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I know of example in America where a person had eye sight defect and could only visit properties by bike (because her eyesite was so bad they refused her a licence) but she now has a portfolio of properties that are all CF+ and she lives in Californa (on the edges, but still – W0W!).
Rgds.
Lucfer_auHeres a few ideas:
http://propertyinvesting.blogspot.com/Rgds.
Lucifer_auI don’t think it will matter to much short term.
Over the medium term they Might rise under Labor (because of larger spending promises in 2006 (MedicareGold) and because of their Industrial relations policy). This is drawing a long bow to try to link each party with higher interest rates.
More important influences are overseas as well as our domestic economic cycles.
Rgds.
Lucifer_auAdding a carport can add value to a house, and yes you can charge more rent for a carport as well, Dolf De Roos book “101 Ways to Massively Increase the Value of Your Real Estate” explains how you can do this relly well. Though he invests in areas that provide higher cashflow (i.e. outside Australia) and can charge more for doing things like this.
3/1 houses are seen as better because a family with two kids, or a household that needs a home office can use it. Of course it all comes down to the deal and the property.
Rgds.
Lucifer_au11 Second Solution:
Rent = 250
Occupancy rate ‘3 Weeks’ = 94.23 Percent
Solution = $117790.00
Asking price = $415000Closing costs:
Deposit 10 Percent = $41500.00
Legal fees = $800
Stamp duty = $14165.00
Mortgage app fees = $475
Mortgage insurance = $0
Valuation fees = $0
Other borrowing costs = $400
Clean up costs = $0
Inspection costs = $300
Other costs = $0
Total closing costs = $57640.00Mortgage details:
Loan Principle and Interest = $373500.00
Interest rate = 6.5 Percent
Term = 30 Years
Weekly mortgage repayments = $544.79
Total repayments for life of loan = $849877.20Annual costs:
Management fees 5 Percent = $612.56
Letting and advertising = $0
Body corp fees = $0
Rates = $800
Utility rates and fees = $0
Insurance = $350
Miscalanious costs = $0
Land tax = $300
Maintenance 5 Percent = $612.56
Other ownership costs = $0
Total annual costs = $2675.12Summary:
Total annual rent = $12251.20
Total annual mortgage = $28329.24
Total annual costs = $2675.12
Total annual cashflow = $-18753.16
Annual Cash On Cash Return = -32.53 Percent
Cashflow Positive Weekly = $-360.64Yes I love jaffasoft’s calculator.
Just thought you want to know.Rgds.
Lucifer_auI recently bought a positive geared IP, the vendor was getting nervous and wanted to settle real fast, I asked and found out that she was using the money to buy a 4WD.
Yes, she sold an appreciating, high yield property (that put approximately $90 p/w into her pocket) for a gas guzzling car that deprecates and costs money in repairs and maintenance.
The fact tht she could of got a loan on the car and the property would of paid for it was totally lost on her.
So thats why people sell positive IPs (and of course divorce and the occasional murder – don’t ask!).
Rgds.
Lucifer_auIMHO = In My Honest Opinon
LOL = Laugh Out Loud
ROLF = Rolling on Floor Laughing
ROFLMAO = Rolling on Floor Laughing My A#@ Off!Rgds.
Lucifer_auI know of some interesting opportunities (around mentorship).
Just want to know are you retired yet?
Rgds.
Lucifer_auI haven’t invested in the US, but from what I know it’s +CF heaven and some states are so landlord friendly it makes me cringe for the tenant!
Downside is it is hard to manage a property internationally (look time zones make it extra difficult). Also transferring $Aus to $US. Also in Australia there is usually higher CG for all properties (in terms of distribution). Also in some states it might take 2-3 months just to let a property.
Rgds.
Lucifer_ausui generis is correct. I buy these houses for cashflow Not for capital gains, other investors here like capital gains over cashflow. It all depends on your strategy.
Rgds.
Lucifer_auAllot of the time it is people who have moved to get out of their city lifestyle into the peace of country life. Unfortunately it can be hard work (having to run animals, having to farm, etc). Usually they don’t want to do it anymore (because while it can be a great lifestyle it can be hard work) and hence they put up their property for sale.
Some can be good investments but of course it depends on the deal (as always).
Rgds.
Lucifer_auIt’s coming round to spring which does get more people out but they are usually first home buyers.
I don’t see any real growth for a while (a long while). It looks like values are rising just with inflation. Certainly nothing like what we’ve had.
As for Roseberry garrytas I would say no, mainly because of the already massive price rises and a large % of your market is in the employment of being unemployed.
Rgds.
Lucifer_auPros:
~Hnds off (you just get the cheques in the mail
~No tennant hassels
~Can be CF+ in metroCons:
~Banks dislike lending on car spots
~High deposit req.
~Hardly any Capital Growth
~Fees are usually involovedRgds.
Lucifer_auAlthough Steve McKnight didn’t get rich from the “few extra dollars he received on a monthly basis” It did allow him to retire and use the time he spent being an accountant to find more +CF deals and increase his income exponentially.
The more income, the more property you can buy (and hence the higher the capital gains – e.g. Have a $1M worth of property, goes up by 20% =$200K; Own $6M, goes up by 10% =$600K).
As for extra CF+ if you spend more time on your own business and not in someone elses, you will learn how to add extra value at a very low cost.
Rgds.
Lucifer_auBelieve it or not but yes there are properties avalible for $40K. And yes these are houses (though $40K flats can be quite good too).
Rgds.
Lucifer_auIt seems to me you know where you are going and what you want.
Right now I would focus my efforts on one (property) or the other (stocks/options).
It seems people who specialise tend to do better than people who diversify (for example I know one person who owns two houses, sacrifices their salary into super and then goes occasionally and picks stocks. I don’t – I focus on RE, that’s why I don’t have to work and their still dabbling (and the insanity of it is that they could easily retire!).
For stocks I would recommend you pick up Safe Strategies for Financial Freedom or if you would rather trade, Trade your way to Financial Freedom. This book is all about risk control (R multipliers, etc which is more important than the trading methodology). Both are written by Dr Van Tharp.
For income producing RE, there are a few ways to go about this. One is to try and buy CF+ through Buy & Hold. This is difficult and you probably won’t make allot per week. Another way is to wrap the property. This is where you simply become a bank (and basically charge the new buyers a slightly higher interest rate than what you get charged by the bank). Wraps provide much higher cashflow than just CF+ Buy & Hold generally speaking (though we picked up a little beauty for 16% CoCR, which is set to rise to something like 96% CoCR within 16 months.
Another way is to find twists in property that you can exploit (for example renovating cheaply to get higher income, etc). This can be quite lucrative.
Hope this helps a tad.
Rgds.
Lucifer_auMainly they are concerned about the publicity. For example they do not want to be seen as turfing people out of their houses because the mortgage hasn’t been paid by the wrapper when the wrappe thought they would one day own the house (ACA and TodayTonight would make such lovely programs about it).
I was told that this decission was made by the Public Relations departments at those banks.
Rgds.
Lucifer_auWith negative gearing you can apply the loss from your property to other income. So for example say you had a property costing you $200 per month, if you were on the highest tax bracket the tax man would take $100 of every month.
This roughly explains the basic concept (and yes I do know the PAYG tax rates, with the highest being 48%, so my figures might be a little off…)
Rgds.
Lucifer_auWell Shares can include many things. I know some investors do an AIP (Auto Investment Plan (ASX200)) and then research (and buy) small cap stocks. So there is two income streams. Usually though the rich might have large interests in 3-4 business and then buy more business (Kerry Pakers model).
Rgds.
Lucifer_au
