The FIRST thing you need to know is how much money you have and how much you can borrow. This will eliminate many suburbs.
Decide if you want to buy a unit, villa, house. That will again limit your suburbs. THEN start your research into the areas you can buy in.
Number 1 criteria for me is I must have equity straight away. ie buy under market value. Sometimes part of the equity boost will be in the form of a reno.I only buy if I know I can sell it without losing money (almost straight away). Bugger waiting around for "possible" growth. Also LVR must be decent. I don't want negatively geared properties for years after I buy them.
This is not correct. You can't claim because you "intended" to rent it out.
You can only claim if it was actually AVAILABLE for rent. By your description it was NOT available for rent so you cannot claim.
An example of being available but not rented would be if it was listed as available for rent but was empty waiting for a tenant.Yes as long as you have an income producing asset.
You can also claim talking to someone (adviser etc) about your assets.
Check the ATO site to see how far you can go back and change anything. I think it's 4 years.
tenant viewing session??? sounds a bit bizarre.
You can't do anything about it if they vacate. It's nothing to do with you. You have nothing to say about the tenant until you actually own the property. You can't MAKE them stay. The vendor can't give you permission to access the property so it can't be put in any contract. The tenants have rights. You can't just go in and check on them.
AFTER you own i you can issue a notice to increase the rent. 64 days later the increase will come into effect. If they don't give you notice they must pay the increased rent by the due date. You can ask them to sign a new lease at the same time. If they don't want to pay the increase or sign the lease they can give notice (14 days) or you can give them notice (60 days) to vacate.
3.58%. haha. That's laughable. I wouldn't touch it.
I wouldn't even look at a property under 6% unless it had potential to value add.
Good explanation Matt!!!
Why is a mate paying market rent when you are living there? or do you mean he's paying normal rent for a room?
Market rent would be the amount you would get if you rented the house out.
I think you are too honest.
I'd also double check the CGT with another accountant as you were living there so it was/is your PPOR.
Out of curiosity I'll ask my accountant. He's amazing.
Not for me. Harder to rent, harder to sell.
Price will be lower to compensate, as will rent.
Who is suggesting these properties?
Are they under market value? What is the yield? How much will you be out of pocket each week? Which one has the best CG prospects? Can you value add on any? Or are you talking off the plan?
Do the numbers, that will help you decide.
Yes there are thousands of properties to choose from but not so many good deals. Make your money on the way in not by hoping it will increase i value.
I only know a little bit. The thing is if you decide to sell you limit your purchasers to investors as there is usually a long lease (10yrs + option to extend sometimes). Rents increase with CPI but any I jhave looked at have been under market rent after a few years. So your sale price is lower to compensate for this. Check what fees they charge to manage it. One I looked at was 16%.
Other than that I can't help. Sorry.
Don't know My portfolio. More info please.
fredo_4305 wrote:Im tossing up between QLD and Melbourne at the moment but can't make a decision lolWhy have you picked these? Do you think that's where the next boom will be? Or other reasons?
I'm still buying in Sydney and will keep doing so while I keep finding bargains. Also I think prices are still rising.
Nina_10 wrote:Can anyone tell me if they have invested with property manager groups and how effective they are. I have been given a choice of 3 properties to choose from and not sure which way to go. 1.Melton Vic. 2.South Yarra,Vic. 3.Zillmere, Queensland, (they are all off the plan properties). I am first time property investor, so would appreciate your feedback. ThanksOK – What Due diligence have you done?
How does the price relate to similar properties that are a few years old?
What will the rent be (not what they tell you it will be?) What is the rental yield?
Is there a rental guarantee? If so why do you need it? Will it rent on the open market? What's the vacancy rate of the area?You need to do you OWN due diligence. Remember they are selling you something so it is advantageous to them to make it sound attractive.
Off the Plan properties are only worthwhile purchasing in a booming market. Are these places booming?
What happens if you get a valuation that is less than you paid? Can you afford to pay the gap between what you paid and what the bank will lend you?Not my cup of tea but everyone is different.
I think they can be a pain. One more thing to break down, leak etc (nd that's without the insurance worry).
Maybe ask a few real estate agents whether the demand is there and would it increase the rent. If not get rid of it.
I'd advertise it on Ebay (dismantle and take away yourself type deal). Easy for you. Just buy some grass to cover.
Get on the committee and send a letter to all owners through their addresses (some may not live there).
Speak to the strata company about costs and find out why fees are rising so rapidly.
You get to vote on strata costs. Maybe they were in deficit and are trying to catch up? Maybe there was a big ticket item that needed addressing? You need to find out these things. Some people like to have a stockpile of money just i case. Me I prefer to have the money in my pocket and then I can take it out if/when we need it. How much is in the sinking fund?
What does your yearly expenditure letter say? Everything is itemised in that.
The strata managers may be hopeless. Some just use companies they know and don't get other quotes.
One strata of mine got one quote for work. I asked for 2 more quotes. Both came in at half the first quote. Saved thousands of dollars.
If the strata company is hopeless get rid of them.Yes that's exactly right.
Numbers are VERY important. I know when I bought my first property I had no idea how much it was even going to cost me each week. I just knew I wanted to buy houses. Luckily it was the year before the biggest boom Sydney has ever seen.Plus research into the area- infrastructure (or likely changes to infrastructure), transport (how do tenants usually get to work?) Sometimes people overplay a trainline. In a particular area most families may own 2-3 cars and not many people travel to work by train). OK I'm overplaying but you get my point. You need to know what the area expects. Eg some people say "I would never buy a unit without a garage" but in the city most people that live there don't own a car.
If you know an area really well, when something good comes up you'll know it straight away.
