You might be getting a little confused as a financial planner is usually used to provide financial advice (investing in shares etc) and risk mitigation (insurances) – which may not be what you’re looking for.

To review and consolidate your current debt, as well as gain advice on how to get yourself to a position to purchase your first IP you will want to speak to an investment savvy finance broker. Speaking with a broker will allow you to gain a strong understanding of your current position, what action needs to be taken to achieve your goals and map out a strategy for moving forward.

The contract may allow them to access the funds to complete development works, or it could be held in trust until completion. I have seen purchasers lose their deposits as the developer has used the funds to develop, only to go bankrupt – leaving the buyers without any recourse.

Location, structure, importance of Rate vs LVR. A lot of complexities here – if you’re genuinely wanting definitive advice with these kinds of deals it’s going to be best to engage directly with a broker who can drill down into the specifics.

How much was the deposit, which lender was your loan applied through, why isn’t the loan getting approved?

It’s always prudent to ensure you’ve looked at all lending options before breaking a purchase contract – it can save a LOT of pain.

Really dependent on the commercial property, purchase price, asset type, location amongst other factors – having an indepth discussion with an investment savvy broker will give you a lot more info.

It can be very easy to say something desirable like 80% LVR but that wouldn’t necessarily be in your best interests.

In reality depending on the security, 65-75% is the norm for CIP LVRs.

Fairly bland rental returns for a regional, but if you can pick something up low enough and it fits your strategy it could well be worth it.

Keys things to look at with Regionals:

*population growth rates
*upcoming planning and development
*current yields and rents growth
*Vacancy Rates
*Stock on market

What draws you to Warrnambool in particular?

• This reply was modified 9 years, 7 months ago by  Corey Batt.

You will find that Financial Advisors/Financial Planners generally won’t touch on property, so if you find one which suggests they are a property consultant/strategist/advisor they are more likely than not an OTP spruiker getting commissions from developers. Likewise there are One Stop Shops which try to clip the ticket on every part of the process, which doesn’t necessarily work in your interests.

If you’re serious about wanting to build an investment portfolio its key for you to build a TEAM of property experts, which include a Finance Broker, accountant, Buyers Agent perhaps if you want someone to source you properties etc. Flick an email/call an investment savvy finance broker who can give you a strong understanding of your current borrowing capacity and how to structure your lending so that you can increase your maximum long term potential.

Also remember that in this process you will be trashing your credit file with further activity, which some lenders and their credit scoring systems can look at very poorly.

Cash flow certainly can be a pre-cursor to capital growth, but I wouldn’t say it’s always a direct progression. Some areas show strong CF for a reason, because capital growth is in the dives indefinitely (buying in Timbuktu with no growth factors).

As always, the profit is in changing demographics – increasing buyer/seller ratio, increasing owner occupier percentages, zoning changes etc.

Went to a number of opens in GWS over the weekend – I think Mark is on the money, the time is passing. The feeding frenzy from the recent boom may leave you with a potential correction (I’ve noticed a trend of some Sydney investors divesting at the current sellers market and reinvesting elsewhere). Brisbane and Adelaide are consistently coming up as investor hotspots as of late.

On the LVR front, balancing the LVR and LMI requirements you should be able to hit circa 90% and keep well away from extortionate LMI premiums. If you were to bump up your purchase price to $450,000 you would have a 90% LVR and LMI of ~$8000, which could be capitalised onto the loan.

• This reply was modified 9 years, 7 months ago by  Corey Batt.