Forum Replies Created
Hi Dave,
OK – so you have ticked off a few of my original questions.
Without knowing the numbers (and you don't have to tell me) I still wonder about your capacity to service the grand plan through the next 6 – 12 months. That is will you be able to get the additional funds (assuming your wife's work is fully recognised) to do what you want to?
Is this a discussion you have had with your brokers or the bank? As an aside comment I would use a broker as your first point of reference as your preferred bank may not have the product/s allowing you complete your grand plan.
Assuming you can get the additional funds – all that remains is for you to do some modelling based on the information you have gleaned to see if how likely it is you will receive your estimated income, what the projected growth in property values could be (use history as a guide) and so.
This process, while not infallible, should give you an indication of how possible your dreams are!
As an aside is the talk of mining arriving local scuttlebutt or more than that? Many mining projects don't get off the ground for a whole raft of reasons.
Derek
You gotta do what you gotta do.
If owning a place to live in is very important to you and you are prepared to 'sacrifice' what you are currently doing to move to a smaller town then this would all make sense from a home ownership perspective.
It seems securing finance is currently presenting problems for you – and this is where your intentions may come unstuck.
How confident are you will both be able to secure employment in this town?
Have you considered the social impact moving to a smaller town will bring? Some people thrive in a smaller town – others don't and end up 'going home' pretty quickly.
Are you going to be able to secure funds for subdivision plans and build in 6 – 12 months time? This timeline would suggests you have some wriggle room in your borrowing capacity – whereas your earlier statement suggest finance is really difficult doesn't portray the same message.But as they say in the classics – sometimes you just have to take a chance.
Kagen327 wrote:(granted I get approval from the historic area association)If this property is under any form of heritage listing you may have a struggle to get approval for car parking – particularly if the size of the parking area exceeds what would be considered normal.
In effect it seems as if you are buying a place to live with a net mortgage of $1200/month.
Bear in mind approximately half your costs would be deductible as these could reasonably apportioned to the tenant's building.
Only you will know if the property stacks up. Go back and look at the fundamentals and see what prospects and opportunities it has.
g0biin wrote:Apparently you flip your mortgage over to interest only and pay the pricable on a property that they find you that has a growth of 10% a year. At the end of 10 years you pay them $45 000s and you pay off your mortgageWhy pay P & I on an investment property.
If buying an IP and then selling it some stage in the future I would go P & I on my home and I/O on an IP and if/when the numbers made sense to sell the IP then consider it.
The comments sound a little like 'smoke and mirrors' to me.
Ignore Part 4A at your own peril.
Try a search of the various uni websites
Curtin Uni (WA) has a few. Haven't done the course so don't know.
http://courses.curtin.edu.au/course_overview/all-courses-search.cfm?cFinderSearch=Property&cFinderSearchSubmit=&search=1&type=Go
rainydaze wrote:I prefer email in these situations, because I can have everything in writing if I need to refer to it, and it gives me time to really explain myself.Hi Rd,
That is good to hear – I should have qualified my comment about email as follows:
Have the conversation on the phone (allows qualifying/clarifying questions etc to be ask) and then follow the phone conversation with an email highlighting agreed points.
This way you get the best of both worlds. A conversation so all issues can be explored and a written record.
Raindayze – GO back and read XDrew's comments. Without knowing the ins and outs of Tas contracts relating to property purchase my opinion is exactly the same as X's.
I reckon your conveyancer needs to be a little more supportive of you (their client) in this situation.
While there is nothing to stop the purchaser from undertaking the inspections requested – if the initial contract did not stipulate same as a condition of the contract then they should not have reason to pull out of the deal.
You need to be phoning your conveyancer and asking these questions.
1. Is this contract now unconditional?
2. Can the viewing of Council Plans provide purchaser with any escape opportunities?
3. Is the deal now unconditional?
4. If not? What are you waiting on? (I suspect it will be finance approval)
5. When is finance due?Have a conversation about your concerns.
Email sucks in situations like this.
As Kenny Rogers said (I know showing my age) know when to walk away.
It would seem to me you are being played here and your enthusiasm is making you vulnerable to manipulation.
Consider the following the property has been in the market for 6 months, your original offer was in the asking range and there is no tenant in situ. On this basis alone I expect the owner is hurting a little.
If you are prepared to walk away then send a written notice indicating your offer only remains valid for 2 further days and it will be formally withdrawn at this time. At this time you will be coming into collect your deposit money as the offer has now lapsed.
While it has taken some time to find this property – it is only a piece of dirt and there will be others.
They're low.
When doing calcs in my head I allow 2% of borrowings.
The actual figure will depend on final LVR – higher the LVR = the higher the LMI premium.
On top of this you also need to allow around 5% of purchase price for stamp duty, solicitors fees, bank fees etc etc etc.
Numbers are rough but they work for me.
gregorsky wrote:I am 20 and new at this,Mate – if I were you I would be patting myself on the back.
Most 20 yr olds I know are still working out which pub or nightclub to go to.
You're on your way to a very solid future provided you go steady, steady.
gregorsky wrote:We currently have a house worth $360000, owing $300000. We want to sell and with the profit, buy a block of land worth 170000, We plan to rent for at least a year and pay of the existing 110000 on the land, then build our house at approx 220000, so all we have is a 220000 mortgage, then look at buying a property to rent out etc, or should we stick to the house we are in and work hard at paying it of and doing it that way.. ??Really hard to make appropriate comment as you haven't indicated why the change of direction.
Kids on the way? New job? Loss of income? Struggling to make ends meet?
A few questions that may help you clarify your best course of action.
1. How long have you owned your existing property?
2. How long have you taken to 'pay off' $60K & was some of the $60K a cash deposit?
3. Realistically how long would you take to pay off the $110K on the block of land?
As DHCP has said – the correct course of action all depends on what you are trying to achieve. Sometime ago you bought your existing property in the belief this was going to be 'it' for a while.As an addendum you will also need to consider the costs you will incur in the changeover – these will amount to a fair bit, agent's fees going out, break fees with the bank, stamp duty, loan set up fees, removal costs, final and new readings for utilities and so on.
Do the reasons you had at the time still exist or has something changed to bring about this change in focus?
The obvious questions is why – I would hazard a guess as this is being contemplated for tax minimisation/avoidance purposes..
Think carefully about the answer because Part IV of the tax act will have some bearing on this.
Part IV deals with tax avoidance and reasons for taking certain actions.
If your reasons are other than to avoid paying tax you would need to do everything at market rates as a minimum.
Was the settlement process past the unconditional stage?
orangestreet wrote:We have decided to buy a PPoR first (want a place to call home) and then be disciplined enough through proper loan structures to leverage that into my first IP in a year or two after that and then build on that.HI OS,
A very newsy introduction and welcome.
Seems to me you have made some great initial steps that should set yourself up well for the future.
Some people may argue the merits of buying a home first (each to their own) – my counsel would be to keep it simple. There is no need for the eight bedrooms, olympic pool + diving board + 8 car garage + home theatre centre complete with reception centre at the beginning. Start small and work up.
As the journey is long you will need to be very focussed so writing down goals is a good place to start and make sure you remain true to your goals.
Enjoy and I look forward to hearing from you as you embark on a long journey.
mrbean wrote:Cat,
why would you do it yourself when someone else, Suncorp, is prepared to pay?This – we only have a finite amount of time to use. Why do something when someone else is available to do the job. Use your time for some other personal gain.
Reading between the lines here and it seems as if the maggots are 'self-inflicted'
Onus is on tenants to keep place tidy. You report the carpet as being soiled and the place is unkempt. What sort of checks did your property manager do before giving your investment to these people to live in?
skips80 wrote:It seems that the banks wont let me access the equity without the parents being involved in the finance at the very least as guarantors. I'm thinking it would be good to get out on my own with the ownership but this will set back any plans for a new purchase JoelHi Joel,
Ongoing finance and refinance can be an issue when there is 'mixed ownership' as per your situation. This is why I consider 'mixed ownership' as an option of last resort unless there is some form of 'partnership' in place which extends beyond a single property. Even this can be problematic if the partner goes bankrupt on the side without your knowledge.
Now I am assuming you are relatively young and 'needed' your parents to help you get started. They have done this so be grateful. Now is the time to buy them out, thank them for their assistance and bide your time.
This is not a race and those opportunities you see will be there at a later date.
