Forum Replies Created
- CheevesFinancial wrote:Hi Leo,
……….. A wholesaler typically models their business model very simply. A to B contract, and B to C re-sale. The "A" part is the seller we buy from ie..banks. The "B" part is me or those direct with banks acting as the buyer. The "C" part is the exit to the B, which are typically investors like yourself. ABC is where it stops for us. The other wholesalers look more like ABCDEFG and your price goes up with every sale of that property. Check tax records to be sure of how many times properties were turned over. It's public record.Hello CheevesFinancial,
Thanks for your detailed comments, but I have few more questions to ask please if you don't mine: How do you distinguish those other wholesalers who are more like ABCDFG compare with ABC? This would be hard to know particularly if you are just buying IP from someone? Also, how do you check the tax records and which public sites that you recommend to find these information? Those outstanding taxes are they payable to counties only which we call here in Australia, council rates?
Thanks Ian, therefore these non performing assets, turned liabilities from those lenders hence they rather get rid off them (i.e., sell them cheap to stop the draining their purse which transfer the liabilities to the buyers but still have the liberty to chase up the former owners of the properties)? Are you better of dealing with the wholesellers then?
Also, where about are you based, Ian?
Hi Guys,
Here in Australia we have our own share of calamities (i.e., bush fire, typoon up North Qld, drought etc). These type of calamities certainly have dire consequence on investment property. Not to mention, the time it takes to rebuild the property if it burned down or ruined by flood. My feel for those fellow investors got caught in the recent Qld flood. As an educated investor, these sort of things that you need to take into your buying consideration hence as part of your due dulligence.
For instance, the recent flood in Qld state whereby there is an issue of lodging your insurance claim because some Insurance company won't compensate the claimants for their claim because of different interpretation of flood (e.g., Natural disaster flood vs burst dam).
I know for a fact that there are more people get killed by Tornado in the US compare with other form of natural disaster. Would this stop me from investing in the US. ABSOLUTELY NOT! – I just got to pick the area whereby not prone from such yearly calamity. As a matter of fact, Tony from http://www.myusproperty.com.au just rang me this morning, and we discussed about about investing in the US which I HIGHLY considering after I've signed my mortgage increase document from lender.
Thanks, Leo
xarp, can I ask the source that you've used to come up with those figures about rental yields for different US cities?
This is a question for Troy & Michael.
Troy – how confident are you getting 75% LVR for foreign national? I read a lot of posts here and most of them are having trouble sourcing finance in the US? What sets your business a part from them, say Loan USA who operate locally?
Michael – can you elaborate more of using equity of your property in Australia and use it for borrowing as you've described such as 80% LVR? I'm about to sign on the document for mortgage increase to access my equity with ING, since Simon and Myself are both foreign national who wanting to invest in the US, what's my chance of getting my finance approve in the US?
Thanks a lot!
Hey Dan,
In Australia, there are few reputable websites that investors use such as http://www.residex.com.au. That website tells you a lot of the Australia property market in the past quarters (e.g. 3 months, 6 months etc). Do you know such website in the US that provides the same service (e.g., history of capital growth, yield return, media rental return, median house price).
Thanks in advance.
Stuartwn,
I'm investor myself here in Australia, even I know a bit of our taxation, I hired a tax accountant to sort out the legal matter about tax. I recommend you take this path as well, that is why they called 'the expert'.
Focus on investing, leave that stuff to the expert….you won't regret it.
All the best!
G'day Dan "the man" (as we call it here in downunder)
I'm looking to invest oversea and I reckon investing in the US is a lifetime opportunity.
Can you tell me more about your self, the area you are investing, your contacts (e.g. property managers, real estate agents)? and areas to avoid. And how many properties you bought thus far (no need to be specific, a range will do (e.g. 1-10).
I can take care off the "Due Diligence" but the biggest problem for me is financing and property management locally based. What's your take on that? Further, I want to leverage my equity as much as I can but without financing, this is not possible for foreign nationals. What's your take on this also?
thanks in advance mate.
Hello RichH,
Sounds like your experience dealing with HouseBuyers USA was positive. Do you have to be in KC to deal with the buyer's agent, look at the property and seeing face-to-face to ensure that these guys are geniune? Or, you the deal was closed without you setting foot in USA turf? I can see using buyer's agent, when investing in the foreign market, takes a lot of the leg work and guestimate. May I ask, if you don't mine, how much HouseBuyers USA sought for their service per deal (i.e., from initial discussion to putting the tenant after closing the deal)?
Appreciate your response in advance.
Leo
Hey Charles 1,
I had not so good feeling about them about the way they entice new members, very good in marketing that's for sure. I've attended one of their free seminar in Parramatta NSW about a month ago. If they try to sell you something then they are only looking after themselves. I bet you, their mentors keep growing their portfolio since they can sustain them from the cash flow they receive from their mentorship program? Such strategy as you mentioned required cash flow to sustain the viability of your portfolio to keep them growing. Thanks mate for sharing…I bailed out on the last minute of joining their mentoring program.
Thanks Millionaire in, for sharing your thoughts on this too.
It real depends on what you are trying to achieve. Buying a block of land is just a liability. If you want to pay out your mortgage first of your PPOR, I don't think it's a good idea if you want to get into real estate investing. Because, you could your equity to fund your 1st IP. In addition, interest payment from your PPOR is not tax deductable hence you could use the added payment to your principal payment, which goes towards your deposit for IP.
Charles 1 wrote:In light of what you said wonder whether Michael Yardney will produce his new book in an audio book – I just read about it in his newsletter and am about to buy it on line – sounds like an interesting read with Ed Chan and 2 other experts,Hey Charles 1,
I told him via email yesterday, that there is a market for Audiobook here (in the US, such product is standard). Also, I reminded him that I converted his one of his recent book "How to built a multi million dollar portforlio in your spare time" into an Audiobook using a digital voice recorder in MP3 format, then transferred the MP3 files into CD-RW so I can add onto them and listen onto them repeatedly while driving to work (great way to master his strategies). I must have fired him up, since he is contemplating to produce one in his next project. There is a posibility that he could produce an Audiobook from his latest book, I cannot see why not, after all he can afford it
. Are you attending his up and coming seminar?Alternatively, if you rent out your PPOR and it became negatively geared IP, get a quantity surveyor to produce a schedule for depreciation which you can claim from ATO. The beauty about this is you don't have to wait until the end of the year to get your refund of negative loss (i.e., your outlays are greater than your total rental income), you can apply for PAYG variation form (section 15/15)…please consult with your accountant about this. This will help you with your cashflow management on servicing your IP loan.
WPC wrote:…. the good thing is that the authors usually write about the same stuff they teach in these expensive courses. .I' agree 100% on this. Having spend amost $1K on books, multimillionaire property investors theology could be easily picked up from their published books. Why? Because, their experiences as investors (i.e., the good, the bad and the ugly) all are written in their published books including their investment strategies. You just got to spent a lot of time reading them…a small price to pay compare with $5K.
Yesterday, I've encouraged Michael Yardney to produce Audiobook for his future project via email because. I told him about the market for this: there are millions of investors out there to commute by cars, train etc., which provide them the opportunity to listen while driving or on the train etc. When he replied, in his own words via email "It is about time I will produce one".
Some books are cater for beginners, others for advance such as Lomas. You could also purchase a digital voice recorder for under $70 bucks…record your voice while reading the books…you can then play it repeatedly until the ideas sunk in.
Must to read, by authors
- Julian Dawson
- Michael Yardney
- John Fitzgerald
All the best mate.
Prior to GFC, there are fundamental differencse between the US banking system and the Australian banking system and these are some but not limited:
- The US banking system could finance a mortgage to borrowers evenif the borrowers don't have employment ( Is this possible in Australia ? Will the BIG FOUR banks allow you take a mortgage without a primary source of income such as employment? What do the banks here lend you? Not a house but your capacity to service the loan? The answer simply NO) Again, it goes back to the risk factor…the culture of their corporation primarily seek short term profit by taking too much risk hence higher return by maximising their ROI. The higher the return the higher the risk (e.g., the US banking system charged higher interest to unemployment applicants believing these applicants can get employment in few months…boy how they were wrong).
- The US banking system, assesed their applicants based on their capacity to service the loan regardless the credit history of these applicants (e.i., finance credit history). They taken on even applicants that have bad credit history. Here, if you have a BAD credit history which could stay in your credit file for years, there is no way you can get a credit either credit cards or mortgage or personal loan, car loan etc…..
Those were I saw the biggest FUNDAMENTAL difference between the US banking system and Our banking system. The US corporations have a culture primarily driven by short term profit by taking HUGE risk…high return…hence higher risk.
Buffet got it right: Being a valued investor, buy shares under market value, hold them for long term for profit. He does the opposite of most of the US corporations by being conservative in investing approach. These US big corporations should learned from him.
I agree to some degree BUT as said they take too much risk, in the end, even their premier rating agency (e.g. Standard & Poor) who supposed to be brilliant on rating those sub prime lending package, become clueless to the point it went downward spiral creating the GFC.
Look, The Australian market rides on the back of the Chinese strong appetite to our natural resource (e.g. coal). Unlike the British and European market are pegged strongly to the North American market. The collapse of the housing market in the US naturally affected those countries strongly reliant on the US market.
Thanks to China's strong appetite from our natural resource, The Australian market was shelled out from the major impact of GFC including our real estate market.
Hello Steve,
One thing that differentiate the Americans and Aussies, is that they take on too much risk which is driven primarily by corporate greedy. Regardless, if we discuss the share market or the real estate market, American executives are primarily driven by short term profit hence greed. If we look back from the last decade, we saw massive US corporate collapses (e.g., Enron, Arthur Anderson etc). Enough was never enough. Then, came the GFC, again, the catalyst for this world economic crisis is, driven again by corporations wanting more, and more profit, hence taking risk too much become the norm. In the end, their greed is under undoing.
Unlike them, we Aussie tend to be a little conservative and don't like too much risk. I'm we have some of our local problem (e.g., HIH collapse etc)., but this is small in comparison with what had happened.
Either it is in the share market or real estate market………the bottom line is American corporation take risk to an extreme level primarily driven by their greed hence their undoing.
number 8 wrote:On that note: How do you go from 0 to 130 in 3.5 years? Can this really be done on an average income like Mum and Dad Australia?…..I will post this as a question, so please dont answer this here, as I do not want to hijack this thread…
http://www.birchcorp.com.auSteve McNight started investing in early 1999 where positive cashflow where everywhere and the real estate market has yet to experience significant boom. In addition, after Steve tackled Balarat, La Trobe Valley, they went to NZ where even more positive cashflow can be found. CGT doesn't apply in NZ hence he was able to buy and buy more positive cashflow. He bought and sold, bought and sold etc. As Steve says from his audio book, to achieve positive cashflow now, you might need to do two or three steps to create positive cash flow (e.g., put large chunk of deposit).
The only market that is suitable for this theory is the US market where IP for positive cashflow is abundant?
In the words of "Steve McNight", "You should consider selling your house, rent for few years because you free up a lot of your money since you don't have commitment unlike your home mortgage. The proceed from your home mortgage invest it back into the real estate market by buying more IP.
As Michael Yardney says, to create serious wealth, you need to build your asset based first.
Your approach is completely the opposite of building serious wealth hence has the adverse effect into "Financial Independent".
If appears you don't appreciate how IMPORTANT investors play in our economy in general. They provide community housing that the goverment failed as its responsibility. You also need to blame those people who are not discipline enought to save their hard earned money for deposit of IP but rather too busy keeping up with the joneses (e.g., buying depreciating assets like fancy car, elec gadgets etc). If you want to get on our side, do the opposite of the MAJORITY, that is, spend less than what you earned, buy incoming producing asset to built your wealth…it's that simple.
. Are you attending his up and coming seminar?
