Forum Replies Created
Hey Greenie!
Welcome to the world of property investing.
Not sure which of Steve’s books you read, but the market has definately changed a bit since he wrote his first one. That’s not to say there’s not the same kind of opportunites which he utilised out there, you just have to look.
I’d be very (very, very, very) suprised if you found a resource out there with a plain, black and white listing of potential CF+ properties. Each property requires some investment… Weather it be your time, or your money which might purchase someone elses time, to look for these properties. No one is going to hand them to you on a silver platter (sorry to sound like the grim reaper here!).
Check out realestate.com.au … Which is probably a good start online. If you happen to see a property which may be of interest, don’t be afraid to call the agent and ask questions… It’s all a matter of learning and becomming more and more confident with the process. Also invest some time looking round this site, there are plenty of other people in a similar position to you who have asked similar, and probably inevitable questions which you will have.
… And most of all make sure you have fun with it all! [blush2]
Originally posted by Terryw:Maybe:
Raby
Campbelltown
Mount Durrit
and surrounding areas??(I hope I haven’t offended anyone living in these areas).
Terryw
Discover Home Loans
Parramatta
[email protected]
Sign up to my mailing list.
Just send me a blank email, with “subscribe†in subject line.Oi watch it buddy, I live in Campbelltown. Haha, seriously though, I’m not a fan of the place, or more specifically, the people and cultures Western Sydney promotes.
As has already been mentioned, there are plenty of nice areas around Campbelltown such as Harrington Park, Mount Annan, Glen Alpine, and even the new parts of Minto and Macquarie Links. However, the holes inbetween are deep, and areas such as Airds, Claymore and older Minto/Macquarie Fields leave alot to be desired. The cultures of “ghettos” built and sustained in these areas are based around youth voilence and malicious damage. Alot of anger seems to be held by the population.
I’m sure these areas exist in plenty of other cities in Australia… as far as opportunities go… I’d say, you’re a brave man! But then again, as Steve always says, you need to do something different to get ahead… so perhaps there is some sort of opportunity lurking which is avoided by other ‘mainstream’ investors. I’m sure the ability to be dynamic and think outside the square would be more then required… anyone got any ideas on how to utilise said areas?
I’ll be the first (and quite possibly the last) to state the obvious… Yes. You might not find too many friends in the forum who’ll encourage negative gearing, but it would difinately pay to see you accountant, and get them to explain the benefits you will entitled to recieve as part of setting up a negatively geared property.
… In addition, make sure your accountant has property themselves. There are three types of account: One would deals in shares, one who deals in property, or the third if you can find them, one who sees the need to diversify, and deals in both (thanks so much Skye [biggrin]…!).
Hi gazmysta,
The picture you paint is a little blurry… And Ron, being new to the scene may be a little dazzled. How much are the apartments? It’s fine to say he’d only have to spend $7K, but how much would his loan have to be, and his interest repayments? How much do you expect rent revenue to be? [hmm]
Only once he (Ron), and other know this information can you proposal be determined as worthwhile… Not having a go or anything, I think you for posting opportunities (and encourage more)… but gaps in information need to be filled in… [exhappy]
Hey mate,
I’m no pro either… but 30K isn’t a small deposit. Steve’s first was 10K, and look where he is now! Most brokers will let you borrow somewhere between 90 – 95% of the value of the property… so there are a lot of paths you can choose to walk down. Don’t underestimate your achivements, and what you can achieve.
There are plenty of good resources on this forum to help you started as far as finding tips for good. You won’t get all the answers thrown at you by asking in one forum… You have to work a little for it… Do a little digging [blush2]
Steve’s books are also an excellent resource… start with his first one, 130 Properties in 3.5 Years, and the passion will soon grow to learn as much as you can. [exhappy]
You’re probably right foundation… I’m just trying to grab hold of these concepts. If it is an interest only loan, the calculations make sense
… however, if it was a normal loan, i would have thought the hole which the tennant and tax man are burning in the amount owing (along with the calculated return) should definately be taken into account. I’m guessing that, in that scenario, that the goal would be to pay the loan out, and own a fully CF+ property, with only ongoing overheads to pay, and all rent to collect?
Originally posted by foundation:I assume the property is negatively geared on an interest-only loan. The rent-shortfall is costing the owner $7000 per annum. The only ‘profit’ in the scenario is the capital gain of $8000 for the year, which as explained, is a pathetic return on investment, although I would consider this a 3.3% return (8/240) rather than 1.7% (8/450).
Cheers, F.[cowboy2]
Hi foundation,
What makes you think it’s on an Interest Only loan? I understand that if it was, that the only ‘profit’ would be capital appreciation, but if it was a normal loan, wouldn’t ‘profit’ also include the amount which has been payed off the loan by the tennant and tax man? [glum2]
Thanks for all the replies so far.
I guess fear of the unknown is what turns me off going the IP route to my goal. I can see how saving a deposit and getting a loan will get me in the house I want in a few years, but the path of buying smaller Investment Properties now is blurry. Could you guys try and explain how this would achieve my goal more efficiently?
Also, if I was to be ignorant, and go down the savings/loan track, on a property like that, what sort of investment options would I have afterwards? How quickly would a property like that (that I was living in repayng) earn equity? I’m guessing on a loan of say $450,000 to $500,000 there would almost the same again in interest, so it would take longer to earn equity, and therefore get involved in the IP market?
Thanks!
As tempting as buying the house outright sounds, I’m still more tempted to save risk free while I’m comfortably living at home, and buy the house I want to live in when I have my target saved in a couple of years. I work a decent full time job, and also a second job part time, so getting cash away at the moment isn’t too much of an issue.
I’m still not 100% of the concept of equity (the differnce between what the property is worth and what I owe?), but I always wanted to buy the house I want to live in, then once I get settled and start paying that off, use the equity i build from there to buy IPs. I suppose the disadvantage of that would be that equity is easier to build on smaller properties (Ie; the difference between value and owing would always be smaller as less interest?)
What I really want to know is how much people think I’ll be able to borrow with a decent joint income and big deposit. Is the 40% of income for repayments rule set in stone by banks? I’m concerned with getting myself setup over the next 3 or 4 years (I’ll still only be 24 or 25), then tackle the IP hurdle depending on the market…
