Forum Replies Created
Hi Rachel,
There are steps you can take to protect yourself under the circumstances you face.
Only deal with someone reputable, get you own valution for your sanity, use a solicitor based on recommendations given here or through the state association, obtain a building and pest inspection report from someone independent, check expected rental returns by asking other PM and/or checking the internet listings.
Get lots of photos.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Hi Damian and Tam,
You are right in that the recent growth, and the timelag in rents increasing, has resulted in rental returns dropping. This means that in general terms ‘off the shelf’ positive cashflow properties are harder to find than they were previously.
Another option is to see if you can identify a niche or missing attribute with the property that can be acted upon to make it positive.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Hi Martine,
Correct address is http://www.somersoft.com (no au) – Kiwi’s memory was a little hazy[biggrin]
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Hi John,
While the gross rental returns may look attractive the net is another matter. Rates and body corporate fees do eat into your cashflow.
You can also run into ‘tax’ issues when you use the same place as a holiday destinatioon. If it is a holiday destination you want the hire a room for your holiday.
(Upcoming holiday 10 nights $1300 a stones throw from the beach)
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Hi Steve,
Further to my earlier post (and don’t take this as a challenge to prove me wrong.
In the last ‘crash’ many of the people who got burn’t were those small time developers who came onto the scene late and expected to make mega bucks.
Hopefully Michael Yardney will pick up this thread as he will be able to add specific comment about the difficulties of developing and the need to start with small manageable steps.
I would be asking some very serious questions about the company who are doing the development before throwing any of my hard earner into the project with them.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Colorbond to match the brick work?
The Shire/City/Body Corporate/neighbours may also have a say.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Hi Zen,
With all due respect it would appear that you are suffering from analysis paralysis. A lot of your posts are of the ‘what do you think about’ type.
I would suggest you go back to your drawing board and work out what you are trying to achieve through property. Then develop a list of property ‘must haves,’ ‘desirables’ and also a list of ‘must nots’ and ‘probably nots’.
This will then help you to eliminate and short list suburbs and areas and allow you to refine your search within a single or group of suburbs.
I would steer clear of managed apartments – they are hard to finance and as Actoday said some lenders are very wary of central Perth property.
By way of exampe CBA used to lend at 80% about 4 years ago. They then changed to ~65% on the same and when someone I know went to refinace they couldn’t utilise the extra equity because of the reduced LVR.
Banks do change policies – that is why I prefer more conventional properties in quality locations to reduce the likelihood of this happening to me.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Originally posted by nowork:I have noticed rental vacancies creeping up.
I am curious – where are vacancies increasing?
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Hi Kidrock,
Your own home will be free of stamp duty and vendor tax in NSW. However should your IP be in NSW you will be up for land tax every year and if you ever sell a vendor tax of 2.25% of the value of the sale.
If however you invest interstate you may still be up for land tax depending upon the land value of your investments.
For details on land tax and/or stamp duty, which are both state levied taxes, visit the appropriate office of state revenue (or whatever they are called in that state) to find out what you’ll be up for.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.H John,
The greater driver will determine where you invest.
If you budget is fixed at $200k then it will be one of those ‘cheaper’ suburbs. If however you really want (need) the cashflow provided by uni students then you are better off closer to the uni.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Ho John,
If you are intending to use the valuation for finance purposes you can always ring some of the bigger valuation firms and ask them if they are on the appropriate banks panel.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Hi Jeff/Tash,
This question gets asked fairly often and you’ll find those that like DHA property and then there are those who do not like it.
Try the ‘search’ button which is located just under the ‘forum boards’ button in the top left corner.
Ultimately it becomes a matter of free choice.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Hi Bwendan,
Why reinvent the wheel. A MSN/Somersoft grooup get togther very regularly as it is.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Hi Steve,
With all due respect I wonder if property investment is the right thing for you.
The reason I say this is that your ‘saving effort’ as commendable as it is indicates (to me) that you have a low risk tolerance. And while I believe well researched property is relatively low risk there is still a risk.
And to consider property investment overseas can add to the risk level. I would certainly advise start closer to home and then if it all fits together and your emotions are coping start looking further afield.
If ‘property’ is still it then you would be well advised to grab a few of the books mentioned in the following thread
https://www.propertyinvesting.com/forum/topic/6845.html
in order to expand your horizons and knowledge base – this will also fine tune your BS detector.
Note I am assuming as a ‘saver’ that you have probably been ‘head down tail up’ saving like hell.
Factors such as desired income levels, your age, family situation, risk tolerance and your personal investment beliefs all come into play.
Critical to your journey is choosing how you want to invest in property – are you going to pursue growth or income or a combination thereof? In some respects this will then determine which properties will suit you as investments.
Hope this helps some.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Hi Jon,
Suggest you do a search of the forum. This topic and reference to Jenman comes up from time to time.
Just under the ‘forum boards’ button is the ‘search’ function.
As always in matters property investment – you need to make up your own mind.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Sustainability is the key – what is the population trend? how reliable and sustainable is employment? what has been the growth history in the town? what is the schools enrolment doing? single or multi industry town? what is the economical history of the place? how many services (education, hospitals, doctors etc) in town? how active is the shire council? will the next government close the services?
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Borrowing capacity is determined by gross earnings – so in essence this figure is most important when determining borrowing capacity.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Originally posted by wubbdubb:has anyone come across these sort of investment opportunities before, and what are your thoughts. i expect that in 4 years when the lease runs out and is not renewed, and i sold, i would probably be in front by a couple of grand.
As per Kwilko’s comments – there are also a number of other comments made in the past so I recommend a search of the forum. Use the ‘search’ button top left under ‘forum boards’ for previous discussions.
I would also add to a couple of grand after putting on the line XXXX dollars – is it worth it?
Rent guarantees generally serve to attract beginning investors – having the security of rental income does give certainty but there is a ‘cost’ involved (Kwilko’s comments).
If you have a well researched property in good areas with good employment prospects and you price the rent right then finding tenants is not usually a difficult matter.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Hi Marisa,
I am not using cashbonds, but they are another bullet I have in the breach should they ever be needed.
A cashbond suits people with high equity levels but who haven’t the income to service additional borrowings.
For example an investor with $150K in unuseable equity can buy a cashbond of 5years annuity @ $30K/annum + interest.
The $30K+/annum then gets included as income and improves a borrowers serviceability allowing the investor to borrow and buy/invest again.
But of course the income from the cashbond is generally less than the interest charged to buy the cashbond.
However the benefit comes in the increased capacity to leverage the equity and income that was otherwise ‘dead’.
The proliferation of no doc/low doc loans means that investors can, generally, secure the additional loans without the need for cashbonds. The non-conforming lenders certainly remove some of the need for people to use a cashbond.
Please note that it is a very laymans description of a cashbond and I profess to only knowing the rudiments of the process and not the detail. For me the details will/may come later if/when required.
As for risk – well some people think crossing a road is risky.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.Hi all,
A point for consideration that hasn’t yet come into discussion with respect to this ‘myth’ is the changing nature of the ‘household’.
ABS projections (and I don’t have them at my finger tips) point to a decreasing number of people per household – which in part (+ other factors) goes to show why more places (I was going to say houses) for people to live are required.
Derek
derekjones1@bigpond.com
0409 882 958
Property investment advice and researched property in quality locations available.
