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I normally just blow the remnants up in the air and have a bit of a laugh.
Then I just reach down in the bathtub, grab a whole handful of more bubbles and start the process all over again. Kids love it !!!
As for tactics, it’s like a bloomin’ commando session in there once all of us get in on the action.
The only downside is the when the wife discovers what a huge mess we’ve made all over the bathroom floor. The bubbles don’t last but….
Wasn’t that the question ?? [eh]
Well described Simon. That’s pretty much it in a nutshell.
Geez…..sounds like most of the Broker’s don’t like any of the big guys….walking from N, C and A.
That only leaves W…..hopefully we don’t put them in the same pot, otherwise the whole thing turns into a big WANC ?? [blink]
For me, I’m happy with the “drive by”, as it’s the dirt I concentrate on.
We got a valuation done just 2 months ago on our PPoR. It’s a 5×2 with a major reno happening right now.
A drive by was done, and then the value proferred was identical to the 2×1 1940’s house sold 3 doors down the week before. Same land size, aspect etc.
Then, a month ago, a vacant block sold (same land size, same aspect, one street across on a busier street) for the same price.
In my unlearned opinion the bricks and mortar occupying the dirt, regardless of how flash, how big, or how much you’ve spent doing it up, aren’t worth 2c and never have been. Hence, my opinions of units and apartments aren’t too high, unless you own the entire block of dirt underneath them all.
It appears a few of the Big Banks agree with my view……hang on…..maybe I’m in the wrong business ?? [biggrin]
Paid $155,000 nine years ago
Put $30,000 into it (re-roofed, a/c, new kitchen, huge back deck etc)
Worth $550,000 (perhaps a little more)Hi Wylie,
With your 185K rising to 550K in 9 years, you’ve achieved compounded capital growth of 12.85% p.a. I’d be very happy with that – well done indeed.
That of course ignores rental income, so your total return is higher still. You’re onto a winner there.
Hint for everyone else confused about how to work out the compound growth of your assets, try this ;
1. Get the end value (550)
2. Get the starting value (185)
3. Divide 1 by 2 (2.97)
4. Get the time component in years (9)
5. Take the 9th root of 2.97 (If you have a bog standard calculator without a x(root) symbol you are pretty much stumped at this point).
If you have a scientific or financial calculator type in 9_shift_xy_2.97_=
6.This will give you an answer of 1.12856
7. Get rid of the 1 to the left of the decimal point, and shift the decimal point two to the right.
8. 12.85% – hey presto.
Hope that helped rather than confused y’all… [eh]
I know of a man who finally received his 600K (after he paid his lump sum tax thingy) super payout about 6 years ago.
He had a good lump of Telstra shares which he and his wife lived off the fully franked dividends. Anyway….(I’m getting there)….
Against all financial advice, he went to his Bank of 40 years, and they extended to him a loan of 1.6 MM to buy a carpark situated on about 1.5 acres over two levels for 2.2 MM, all on one green title. The concrete infrastructure was worth a bit, the dirt was worth most of it.
Ever since, he has been going to his “place of work”, being the guy sitting in that little booth where you hand him the correct change or he doesn’t let your car out. He has some long term bays leased out to corporate suits and some casual bays.
He listens to the footy on the radio and has a small TV set there to keep him company. The newspaper is thoroughly read from cover to cover.
Personally, I think he does it mainly for the human interaction when the people come through. He regularly patrols the carpark and knows most of the regular people by name. He’s very proud of the fact that in his time, no vehicles have been stolen or even tampered with on his watch.
At about 6:30pm he packs up, pulls down the steel shutters and heads home to his wife.
The carpark is cashflow positive with his 1.6 MM loan, and he refuses to pay someone to do his “job”, as he believes they won’t care and treat his “customers” properly.
At a function a couple of weeks ago, he was saying (no idea if it’s actually true) the bank valued his property last month at 4.2 MM. The concrete is still worth the same, but the dirt has gone up just a tad.
So over the past 6 years, with an appreciation of 2 MM, he’s literally been paid $ 913 per day, every day for the past 6 years. Not bad for shuffling around and saying hello and goodbye to commuters.
Not sure if those financial advisers have been paid as well every day (including holidays and weekends)….The little man in the booth is probably on more than his high faluting customers.
Knowing him, I always say hello to carpark operators nowadays….’cos you never quite know who just you are really talking to. [happy3]
Owning the dirt underneath is the key….
Originally posted by wealth4life:Yes we looked at Perth as well and found it far too expensive compared to say Queensland which has all the factors of better growth.
Queensland is moving backwards now and we have identified some great deals especially small shopping centre complexes as we are getting bored of investing in houses and puting up with tennants etc
D
Wow D,
We’ve been studying the “Perth market”, if there is such a beast, for over 12 years now and can only admit to knowing a tiny portion of it well enough to even comment lucidly. How long did you spend running your eye over it before writing it off ??
What did you look at…..there’d have to be at least….guessing now….maybe 400,000 separate properties, some silently listed, most not listed but maybe available, some on the internet, some just have a sign out front, some have nothing, some just in a REA’s window. To cover the lot is a mammoth task indeed. Or was it just a quick high level surf on re.com and then
> straight to conclusion.How can Qld (once again that’s a whole bunch of properties) have better growth “factors” than WA, and therefore overall better, but you say it’s going backwards and WA is roaring ahead…..I don’t follow that logic at all ??
I agree 100% with you however, that over time you get pretty sick and tired of listening to very low paying residential tenants whinging constantly eroding your cashflows. I’d caution the retail side of things though…..we’ve spent quite a few years studying these small shopping complexes and unless you have a solid retail background, can be a big trap for the unwary. But hey, not to discourage you, do your DD and hook in I reckon. nett yields for retail in my neck of the woods have dropped from 8.5% down to about 3.5%, as the flood of residential investors realise that there is perhaps better investments than the typical unit or house. It’s a bugger competing with them, because anything above about 2.5% gross is better than what they are currently getting and therefore think it is Xmas to get 3.5% nett and snap things up.
Good luck with your endeavours.
Rent it out.
Hiya Cata,
For us it’s the great big wallchart we have up on our bedroom wall, above our study. First thing I see in the morning and the last thing I see when I go to sleep…..when I’m there of course.
The chart is now over 12 years old and has diligently tracked our debt and net worth over that time.
The debt is a big smear of red and the green bit is the “good bit”. The red bit has stayed constant over the last two years and the green bit has gone outta sight.
That increase in the green bit has allowed me to quit my rotational overseas job, and come home to live permanently in Australia with the wife and kids.
We are now eating our cake…..and it tastes pretty good after the massive sacrifices made.
Excellent work camden….very inspiring story indeed, and likely to improve further when you get units 5 and 6 up and running. I bet your finance provider thinks you are a top customer.
Now where did you get that idea about getting off your bum and out from behind the computer and mixing it with the real world ?? Do you mean life cannot be downloaded or emailed to me as an attachment ??
Excellent thoughts wylie….I’d love to catch up with you over a cup of tea, especially to pick your brains on the self management side of things. We do it as well, but you seem to have the runs on the board…..perhaps you are nicer with them than the wife and I.
Need six properties to retire on ?? Hmmm, I reckon one big one would do it for me. I remember an older lady standing up and saying she only had one IP, but it was an office block that her deceased husband left her more than 30 years prior. It was renting for 1.1 MM p.a. nett, that’s $ 21,100 p.w. after all costs paid by the tenants. I think she was reasonably happy, and really didn’t need six of them. We really do need to get away from these average smo 3 bed houses renting for $ 180 p.w. to get anywhere. Anyone actively promoting these or similar needs to have a good hard look at themselves.
Property has been reasonably kind to us over the past good while, especially the last 2 years….yes I’m in Perth. We are looking to purchase again, probably a dirty big block of dirt. Our spirits are high, and if the WA media are talking gloom and doom, then we actually take comfort from that. We concentrate on specific contract details, both sales and leasing contracts and the nitty gritty therein. What Mr Rossen (the Prez of the REIWA) is quoted as saying, usually has very little bearing on real life out there where it’s every dog for itself.
What the “property market” as a residential median is doing…..has absolutely zero bearing on what we do.
As I’ve noted on the forum before, don’t fly up in the stratosphere looking at the “market” on a macro level…..you’ll go blind and broke trying to figure out all of the gobbledegook, with far smarter individuals with access to every piece of data coming out their ying yang trying to convince you one way or the other.
Instead, get down on your hands and knees and scrummage through the weeds, sniffing out the gems in the rough that the other more intelligent people have already “surfed” over. Sometimes they are absolute crackers.
Good luck everyone.
OK, Foundation, bring on the misery stories.
The only other way…..Not sure this is correct….there are absolutely heaps of ways of creating +CF.
Good onya Wake. You appear to be a competent and intelligent property investor. These type of investors usually get frustrated with the service providers they deal with…..especially the lawyer types who naturally assume you are all cloth ears and really really really need their help in every matter.
As you’ve found out via experience this is usually not the case, especially if you are very competent.
i could tell you a few crackers about lawyers….but my fingers would hurt typing it all out and basically far too frustrating to recount. Suffice to say they’ll all stand there with their arms folded and tell you they are qualified professionals and absolutely did everything perfectly and will never never never admit to anything.
Best advice I can give you is to move on / over / around these clowns. I’ve done deals with vendors before and everything has gone swimmingly for both parties.
It’s amazing when all of these hangers on / advisers / experts suddenly get in the way of the deal and sometimes stuff it up so royally that one of the formerly keen parties throws up there hands and walks away…..and everyone in the circle of incompetence loses….but not nearly as much as the two primary parties.
The worst advice I can give you is :
Seek independent legal advice…..bah….humbug.
P.S. Have a quick squizz of the legislation that pertains to your particular circumstances…..Lawyers aren’t the only ones that can read legislation.
G’day Mee Chee,
As per your thread title, the easiest way to maximise your salvage costs is to simply pick up the phone and get quotes from say 3 or 4 local salvage companies who do this sort of work all the time, and then simply choose the highest quote.
If on the other hand, you wish to minimise your costs, you may be able to get the company to take the house away and all the products for free. I’ve had two friends do this is in the past 12 months. They had to negotiate hard on this though….most companies want to charge you to take it away.
Would you use the local mechanic to diagnose your medical condition?Of course not – but then I wouldn’t use a judge or QC to diagnose my medical condition either – what’s your point….and how does it relate to the topic of discussion ?? What an obtuse analogy….
as a Lawyer, I consider myself as a professional and do not accept some of the views espoused in this forum.Oh well Francis….I suppose that’s the good thing about forums such as these….Lawyers don’t always get the final say….despite their passion for arguing the toss.
Would you buy a car and not insure it? I doubt it unless you are not interested in protecting your investmentFrancis you really are showing your lack of maturity in investing philosophy if you believe cars are investments worth protecting…and how they have little if any parallel to property investing.
If you are worried about penny and cents, then you should not be in the property market.Once again Francis, you are showing your lack of experience, as most experienced property savvy investors will quickly enlighten you that having an eye on the costs details is one of the facets that successful property investors all have.
Unlike at a lawyers convention, this forum is chock full of intelligent canny investors who are looking at and discussing ways of getting the paperwork completed in a correct, timely and efficient manner. Are you suggesting only qualified Lawyers are capable ??
My faith in lawyer’s over inflated views has been restored.
Have a great day Francis… [biggrin]
We’ve used settlement agents for every purchase. We are in WA where they are far more common and significantly cheaper than using a solicitor. Sounds like there is a big market opportunity in other states as this doesn’t seem to be the case
Never used a solicitor for purchasing property….nothing has been that complicated that it has warranted it.
We’ve sold two properties and didn’t use anyone….what’s there to do ?? If the purchasers didn’t slap the unconditional cash on the table, we didn’t let them have the title deed….simple.
how much money are each of the moderators worthMy 3 kids kids reckon I’m worth ‘the world and beyond’…that may change as they get older…. [blush2]
what is their opinions on wealth creation.I reckon steady steady as she goes is a pretty good model. Preparation / neat filing / organisation and all of that other boring paperwork type stuff is crucial.
Have your ducks in a row, and be ready to pounce on anything that swings your way. I’ve found the wealthy people always seem to be both willing and able to make a quick decision – they don’t “dilly dally”…..and they can normally smell a rat a mile off.
Rich people can also be very lopsided in their life also…..note the stressed out highly paid CEO who is just about to get a divorce and wouldn’t have a clue what’s happening in his kid’s lives…..he may be rich but he ain’t wealthy….
On the other hand, the dero on the park bench with no stress, no hassles and little worries is also not wealthy either IMO…. [eh]
I’m shooting for the “well rounded” type wealthy ideal….bit of dosh, happy family life, kids that like me and want to hang round and do some fun stuff, and someone who enjoys interesting hobbies and has a full busy life…..the type of life, that if recorded, would easily overflow a one day to a page diary.
I reckon this one depends a bit on what is happening to the broader economy in the state at the time.
One thing I’ve learnt in Perth during the past 20 years I’ve been observing the broader market……and that is no matter what is happening nationally, at any point in time there is always one or two local industries that are absolutely booming.
This spawns the execs (or more usually their partners…) in those particular industries to be on the lookout for houses in the pricier suburbs. Normally they’ve got a pocketful of cash and prefer the upmarket suburbs and are quite prepared to stretch that little bit extra.
Also, going down a level of detail, a major defining feature within a suburb can have a big impact on prices and “exclusivity”. Anyone who is familiar with the suburb of Nedlands in WA will know what I mean. South of Stirling Hwy is way pricier and much preferred by nearly all buyers (same suburb but about 180K difference) due mainly to all the schools being south of the highway, and mothers not needing to cross the busy highway with kids in tow on their way to and from school.
Depends on your cashflow limitations at the time of purchase of course, but we’ve always tried to stretch that little bit further to get into the worst street but better suburb.
Indeed, the best combination we’ve found is what we scored with our PPoR…..worst house / top street / top suburb….essentially rubbish bricks and mortar, combined with top land component.
In conclusion, our priority has always been ;
1. Suburb first
2. Street second
3. House lastN.B. : This only works for residential stock. We’ve found this criteria does not hold true for other forms of R/E.
I’m in the same boat as you audrey.
Never bought a vacant block of land but just about to take the plunge.
We are looking at 120 acres at the moment some 25km from the Perth CBD.
We have no intention of building anything on it in the short term…..but plan on digging it out and selling the sand (a big sand hill would be perfect) and then apply to council to fill it full of rubbish once the hill has been converted into a dirty great hole.
Soil tests aren’t too important to us, as there won’t be any when we have finished….but it’s fun to look.
Having a council onside is more our important criteria.
lyndon_g, great to have you on board. We are currently just starting a reno on the PPoR and just finished pouring the footings for the building. 7 cubic metres and 17 tonnes of concrete at 25 MPa. Didn’t go far in the footing but was a good job and should form a good basis for the house. That penetrometer they use to check the footings compaction is very dodgy in my opinion. 6 blows with a 9kg weight for the first foot (I think the OD of the metal probe was 3/4″ inch) and then a further 6 blows for the second foot.
Looking at the “engineer”…..he wasn’t but called himself such, it all looked a bit agricultural, but if subsidence occurs they all fall back to the certificate he scribbles on in the dust. It didn’t seem right to me…..but was told “she’s right mate – everyone does it”…..hmmmm. Being a senior engineer myself, I could see flaws everywhere. On further discussions, I was told if cracks do appear later on in the building and settling process, the building company doesn’t actually refer to it as a “crack”, until the assessor can fit his entire hand through the crack…..[blink]….until then it’s officially just a hairline anomoly….and “nothing to do with me mate”….[angry2]
You missed my entire point. I was making no judgements on any group. In fact your examples support my pointMatey, I got your point and agreed with it. I agree you weren’t making any judgements. Hopefully my examples did support your point, that was the intent…..gee whizzy !!!!
How about we firm up what it means to “make it”…..that’s very rubbery and depends on your living standards and expectations. I’ve seen people “make it” on 25K p.a., and others who would be hopelessly lost on 100K p.a.
F,
Good post, and I can see where you are coming from – or more to the point going to.
A few things….
1. What happens when the strongarm boys come in, beat up the teacher and take over the lucrative lolly market.
2. The parents think the school isn’t good enough for little Johnny, and are happy to pay the neighbouring private school 1,000 lollies per year.
3. Some American or whizz bang Chinese thing comes in and makes boring marbles worthless. Useless marbles and useful houses are different….bad analogy.
4. The children decide, instead of playing the sandpit, to dig it up and flog it off to China for 10,000 lollies per Tonka truck load.
5. All the kids teeth fall out from eating lollies, savings disappear as they now prefer a tepid soup, and the teacher is taken away for rackettering and non-disclosure due to ASIC not receiving a valid PDS on the marbles venture.No doubt, security will come and drag me off kicking and screaming as well. [biggrin]
Some of the wily old Greek and Italian gentlemen I bump into occassionally out in the industrial back blocks certainly fit that mold you describe Simon.
They can’t speak very good English, they cannot read or write, they don’t own a computer and have never “surfed the internet”.
Yet, when it comes to savvy property investors, I’d confidently put them up against any forum member anywhere in Australia on any forum. Some of them are massive investment barracuda’s, chomping their way through the investing minnows.
Be careful…..just because you don’t “chat” on a forum doesn’t mean you are loser, and conversely…..just because you do, doesn’t mean you are a “winner”. Nice for a chat and all, especially when you have some good news or an interesting tale to share with like minded folk…..but for me that’s about it.
