Forum Replies Created
- Boy I wish I had a bit of land
Hi,
This may be the weak link in the plan ??
I’ve always felt the dirt is the big thing in this game, the thing sitting on top is quite irrelevant in the long term.
Nathan,
First thing I’d establish by reading the lease is exactly what the lease says the rent shall be.
Normally the standard REI lease has three different blank spots. The PM fills in one and scratches out the other two. One for weekly rent, one for fortnightly and one for monthly.
Before you go in there all guns blazing, just double check that indeed your lease does say $ 260 per week. It may very well say $ 1,040 per month, in which case you’d look like a goose and the PM doesn’t owe you a thing.
You may have asked for $ 260 p.w. to be the rent and some little 18 yr old office girl has stuffed up the calculation, converted it to monthly incorrectly and the tenant has signed the lower amount of $ 1,040 per month and away you go. If that has happened, you’d better has some written documentation you asked for $ 260 p.w., or you’re hooped again.
If the signed lease indeed says $ 260 per week, a stern chat face to face would rectify things…..well in most cases it does with me.
Good luck, but double check the paperwork first.
Matt,
If this is your first lease and first CIP, I’d recommend you pay for some assistance.
As Terry pointed out, you don’t want to stuff it up. The document will govern your relationship with the Lessee, and you want to make sure you cover yourself, and receive everything that you are entitled to.
On your first go around, I’d suggest it was false economy to try and do it yourself. Pay to have it done professionally, and you shall have a magnificent blueprint for future deals to work from, knowing full well from your first that it is a document that works well.
Good morning hiflo.
My suggestions would be the following ;
Property Presentation
1. Make sure it’s clean / clear and neat.
2. Make sure it’s secure (Lessee can lock it up).
3. Make sure water cannot get in and damage their goods.
4. Lease is written up and ready to fire off to prospective Lessee’s.
5. You know the property backwards. NLA / service connection points / 3 ph power / door heights, door widths, truss heights, mezzanine access etc, male and female amenities.Property Advertising
1. Make sure there is a prominent For Lease sign out the front with your phone number…surprising how much demand comes from local businesses expanding.
2. Make sure you have a copy of the Lease ready to fire off to all enquiries.
3. Make sure you know what the property can command in rent, not too high and not too low.
4. Place a well worded ad in the paper and sit on the phone with a confident voice voice ready to answer all enquiries.You
1. Don’t go out there in a suit trying to negotiate with a trucking firm.
2. Talk their language and know what is important for their business objectives. If you’ve got a 3.5m truss height, and they have 5m tall tipper trucks…you’re wasting your time and they theirs.Cheers.
I certainly don’t think that the reporters who write this stuff are as good at property investing and finding a deal that shines as they are at making stories shine.Agreed. I wonder what level of knowledge and experience ol’ Darren has. He starts off by saying 4,000 families in NSW, then later in the story downgrades it to 4,000 people. Which one is it, and more importantly, with a population of ~ 4 Mill, give or take a few ten thousand odd, is this really newsworthy statistically ??
0.1% stuffed up royally…..OK….gotta expect a few people who purchased unwisely…..I think Darren wrote it as such…”They believed that prices would never come down, tempting them to borrow more than they could really afford if circumstances changed.” I wonder if there belief was based on any solid research, or they took all their advice from the previous month’s newspaper articles.
So, does it mean the other 99.9% are still doing tickety boo ?? Not a bad success rate I’d contend.
Yep,
Just went to one on Monday night at the East Perth Railway Station. A reasonably good night for free.
I’ve changed my opinion of this club somewhat of late. (See earlier associated threads for my previous views).
Don’t be under any illusion, money is being made on all fronts.
But it ain’t a big conspiracy – very ordinary folk doing some good things. You certainly don’t require feedback before attending. Just turn up, sit down and open the ears up.
The only teensy little criticism I have is that they all flog new ressy stuff – due to the fundamental mechanism of the “club”. This is directly counter to my investment strategy….but then – who cares – good to be amongst people chatting about wealth / equity / deals etc.
Best thing is there isn’t a suit in sight, and the refreshments are very average indeed, which is what I like. The other enjoyable thing is watching the newbies panic and try and work out what the scam is and where they are getting ripped off. Rest assured, it isn’t a scam and you won’t be ripped off.
Santa came early for us on Xmas eve.Excellent work Amanda….your timing of Xmas eve reminded me of what we were doing at the same time. 8pm Xmas eve standing outside a factory with a hired locksmith, picking locks to gain access and change out all the locks and start the physical eviction process…..after 3 months of useless lawyers sending letters back and forth,lies, more lies, excuses, no rent and no action.
Cleaning out people’s garbage seems to be my forte. Good money in it. A broom and bin are my very best of friends.
When they supposedly came back to work on Dec 28th, their shocked look with all of their garbage neated stacked up outside the warehouse, and a dejected “OK, our silly little game is up” was a very excellent Xmas pressy for me.
In went my fully signed up national corporation tenant and all now happy days.
Hope everyone else had a good Xmas treat.
If you have a problem with the quotes from the newspaper clones, my only suggestion is to write to the REIWA president and ask him to clarify his statements because you don’t believe him. He may respond or he may not. Either way, I personally have no comment. I gather you wouldn’t listen to the logic or written facts being lodged at the Govt depts, so it doesn’t really matter either way.
You did ask for peoples opinions in your original post.
Happy investing clones.
That is just the real estate industry trying to talk it up.Not so sure about that ecatt….all except number 3 are statements of historical fact. It’s what has actually transpired, not what they hope is going to happen. It’s difficult to ‘talk up’ history. It either happened or it didn’t.
The fact there is ~ 4,000 less properties on the market and a larger pool of eager buyers isn’t something the REA’s are dreaming up…it’s happening.
With the oil price going nuts last year, the company dolled out 3 big fat pay rises….all USD and all tax free.
That quickly brought me back from a PAW to a AAW….but then, not too unhappy.
Oh, and not to be too pedantic, the good Dr revised his formula a tad in later editions. Instead of dividing by 10, try multiplying by 0.112. A small change I know, but he refined it after studying a few thousand more millionaires. [biggrin]
Yep,
Spoke with the accountant this afternoon. Going in tomorrow morning to sign all of the paperwork. That’ll be company # 4…the hardest thing is choosing a name that hasn’t been picked before.
It’s all good.
Any thoughts?Just reading page 84 in this Saturday’s edition of the Real Estate section of the West Australian, I noted in Kelly Girdlestone’s article some quotes from the REIWA president ;
1. “All listings from spring were sold out in Nov and Dec”.
2. “There is low supply, strong demand and prices are going up. Buyers are paying the full asking price and sometimes in excess of this”.
3. ‘Right now is a great time to be selling, especially with the buyer floodgates opening after the holiday period.”
4. “This time last year there were 13,000 properties on the market as opposed to 9,200 on the market at the moment.”
5. “A place listed at the weekend in Swan View and 30 families looked at it. It sold for $ 10,000 over the asking price.”
6. “Rents are up,up up. Existing tenants understand the situation and are accepting increases in rent.”
7. “At the weekend, a 3 bedroom duplex in Willetton was advertised for rent at $ 190 p.w. Many people looked through and it rented for $ 205 p.w.”
All I can presume is that different markets perform differently at differing times. I’ve been saying that for a while now….these are only tiny little snippets…..each individual property behaves differently.
But then….we in the West had our turn in the shade 3 or 4 years ago when the Sydney market had it’s turn in the sun.
Hope you all have a good day.
I’ll save you some time, the 11 second rule is not applicable anymore and if you find any property that fits is because it is in a crappy place or in the middle of nowhere (no tenants).You do the young 18 yr old “Sweet” a great dis-service with this ‘advice’. What positive advice do you have for the young chap to get his first deal under his belt ??
Commercial property…..is very risky for people without any knowlegde about it.I’d go so far as to say that any business venture, no matter what it is, property / shares / fine arts / options / you name it, is very risky for absolutely anyone with no knowledge in the area in which they are investing.
If you are putting your money into a deal where you don’t know what you are doing, you should expect commensurate results.
The people on this forum who have been enquiring about non-residential properties appear to be a little more savvy than what you give them credit for.
……”and/or nominee” the vendor and see how you go.
I wouldn’t accept this as an acceptable Purchasers name if I was a Vendor, but I know many people who would. Keeps it anon. until the deal is done.
Chaps,
The agent called me tonight to say that he has been flooded with calls for the place. I had no idea everyone was so keen….these deals are everywhere if you look around. Apparently the Vendor hasn’t accepted any offer as yet, so good luck to all.
Please cease PMing me…my inbox has gone nuts.
End of bird dogging session….now I know what the REA’s go through…geez…there is obviously some pent up demand for proper +CF deals.
Sorry if I didn’t respond and email the deal to everyone….there’s only so much spare time I have when in Australia.
I’m in the process of looking at some decent industrial deals, I’ll post the details when the ink is dry on the contract.
Good luck in your search everyone.
One of my eight agents keeping an eye out for me just sent me two properties – both shops – both 11km from the Perth CBD in a good suburb…..how do I know the area is good…..hell it was the one I grew up in 20 years ago.
They are too small for our group so happy to pass on the details to anyone that asks nicely.
One is 190K….rents for $ 307 p.w. 3 year lease with a 3 year option. Only 5 months into the lease. Tenant pays all of the outgoings, so that $ 307 p.w. is in your pocket.
The other is 230K….rents for $ 375 p.w. 3 year lease with a 3 year option. 18 months into the lease. Tenant pays all of the outgoings, so that $ 375 p.w. is in your pocket.
So, 420K gets you $ 682 per week in rent. 100% loan should cost you about $ 590 per week. The other $ 92 per week is clear profit.
Anyway….do with it as you will. Tried to pass it onto my father who immediately dismissed it outright without even knowing the price or rental figures ?? Reckons commercial property is for losers.
I got a tad angry and so am happy to palm it off to someone else. Hey Jenny – weren’t you looking for something like this ???
Never ever ever believe true +CF properties cannot be found in the city somewhere. The figures get way better when you start getting into the good stuff, but it’s a start…..and you won’t have to put up with whinging residential tenants or tribunals either.
Emotion is a funny thing – it can push you over the edge and clinch the deal or get you completely frustrated as the dollar people drive you nuts with the “it’s just a deal, there are plenty more there”….that sort of makes sense, but then when you’re holding a thick manilla folder in your lap with about 40 bits of paper and research on a particular property, and everything checks out…..and you offer something and the vendors quite rightfully start playing “Ignore the Buyer and frustrate the hell out of you”, it’s not that easy to toss all of that research and time and work in the bin and merrily reach over, grab a new manilla folder and start all over again….knowing full well the next 7 might be complete dogs before you come across another good’n.
I can remember in April ’01 standing on a balcony of a beach house we were looking at with three other couples. It had glorious 180 degree uninterrupted ocean views, on a large green title block which satisfied all of our investment criteria, and more than all of our family getaway desires. The Vendors were fairly old solicitors / city councillors who’d owned the property since it was originally released back in ’67.
The asking price was $ 250K, and I was thinking that I might be smart and try a low offer of 230K and creep up from there. When the agent started taking other offers from the other couples lined up, we both thought, hell, it’s exactly what we what….and our research was thorough, and this opportunity might not arise for another 40 years. I scratched out the 3 and replaced it with a 5 – full asking price with only finance and building clauses.
The offer was accepted within 2 hours and subsequently we’ve had immense enjoyment out of the place over the last 5 years as a family holiday destination. We casually rent it out and it brings in about 11K of rent per year, with total costs of ~ 17K per year. 3K after tax – $ 10 per day.
So all up, over the 5 years it’s cost us 15K, but then the value has risen to 620K to 630K, so we aren’t too unhappy. Paying interest only, our equity has increased from 0% up to over 60%.
Every time we drive up the driveway on our holidays, we look at each other and both of us are always thinking the same thing – wasn’t that a wise move not haggling over the asking price. The difference between what we intended to pay and what we did pay, vs the growth achieved seems quite peurile in hindsight, that the other purchasers were prepared to let it go. Who knows, maybe they bought something for 230 that is now worth 800…we’ll never know….but we do know we are happy with our little deal.
Good luck everyone with their offers.
That reminds me of the time I helped a mate last year demolish his next door neighbours place. His next door neighbour wanted to build a quadruplex on the land and simply wanted the old 2 bdrm 1940’s brick and tile house gone. The neighbour gave him permission to get rid of it, but only gave him 30 days to do it in.
My mate wanted to salvage most of it for his extension out the back. I came on the scene on about day 4 and it looked like a bomb site. He’d cut a 10 foot wide hole in the fence to cart all of the bits and pieces into his back yard. Talk about spread stuff far and wide.
When I got there the old house was littered with debris and rubble on the floors. I could see that I was going to twist my ankle or something worse, so spent the first 2 hours with a shovel and broom and wheelbarrow and cleaned up the floor so we could work far more efficiently. Having the ex-tenants being druggies didn’t help either, scooping up used syringes with the shovel.
Rubbish management is the biggest issue.
Smacked out the surrounding bricks with a sledgy so the wooden door frames and the wooden windows could be removed. Jeez windows back in the 40’s are big and heavy. A smallish looking window, when completely removed is like an icebrg, more is hidden behind the walls than you think.
Took the tiles off in less than 6 hours with three men. One picking them off and stacking in piles of 4. One carting them around to the drop off point (the smallest guy who wouldn’t crack the tiles as he walked over them with the load in his arms). The last guy taking them from the roof and stacking them in piles on the ground. These weren’t being used on the reno out the back. A woman from 4 doors up saw the action and came down and bought the whole lot of the tiles for $ 1,200, which paid for a few of the skip bins and the subsequent hiring of the brick cleaner.
Next came the biggest job – the bricks….11,000 recovered out of about 12,500. All cleaned with old mortar removed and stacked on pallets in the rear yard, taking up most of the yard. His wife wasn’t too happy having these taking over the only area for the kids and sitting there for over 8 months before being able to be used on the reno…..waiting for council approvals etc.
The Owner of the lot then hired a big FEL and removed the remainder of the slab and debris in 5 hours one morning. I agree, it’s fascinating to watch those guys work. In such a short time a massive amount of work is achieved. By the end of the day the block was smoothed over and ready for the new construction. No trace of the old building was to be seen.
It really brought home to me the importance of the dirt (size / frontage / position) in a property as it’s the only permanent thing. The house or construction / shed / whatever is only temporary if you have a long term view for the property.
Not having been part of the building industry, I gained alot of knowledge tearing a house apart bit by bit in the way that it’s put together. Good exercise too !! I reckon every Aussie bloke should do that at least once in their lives just to see what’s involved and have the experience.
Fantastic tips there from people who have obviously done it all before and know exactly what they are talking about.
A great read guys.
