I understand the person who owned the property was working overseas in Africa – the same continent the scam originated in. Probably just a coincidence.

I also understand both properties (one sold + one almost) were mortgage free.

But – scammers are getting trickier and trickier.

Hi Mal,

Onslow is an interesting one.

I expect getting funds for a lend in Onslow will be extremely hard – I expect lenders will consider it to be highly risky. We are hearing the Onslow LNG companies are looking at Karratha, over Onslow, as a place to house their construction workforce.

Insurance premiums will be high in Onslow – cyclone alley it is.

Very small town too – which increases risk exposure to investors.

Mick – I would be wary of trying to jump in before a mine is established. That is a really a high risk strategy – Ravensthorpe and Hopetoun would be classic example where that strategy has failed. There is a lot of work required to bring a mine up to production levels so you could be waiting a few years.

You'll probably find the contract you have signed is pretty well water tight and if there are any out clauses they'll be few and far between. The builders/developers of these projects and their solicitors are well versed in these sorts of contracts.

Get your broker to review your situation in light of your changed circumstances and see if you are in a position to get finance.

If  the answer is no then seek independent legal advice from someone who is well versed in off the plan contracts.

I assume your original solicitor was recommended by the vendor – if this is the case it is extremely important you seek independent legal advice.

Has already happened once in WA.

The owner of the property sold out from under him almost lost another to exactly the same scam. Only got caught out when a neighbour happened to mention the property sale to the owner.

'only' $120 behind. Sounds like your PM doesn't recognise the importance of doing their job properly. Tenants generally should be in advance. Sounds like your tenant may be $120+ 2 weeks rent behind.

Should have been more assertive at this point. Sends a clear message to your PM that you have service standards you expect upheld. At this point I would have requested supplementary payment to see if your were being told the truth at this early stage.

Once again sounds like an incompetent agent. I find computers are rarely wrong – it is more often data entry or failure to follow processes.

In addition to REBA I would also send a strongly worded email to the PM and their principal seeking immediate restitution of lost income. I would also get another agent on the job – rent rolls are important to agencies. Changing agents is one way of sending a strong message to this one. If they try and hold you to any exit clauses assert yourself on the basis of failure to perform required duties of PM.

Be interested to know this 'someone's' investing experience and knowledge.

I assume their solution was to save cash for a deposit – is this correct?

Welcome aboard. Your question is entirely appropriate and you'll probably get a few responses over time. Some of the responses may vary a little – the challenge you may have is to work out what suits you & your situation.

While Dec 5 seems a long way off – in property terms, it isn't. My understanding of an end dated pre-approval such as the one you have is that a finance application should be submitted before expiry date. One of the resident brokers will clarify this.

If this is correct you may want to do some 'homework' to get a wriggle on.

Having said that – an expiring 'pre-approval' is not the end of the world and it is better to make a good decision, rather than a hasty one. As an aside interest rates have recently reduced so your borrowing situation may have improved in light of recent rate movements. That is, if the remainder of your situation largely remains as previous.  

Keep it simple at this stage – work out what your broad plans are, kids in the picture? work changes? lifestyle changes? job security? your ages? your timelines? your current financial position? etc. All of these factors should be considered as they will help you determine your strategy and, from that, what sort of property you should be seeking. 

Once you have the big pieces in place the rest becomes a little easier.

If you do negative gear then you do not have to wait for the end of year tax return. It is possible to complete a PAYG tax variation to estimate your tax position at the end of the year. It can result in you tax being reduced every pay period rather than waiting for the lump sum when your tax return is processed. The PAYG doesn't equally apply to small business owners and is most suited to wage and salary earners.

The issue you have with negative gearing per se is that you largely spend a dollar to get part of it back. The portion you get back varies according to your taxable income.

On the other hand positive cashflow will give you additional income (less some tax) that could be directed towards your mortgage.

The tricky part is that in some case depreciation can help make a property which on the surface appear to have a negative cash flow into one which is positive after tax benefits are applied.

Which ever way you go you may need to consider ownership structures and make up to maximise any tax benefits that are available to you. If the property you choose is negatively geared then the higher income earner should own a greater proportion – if the property is positive cash flow then the lower income earner should own more.

And then there are trusts etc

See above – as rental income increases or your taxable income reduces then the impact of negative gearing also reduces as you fall through the various tax boundaries.

I would argue you don't NEED to negative gear. Sure it is an option but you don't have to. Would really need much more information to provide a more detailed response.

I can understand this – some experts simply don't want to go over to a field in which they have no qualifications. Litigation and licensing put an end to that a long time ago. I might add the tax, finance and legal world is a constantly shifting position and unless you specialise in an area – keeping up can be hard work.

Hope this helps.

It will depends upon the long term objectives of the people concerned.

Given they have no other debt – paying down the LOC has some attractiveness to me. Offset account would be better.

Hi Dgirl,

LOCs are a great tool if used correctly and with discipline. I have seen people squander their LOC – this is certainly something to be avoided at all costs. The greatest tainting of LOCs occurs with people mixing non-deductible debt (car, holiday etc) up with their investment debt.

I like to keep things simple – I use an offset account linked to my own home to assist with the home loan and have a LOC for my investment properties.

MY LOCs and IP loans are all interest only. I do not use a revolving line of credit facility as per those companies who advertise "pay your home loan off in 10 years with our secret" – as I said in my previous paragragh I like to keep things simple.

You can create multiple LOCs secured by one PPOR.

Hope this helps.

Hi Wheeler,

Is your unit along Herdsman Parade or somewhere else in Glendalough?

I understand the Herdsman Pde units have shown little growth over the long term apart from tracking the wider market