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Awesome post. I’ve been laughing at this plan for nearly a week now. Idealogical rubbish, who wants to live in an ugly McMansion on 500sqm in Ipswich and catch a bus to the Gold Coast?
There aren’t really many towns left, unless you want to buy a big shoe in the bush and rent it to someone who has 14 kids.
Try Steve’s 2nd book, it covers quite well achieving +CF in todays investing environment.
Also try some people on this forum who have lists of +CF propeties waiting to go.Good Luck…G7
Well…where do I start?…Great article[sleepy2]
These types of investments are hard to finance, because usually they’re so small <50sqm, and if you can finance them you usually have to put up about 30% yourself.
Body corp rates on these can be astronomical, I’ve seen 60% of annual rent eaten by body corp fees.
The net return of 7.5% is nothing special for these investments, you can get a lot more in good places at 10% onwards.
However, I think as a hands off investment, they can cetainly be ideal if you’re after that sort of thing.Hope this helps…G7
Hello!
Hi Rick, I’ll have a go at your questions. I’ve seen these types of properties managed by a real estate agent, there’s no reason you cant do the same. Just talk to some and find out what the deal is.
Each room is leased separately, each tenant has to pay their own rent and bond and in the tenancy agreement, cleaning, use of common areas etc. would be covered. Trouble makers and night owls and conflicts would be the propety managers concern. However, these places are usually filled with students, so the risks of hoons would probably be minimal.
Insurance shouldn’t be too much hassle, just tell your insurer what exactly the arrangements are to avoid any nasty surprises later on. You’d probably pay a bit more, but who cares, atleast you’d be covered.
I think this type of investment is great but make sure to get a decent agent and do the right thing by your tenants, and as it said in Steves book the likelihood of trouble is greatly minimised.Hope this helps…Good Luck! G7
On a stand alone basis, ie- rent versus mortgage, you’re not CF+ (let alone with expenses factored in). Rockhampton is not booming, not according to the stats. It’s like a lot of places in Qld, the property market is scratching it’s head wondering whether to go up or down.
If an agent who is selling real estate in town tells you it’s booming, they are doing so out of self interest, not yours. Good Luck…G7No, definately not. If this has happened to you contact the agent immediately and find out what’s going on. If there’s any run around from the agent your next call will have to be to a solicitor.
The vendor has to OK the offer, if they haven’t it could take a while to get your money back.Springfield Lakes, Qld. Just recently moved from Melbourne. Bloody Qld humidity…
Welcome to the other side! In regards to the NZ agents comments about property just be careful because if a person giving advice has a vested interest in that advice, well there’s a high chance of BS!
About the Taxi licence, I think your money would do better elsewhere, a lot better. There was an article about cab drivers in Brisbane the other day and the chronic shortage of them. Lots of cabs are off the road becaus nobody wants to drive them. Besides taxi plates have gone through the roof all over the country in the last few years and you’d be buying at the peak of the market.
It sounds like you’ll be in quite a strong position after selling, so be patient and you’ll get there. Remember sometimes the best investment is to do nothing! Good Luck…G7Yes you can, this is called flipping. The contract needs to be unconditional though.
The Aust. Bureau of Statistics is generally pretty good. You can get a suburb profile online for $10 that’s quite comprehensive. I think their site is at abs.gov.au
Hope this helps!
I’ve been watching the area for some time now and believe that it’s done its dash.
How long’s a piece of string…
If you think it’s a good investment and you’re happy with it and it fits into what you want to do investing wise, then go for it.
However, in this current market I believe you have to be a brain surgeon in regards to investing. One wrong move and it’s really gonna hurt! G7No you’re not missing anything, just complicating it!
The end price of a wrapped property is simply the price you initially sell it for. If you wrap a house for $100k, it will be $100k at the start, middle and end.Hope this helps… G7
1. Yes they do build equity in the property with every payment they make. It’s just like a standard mortgage, although they are paying off that mortgage from you not a bank.
2. With each payment the amount of money remaining on the property will reduce and you’d have some sort of spreadsheet to track this. If they want to pay you out before expiry of contract they simply pay you the exact amount owing upto to that particular date in time.
Wrapping’s a good way to go to quick the job habit in 6 years, good luck.
You only pay CGT after contracts have been exchanged. In a wrap you dont exchange contracts with your purchaser until they make their last repayment, 25-30 years down the track, unless they re-finance earlier, rather than taking the loan to term.
Hi,
If you are in a strong financial position or it’s a really good deal eg. Price $100k, Rent $250pw you can often buy with no cash down. There are other factors, talk to one of the brokers, they’d be better to help.FHOG is $12 000 in Vic. 7k from federal gov, 5k from state upto a certain amount though, I think it’s $250k and then it phases out.
If you bought a house in joint names, then no, she would not be eligible for the grant.
Grant or no grant, you can invest in as many properties as you like. Hope this helps…G7You might have to meet the market where it’s at and just sell it for whatever you can get.
Wrapping something like this would be very hard, but not impossible…Good Luck G7
