Forum Replies Created
Find a vendor finance opportunity!
I think that because you plan to make your first purchase your PPR to begin with and and then IP I would look at an older house first. Buy doing this you can manufacture some growth and give your self more leverage when you go to make your second purchase. It may also help you to make that second purchase a lot faster. Then once you are ready to make the second purchase you may then look at new builds. New builds dont allow to manufacture growth as much as existing houses. This strategy will get you your first IP faster and give you more leverage to buy you PPR which is where you want to get the best you can get which often translates to spend as much as you can.
Have you looked at Boronia? Lots of zoning changes and infastructure going on there. Possibilities within 400k range
Hi Troy, dont get me wrong mate I totally agree with diversification I just wanted to present the question. Its always good to have a few different ideas and view points. In answer to your question I am NOT a local although I do have an IP in Rutherford that I bought when I was a little less educated. I have looked at many properties in the hunter over the years and have been very close to closing a few deals but for various reasons they have not gone through. I still do like the area and even though there is some fear about job cuts in the coal industry I dont think coal exports are going to slow down at all and will most likely increase if anything.
Yes i totally agree Jaqui, investing is to take yourself forward. I i was looking for second IP I would be asking what is going to give me the best return. If that meant buying again in the the same suburb then I would not hesitate……assuming my first IP had performed well. If a suburb is well established, has more than one industry with a good history of renters then the chances of a shift change in the suburb are very small unless something goes drastically wrong in that suburb. The only places where we really see this happen are mining towns. Newcastle knight, the hunter valley is more than just one suburb and is a large geographical area that has many industries, including mining. I think there are still good deals to be found in Singleton, Muswellbrook and Maitland, even Newcastle! All Im saying is dont rule out the Hunter just because you think you should invest in another area.
Thats a bit of a wishy washy reply Jacqui. If its a good basket then keep using it. There is more risk is going into an unknown area if you already know you have a good area. A situation like this would require a definite exit strategy ………………………..What is going on with the "enter" button on this forum??
Newcastle Knight, how has your first IP performed? If it has worked why not do it again in the same area? If something is a success why not reproduce it?
Rusty, it all depends where you are talking about. Perhaps in small mining towns where the boom is over you might see vacancy rates lift but if your talking about capital cities or major suburbs you would need some seriously heavy investor activity to see any noticable difference in vacancy rates. Investors make up a small portion of the general population
Gday diamond,
I dont have anything to swap but may be willing to pay money if the price is right. Would you consider selling it?
I was actually talking to an agent up there and he said he has seen this cycle 3 times in the last 10 years. He believes demand is still very strong.
Hi Harry,
Just thought I would offer my opinion and tell you about my plans. Unfortunately it is not the advice you are looking for but you may be able to take something away from it.
A mate and I are also looking at doing a small development and we are in the very very early stages of planning, but we are going to look at trying to locate a block with a reasonable house on the front and subdivide the block and build something out the back. We have not dismissed the idea of buying something with an existing house and demolishing the house but to start with we would just like to find something where we could keep the existing house and subdivide.
My mate works in the building industry, although he is not a builder, he deals with builders on a regular basis. We are going to employ a builder and the project manage the development ourselves. By doing it this way it will be the builders responsibility to organise the tradies. The key to success with this strategy is having a rock tight contract with your builder to provide a house and set mile stones for the construction process. Obviously penalties if these mile stones are not met. Also by doing it this way if there are any problems or faults with the final product it is the builders responsibility to rectify these faults.
By the sounds of it you have more than enough capital and borrowing capacity to complete a project like this
Not sure how you are performing your feasibility studies but I have a feasibility calculator from a friend of mine who paid big money to complete a developers workshop. One of the things she got from this workshop was this feaso calculator so if you want a copy PM me and I will send it to you.
What areas are you looking at? We were considering around the clayton area purely because of monash uni and there is big demand for the smaller style homes. I think any area which has a large university nearby is a a good place to look.
Corie
cheers Jamie, that was the form I was looking for. I think improved cash flow during the year is much better than getting a lump sum at the end of the year, although a lump sum is a way of forced savings.
Hi Dev,
I think trying to find a property in perth will be difficult if you have to come up with a 10% deposit and stamp duty if you only have 30k capital. Perth is over priced. Dont confine yourself to the state you live in when looking for a good IP.
Perth and Darwin are currently leading the way in terms of rising rents and growth which would make them ideal places to invest, but when you have limited capital it can be very hard and sometimes seemingly impossible. This is why you should not limit yourself by looking for IP's in the same town or state you live.
Im sure you could find properties in some of the less desirable places around perth (if you live in perth Im sure you know some of these places) using the cash you have available but but if you broaden your horizon you could make that money work for you much better. Ask around on this forum for other places people may be investing that may be more within your budget. There is a wealth of knowledge available to you right here at your finger tips and most people on here are more than happy to share information.
I would be very reluctant to go out and spend big money on some of the property course available out there. These courses can teach you a lot about their chosen strategy but they often dont teach you how to implement the strategies into real life situations.
Freckle wrote:To me it signals the end of WA's RE boom. I expect to see the economy contract hard over the next 12 months. Property prices will follow in due course as unemployment rises and everyone realises the resource boom is really really over.
Freckle,
In case you hadnt noticed the WA RE boom ended a long time ago. And that is especially evident in the city of Mandurah, and has been for a long time. Mandurah has been one of the hardest hit cities/suburbs in WA over the last couple of years. What year was it when people were camping outside the office of sellers offices? Seriously!?!
Property prices have been flat and in many places contracting for a many years i.e Mandurah, but to say that the resource boom is "really really" over is a major over statement! Statements like these sound like the scare monger tactics similar to something I would hear on "Today Tonight".
There are lots of people who have lost money in the Mandurah property market but the Perth property market is doing better than it has for quite a few years. And the fact that mandurah and perth are only 70kms apart says it will only be a matter of time before mandurah starts to feel the effects of the uptrend in Perth.
Yes i can understand what you are saying. Based on the upward trend of gladstone over the last couple of years compared to its trends now may seem like it has peaked and beginning to plateau but there are still 65 billion $$$ worth of projects that have been approved and are soon to begin. Specifically 2 gas more gas plants.
The population of gladstone these days is around 60k. With $65bill worth of infrastructure due to start and a population of 60k, thats an investment of $1million per person! I agree that Gladstone may have slowed a little but still has not run its race just yet.
Yeah I hear what your saying freckle and I had thought of this. Because I am actually buying this through a buyers advocate I think the discount might actually be coming from them although they tell me its from the developer. Because they buy large quantites of houses through this developer they can go back to them and request these discounts. Either way I know Gladstone is not a falling market, and although I dont know for sure I dont think the developer is going under.
Sounds like Booragoon…..you looking for a JV partner?
Hi Jamie,
Thanks for the advise, Some good pointers to remember for the next time I get in a similar situation. I was about to ring my broker but I cant help thinking that getting a low bank val in this situation is actually a good thing. With the 25k discount the developers are offering I am ahead of the 8ball straight away. Even if I do have to come up wih some extra cash of my own, it is less than the discount they are offering.
I think I have answered my own question.
Thanks again
Derek,
I didnt think the federal govs budget would have much effect on projects that take place within this state. Didnt Colin Barnett just say recently that if he get back into power that he will build the airport and light rail link?
RPI wrote:Some Marketeers try and come across like they are there for you. Check the disclosure contract on the statement and you will see $30k or so going to them for selling the property. They are NOT there to help you.
I am litigating on behalf of numerous clients at the moment who have been done by some of these marketeers. One very common thing in the client statements is the buyers having to tip more money into the deal because the bank vals don't stack up, strangely enough by the val often comes in to be at least the commission amount lower.
Barge pole.
If in doubt, get them to draft a contract for your offer, the accompanying disclosure will have to outline the marketing kickbacks (in QLD) anyway.
D
This is interesting because only yesterday I had a bank val come back 40K under the purchase price. It was a new build in QLD and it was presented to me by a so called mentoring group with whom I recently joined. I am not going to mention their name at this point but I wonder if this was a similar situation to what you outlined D?
