Forum Replies Created
- Originally posted by Broche:
working it out I should be positive on it for about 5 years , then look for a sell, picking up 8% compound growth, so I see it that i will be positive for 5 years then sell for 50k profit, looks relativily low risk.
Hi Broche,
As others have said check out the body corporate costs – they can be high,
I wonder where you get 8% growth figures from. My understanding is that the over 55’s is a relatively new concept and to say these units have performed at 8% through the good times and bad makes me a little sceptical, I suspect in reality the median price in Townsville has done 8% for a while. This is very different to saying and believing this style of property has (and will) achieve 8% over the next five years.
For me assuming 8% growth in the next five years, and factoring investment decisions, on this rate of growth is a little optimistic.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
Originally posted by noddies:Replies on this site are intended as general information only, as any specific investment solutions/advice must only be given in accordance with the requirements set out in the Financial Services Reform Act 2001 and the ASIC guidelines as set out in PS175.An appropriate professional should be consulted for specific advice
Hi Bryce,
That disclaimer is a real kill joy [biggrin]
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
Originally posted by JoD:The agent insisted there were other buyers waiting, but I never know whether to believe that, so went with my gut and refused to offer higher.
You could always counter with – they’ll now have a chance at this property then and you’ll still earn your commission without any problems. I expect the under offer/for sale sign will be up very shortly to confirm what you are saying is factual
I had to go back to my initial goal of +ve cash flow, and although the unit was pretty good otherwise, it was creeping further and further into the negative the more I researched.
Hope I made the right decision, but feel I gained a lot of learning experience just from putting in my first offer!
It sounds to me that you have made a decision based on ‘adverse findings’ uncovered in your research – based on this you have made the right decision.
If, on the other hand, you start opting out because of irrational nervousness then you may have a ‘problem’
Hi Jo,
A good learnign experience at the end of the day – and from this you’ll be a better investor.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
Hi Julie,
Welcome back – given it has been around for ages I am surprised that so many accountants do not know the situation.
No doubt it is a case of information overload for those accountants who, for various, reasons cannot or do not focus on property.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
HI Lukis,
Too long.
Things change and you could be up for significant break costs if ‘things changed’.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
HI Terry and Asiababy,
I have merged the two threads to keep things on track.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
Also look at School Population statistics on the appropriate Departmental website – that will give you an idea of what is happening at the school age level.
As a rule of thumb school populations mirror what’s happening in the town.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
Hi FM,
Will lock this to keep all comments in one thread and to save the forum from becoming cluttered with dual postings.
Those wanting to post a comment can do so at
https://www.propertyinvesting.com/forum/topic/13534.htmlDerek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
Hi Wake,
Try
Nick Moustacas at http://www.strategicwealthmanagement.com.au
or Chris Batten at http://www.chrisbatten.com.au
or Ed Chan at http://www.chan-naylor.com.au
As with all matters tax you will need to do some checking to see if they are suited to your needs.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
HI JoD,
Split rates are Augusta-Margaret Rivers attempt to get more money out of the numerous absentee landowners who the council believe are not carrying their weight in terms of financial contribution to the community – the argument goes something along the lines they stock up elsewhere and spend incidental amounts when there on holidays.
The Port Hedland matter is slightly different in that the Shire is in the ‘red’ and has been agitating for a number of years for Government and Mining Companies to contribute more to local government coffers.
As mining tenaments are not rated the Shire want to recoup some of the expenditure maintaining facilities with a high minig wear and tear rate.
A ‘levy’ on absentee landlowners in Port Hedland will hit the Government housing authority with its employees housing and mining companies in a back door attempt to prop up the Shire income levels.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
Hi Arungounder,
Technically you and are correct (how is that for a win-win).
Meegs has $100K in equity but ‘only’ $64K would be considered as suitable security for loan purposes at 80% – going to 90% releases security of $82K.
In terms of security Meegs has sufficient equity to borrow a further $320K provided she/he also meets servicing criteria.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
As Lucifer has suggested I would imagine that finance may be considered (if at all) along commercial lines and as such a greater input of equity and/or cash may be required.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
Hi MLV,
As I see it you can either sell one/two of the properties that have made the most gains and thus have the greatest capacity to reduce your debt levels. The flip side of this is that these are also likely to be the better long term performers – as such it may be a case of short term benefits but at a long term ‘loss’
The other (maybe better) is to sell a couple of underperformers either in a growth or rental return sense and cut out some of the debt this way.
Ultimately your choice – but a word of caution try not to sell both properties in the same financial year otherwise you will be up for increased CGT – be aware that CGT is determined from date the sale contract is signed.
I also suggest that a discussion with your accountant would be in your interest before you progress too much further down this line of thought.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
Hi Wake,
Time for a new accountant – the purpose of the loan is to buy an income earning asset and therefore is deductible.
This has come up before see this thread;
https://www.propertyinvesting.com/forum/topic/11153.html
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
Originally posted by JoD:This may be a silly question – do the body corporate have any control over rent? I mean do they have power to say ‘hey that’s too high you can’t ask for that rent!’ or is it none of their business?
Hi Jo,
None of their business – they manage the complexes common property. The rent paid is strictly an agreement between you and the leasee.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
Hi Steve,
Don’t make a typing error [biggrin]
Not a techo – but methinks time for a new keyboard – pretty cheap today and cost of labour generally outweighs replacement costs.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
Hi Joe,
Concur with PG’s comments – happy to email you the index of Dale’s book so you can see for yourself. Email me if you want a copy of the index.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
Hi Blade,
Not a broker – so take what I have to say with a grain of salt.
based on value of $320K and debt of $200K you have $56K of useable equity going to an 80% lend. That is also assuming your $40K improvement are not on another loan somewhere.
So from an equity perspective you are fine. Income also looks strong to me but then I don’t have access a fancy calculators brokers have.
We faced a similar dilemma (invest or pay off) a few years ago and after some number crunching realised that we would be sometime paying off the home before we could start accumulating assets – and as time passed we would be closer and closer to leaving the workforce and as such would have less time for the assets to grow in value.
At the end of the day we invested and are ahead by a considerable margin as a result of that decision.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
Hi Terry,
On a similar note there were also cases when vendors used the finance clause date absolutely to do the same thing when delays in securing finance occured.
I am sure given the different market we are now in that there situations are less likely in todays climate.
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
Hi Wake,
Understand where you are coming from but……
Are you able to access enough equity to secure additional loans if you sell your cf- IPs?
How many more cf+ properties are you going to need to achieve your goal of working less?
Is this feasible?It seems to me the 2 cf- properties are on track to do what you wanted them to do – it is just the fear that they will flat line for a few years has you spooked. There are ways of using the available equity to produce an income – see below where the subject was briefly touched on.
https://www.propertyinvesting.com/forum/topic/13094.html?SearchTerms=cashflow+from+equity
Derek
derekjones1@bigpond.comProperty Investment Support Available. Ongoing and never stopping. PM welcome.
