Forum Replies Created
djac just do a http://www.google.com.au with Australia ticked and put – low doc loans or no doc loans into the search box and you will find the information you seek.
I live in a house I do not own and I just had ducted evaporative cooling installed by the owner and it works really well except if very humid conditions.
I originally asked for some outside blinds over the windows to cut the heat but the owner put in the cooler.Find out what rooms he wants cool it may be just the bedrooms and an inverter air conditioner is cheaper if only one or two rooms are needed to be cooled and you may be able to split the system to do two rooms at once. Some of the reverse cycle air conditioners can be used to heat as well. My investment property I dropped the rent $20 a week from the market proce of rent because it doesn't have ducted heating or cooling.
see if you can get a line of credit set up on PPOR so that you can separate PPOR loan in australia from your investment purposes otherwise it will be difficult to separate interest on investment and interest on PPOR.
Ask the bankHave you thought of using a deposit bond just a financial instrument you might want to consider or know about.
Sometimes you have the equity in another property but no cashYou could see if the real estate agent will accept a deposit bond
ask banks if they issue them
see
http://www.smartline.com.au/DepositBonds.html
http://www.findlaw.com.au/article/10086.htm
http://www.asic.gov.au/fido/fido.nsf/byheadline/Home+loans?openDocument#deposit
https://www.propertyinvesting.com/forums/getting-technical/finance/22804
Some organisations that do issue deposit bonds – not a recommendation !see
http://www.anz.com/aus/ind/insurance/deposit/faqs.asp
http://www.depositpower.com.au/
http://www.depositbondaustralia.com.au/web/?gclid=CN6Bh_zm3pECFRVaiAodR1sSXw
http://www.stgeorge.com.au/insurance/deposit_power_bonds/default.asp?orc=personalYou need to work out a budget and see how much spare cash you have after paying all your living expenses. Then you need to ask the bank or mortgage broker how much can we borrow like a pre approval . If you go for investment you need to look at an area where you think you can afford and find similiar properties to get an idea what the rent will be. Then take $2000 off this for expenses or make enquires on what the insurance and rates will be for the house. You need this figure to work out how much you can borrow as the banks sometimes use it as additional income. If you want to be safe work on a 12% interest rate scenario to give some breathing space.
If you want to own a home you need to talk to a bank or mortgage broker to find out how much you can safely borrow as rent will no longer be an expense to the lending bank. You may be eligible to get the first home owners grant.This way you have an idea if you can afford to own your own home or an investment property.
You may need to factor in the loss of your partner's wage due to starting a family.I can't give you specific advise but with the discovered financial information you may be able to decide how to go forward.
The areas worst hit are the new development areas where every one in the street has a new mortgage like Melton, Berwick, Caroline Springs. Imagine the effect on the property value if a lot of houses go up for repossession sale in the one area.
The article also mentioned the banks were trying to get their money before the value of the houses drop.Sixty minutes had an interesting story on it also at http://sixtyminutes.ninemsn.com.au/article.aspx?id=289100
from a national perspective.
Every week across the country, nearly 30 a day are repossessed {sixty minutes aug 2007}Also this might be of interest
Auction slump
http://www.news.com.au/heraldsun/story/0,21985,23266297-661,00.htmlWe will see a lot worse to come if interest rates keep rising as the sixty minutes story was in Aug 2007 and a lot of people have borrowed more than they can pay back due to the rising interest rates and I reckon their 5 year low rate fixed interest rates of the boom times 2001 – 2002 will be expiring right about now and suddenly jumping to over 8.5% p/a.And also a lot of people are selling out before the repossession occurs as they know they are heading for trouble and do not want to be kicked out by the bank. This will not be in the Statistics figures being quoted.
Blogs,
You have done really well but remember that a 400% gain comes with an increased risk. Diversifying your stock market investment rather than having 50k in one high risk speculative share would lower the risk.
What you have to keep in your mind is how would you cope if 50k became 5k like one of my shares MFS did – hence I do not own it anymore. However as it was a small part of my overall portfolio I can cope with the loss and make up the lost ground later.
Imagine if you had invested in these blue chip companies -Centro or HIH or OneTel.
Check out the past failure of them!What is better with shares is the fact that you do not have to tie up $240,000 in one investment or $50,000 IN ONE INVESTMENT ,where as in property you have to pay stamp duty, mortgage insurance, council rates, Water rates, repair bills, cover any vacancy periods, insurance and land tax. Plus you have to find a lot of money to put in one investment unless you are entering property through using listed property trusts through the share market.
This is not financial advice but given information for you to think about what the risk tolerance you have with investing may be.If you buy an investment property you do not live in it and it can be in an area where you can afford the loan repayments.
You will have to weigh it up with losing the first home owners grant.Baby steps are better than having a huge mortgage that you struggle to repay and that greatly leaves you at the mercy of interest rate increases. Once you pay off part of the loan you will start to have an extra income source to purchase the next house and equity that can be borrowed against to buy another property.
My general advice would be to buy investing books on property take a look at http://www.businessmall.com.au and look at Australian Property investing magazine http://www.apimagazine.com.au and another magazine I recently discovered called your investment property http://www.yipmag.com.au when you are in the newsagents.
Education at a very cheap price.
What you need to be aware of is the property takes time to build wealth.How many banks did you apply for the loan with ?
Banks differ in their calculations of serviceability
Also find the loan amount you can service from the lenders because you may be able to take out a small loan from another source
(family, friend, ect) to make up the short fall.You need to seek professional advice from a licensed financial planner as there is more to consider than just income insurance.
I cannot specify the other forms of personal financial insurance you may need as this would be considered as giving financial advice.Rather than looking at timing of fixing your interest rate you need to look at fixing your costs of interest for a certain time period up to 5 years. No one has a crystal ball on what interest rates will be. You may want to have a split loan on the PPOR . So you can have the option of being able to pay off say for an example 30% (variable) of your principal amount and have 70% of the loan fixed. So that you can have both worlds with a variable component and a fixed component. The interest on the PPOR is not tax deductible and is a larger loan than the investment loan so it would seem prudent to try and fix the interest costs of the PPOR loan while being able to pay a component off the loan if needed via a variable component plus there may be some extra features you are entitled to or using with the variable loan which having a part component of would keep these features. You have some breathing space with the investment loan as the income is greater than the expenses but you may wish to fix your costs for a time period so that you know what your expenses will be for a certain time period.
Consider how much can you afford to fork out each week in interest, council rates, water rates, insurance minus the rent income. Use a guess of what similar properties in http://www.realestate.com.au receive in rent and work out an interest rate of about 12% for a safety margin due to the trend of rising interest rates. Also you might want to consider fixing your costs by fixing the interest rate of the loan for a certain time period. Also consider how to pay these costs if you have a three month vacancy. If you pay say 40% tax you are paying for each dollar of expenses to get 40 cents back and making a 60 cent loss.
I think new home buyers are going to be creamed when they pay top dollar and borrow large sums of money. This will be because they have no equity and are sensitive to interest rate rises. As all the buyers in the new housing estate are in the same financial position the prices will fall in the new housing estates and they will end up owing money after they sell their home. So some areas will not lose money but other areas will have losses.
You can never neglect safety from un-planned explosions from leaking gas, car crashes, acts of war or terrorism.
Have you looked at Stratco. Check their web site . http://www.stratco.com.au/
Do not know how good their pricing is as I haven't used them for a carport but for shelving. They are in Queensland .These places may be able to provide a bungalowGeelong (Fagg's Mitre 10)
1-13 Barwon Terrace (cnr Moorabool Street)Geelong VIC 3220Phone: (03) 5221 2899Fax: (03) 5221 6754Store hours:
Monday to Friday: 7:30am – 6pm
Saturday: 8am – 5pm
Sunday: 9am – 5pmhttp://www.aaronsoutdoor.com.au/bungalows.htm
Orhttp://search.ebay.com.au/bungalow_W0QQfcclZ1QQfclZ4QQfltZ9QQfnuZ1QQsatitleZbungalowQ2a
orhttp://www.ortech.com.au/green/documents/BungalowBooklet-Email.pdf
or
http://www.bondhomes.net.au/
you are within 50 kms of ballarat will deliver to hoopers crossing
or
Nobility Homes
Geelong 52722771What you may need to do is check with your local council to see if a building permit will be required for what ever you decide on getting.
You need to consider how you would cover the loan if you had three months without a tenant or lost your job for a period of time.
Lenders will take a percentage of rental income into account when you borrow, this figure is different from each bank in working out if you can service the loan.
Another point is you may be thinking of is an interest only loan, which is an investment loan where you do not pay off the principal loan balance. (thus less payments each week)
Also investment loans are not protected from the UCCC regulation that covers residential loans. So if you get behind in the payments you will be treated a lot harsher than if you were a normal residential loan holder.New property would have capital works deduction depreciation and may increase your cash flow
http://www.ato.gov.au/content/downloads/NAT1729_07.pdf
section 1:19 page 23 of pdf fileTalk to your accountant to find out how much – is it claimed over 40 years .. 100% of capital building cost / 40 per year .. and th e cost base draw back for CGT
web site of interest
