Forum Replies Created
Hi Pstoe,
I’ll throw another course at you. It is similar to Peter Spann’s and costs considerably less.
Have a look at Steve Navra http://www.navra.com.au/ – which, in essence, is similar to Peter’s philosophy and that is buy quality property and use equity to leverage into shares (Steve does have a fund that operates very differently to many in the market and with nil entry and exit fees and no management fees unless his fund outperforms the ASX)
Steve’s course is one day long and similar to the appraoch I am using at the moment and have been doing so for a while.
BTW – I do need to declare I have a small parcel of Navra shares.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Originally posted by crashy:legally you must at least be an electrical mechanic. bear in mind, if you do something wrong, and there is a fire or electric shock, you could face a prison term. this is serious stuff.
Now I am not sure of the legalities or cost associated with certification of electrical work but………………………………..
Assume something goes wrong and (perish the thought) a tenant is electrocuted, coronal enquiry held, owner didn’t have work ‘done properly’ and is held responsible for death (albeit accidental).
Family/ies then institute legal proceedings and a finding comes down against the owner. Owner’s stress levels through the roof and assets wiped out as insurer has little clause saying all work is to be carried out by qualified people.
For me the stress and risk is just not worth it.
And don’t think it won’t happen.
In WA a child tragically fell through a shower screen (incorrect and thin glass used) and died from loss of blood. Huge investigation carried out and owner, PM, tradesmen, previous owner etc all dragged into the case in an effort to find out who put the thin glass in. Unfortunately the culprit was never located but………………..
A key aspect of property investment is asset protection. For such a simple issue I would be using a professional so my assets are protected.
And so endeth the lecture.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Maddy
I have merged the two threads as they were on the same topic.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Wylie,
Yep 4 bed and 2 bath.
PS great result Dazzling.
For any other Perth investors out there you should be cranking your rents up. The market has moved in your favour. An recent article in The West said median rents had increased by 20%+ last year.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Paul,
You are right – you cannot attach documents to either PMs or emails through this site.
The best option is to either post your email in a PM or within the thread itself so that information can be exchanged via the backdoor. Obviously some people do not like posting email addresses on public forums so the PM may be the best option.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Kkat,
Welcome to WA.
Try this link http://www.homesite.com.au/new-homes-and-land/new-homes/new-homes-wa
Bear in mind that while Perth may be smaller than some of the other cities and getting arounds is generally OK it can still take sometime to get from A to B if they are apart from one another. It is therefore important that your home be located within reasonable driving distance from your main activities.
You will also find that in the main there are delays in construction and a period of rental may well be required – unless you buy something that is established.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Neak,
Ditto Xena’s comment. Given the Centrelink campaign to ‘catch cheats’ it is best you do clarify these matters with people that are in the know.
You can also drop into http://www.centrelink.gov.au/internet/internet.nsf/payments/pay_iat.htm
and have a look around for yourself. Mind you my vague understanding is that you will no longer qualify for the pensioon now based on your current assets.Having said that, if your goal is distracted by the need to retain the pension I wonder if you are inadvertently placing unnecessary shackles on yourself. Wouldn’t you be better to make sure you can earn an income from something other than the pension.
Now I know that may seem harsh (and it isn’t meant to be) but the retain the pension thought has limited your thinking. Remove that restraint and the world becomes your oyster.
If you continue to make good investment decisions then you will be able to fund yourself through property investing. Others have done it and so can you.
Financing shouldn’t be a problem – no doc loans are a possibility at the very worst. But I am not a broker so you will need to run this past someone suitably qualified.
Just a thought – and something different to consider.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi JG,
This topic comes up quite regularly as the ‘returns’ to appeal to the beginning investor. However there are some pitfalls finance being one of them. WHile these properties may appeal they do suck up more equity than they return and as such without careful consideration can hold your investment journey up.
I would also be wary of buying such property as they really only appeal to investors as home owners seek elsewhere. As a result of this you are at the mercy f the niche investment market.
Recommend you also do a search to see what other information is contained within the forum. Scroll your mouse over the forums button at the top left of the page and you’ll see the search facility.
All teh best
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi LG,
Congrats on the IP.
I use a simple excel spreadsheet that you are welcome to have. All you need do is send me an email with the subject property spreadsheet and I’ll return you a copy no strings attached.
I’ll be the first to admit it isn’t fancy – very cheap and it does the job.
As Amanda said you also need to consider the paper reocrds of the other bits of paper associated with IPs – I use a leverarch file for each property with sections devoted to aspects relevant to each property; rental (agreements, documents and property reports), strata (meeting minutes, agendas etc), finance (loan applications, correspondence, valuations etc), settlement (contracts, correspondence etc) and a misc generally covers it for my needs.
For me it is keep the system simple as I have more important things to do. In saying that you are now entering a business and need to adopt efficient and effective processes to run your business.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Lynette,
P and I or Interest Only Loan?
Depreciation report done?
Market rent or better being paid?
ITWV done?Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958I assume that this property is relatively new to your ‘stable’ and as such you haven’t completed a full year of rent. Each month is a slightly different length and such there are typically two months in the year when a tenant will make an extra fortnights payment.
Bear in mind there are not exactly 52 weeks in a year either so some leeway needs to be allowed.
Hopefully this puts your mind at rest.
If on the other hand you have owned the property for 12 months your PM does have some explaining to do.
Irrespective of deductions made you should have received a full year of income ~ $13520.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Chris,
This thread is currently panning out to be a ‘trawl for new clients’ rather than an attempt to genuinely network with like minded investors.
The forum does not take kindly to invitations to take conversations off the board but prefer they be by individuals themselves through PM or email.
The drift will have to be rectified otherwise I will have no choice but to lock or delete this thread.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi The Wild One,
Would continue to invest too.
While the events you have listed are potentially quite devastating they would compare on similar levels to some of the ‘major issues’ of the past. With good research and prudent decision making an individual can still progress their investments even in time of adversity.
I recommend a read of Fred Johnsons Story (page 76 of Jan Somers – Story by Story) which outlines some of the ‘significant events’ of the recent past and how the herd continually told Fred not to invest. He didn’t listen and now is a very successful investor.
While some of the events may seem a little less ‘significant’ by way of comparison to your list they were, in their time, major.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Originally posted by Terryw:Derek
I think you are mixing up superannuation trusts and discretionary trusts. Discretionary trusts can purchase property held by a beneficiary. A few of my clients have actually sold their property to their trust.
Hi Terry,
Make that grain a bloody big boulder.[biggrin]
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Not an accountant so take what I have to say with a grain of salt (or two)
As I understand it all transactions need to be at market or arms length to comply with the various sections of the tax act. If they are not then it is possible the ATO may consider the transaction a form of tax avoidance.
A trust is not permitted to purchase a property previously owned by one of the trustees. Chris Batten refers to this as being ‘poisoned property’ http://www.chrisbatten.com.au/web/main/poison_property.htm – might be worth a read.
I assume at the heart of your dilemma is an asset rich – cash poor elderly parent. Have you considered a reverse mortgage? This may solve some/all of your mothers problems.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi all,
This thread demonstrates quite clealry while generalised statements as per the thread title are somewhat misleading and/or inaccurate.
The property market is not a single entity and while some parts may have slowed or dropped there are others that are still powering along.
For example I was speaking to an agent who works in a coastal part of WA yesterday. He said indiciated he had a single property on his ‘for sale’ list which is normally 25 or so in length.
Another example – agent who is doing a market valuation for me on our house (part of the valuation for finance process I use) is screaming for listings. She cannot list them quickly enough.
I would not be surprised if some agents go to the wall in WA due to a lack of listings and therefore a dearth of income opportunities.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958I suggest that you do a search of the forum as this topic has come up before. The search facility is located under the forum button at the top left of the screen.
I have also moved this thread to teh heads up forum.
Trust you find the answers you are looking for.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Hi Steve,
Stamp duty will be payable on any transference of title – however this may not be as terrible as it sounds.
I am not a developer so take what I say with a grain of salt and I defer to the experts in this area.
Get MIL to subdivide block and transfer/sell the bits to be developed at the rear to you and leave the bit she is living in in her name until the will kicks in. Obviously this approach is dependent upon the house being suitably located for subdivision around it.
Without knowing your financials banks will have a great reluctance to lend you money for a development on land you do not own. As such it may well be worth your while to get you name on the titles anyway and factor in stamp duty costs as part of the overall project.
Can MIL be partners in the project (1%/99%) split so that funding may become easier?
Of course at this stage you are looking at this project from your perspective but should it get up and running then there could well be tax implications for MIL. Certainly discussions with an expert in their respective fields is mandatory as part of your due diligence.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Originally posted by samjames:Hi
Am new to contributing to the forums as I have never really have any great input as yet and quite inexperienced in investing but your comments about inveting in a mining town caught my attention. I was considering seriously investing in a mining town that was showing good returns but saw on another forum that suggested “never” to invest in a town with only one industry??? Confused now??I would agree with this sentiment.
Any town that is solely reliant on a single industry is at the mercy of that particular commodity. Sure when you time your run perfectly you can make hay in the sun. But when the industry turns sour then you are in for a hard row. Industry closes (partially or wholely), employees leave town, businesses shed employees, businesses shut/scale down, spare cash in community dimishes and doldrums arrive.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958Originally posted by jesse010:I’m 22, my husband and I just got married and bought our 1st home in the last year. We are living in it and it has been recently valued at $320,000 and our loan is $283,000.
For me these are the crucial details in this whole passage.
You are only young and have a hefty sized debt (88% LVR) on your hands as it currently stands. I wonder what sort of stress your existing repayments could handle if interest rates were to rise or you started a family or……………..
For me the important bit is to make sure you have some time available to you should one of the aforementioned events occur.
I would also get another broker to look at your existing structure. You indicate that you felt you got ‘sold’ something that really wasn’t suitable. You may find one of our friendly brokers will look at what you have on a ‘no strings’ basis to confirm you fears or reassure you that what you have is OK.
Initially I would look at either a redraw or offset structure so that you can access any additional payments made. This way you can maintain the discipline of paying off the loan either directly or indirectly while still having access to these funds.
I would also agree that any investment decisions you make should be wise ones and time spent learning and researching at this stage of your journey will be very worthwhile at this point in time.
I would also spend some time working out what it is you want to achieve through property investing as there are many ways to make money from property.
Read a few books (Peter Spann, Jan Somers, Steve McKnight etc). While the approaches may be different there is scope for you to adopt or modify some of the aforementioned people’s style to suit your needs.
This process may be lengthy but like building a brick wall – get the foundation right now and you have an increased chance of building a solid wall and not a pack of cards.
At the end of the day it is your decision but for me – treat 2006 as a year of learning about PI, enjoy your early years of married life and get to know your hubby too as you need to sepnd some time getting this part of your life right too.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958
