Forum Replies Created
I have negotiated price reductions based on work to be done for properties in Qld, Tassie and WA. We had a termite problem in a tree outside a house in Qld and the $1320 for a complete termite barrier was taken off the purchase price.
Tassie (for a client) arranged a quote for some serious repairs to walls,doors etc to bedone. The quote was $8,800.00 the price was reduced by $9000.00 to complete the sale.
WA repairs to a downpipe, a faulty air conditioner and some electrical work was all done by the seller at no cost or change to me.
Go for it, and as soon as you can get it all documented through your solicitor or conveyancer. Most in WA are conveyancers only.
Good Luck
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!Foundation, with the right research you can always find good properties. The fact we are looking at slightly increased interest rates is goodie goodie in my books because those thinking of selling will start to panic a bit and the bargains will be there.
Waiting for the market to move is silly because unless you have your finger on the pulse you will miss the initial changes and loose those deals that may not be repeated once the wave of change moves on.
We buy, we sell, we constantly update our info.
Today I found out that 85 new townhouses were being built and sold in Logan Central for $230k each. What do you think that means to me. More interest in those properties in the area still worth $120k. Given a 24 month build/sell cycle for the new ones, I expect this “tip” from a local agent only on the 6 townhouse we now own in the area will make me $300k in the next 2 years . We have houses there too.
So maybe a hold off until the movement happens isnt quite what Steve really meant.
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!Thanks for the vote there Monopoly, its always good to get encouragement from the top tier like yourself.
Hi Brenda, long time no see. Great minds think alike. We settle a sale on one of our non performers in Perth next month and pay down another to get more cash positive. Renos and upgrades I do all the time. Did one in Redbank Plains in December and just did another in Kingston 2 weeks ago.
Its always good to fine tune your thinking regularly. None of our loans are fixed as we have always needed flexibility but we are converting a few stragglers to Interest only now the dust has settled a bit.
Still bought 2 more townhouses Dec/Jan in our pet area of Kingston. Can’t help myself.
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!Use your UK cash to flow into a new IP in OZ rather than the uk. I take it that you wish to come home at sometime? Would all the value of your surplus funds there be wasted if invested there? What are the UK vs Aussie tax ratios and other charges. Things like land tax for non residents and things similar to that. Do your research, and if then you have better options there, just go for it.
Informed decisions are the best ones. Be wary of accountants that miraculously appeared on the night. What commisions do the various parties get and is it as clearly disclosed as it is over here.
Good Luck and keep warm. One of my clients is over there for a month and is freezing.
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!read, ask questions, find a mentor, then go for it. The best time to invest is always when you can afford it so good luck and have fun.
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!Ask the managing agent your rights and obligations. They will, if any good, spend the time to be very clear where you stand.
Good Luck
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!Managing one tenant per property is hard enough sometimes leave alone 2 or three. Be very careful as sometimes the $$ on offer get chewed up by increased maintainance or insurance or other costs due to several tenants that “dont care coz its not mine”.
Not something I would do.
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!Always the same posts of gloom and doom. I say goodie!!! for where others see problems, I see challenges to solve.
I buy entry level properties and do renos and hold them. I get ok returns and currently have a 64% LVR over all. I agree with some of the other posts, doing nothing is going backwards. Never be afraid to have a go, and if you fail you have experience and knowledge to move forward again.
To Monopoly, hi and wow hip replacement and a pending knee reconstruction. I have had three(yes first one failed)knee recos and since had 9 arthroscopes on both knees. Ive been told by someone its a failure to accept authority to have knee problems, you go girl!!! Leave the rest behind.[biggrin]
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!Kate, sometimes we do in the shortterm what then allows us the freedom to choose what to do more easily later. So you go to work for a bit, not too hard a call when you see that by working a year, you will then be in a better financial position to invest and cut back the hours.
Forgoing some quality time now may allow you to have much more quality time later.
Steve(Mortgage Manager) was right, most financial planners, by the very nature of the industry, will steer you away from active investing into managed funds and share portfolios where they get a commision on whatever you do. Especially banking FP’s, they are aweful and do not give one bit of intelligent investing advice.
To put your shingle out as a financial planner you have to(by law) be associated with an insurance office or financial institution. This sucks as you cannot truly perform your function to the best result of the client. I have completed my Dip FS(Financial Planning) last year and most of the guys that did the course were mortgage brokers looking to add income to their existing business.
Our case study, we all laughed at as there was an obvious thing to do that was not allowed by the “financial planning” guidelines. Pay off the PPOR with $100k inheritance and then use PPOR as deposits for property investing. This although agreed by all was the best option given the full picture, was not allowed under the guidelines unless a managed fund and total insurances were offered first. These items were deemed smarter than a true investment you control and manage yourself, so I was quite taken aback by the control being imposed over planners to do the right thing for anyone other than the person who has asked for your help.
It seemed a bit rediculous really, that the ASIC PS146 guidelines were so tight that you could not offer truly intelligent advice without breaching you licence. This is only one mans opinion, but it was confirmed in that class of 23 people who all agreed that what was expected of us in the case study was not the best thing for the client at all.
Be aware Kate that some of us in good conscience could not then put our shingle up. I act as a buyers agent for property and do not perform the full financial planning function as I am not associated with any financial institiution or insurance company.(Just so we are clear)
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!HI Rita & Karl, well done is the first thing that comes to my mind. To have a home and 2 IP’s you are already above 95% of all investors, great work.Secondly, dont be afraid of changing IP’s for profit.
We just sold an IP in Perth that was a dog for maintainance and returning just below 6% for a townhouse in SEQ which gives us 7.5% return in our pet area. So yeah there is a cap gains question in selling, but if you like we have a couple of non performers in your mix, maybe not struggling with them is the best solution.
Look to areas that have constant if slow growth like you already have in Ipswich and Cairns(good call on both) but with a basis of return from day 1. I got one for my nephew recently in Cairns in Westcourt for $80k a 1 bedroom unit and the owner rents back at $120/wk. It takes good hunting and as many others have said, no emotions.
I have clients who use a calculator and very little else to buy. These guys sell just as coolly and cull bad choices where possible.
Some people cant be that detatched and I myself get a bit determined and emotional if I see great potential. My wife and I bought our first IP in Blacktown in sydney and it was neg geared, we were about to havea baby and loose my wifes income but could see these off the plan units had great potential so gave it a go. We struggled and just over 14 months after buying it we sold it and made $60k profit. This paid off the PPOR small mortgage we had left so then we got serious about investing.
All im trying to say is Purplekiss and others are right in saying be aware of real costs of ownership, but if like us you can see the potential in a few years maybe its worth the wait.
Something to think about. Good luck with whatever you choose.
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!Well we took 13 years to pay off our mortgage in Sydney. It has taken us 4 years to now have a gross worth of over $4mil. All the tax and depreciation benifits, staying put in Sydneys west for longer than we needed to, and then doing the quantum leap into a $million dollar street in Coffs, I think its pretty clear.
Rental of a nice place is considerably cheaper than owning in the same area, and mortgage hunter it is that clear. With a few runs on the board now, I would never start with a big mortgage. I and my wife would rent until we could just sell a few and have a big enough deposit to make it feasable to buy where ever we wanted and not be crippled by a big non deductable debt.
If the NZ props are putting cash in the mix, repeat the process like a cookie cutter until it bleeds. Watch the NZ/Aus tax situation though. It can be a little tricky. Careful with reno costs in NZ too as even standard tiles are 3 times the price here.
Bottom line though is that it is your final decision and not anyone elses. Choose what is best for you, and be damned to those that frown at whatever you decide. It is your life, enjoy the ride.
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!OK last week down in sydney I was in front of a lawyer and his fiance. They were renting a unit for $460/wk, to buy the house would be $800k, this would mean a 1200/wk mortgage.
I would prefer to rent and live where I wanted rather than struggle and live where I could only afford. Ok end result, happy you due to location, happy you as you have $740/wk in your pocket rather than a “bad debt” with no tax deductions, and finally happy you because you have extra funds to service another 4 IP’s straight away. Get as many as you can financially stand, struggle with rates and servicing for a year, sell off the worst performers and then review and move forward. 4 years of good property investing now has us in our fream home in Coffs and its all good.
Good Luck with your decision but i know where I’d be.
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!Buyt established hgouses/townhouses hopefully with tenants in place paying good rent. Cash back as soon as it settles to pay the mortgage.
Building delays like that in Ipswich area of Qld too. Means one thing to me, pockets that have been missed to find and invest in. Thanks Hobart.
Keep the good news coming.
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!Watch out on postcodes for some of these suburbs, Penguin, even though its between Devonport and Burnie its postcode means the antequated mortgage insurers downgrade your application so you may only get 65-70% LVR loans or pay high LMI.
JUst a thought.
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!Dont sell as it does act as a catalyst for capital gaoins and the tax man always has his hand out so no thanks. $600k if you got that as a bank or lender val would mean the safe 80% lend would have you at $480k lend. Depending on your servicability, an extra $190k couuld be released as deposits and costs. So what are you waiting for.
Good Luck.
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!100k cash to me would mean 4 x $100k properties plus costs. This would mean that with 80K debts and rents of $150 achievable then I’m a happy man.
Just a thought.
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!Gatton uni will help you as they add new places to their list like most other SEQ campusses. Rosewood is 20 mins to Towoomba and 20 mins to Ipy campusses so its prome location for growth as well. $1.8mil estate going in there now shhhh!!!!
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!Hi Marissa, Hi Purple Kiss, havent seen you guys on for a while. The issue none oif you have raised is the asbestos fencing that was used in all of these areas up until about 10 years ago and is now slowly being replaced by Super6, the asbestos looking corrugated fencing that is non toxic. For a novice investor watch out as it is hard to tell the difference.
Make sure any new investment has this covered in your building report. Good Luck all. C’mon the railway.
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!My wife and I totally agree, that should we start again with our current knowledge we would rent for 5 years while squeezing the life out of the cash we had to build a property portfolio.
Decisions like this are yours alone as others have said but if a previous example had been taken a bit further a Sydney 3 bedroom inner city unit costing $800k currently rents for $460/wk. Should you buy the one next door for the same your mortgage would be $4600 apprximately a month. Based on that , to own there is madness but to live there is a choice.
Your servicability is drained substantially by buying these types of properties unless its for investment and where you have a really rude income you are trying to offset a mass of tax on.
Rent young man, and take the extra $700+/wk to the investment servicability table and buy more. And investment interest is all deductable so win win win.
Good Luck.
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!If you paid the 80k ff the loan properly and didnt hold in an offset account you could ask your lender for a variance on repayment and get your monthly amount reduced. So the cost of the money in the offset account is the loan repayment level being set higher than necessary.
Your choice your call.
DD
PS146 Certified Financial Planner
Don’t sweat the small stuff,and it’s all small stuff!!
