Hi Anny,

Congratulations, you've taken your first step. Regardless of the detail of the investment, you have already set yourself apart from the masses.

The next thing IMO is to try learn from this investment, whatever it may teach you. The reality is that you will need to wait some time before you would be able to sell without making a loss (if you wanted to sell that is). So use that time to see what happens.

I agree with the others that you should hold off any further investment in this one until you see what it's going to teach you. Time is your friend, let it work for you.

WRT the lawnmowing, you might want to work out whether using someone who can give you a tax invoice will cost you more or less after the tax deduction than the current pensioner. If it's much of a muchness, you may well get a better job from the pensioner anyway, and it's a nice thing to do.

Best of luck,

Daedalus.

Have a look at these posts:
https://www.propertyinvesting.com/forums/property-investing/help-needed/4322828

https://www.propertyinvesting.com/forums/property-investing/general-property/4322827

Also, have listen to the podcasts at (and read throught the comments):
http://www.debtdeflation.com/blogs/2007/11/23/debtwatch-podcast-now-up-and-running/

(Thanks to Foundation for bringing this stuff to my attention).

I'm not sure the clock is that relevant, because of the assumptions that it is based on. What does matter is what you do with the information available to you, and how you find opportunity in it.

Daedalus.

Hi Megsaletta,

The first one you read is kind of the best one, because it starts you on your journey. It doesn't really matter what it is as long as you start reading and keep reading. I don't think there is a 'best one', because different things are significant for different people.

I have found both Steve McKnight's "0 to 130 properties in 3.5 years" and Margaret Lomas "The truth about positive cash flow investment" to be worth reading though.

Best of luck,

Daedalus.

Hi Glendafull, welcome.

From a cashflow perspective, this looks worthy of further investigation. (200 – 80) = $120 pw * say 50 weeks = $600 per year, which on $5,500 purchase price is > 100% return. Where's the catch? Why wouldn't you do it?
ARE those rental rates are holiday season only? In which case the number of weeks per year is considerably less.
If you've got permanent residents, then you'd get more weeks per year, but I would have thought less rental, since caravan parks are generally the most 'affordable' accommodation.

LA is right, in that there is no prospect of capital gain, since you are buying the caravan NOT the land it's on. I doubt you could borrow against them, so you'd be using your own cash, or borrowing against another asset. This would have an opportunity cost.

So, it comes down to what the realistic cash flow would be, and the CoCR on the cash you stump up.

Daedalus.

Hi jtr

I felt the same way when I first started. There seems to be so much to learn, and finding CF+ investments is so hard that it seems easer to just get an expert to do that hard stuff for you.

The thing is that once you take the spotters fee into acount, the IP has to be an even better deal to make it CF+!

I agree with TracyD; you'll find a lot of info on this forum from people who tend to do it themselves. I encourage you to persevere through this early stage and keep learning. Eventually your hunches will get better and better…

Having said that, some of these agents have a subscription service. For a couple of hundred tax-deductible dollars a year, they send you opportunities that they come across. Some of these might be good enough to act on, but if not, at least you'll get an idea of the areas where the agents are finding good deals. You can then go on to do your own research into those and similar areas.

Best of luck,

Daedalus

They also deal with negatively geared properties, but with a negotiated discuount on the buy price (usually 15-20%). Has anybody in this forum actually bought a property through them? They look good, but I can't get my cash flow calculations to agree with theirs in most cases. They seem to be generally a bit optimistic with the cash flow calculations, especially depreciation.

Having said that, the finders fee is included in their cash flow calculations, and if the numbers stack up, then they stack up. You can either spend the time finding places yourself or pay someone who already has.

Daedalus.

Sounds like a mining town. Maybe Bowen Basin or Surat Basin? Residential IP most probably.

If so, maybe a bit hard to wrap because the customer base (tenants) are not that interested in buying, often are mining companies. On the other hand, other characteristics are good because these people are often high income earners. Average household income in some of these towns is 140k+ pa! Makes 450/pw rent look cheap!

Daedalus.

Hi. I think there is hope.

They will not sue if they can't get anything out of you. Unless you own a significant portion of your own home, you are probably reasonably safe. The first question their lawyer will want to know is if you have any money. A lawyer will only press ahead with a lawsuit if there is a good chance that he will get paid.

I too suspect that the threat to sue you is a bluff, and part of the whole dodgy package. If they are pushing overpriced real estate to naiive buyers, then they will be relying on that naiivity to scare people into the deal.

Talk to a lawyer, and I hope things work out for you.

Out of interest, I assume that the conveyancer was not a solicitor?

Daedalus.

Congratulations!
 

1. It doesn't take long to arrange LL insurance, so you should make some calls now. I've had a contract where I needed to insure from the date of contract, which I think is a bit unusual. Worth checking though. Hey Ben, does your company do discounts for multiple properties? I'm not having much joy in that department…
2. Nothing to contribute here.
3. In metro Melbourne you should be able to talk to a mix of REAs and professional property managers. Ring around a number. Start with the ones you think you're least likely to go with so that you learn your good questions by the time you talk to the more likely ones.

4.That's a new one to me. My view is that if you can get the government to give you your money NOW, then you should. Why wait? You can still use it to pay off your PPOR, it's just cash. So long as you have the discipline to actually put that money into your PPOR…

5. Probably, I usually manage to forget something

Daedalus.

DL,

Unless your critics are using a better way to achieve financial independence, and my suspicion is that they aren't, then I would ignore their opinions on the subject.

You are clearly in the very small percentage of the population who is actually taking responsibility for their own destiny. Good on you! They probably aren't. Have confidence in yourself and don't worry about what they label you. In years to come, when the results of your years of hard work starts to become really obvious, they will no doubt label you as 'lucky'.

I don't think it's really about affordability – it's about laziness and/or poor financial education. Quite a shame really, because both these things inflate property prices and make investing harder work for us guys

Daedalus