Forum Replies Created
I have played this game, and found that:
a) it’s not that fun.
b) folks tend to believe it reflects the real world when it’s view of investing is seriously distorted and flawed.
c) it costs about $250!!
d) this is not a HELP NEEDED topic…IMHO.
Cheers, F.[cowboy2]If your current house has appreciated dramatically in price over the past couple of years, chances are it is either fully valued or over-valued. Selling it will ‘lock in’ your gains. Given that the HPI of the last six years cannot continue into the future, I don’t see how you could lose by following this strategy. Holding an asset that is either fully valued or over-valued at the end of a massive bull run is risky, borrowing heavily against it is dangerous…
All IMHO of course, but there is a very good case for this prediction and little to no evidence to the contrary.
Cheers, F.[cowboy2]Investing OS?? what could the dangers be?Kiwis![biggrin]
A) I wouldn’t. I’d leave and never look back.
Q) If you try to fail, but you succeed, which have you done?
Am I still eligible for the first home owner grant if I’ve decided my friend to rent my property for 4 months, and after that I will move to my property continuosly (i.e. August) ??Providing you live in it as your “principal place of residence for a continuous period of at least 6 months, commencing within 12 months of either settlement or completion of construction”, then YES, you can still claim the FHOG.
However, if you have told your lending agency (and insurer) that you will be occupying this as your PPOR, they may not take too kindly to you becoming a landlord. Might be worth staying ‘under the table’ on this one and forfeiting any potential -ve gearing tax benefits.[fear]Cheers, F.[cowboy2]
PS – If you follow Enzo of REIV’s logic, that:
CAPITAL LOSS = $10,000
can more positively be described as ‘slightly negative growth’ or ‘more realistic levels of stable capital appreciation’…[biggrin]Originally posted by li21:What is the recommendation for the following:
a) Using more of own money for deposit, avoid mortgage insurance, lower monthly repayments
(possibly see positive rental cashflow)More sensible, less risk.
b) Use less deposit, more banks money, larger loan and monthly repayments.Less sensible, more risk.
Why am i always being told to use more of the banks money when it seems more risky?a) Because higher gearing brings more profit in a booming market, but even more loss once the boom is over.
b) Because you’re getting bad advice.Cheers, F.[cowboy2]
I wouldn’t try to claim tax deductions from the time you moved out otherwise a FHOG audit would show that you did not live there for the requisite 6 months and the grant would have to be repaid. I’m pretty sure when you signed the application, you agreed that:
â— I/we will occupy the purchased property as my/our principal place of residence for a continuous period of at least 6 months commencing within 12 months of settlement or completion of construction.[blink]
…oops.
F.[cowboy2]Originally posted by calvin@thirty4:Last bastion of bad debt still to go is $1500 on old C/C and $13880 on old personal loan! Both will be finalised this year to $0!!!!! Despite investing.
[thumbsupanim] for your progress!
I would suggest that your best ‘investment’ would be to get rid of those debts. You’ll be hard pressed to safely find an asset returning 10-18% compounding this year.In relation to Resi’s questions WHY?
I guess lack of financial literacy coupled with greed and the glorification of consumerism has lead to most Australians trading their future wealth for an ephemeral (and false) image of wealth in the present.
Cheers, F[cowboy2]Are they declaring the interest you pay them as income for the purpose of income tax collection?
I can’t believe you’ve left it until now to look into what are crucial issues!Ok, time to step back & take a deep breath. SMARTMONEY is looking for a home to live in if I understand the question. What we have here are a stack of suggestions to buy in rough as guts areas where houses could be bought 18-24 months ago for under $100k! The only thing that has changed in these areas leading to price increases is speculators chasing big capital gains have bought in. Remember, “when the only fundamental that matters is recent capital gains, that is the very definition of a bubble”.
My advice would be:
1) find somewhere nice to rent for around $250 per week. Believe me, you’ll get somewhere nicer for that than for a $220k mortgage.
2) put $230 per fortnight into a high interest (secured) savings account. This is the amount you will save by renting over buying.
3) in 24 months time, take your $13,000 in savings and put that into the purchase of a house. Those ordinary houses in ordinary suburbs for $220k will then be priced at $150k or less, so choose one of them or pick a house in a suburb with a current median value of $350k – there’s your $234,000 house of the future!Cheers, F[cowboy2]
1) The accountant will be best able to advise you.
2) Carry a tissue or two.The link is broken.
I think this is itOriginally posted by MichaelYardney:the article including Frankston South (a drop of 19%) an area mentioned in a number of posts in this forum.
Well, if people on this forum are buying for 19% ‘BMV’, the market value for those properties has fallen by 19% which inevitably drags down those neighbouring…
I don’t think any indidual property in Frankston south dropped in value by 19%, if so we should all go out and buy a few.Or we could just wait a little longer and buy a few when they have dropped another 19 percent![biggrin]
Originally spun by The Herals Dun:Property growth has slowed to a crawl across Melbourne: house prices rose by a minuscule 1.8 per cent
So even with the REIV massaging the figures they still ended up with a loss![blink]
Cheers, F.[cowboy2]
[blush2]
…providing the investment property in question was not purchased prior to June 2000 and the investor has NEVER lived in it.
What a brilliant article by Clive Hamilton! The thing I find amusing is that the very cause of rising interest rates is the irresponsible behaviour of such individuals!
Cheers, F.[cowboy2]As I understand it, should you default on the loan repayment and the house be sold during ‘recovery action’ by a lender, the first mortgagee lender may make a claim on you personally for any shortfall between the sale price of the property and the amount outstanding, up to the priority amount.[blink]
The reason it is higher than the mortgage amount is that it includes all future interest payments.
Of course, I’m probably wrong again!Cheers, F.[cowboy2]
Hi Scarlett,
Plenty of valuable UK information:
HereRegards, F.[cowboy2]
Yes absolutely…[blink]
And my point was invalid because?
Cheers, F[cowboy2]
BTW Somebody has already ‘prospered me’, and it wasn’t ‘God’.Hi Lady24,
A few things –
1)if
‘The house is in need of major repairs and is structurally not worth the huge costs involved in fixing it doing this – quoted at about $100,000.’
then I doubt that with moving costs, connections, purchase of new land, permits etc,
‘move the old house to a vacant block in a country area where a few upgrades such as bathroom and kitchen paint etc will enable it to be rented – total cost being about $70,000’
is a reasonable scenario!2) $150k (business) + $480k (home) – $195k (mortgage) leaves you with $435k minus selling costs. You appear to have factored $600k into your options – probably best to go with the lower figure.
3) You are not going to see 2 ‘property cycles’ in the next 18 years if by that you mean two periods similar to the last ten years.
If you have your heart set on property investments as the only way of reaching your financial goals, I would suggest buying one for starters and gradually adding to your portfolio over the years. This will ‘dollar cost average’ your investments, and avoid the dangers of maximising your debt levels at the peak of a booming market.
Cheers, F.[cowboy2]Oh golly. I find it interesting that the UK is in such a similar state to ourselves. I notice you’ve said that we may be ‘6 months ahead of the UK’ – why do we only ever hear stories in the media of flat or stagnating house prices?
Out of interest, have the Brits lost their passion for renovation / auction / developer tv shows? I notice that despite the return of ratings season these shows have evaporated here!
An interesting find. Thanks for the link
F.[cowboy2]
