Specify it in the contract then. “Vendor is responsible for insurnace untill settlement”. Quite easy…

Rgds.
Lucifer_au

Sorry I should of said pay them off and get rid of them – go get a LOC or something instead, or ReadyCredit (quite high int rates but it has certain,… benfits…).

Also a soon as you pay of a credit card, you have a ROI of that amount (so if your credit card is say 14%, you’ve made 14%, by not having to pay it off on easy monthly payments.

If it’s a friend and they don’t care either way, pay them latter.

Rgds.
Lucifer_au

The structure most people use is to have a trust, with a corporate trustee (a company that acts as a trustee).

That puts an extra barrier to people wanting to sue you.

Rgds.
Lucifer_au

They lost the game as soon as bidding stoped around $1.5Mil and they said is “what do we do now?”, they didn’t even have a plan if X or y happend – their only plan was that it would reach over their reserve of $1.6Mil, and when that didn’t happen they lost the game.

They had no game plan, and they were totally at the mercy of the RE agents (who wanted the commission of course), whom tell them the line “it’s what the market is telling us” and “we put it on the market and we will be able to get more bids” (in this case 2 more of less than $5K).

That said, the house was basically a knock down job (well it was damn well ugly, and you probably just domilish it and start over, esp. if you are paying over $1.5Mil!!!). They bought the house 20yrs. ago for $200,000 (so round about a increase of 14% per yr, minus inflation of 5%).

In an interesting note, if they hadn’t sold at auction I wonder how much they could of got if they played the mystery buyer game – I suspect a hell of alot more, as that guy was out to buy the property. I basically laughed when the owners said “were not happy” – yeah neither would I of been if I put it on the market and got less than $10K in bids befor the bidding stopped (for $1.5Mil prop!).

Rgds.
Lucifer_au

Allot of investors use trusts (and have a company as a benficiary).

Rgds.
Lucifer_au

Banks go on either valuation or contract, which ever is lower. And because the owner is giving back 10%, the bank assumes that this 10% is takn off the contract price for lending.

You could always go back with a normal contract, with a side note (which of course is not inc. in the contract as it’s an entirely seperate issue). Of course you should tell the bank the side note exists. Or you could try to find a pretty flexible lender… if one actually exists…

Rgds.
Lucifer_au

To really think that everyone could own 130 properties is a fools paradise. Nearly everyone could buy 130 properties, but most people don’t want too, just as most people don’t want to be independently wealthy….

>”Also the government is about to review the Depreciation on investment property. That will blow up investing for good in property!”

It will mean nothing to me. I have got all my investments cashflow positive… But even if it did – do you think I can get on a plane and head over to another state and/or country?? Hell even if I do pay a little more tax, it will still be very low compare to employes.

>”Imagine what would happen if every Tom Dick and Harry set about doing 0 to 130 properties in 3.5! What do you think might happen??? There would be a festering and what do you think it might do for genuine persons struggling to find a home, hence low home ownership. And this practice thanks to Mr McKnight 0 to 130 is causing all this !!!Face it they are unreal!”

Do you think investors stop people on pensions from buying homes – or do you think it is the banks? Which require huge deposits from them??? Have you ever herd of Lease Options? Do you know why they are mostly used? Because renters can get rent assistance and still have the opportunity own their own home. Thanks to us Investors, these people whom would be almost instantly denied by the banks are able to have a house to call their own.

>”Do you think a nation of greedy Landlords might resolve social tensions!”

You call us greedy? Why? I could suggest you are greedy! I am helping more people put a roof over their head than you… I am making sure that rental stock remains robust. I could suggest you have been the greedy one… all you might have done is simply put a roof over your head?? Well what about the family next door??? What happens if they can’t pay a mortgage??? What throw them out on the street??? But I guess us greedy landlords are stopping that…..

I think it would be much better for the government to teach financial education in school. Do you know how powerful economy we would become if it was mandatory to read “if you want to be rich and happy, don’t go to school?”, rather than try to save people from the greedy landlord….

I guess you see everyone who opens a business (and place their, Not your, assets on the line) as greedy… Hell they could potentially go bankrupt but they are the greedy ones, because they are willing to forgo the money now (which employees demand) because they believe and have faith in the fact the pay off will be bigger at the end (which might or might never happen).

Well PM me if you ever change. This greedy landlord will give his knowledge to help you for free….

Rgds.
Lucifer_au

***Warning – Long Post***

Why should tertiary education be free? – please no tree hugging hippie ideals, a solid logical argument for it. I see no reason for it to be free, or for students not to pay some amount towards it.

>It’s NOT free, there is something called HECS and something like 97% of all students pay it off. What allot of anguish about is the fact that fees are going up, I for one feel concerned when I walk out of uni and I’ve got a $60K debt hanging over my head…. Current reforms will increase that. This has concerns about trying to keep our work force up to a high standard of education (which is quite important for 1st world economies).

ALP – beholden to unions which have a socialist mentality, which doesn’t gel with my own life philosophy, and propped up by leftie students with no life experience. Unreasonably against people earning over 50k a year, which would be many of their own faithful nowdays.

>Alot of the statement there is true, cacus still holds the power (with unions holding 50% of the vote, and have te power to defeat motions, even if they have been succesfully – just in case!), I wouldn’t say they are propped up by left wing students more like unions (whom finance their campaing – nothing wrong with that).

Democrat – what do they stand for? Very much a spent force politically with no relevance. Hating John Howard is not a political position.

>I would agree they are a spent force, but they do provide a resonable balance in the senate – which is required.

Green – Lunatic fringe who know they have no responsibility to anyone as they will never win power, so they can try to headline grab, with no thought to impact or effect. 40% of Tasmanian forest is protected from logging – 40%!!! Get over it.

>Have you seen the devestation of Tasmania forrest when Gunns goes into one of those places??? Do you know how poison 1080 kils animals??? Do you know why Gunns refuses to let skilled timber workers access to pickup ‘left-overs’?? Because they burn everything that is left over, thats why. Tasmania is a beautiful place I would hate it to become a Sydney or a New York. As Tourism is the future (rather than logging) due to the ability to add higher value (you can’t really add value to wood chips) this issue will dominate the political/enviromental debate further. The fact the the Tasmania Forrestry does not really regualte Gunns or even discloses how much they have sold the forrests to Gunns for, does add a certain fuel to the fire.

How it is, is how it is.

I jut hope we can get more posts focusing on the impact to investors (Gittens in the Syd. Mornign Herald – is a great source!).

Rgds.
Lucifer_au

Craig banks dislike lending on residential purley on the figures, until you either have a huge amount of properties (say like Steve McKnight has), or you have alot of equity (like a coupme of million)/large scale developments/cash. There are ways around (i.e. company in another spose name that employes you , 20%+ deposit, etc).

That being said the bank must see you as a professional player before it hands over it’s money.

Rgds.
Lucifer_au

***Warning – Long Post***

“In your Economics 101 textbook you will see that deficit has its economic place (e.g. to stimulate and economy) – contrary to the Costello line that it is the root of all evil. It’s just that right now, we don’t need the stimulus and people swallow the “Defecit = Bad; Surplus = Good” line that the Coalition use because it suits them politically.”

>You forget about the ageing baby boomers – that is why it is so important to have surpluses. So when we go to borrow on the international market we get to borrow more and at a lower rate of interest because according to credit agencies (Standard & Poors) there is less risk, rather than being like America – large deficits now, larger deficits in the future, and less capacity to tax or borrow. Wouldn’t it be better to have surpluses now??? Or do you believe that super is going to save us! L0L!!!

“I just wanted to reply to the above & remind everyone that until the coalition came into power under Howard, NO previous Coalition party in power had EVER had a budget surplus! Some previous Labour parties in power had. And we are all quick to forget the major reason for the budget surplus – Telstra???? Read up on your political history fellas!”

>Telstra provided a large surplus, but the budget had an underlying surplus anyway (this ignores one off ‘special’ effects, such as the sale of large Gov assets). Also during the last Coalition Gov was in power at that time the economy was booming and there was no need for surpluses (as the word baby boomer hadn’t probably even needed to be invented then!)

But I digress, on to Labour/Lib governments thoughts:

Labour governments tend to have big social agendas that require large expenditure, which in turn means increase in taxes. An because the unions want to be seen doing something for their members this means this tax burden tends to be shifted on to entrepreneurs, business owners and investors (the people who create the jobs in the first place… but anyway along with the real debate – what will this mean to us!).

I think I could confidentially say that a Labour Gov wouldn’t change current structures fundamentally. Saying that things like taxation would probably change, perhaps trusts wouldn’t get the 50% CGT discount, certain trust loopholes would be changed/closed (when Latham promises no CGT changes, he means for the everyday worker not us investors – it’s called politicians speak), perhaps larger payroll taxes.

He won’t have a lot of room to move however as many dollar commitments the Howard Gov have made is through contracts and these can’t be torn up (thanks to the courts!).

As for his $5 billion in government waste that would be used to fund some of its spending commitments, I think that is very much up in the air, and I know it won’t be used to reduce public service numbers, etc

He states that taxes won’t rise more than GDP, but that is assuming that there is still high growth rates… what if there isn’t????

All politicians lie, it’s kind of like a get out of jail card…. Saying that I would prefer a Howard Gov because I know nothing much is going to change for the entrepreneurs, business owners and investors. In fact I feel there is a higher chance our interests will be protected. With the Labour I don’t see any words to suggest Latham will protect us. Better to go with the Devil you know.

Anything Labour puts up we will get around, but it will increase costs and hassels along the way (and in the end they will just put up hidden taxes which cna be either passed on to the rent or worker, somehow).

As for Negative gearing being outlawed – I don’t think it will happen for quite a while, mainly because the state Gov’s are now relying on stamp duty more and more. Either the Federal Gov will have to increase there contriutions to the States or raise GST (which will mean increases to the States), I don’t beleive either will happen.
When negative gearing does disappear – I will be prepared to jump on some fantastic deals!!!

Rgds.
Lucifer_au