Huh, where did you get that figure from, Monopoly?

Try doubling that and adding 3, then a wife & 3 kids.

Perhaps you have me confused with someone else?

Well done Ronulas, great to hear from someone just starting out who’s doing well with it.

I have just had an offer accepted on my 1st IP. Now getting paperwork organised and looking for finance.

I’m a bit worried about property prices and interest rates over the next few years but this is long term so in ten years time hopefully I’ll be glad I did this and not kicking myself that I let the opportunity slip by.

eeshole

Hi Zippys,

I too am looking for a small commercial loan on a property worth 220k. I have spoken to a few brokers, and the lenders that always get mentioned are ING and IMB. Some brokers tell me that ING won’t finance anything below 300k, others say that if I refinance my home loan with them they will do the commercial loan with it. They are advertising 7.3% variable, 7.55% 5yr fixed, less .05% if you pay interest in advance.

I was told that IMB will look at a smaller commercial loan. Variable rate was around 7.5%. 3yr fixed was around 7.65% or thereabouts. The broker told me that because it’s such a small loan he gets no commission from IMB and he would have to charge me a brokerage fee of .75% of loan amount.

The other thing you could try is the Public Trustees Dept. They do 7.5% 3 yr fixed and 7.65% 5 yr fixed. Do a google search you should find them.

Hope this helps. Let me know how you go.

Eeshole

Chipper, I think you’ve missed my point totally. Don’t call my opinion rubbish. It’s not. I am not an idiot. I have worked hard all my life and I am educated and I listen to other people and learn what I can from them. So watch your language.

Try and get the drift of what I am trying to say FIRST.

Let me explain my “rubbish” to you. All I was trying to say was that there was no point pulling out statistics to try and prove that the generic term “shares” or “property” performed better. At the end of the day your personal investment performance will reflect the SPECIFIC shares or property you invested in, over the SPECIFIC time frame that you invested in them. So no point saying “shares” went up 60% over 1965 – 1982 and “property” only went up 43% over that period therefore “shares” are a better performing investment.

In fact your point was mostly pretty consistent with mine. So I guess you were calling your own opinion rubbish too?

There was a bit of venom in the earlier posts, with some saying shares are “better” and some saying property. I was just making the point that these generic terms don’t really reflect what YOU will make on YOUR investments specifically, therefore let’s stick to what people have done and how they’ve gone at it.

OK?

Rubbish indeed! Honestly, people these days are too ready have a knee jerk dismissal of other people’s ideas. Some at least.

I’m sure you’ll have a comeback for this. Fire away.

Ripstar,

1. I thought you said it was valued at $82,500? Where did that figure come from? Yes, it would be a good idea to get an independent valuation.

2. Unless you exchnage contracts, it’s still on the market and may be bought by someone else. Suggest you exchange quickly but put conditions on it so you can pull out if valuation & building/pest inspection reveals it’s a lemon.

3. Valuation should tell you this. Just remember that valuations aren’t gospel. 4 yrs ago I went to an auction, and got a valuation done first. Valuation 300k, but auction ended up at 350k. Just last month a 4br house nearby my place was bought for 700k. The valuation? 750k.

Don’t know how great the returns are for the property you’re looking at. I figure that even at 10% gross rent, after interest, rates, mgt fee, insurance, maintenance, it’s only going to be cashflow breakeven or thereabouts. If you get no capital growth, you’ll be tying up large amounts of capital for nothing (and even losing due to inflation). Of course you might get some depreciation, but that stings you when you sell. So if you make breakeven cashflow, with no capital gain, and claim depreciation, when you sell it you might be liable for capital gains tax even though you haven’t had an increase in the price. Remember you have to allow for about 5% of costs on purchase too. If your cashflow is neutral and you have no capital growth you will automatically lose 5% because of the purchase costs.

Hope this helps

How about post some of the property details here? I am from NSW and on the lookout for IP’s. If the deal’s right, I’ll bite.

Regards,

eeshole

I told my wife I wanted to speak to her about our finances. Managed to sit her down for 20mins or so. All the time she had her arms folded with a frown on her face and shaking her head. Went through Buy & Hold, Reno, Development, Mezzanine Financing, Bird Dogs. Every time I started to explain, she would snap “hurry up! I’m busy! So many things to do! Don’t go on and on just give me the summary!”

But you know what? Despite her resistance she still ended up spending 20mins listening to me talk about property investments. I’m happy with that bit of progress (for now), even if it is just a tiny step. So hang in there guys, don’t give up! This is for the sake of your family’s future, don’t let one person’s lack of understanding stop you from setting up your family with a more comfortable future!

Regards,

eeshole

Right. Good on yer for thinking about your future career. The best thing to do is talk to CA’s and CPA’s and ask them what their career path was, how they benefit from membership, what pain they went through to qualify for either qualification.

Certainly if your ambition is to rise through the ranks of a large accounting firm to partnership (say in audit, tax, insolvency or business services) then you would pretty much have to go the CA route (unless your area of specialisation was management consulting or IT audit, as these two disciplines often don’t require CA, even within a chartered firm).

Traditionally those who start off in the finance department of a commercial company would look at CPA program, but some larger companies (eg. Westpac, BHP) do support the PY.

If you wanted to do audit/tax/business services as a CPA there are plenty of CPA firms out there in public practice. They tend to be smaller suburban firms though. There is no CPA equivalent to a PwC.

Most jobs I see advertised (excluding those in chartered firms) for accounting jobs specify CA OR CPA. Very few ask for CA but exclude CPA. I haven’t seen any ask for CPA but exclude CA.

It really depends what you want to do. Some choices are:

Within Chartered Firm:

Audit
Tax (Personal or Corporate)
Business Services
Insolvency
Management Consulting
IT Audit
Corporate Finance

Within Other Kind of Company:

Financial Accountant (produce financial statements)
Management Accountant (work out how to make more money)
Treasury Accountant (work out where money is supposed to go in a bank)
Fund Accountant (Do the books for investment funds managed by your company)
Systems Accountant (Fiddle with computer systems)
Software Consultant (Sell or implement financial software)

There are also non-accounting jobs which an accounting background is good for. Like:

management trainee programs at big companies are usually good.
Sales – selling financial products, insurance, mortgages etc.
Purchasing – buying stuff for big companies (eg. deciding who to buy biscuits from for Coles)

These are just a few examples. The accounting degree gives you such broad skills as to enable a very wide choice of career.

If you have any further questions, feel free to ask. As an old fogey (35) who never had any guidance when I was trying to figure out what I wanted to do, I’m only too happy to help anyone I can.

eeshole

I think it’s pretty standard. Basically they just look around the place and poke a few things. They don’t really do anything intrusive (eg. they don’t take off the gyprock and look at what’s behind it) therefore there are a billion possible things that could be wrong that they wouldn’t know about. Therefore they have to slap on the no responsibility clause, or they’d get sued big time every time something was wrong that they didn’t report on. For a couple of hundred dollars, all you are really paying for is someone to do a cursory 15 minute walkthrough of the property.

Hi Maggie,

I’d say you’re doing pretty well if you’ve saved 100k. As for whether the market is going to go up or down, well, that’s the $60,000 question we would all like an answer to. I have read a few articles which suggest that house prices have so far outstripped inflation, wages growth and rental returns such that it is inevitable that the market will go down 20%ish over the next couple of years. I have also seen articles which suggest that population growth will provide the demand to continue the rise in property prices, and we have already suffered a drop, and it’s time for the market to turn the corner and go back up.

So I guess it’s a matter of assessing all the evidence presented to you and making a call one way or the other. Anyone out there that’s closer to the inside of the industry and can provide some insight?

Regards,

eeshole