Forum Replies Created
Hi Tina,
Well done for having a go at 24 years of age. First thing would be to try and stay positive about your current situation.
.
As you are experiencing having multiple properties is not always easy and you will need to have a well developed plan to be able to stay on top of things.
.
You will probably get this advice over and over but you need a plan. You will also need a well developed plan B as part of your plan.
.
If you wish to continue to invest in IP’s you may have to embrace debt or a least get comfortable with having debt. Try to keep focused on what the debt is for and the time frame in which you want to pay the loans back.
.
I personally don’t have a problem with IO loans but I am not a IO zealot. There is a big argument for debt reductions. There are IO loans around that are fixed, let you redraw and make as many extra repayments as you like. If you find this sort of product it may help your current situtation.
.
It may be that you have to reduce the size of your portfolio. There is much more to investing in IP’s than buying and holding forever.
.You could look into moving out of your PROR and renting it out. Downsize to a smaller rental property to live in. You may find that the saving are well worth it.The int on that loan would also be a deductible expense.
.
Your idea about adding value to the current properties is a good one. Try to keep your costs down to a minimum and make sure each addition is something that a tenant would be willing to pay extra for. You need to try and make your properties the best in their rental market.The other issue I have is if wise investors DON’T pay off their mortgages how do they sleep at night wandering if the unthinkable happens how they are going to meet their mortgage repayments – I can only suggest that they would have a set amount put aside to cover all the mortgage payments for at least 6 months – Is this correct?.
Exactly! some people feel comfortable with 3 months.Our aim is obviously to replace our income and ensure that we are making a steady and regular profit NOW from our properties and also draw from the equity to continue buying more properties – not just have the rentals pay the mortgage and see the profits when we reach 65It’s great to be ambitious but you might have to slow down and be a little patient. Eventually all your hard work will pay off. However, over the coming years you will have to develope a plan and get some skills if you wish to continue building your portfolio. There are many many things you can do. Keep your chin up and your eyes open to opportunities and ideas.
.
Good Luck.Hi Nathan,
2k is a massive amount to spend on window coverings for an
ip. Try an get the budget down as low as you can. But it would be a good idea to get some up. The last thing you want is the tenant hanging some old sheets etc.
.
20k is a lot to spend on a reno also. I was wondering what sort of work you were planning for that amount of money.
.
Good Luck.
.Hi Bonnie,
Maybe now is a good time to open dialogue with the new owners of the house. The amounts of money your are speaking about are quite small and it is perhaps something that you could talk through with them.
.
Not sure how that exclusion type clause would work in your state but it would be a shame if it got that far.
.
Good Luck.Hi Arnitrav,
As you have found out you will need to set a money budget as well as a time budget.
.
If huddy is a tradesman and you are on the same page as a couple then you have the potential to do well with the reno’s. There is alot to consider.
.
Find yourself professionals that you are confortable with and who understand what you are trying to do. Sit down with the accountant and explain each project.
.
Timing will become a very inportant issue.
.
Good Luck.
.Hi Arnitrav,
Terry is spot on. The contract date is the date that is relevant for your CGT. There is not too much you can do now.
.
On a positive note if you get right into this reno thing this will work to your advantage if you can negotiate long settlements on your next project.
.
Good Luck.
.Hi Start,
slow down with the old saw. First find out why the area is rotten. Most common reason in the area you describe is broken or leaking guttering. You need to get the water away from the wood by fixing this problem or you could end up where you started. Could also be ground water in which case you will need to get some drainage in the ground and get the water running away from the house before you start.
.
The job (weather boards) is pretty simple. Just lift the old with a pair of small pry bars (slowly) so you dont spilt any of the “good” boards. Get yourself a long nail punch and punch the old nail through then just left em out. If this does not work get a hack saw blade in behind the back and saw them away from the studs.
.
Before you start make sure you have the boards to put back on. Don’t get caught with your pants down having nothing to cover the damaged section.
Even if it is just a section of marine ply or something you will have to protect the internal wals from the elements during the work phase.
.
The stud problem is not a big one BUT if it is rotten then the bottem plate is probably gone which brings us back to the begining. What caused the damage? How wet is the ground around the area etc etc.
.
Spend some time with a shovel and dig in some ag pipe near the footings on that damp side. Fill your lovely little trench with some stone (fine blue metal is very cheap and does the job)and cover the top back up.
.
While you are doing all this soul cleansing work you can contemplate the weather board problem.
.
Oh, and once you have it fixed get some really good undercoat on those boards. You could even seal the bottom few courses with diluted bond crete etc.
.
Good Luck.
.Hi Crusader,
There are some property managers who will take on this problem and sort it out for you. Don’t know the laws in WA but it probably not a good idea to trot off to the tribunal on your own as a first timer with this problem.
.
Good Luck.Hi Wayne,
Just thought I would add one thing that some of the other posts have touched on. Knowledge about the seller is very important in these situations. You don’t want to be bouncing prices back and forward over the phone every couple of hours. Ask the agent about the seller etc to get some sense of their motivation.
.
Also be very carefull about potential views, that is the ones you get if you build over the house in front. Make sure you are able to do what you are thinking of doing.
.
This all seems to have happened very quickly. You may find that you are raising your offer and the agent has not even had a chances to speak to the vendors ie you are bidding against yourself. Vendors may have said something like don’t bring me any offers under 190. 185 is probably a respectable figure that the agent would take to the vendor. That is, only 5k under so not so insulting. It’s true that in most states the agents are supposed to submit all offer but this won’t happen for many reasons. The agent may not be able to reach the vendors if they are busy with work etc.
.
Anyway, the point I was trying to make was do it in writing. Verbals are a waste of time. Fax it and move on to the next deal. Get back on the net or in your car and go looking for more deals to offer on. Put all your energy into that rather than trying to force this one over the line.
.
Establish up front that you are qualified buyer with the cash/finance/experience to do what you intend.
.
Try not to stress to much about it. Have fun with it.
.
Good LuckHi Salla,
What do you experienced reno folks replace old carpet with in order to achieve an attractive presentation for selling a family sized house? I would like to achieve a more modern look – the house is very 70s!Polishing the boards if you have them is a super idea. Don’t pay to get it done. Im not suggesting it is easy but it is a skill that once learned will be extremely valuable and save you a couple of thousand per reno. This equates to quite alot of positive cash flow earned.
.
.
If you dont have boards or you wish to replace damaged boards then get someone skilled in to show you how to do this at least for the first few times.
.
.
You can find good quality pine flooring for between $1.50 and $1.80 per lineal meter. Each board is around 100mm wide so that means 10 boards wide times 1 meter equals a square meter (sorry).
.
.
To get them at this price you may need to head to an auction centre. I would not recommend bidding for the goods like all the other weekenders. These places run on a very tight margin and will be happy to disclose the reserves and sell early in the week before auction. Build a relationship with these people. Do a good deal and negotiate but try and stay friendly.
.
If pine is to light there a many products you can stain it with before you apply the polish or sealant. This (if done well) will definitely give you the WOW factor you are after.
.
.
TILES: Great idea especially for kitchens and wet areas. We have never paid more than $9 a square meter for them. You need to go to tile houses and look for end runs or again auction centres. An end run is the left over tiles of each palet or discontinued lines. Only use white or other neutral colours as some of the tiles out there may date very quickly.
.
.
What about the weather. If it is very cold where you are be careful how much bare floor you have in your home. Pontential buyers may be able to spend a few extra dollars buying cool rugs to put on the floor but you can’t assume that everyone has the extra cash. Also learn to lay tiles yourself but start with a small area like a laundry floor and work your way up.
.
.
Vinyl floor is also another viable option and alot of the new products represent a very high quality alternative as compared with the lino of years ago.
.
.
If you have the room keep any spare tiles, floor stain and boards, sealant etc and clearly mark it with the house its from and the date you applied it. It can be very hard to try and match these later. This is the beauty of floor boards because you can just hire the sander and go straight over them if they are damaged and re stain them. It doesnt really matter if some of the rooms look a little different and can add character.
.
Have fun.
.
Good Luck.
.Hi Guys,
My 2 cents as well. Have to go with the debt dog on this one.
.
Jason:I’ve never heard positive gearing descibed in that way debtdogg described it.From my point of view positive gearing and positive cash flow are exactly the same.
.
When you get over a dozen or so properties the difference b/w gearing and cashflow will be obvious. More money in your bank than out of it each month is what you want to achieve.
.
Good Luck.Hi all,
Rodney and Dunedin came out on top with a score of 91 as places offering a good or extremely good quality of life..
Does not suprise me either Westan. What a brilliant part of the world to live in.
.Regards,
Don and Liz
.I haven’t had any reasons why i SHOULD be a developer, but 58 reasons why not.
Sort of like 90 percent of responses to my posts dating back years now about the awesome possibilities of CF+ve investing in NZ.Just do it mimi!
.
From memory your new developement/s are in NZ. I thought the whole idea was growth. Not just in the financial sense but also personal growth through new ideas and experiences.
.
You will no doubt learn skills through this new venture that will be invaluable throughout the rest of your investing career.
.
I got the sarcasm re the OS structures. It’s not hard to see that you need to be paying loads of tax before you go to those lengths to avoid paying a bit.
.
Forget about the naysayers. Do your due dilligence and steam forward with the new project.
.
Good Luck.
.Hi Foundation,
I’m not intentionally being pedantic or negative, but I hear this often of late, and it rings alarm bells for me.Obviously the market price is where supply equal the demand.
.
I think redhaven like many others is just using this term to indicate that they intend to research and negotiate the price of each property.
.
good luck.Hi Loanwolf,
Some people may disagree but I think travel can be very beneficial to you investing career. If you don’t have the opportunity to see other countries and cultures through work you will have to pay for it yourself I suppose. Although you can do this on a budget if you research.
.
The other problem, ie, how do you stop yourself wasting the cash on booze and tarts.Get the tarts to buy you the drinks.) Sorry its 4am should not have said that.
.
Seriously, if you dont get spending under control now this wealth creation jouney you are on may be pointless. There will always be a new doodad out there for you to buy. Stick the money in a term deposit. Take a deep breath and sit down and write yourself a plan of action.
.
Good Luck.
