Forum Replies Created
OK the basics, ppor and ip total value is$500k as far as the bank is concerned, total to date borrowings is $410k. That is already $10k above the standard 80% that banks like as their comfort zone before charging great amounts of mortgage insurance.
So with a ppor loan you could get upto 100% loans and it seems you did. For any redraw to be comfortable for the bank it usuually needs you to be below the magic 80% LVR before they will rethink things.
There are 2 or three lenders that charge 10% on your money and will go over this. You do however have these level 3 lenders listed on your CRA when you next apply for loans down the track and this can be looked at disfavourably when approaching a tier one (major bank)lender.
So Each loan and lender has advantages and disadvantages you really need to consider before jumping in.
Basically if you are so keen to get the second IP, you need to strongly consider different lenders through a good, yes it is important to have a good, broker.
410/500 now doesnt shine as far as affordability or dripping with equity. Maybe let this one go and catch the next bus due shortly.
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!Contributions may include specific area knowledge and heads up on new developements and roads and shops etc.
Another topic is dealing with the vagaries of management agents state by state. The differences need to be highlighted for new investors who sometimes assume a one week letting fee and 6.6% are the standard as it is in Sydney.
Your the guru Steve, show us the magic.
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!I was asked this by a solicitor client of mine recently in Sydney.
He rented a quality home in Sydney worth $800k his rent was $460/wk
to pay the mortgage he would need approximately $1200/wk
This meant that by staying put he would have $740/wk less out if his pocket while throwing as much as possible into his investments.He bought a small investment and has made $20k equity since settling in Jan on a 2 bed unit in Woodridge he bought for $100k.
Now with the additional cash NOT wasted on paying down a PPOR he can peel out $16k of his original $20k invested and cover the rest for his next purchase sooner.
How long paying of a ppor do you think without tax benifits and writeoffs do you think it would take you to have enough equity to reinvest in an additional property??
Hmmm, I think I would rent there and buy IP’s for a while.
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!Nice to see your softened approach Qlds007. As you are happy to promote Westan, another non real estate licenced buyers agent, albeit overseas, are you still sceptical about people like me sourcing property in Qld and Tassie for people?
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!our investing path started a couple of months before my wife became pregnant. My daughter is now 5 and when we lived in Sydney, she travelled as a bub to Brizzy 7 times and even Perth with me on a buying trip when she was 2. It is hard but the harder thing is to do nothing.
You know that for a bit of hard work now you will have more money and time for those later years with the kids. By adding them to your early ip journey you are also ingraining in them the value of property and hopefully a mindset for life.
Never think you are taxing your family to drag them around looking at property, even in hot conditions in Brizzy one January. Seeing a baby in tow could ease your negotiations with an owner occupier who thinks you are buying as a ppor their little home or unit.
The awww they have a baby worked for us and a townhouse in Kingston when we had a limited budget. The lady assumed it was for us and we didnt realise until the agent mentioned it back in his office after talking with her.
Hopefully the whole process is fine for the kids and you end up spending more quality time with them due to your portfolio and the steps you now take in acquiring it.
Sadly, too many of us use the kids as an excuse to not do things in our lives, I for one am guilty of this as I have put off diving for a year now saying its due to the kids. I have a wonderful wife though who has kicked me out of this thinking. Im off to Swains Reef out of Gladstone for a week in August for a 6 day live aboard 5 dives per day trip.
All Im aluding to is that we need to focus on what really is important now so we can realx a bit later when our impetus is slightly slower.
Go, get those inspections, get the properties, spend time with the kids, and most of all have a life while achieving those goals.
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!Hi DD here, the houses in the woodridge area are set to be the flavour of the month in about 3-6 months time. This is due to one very important factor, the townhouse and unit market there is going batty at the moment and most agents are now struggling to get stock.
What this means is that as the prices of these units is being pressured northwards, buying a house for the $170k+ range is a lot more attractive than a 3 bedroom unit I recently saw for $165k.
Yes the body corp fees are a hit in the pocket, but also tax deductable. What has to really be looked at is the % return in cap gains and rental ratios.
With a $185k house you get between $185 and $240/wk rent, a max of 6.4% for the rent. With a $5k reno you can still achieve 7.5% rent return for units(yes before you take out the B/C fees), but still a better paper return regarding servicability with some lenders.
Then with a house looking to rise 10% on average in the Logan area in the next 12 months and units/townhouses looking at 25% due to the usual pressures of demand and 1200 new people landing each month. A 13 storey apartment building recently approved due to change the skyline, Aldi supermarket last year in October, Kingston has a new indoor aquatic centre a year ago, all minor in their own right but all adding to the jigsaw picture of why to invest in this region.
A melbourne based investment company will be buying houses in Logan for their clients(spoke to them this morning) to complement their existing Victorian portfolio.
Yasmina, there are too many reasons this area is hot to go again. Now the houses have been pretty stagnant for the last year as the townhouse market and rentals in the area have caught up to some degree. Now I feel(opinion not advice) is the time to start looking at house returns and comparing apples to the oranges in a slightly different market neiche.
Several large developements are scheduled in the next 2 years, so maybe its better to take the plunge sooner rather than later.
Other markets such as Cairns are also set to rise, but due to the 3 large developements happening there right now, 110, 180 and 190 units in three separate southern subs developements, it looks like the locals there didnt learn from the 90’s at all regarding over developement.
Some nice pockets of quality estates are well worth looking at. One being Bentley Park which has everything you need in a 2 minute radius, a high percentage of houses and only 3 small townhouse complexes at the start of Roberts road.
It is all a matter of learning, researching and feeling comfortable about whichever areas you choose. So get as much info from as many sources as you can, write things down, get a map and reference your info to the map. Then target for investment based on your findings.
Just dont ponder too long. Markets and pricing affecting your decisions wait for no one so be decisive and good luck.
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!Well even though it showed no replies here we got 10 people for the second meeting of the Coffs investors group(CIG). One couple shared how they had purchased 2 in Cairns, another said he was relocating a house to do a dual occupancy, anither lady bought duplexes and strata titled them and sold, and it goes on. A good thing to see 2 real estate agents there as well, each investors oin their own right.
All has gone so well that we are actually having a guest speaker from Deppro coming down from Birizzy for our next one on the 19th July. This is due to school holidays pushing it back a week so Tuesday night 19th July at Annuka Beach Resort on Firman Drive Diggers Beach Coffs Harbour in the beach bar. I start a new thread for that too so could you please reply to show numbers attending. Thanks
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!Coops a few ideas of area and type might just find a buyer in here.
Several of my online clients do sell their IP’s through here so put it out there and they could private message interest back to you to avoid agents fees. What state are you in as well as this impacts on the contract inclusions and conditions, as they differ from state to state.
Either way goodluck.
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!May’s edition if you can get it on backorder from your newsagent also had 50 top tips to improve your retal yield. Every tip had a footnote from Deppro director Paul Bennion about tax deduction of the work done as well.
(My wife and I were also profiled on page 48) So a great one to chase up……for the tips the tips!!!
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!Well how well did they consider the possibility that her gear was tampered with. The baggage handler fiasco in Sydney would have been enough for me to vote not guilty.
They had Aussie Feds assist them in catching the Bali 9 so let the poor girl go. Bang the rest of them up for as long as you like but this ones a bad call.
If Qantas,Virgin and others banned flights for 3 months, how quickly would she be home. Sure the Indonesians want to save face, but this smacks of pig headedness and sending a message. 20 years is madness if she is innocent and im pretty sure she is.
Do the trade and transport boycotts, leave the Tsunami money alone as thats a separate issue. Leaving her to rot over there is not right. She has not recieved the benifit of the doubt so lets all pitch in and not sit on the fence out there.
Have your say here as we still live in a free country.
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!I disagree battleships. The roll on effect of more disposable income would mean more “toys” for the rich in the form of cars boats big TVs etc and the follow on economic boost which again breeds its own follow on in different areas of the workforce. Job creation in tourism and holidays as more can afford better escapes and in the not too distant future the extra IP’s they all will want.
Follow this with the interest rate hike and then the “woe is me” mentality wil again rear its ugly head and stablilse the property market again.
Why not be a player in the market. Life is not a rehersal, its the real thing guys. So gey out there and have some fun.
Woo hoo!!!!
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!Terry I could sell you a nice little printer for ……you guessed it $123.00.
Never mind[biggrin]
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!Benali, all depreciation schedules give you are effective deductions for everything in your IP and im sure i would miss quite a bit. Just had one done on a 2 bed townhouse in Kingston. The $2089 for the first year is about $20.00 different to rates and body corp for the year so with a 7.5% return and the depreciation schedule im neutral.
So tip1 get a dep pro schedule
tip 2 read this months API mag about 50 ways to increase rental yield(cool article about me on page 48 too hehe)
tip 3 never say die, bad val get a different lender or a different valuer on banks panel, not going to settle on time get extension, repair as if you would live there yourself, and take no prisoners!!!
tip 4 have a team of professionals around you at all times. Tradesmen, solicitors, agents etc.
tip 5 never get emotional about a property, as Peter Spann put it in Brizzy last month. “if you sell you are just realising profit”, dont be afraid to cut and run.
tip 6 set goals and review regularly. My wife set goals 10 years ago that nearly gave me a heart attack. Now 10 years later its all happened.
tip 7 get some sleep!!! its 3 am why am i typing this??
Goodnight
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!This months API has 50 top tips for raising rental yields so worth a visit. Personally love the quotes on 4 renos from one couple.
DD[angel][
]Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!Dr X, whoooaaaaa there doggie. I have an established portfolio(may API) and find deals constantly. Whether I have available funds to do the deals myself or pass them on to my clients, its the same on both counts.
I find and negotiate deals because I love to, and your last post I found offensive. As you havent considered that the research and deal creating are the buzz I enjoy, maybe yours is being jealous of missing a few deals somewhere along the line.
Im not really fussed, but to say that those of us that work professionally in this market are frauds due to saving the best deals for ourselves is just BS. There is a Cairns deal I would love to do right now but dont have the funds.
I have happily passed that onto a lady in Tokyo to consider and have no qualms about it either.
Ok so im not cashed up at the moment, do I stop finding deals, no.
Think about your posts a bit more before critisizing others.
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!good property, good agent and now a goooooooooooood new owner.
Great to see the win there and where is the next one???
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!HI Lea, great to see another motivated buyer. Shame we all face the negative people who say dont do it. They mainly want you to stay poor and miserable like them so maybe its time to surround yourself with others that own IP’s and speak to intelligent forward thinkers.
I believe it is 20/1 the raitio of negative comments about property to good ones from family friends and business people I deal with.
If I listened to the dudds, my wife and I wouldnt be in this months API agazine as a feature couple.
Take the plunge again and again and again. As long as its safe, affordable and allows for your costs, why be held back by the dummies that infest our thoughts sometimes with their sad tales of woe.
Being a part of this fantastic forum with intelligent and knowledgable people is a great asset. Is there an investors club or meeting group you could attend locally to you. What a breath of fresh air that would be for your psyche, to actually have smiles and genuine interest shown in your little(for now) empire.
Go get em!!! Don’t take prisoners, and see you on the beach.
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!if you can arrange access, get your repairer or builder to do an accurate quote on what needs doing, this then becomes the basis of part of your deduction. If you have pre approval and can make it a 30 day contract, reduce the purchase amount by $2k for that, if you get a price fixed on a contract, then pest report shows small termites or it needs a barrier in place, quote for this comes of price and should also be negotiated asap.
Checkout postcodes as some LMI headaches arrise from regional or just out of main centres re LVR on property. In major centres 80% lend is fine, outside can be as low as 65% or worse.
All are bargaining chips and only the tip of the iceberg regarding negotiating.
Good Luck whatever you end up doing.
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!PLA Management in Edgecliff are hot. I use them personally and the tax man cries each time he sees my return they are so good.
Ask for Maria, she is italian, early 40’s has her own property portfolio and does not take prisoners. Awesome.
http://www.plamanagement.com.au
the picture does not do her justice either.
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!ok all meeting at 5.30pm for a 6pm start. First meeting so its open to discussion what future format the meetings take.
Look forward to seeing you there.
DD
Buyers Agent (Dip Financial Services(FP)
Don’t sweat the small stuff,and it’s all small stuff!!
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