Forum Replies Created
- Originally posted by foundation:
Putting family first would surely include such niceties as feeding and clothing them, not just providing a roof over their heads? On $960 per week minus tax, plus welfare, minus $600 mortgage payments, I’d suggest one would need to be neglected…
F.[cowboy2]Indeed F, indeed. One would surely be eating 2 minute noodles with water. However, that’s not the point I was trying to make.
I was trying to say, that by keeping the PPOR, he’d need to think differently about ways to make money, and keep a roof over his head, not that it would be impossible. By using the situation he’s in, in a positive way, rather then looking at all the negatives, new opportunites present themselves everyday!
Tsk tsk tsk. Sometimes I really hate the way these enquiries are answered on this forum! Let’s all sit on the porch, have a cup of tea and calm down!
I’d personally keep your PPOR. Living in your your own home has it’s own emotional responses and effects, and IMHO, those feelings are more important. I put family ahead of everything. The family home is the base for this. Perhaps that’s just my own flawed mindset… I’m sure there’s worse things to be spending your money on!
That’s not to say it’s easy, but try and use the situation in a positive way. The best outcomes originate from the worst beginnings. Have you read Rich Dad, Poor Dad? Rich Dad said to pay yourself first, then everyone else last. This forces you to think, in particular about new ways to make money. I love this way of thinking!
In your situation, paying yourself first means paying the home loan, and surviving. On $50,000 a year I can’t imagine that would be easy. Not impossible, but not easy. Look around you, what are you good at? Look for problems, and ways to solve them. Use your situation to drive you further beyonf your “needs” and into the realms of “wealth”.
Hope my little emotional speel somewhat adds (or contridicts) to the argument of all the seasoned investors in this forum… [blush2]
Originally posted by grossrealisation:hi pipelinebuilder
I have two duplex’s on one block and another two on another in harrington waters further north and an option on a motel that will soon be a 7 townhouse construction site looking at sand.
and yes the market is moving this area has 60% over 55’s and is growing.
the adamstown, williamstown area is also an area to keep a lazy eye on ( got a couple of irons in that market also nothing finalised so no info on it)here to help
If you want to get involved in some of the projects I’m involved in email to [email protected]Haha… I’ve been holidaying in Harrington for the last 10 years… As mentioned, grossly elderly retired population, with defined holiday seasons each year… Plenty of run down weatherboard places in town (not Harrington Waters). Not sure what general economic growth is like though? Seems to be slowly building now that the Waters estate and the shopping centre aree taking roots?
Hi guys,
Thanks heaps for the replies. Before I’d even come back to the thread, I took my own advice last weekend and went and saw a sales consultant for the house I want. For the record, this isn’t going to be an investment property (at least, to begin with), it will be my PPOR, so it’s not necessarily “small” or “3 bedroom”.
What Anthony said is correct regarding what’s included in the base price. Floor covering, Air con, along with curtain/blinds are the big costs on top of this. Of course, along with Land Site fees, basix, and other essential “costs”. As mentioned, depending on how much you shop around, quality you’re interested in, and negotiation skills, prices for these added items may vary significantly.
As far as builders go, I actually also went to homeworld after I’d spoken to my builder of choice, and saw display homes for most of the builders you recommended. All are nice home. For the record, has anyone had any experience with Domaine Homes? These guys have the design I’m interested in.
Cheers and beers,
DanI agree with what the majority of people have said… And thanks for posting that saving strategy Chris!
The most important thing to concentrate on would be reducing that personal loan ‘bad’ debt, and increasing intellectual knowledge in the mean time! So, while you pay down that debt, read read read, and grow more and more knowedgeable.
As Chris mentioned, there are a million cash management account sout there (CMA) where you can park your earnings and generate some sort of (some would say modest) return. I’m using an ING Direct account which returns 5.85% variable, calculated daily paid monthly… But if anyone would care to recommend something similar, or better, I’d also be keen to listen!
Hey, I’m in a pretty similar position mate. I’m the same age, but I NEED to move out with my girlfriend in the next couple of years.
It’s a huge toss up to either invest in smaller IP type properties now, and sacrifice the FHBG, or save up for a bigger deposit, and buy your PPOR with the FHBG. Passing up the grant, and more importantly, the fact you don’t have to pay Stamp duty, is a big call. It’s a lot of risk free money you’d be throwing away. On a property worth $500,000, FHBG equates to around $30,000!
At the moment I’m leaning towards saving for a couple of years, utlising the FHBG, and buying my PPOR first up. At least this way you’ve utilised the benefit the government is willing to give you, and you still have plenty of options. If you wanted to sell in a years time, and rent a place so you can use your original property as an IP, you can. Alternatively, it may force you to find other ways of generating cashflow….
Doing this also allows me, at least, to enjoy life while I’m still young. I still have the money in the bank to spend if I decide to travel, or whatever. There’s also no huge obligations to banks or lending companies! At the end of the day, you only live once, enjoy this life how YOU enjoy it most!
As Rob Kiyosaki would advise, pay yourself first, and everyone else later. Never say “I can’t afford it”, but rather, ask “How can I afford it?”
There are ALWAYS option, no matter what situation you’re in. [biggrin]
Josh, the last thing you need to do is apoligise… Thanks so much for writing such a long and helpfull post!
The question I was leading to was how much MPI cost, but you also covered that! I guess it comes down to working out weather it’s better to pay the MPI and have the advantage of taking out a higher LVR loan, or saving a larger deposit and keep LVR at 80%, right?
Cross Collateralisation? Can you explan Josh?
That makes sense Terry, thanks. I’m just trying to get my head around it though… Because the principle of the initial loan has increased to $120,000 once we draw out the equity, I assume repayments will most probably be higher? You implied I’d need to refinance, is that correct?
If you wanted to buy that second property, using the first one, it would be the same process of refinancing to access equity?
I guess I just always imagined drawing on equity to be a rather simple process.
Dazzling… On fire as usual!
Are the six costs you mentioned generally speaking the big six which would need to be considered when evaluating any CF+ deal? I don’t mean the figures themselves, they will obviously vary with location, but the actual type of cost…
Originally posted by mouth:Originally posted by Nigel Kibel:On the other side there are areas like Altona. I know of a weather board house with a Unit behind where the asking price is only $260,000.
If it’s for both, that does sounds good. And the casual reader could not be excused for thinking that you got both in the price. Though if you read it several other times, I admit to some creeping ambiguity.
So I did a realestate.com.au search on Altona to check it out.
What do we have here?
A house in Altona with a unit behind it. The asking price is $260k. That description does sound good, even if ‘superb’ is spelt wrongly.
Scroll down and the facts are revealed. The house is $260k but the rear town house is $380k. So it’s not $260k for the lot, but $640k! Again the ad has ambiguity, just like the post quoted.
Look at the sales rep’s name and the user quoted above. Coincidence huh?
The take home lessons are:
1. Read the fine print
2. Beware of forum users with vested interests and stuff to sell
3. Beware of spruikers trying to make a deal sound better than it is by omitting salient factsmouth
Nice work detective [thumbsupanim]
Ummmm, nah, I’ll be right, thanks [thumbsdownanim
Hi Daniel,
Welcome on board. I think everyone is in your position at one time or another, and as a result, this forum gets flooded with questions very similar to yours. [blink]
This forum is full of rich information which you should try to absorb and take it (as overwhealming as that seems at first). In addition to the books you’ve ordered, which are all great, I’d also suggest a book called “The Richest Man In Babylon” by a guy called George Clason, and another book in the Rich Dad Poor Dad series called “Real Estate Riches” by Rolf De Roos. I’d suggest to definately read Rich Dad Poor Dad first, I can’t speak highly enough of it! [goatee]
It’s great that you and your partner have some money saved up. Given your situation, and current level of knowledge, I’d suggest you took some time (I’ve spent the last 6-12 months) researching and becoming total familiar with the market. [blush2]
The most important thing is to have fun! [chill]
Thanks for all the kind and cluey replies so far.
I guess I should have described the property a little more. It’s a 3 bedroom house, close to schools, with polished floorboards throughout. The area is semi rural, but NOT Broken Hill, or that isolated. Have already done that search, and thought twice having read up on these forums about the area. Still definately an area I may investigate further in the future, once I have a little more experience.
I guess what I’m doing is beginning to perform my own “Due Dilligence” checks, but still require a definitive list of costs to factor in when calculating estimated costs. Could someone confirm of expand on the following?
* Loan Repayments – Can be estmated based on current interest rates, factoring in somewhat “worst case scenarios” for Interest Rate rises. I was also thinking about starting the loan as P+I, and leaving myself the option of dropping back to a more servicable IO loan if required. I’m told it’s easier to go P+I –> IO rather then IO –> P+I. Would anyone disagree with this way of thinking?
* Rates – Can be estimated from… The Real Estate Agent? Council?
* Maintenance – Estimation based on current state of the property?
* Rental Management – Estimation from Real Estate AgentAny further input would be GREATLY appreciated. [aacool]
Thanks again,
DanHey Bedford… I’m a new investor also, so my word is far from gospel…
Times have changed, and so must techniques. As Steve’s said many times, CF+ properties can no longer be bought, but created. See a problem, then think creatively to try and solve it. Do yourself a hige favour and buy “Rich Dad, Poor Dad” by Robert Kiyosaki… It’s now a few years old, but it’s a little more conceptual then Steve’s book, and is all about the way of thinking, rather then specific techniques.
Make sure you stick to your due dilligence now more then ever. It’s a new environment, where inflation is driving interest rate rises (or so Steve believes). I’m a firm believer that there is money to be made in any environment, given you can think DIFFERENTLY to everyone else. That’s what all the great investors have done. Not stuck to ‘rules’ offered in an internet forum… As Sinatra would say, do it your way [blush2]
Mitsubishi Evo IX… My pride and joy… Haha [blush2]
I assume though, that the cost out of your own pocket to finance the loan throughout that settlement period should be factored into profits?
Sorry to bump this up after so long, but I’m pretty interested…
Regarding these type of cosmetic improvements, particularly gardening and simple landscaping, what sort of return could you expect? I realise this is obviously a rediculaously broad question, but maybe some examples, or rough estimates?
Yeah Dazzling, I read another one of your posts somewhere else and it mentioned what I assume is the same patch of turf (or bitumen in this case). Is this the same Ugly Duckling?
My only other question would relate to how you found the tennant. Did you simply advertise the space, or did you have the opportunity lined up through networking before you bought the property (or during)?
Wow Dazzling… That’s impressive. I’ve been reading these forums for quite a while now, and your’s and foundations names (just to name a couple) are ones which stay in my mind, with the label “RESPECT” attached! [buz2]
What are the tennants actually paying for on the land? Some commercial lease on the “crappy rusty sheds”? For someone to be paying somewhere around $1,500 a week rent, I would have thought some commercial operation?
Anyway, congrats again on the purchase, keep up the good work, and keep us informed (so hopefully we can all learn something!). [blush2]
Originally posted by SteveMcKnight:Hi,
Yep – Dave and I have shaken hands, thanked each other for the memories, and decided to part ways.
There is no gossip or hidden agenda. We had simply reached a point in our business relationship where we wanted different things.
Rather than compromise and end up with a lose-lose outcome, we respected each other enough to end on a high.
No doubt our friendship will continue and we’ll be able to bouce and support each other in our new businesses.
Cheers,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Nawwww, come on Steve… we wanted good old fassion, behind-ya-back gossip! Haha. But seriously, I think I speak for everyone here in thanking you for the ideas and concepts you’ve brought us together, and I’m sure you’ll both excel in in the paths you walk down seperated…
