Hi Winzer.

This sounds like just the sort of property to get.  I have found similar situations myself in SA, where covenants had been put in place by the original developer to protect the 'new' development.  I did as a previous respondent suggested and looked for other properties that HAD been developed.  Then I knocked on the door of the developed property and asked them about how they'd gone about it.  They gave me the name of their conveyancer/landbroker, who told me that the original developer no longer existed and another entity had authority over the original covenants.  Apparently they were now looking favorably on subivisions, and she was able to handle the process for us.  You could try that approach and I wish you good luck.

G

Hi Johann22.

Previous responses have provided useful alternatives to complete new kitchens.  I just thought I'd add that if the cupboards are 600 mm deep (not the old-fashioned 450 narrow ones) you can replace the doors, kickboards and the benchtops, add new handles plus appliances and voila!! a new kitchen.  These suppliers are usually listed in the yellow pages separately e.g. kitchen doors, benchtops.  Another option that we used very successfully was a fantastic secondhand kitchen, not from ebay but from the shopper in the newspaper.  It depends on the shape of your area if this will be easy or not.  Just a note re. tiling.  If the walls are gyprock the tiles may come off with chunks of the gyprock, so it is a good idea to replace the whole piece, which isn't that hard.

Regards,
G

Hi Andrew.

I think it would be really beneficial if you read some quality literature to see what others have done to create a successful real estate portfolio.  Personally I like Margaret Lomas, but there are lots of others, all good and a book only costs $25!  Many are in the local library.

From my experience, it is a matter of buying things you can afford, in areas people want to live.   If you can do some work to improve properties that are a little tired, you can add instant equity in many cases.  You may also be able to buy something that is subdividable, e.g. a corner or 'header' (rear) block which can be sold to reduce your debt or to build on. Or you might be able to strata title something that is on one title. If you are not sure where to buy, it is good to look at areas that are alongside pricier suburbs, as they often go up also in due course.  If you want to buy in other states or country areas you need to do your own research and ensure that there are plenty of sources of work for tenants (reasons for them to live there) and that rental vacancies are not high, e.g. there is good demand for your property.  Local property managers can help you with free advice.

It can be very interesting to hear what property advisers say, e.g. 'the investors club' but ultimately you can gain the confidence to do things yourself, armed with the knowledge that you are cutting out the middle man.  I think this forum could be your best friend!  PS.  There are also free articles and statistics on specific locations via Doman and Realestate.com

Good luck,

G

Hi Anthony.

As a local I'd have to say anywhere within the Marion and Holdfast council areas, on 'the flats' between the beach, Marion Shopping Centre and vicinity.  It  appears to be a hot-spot for retirees and young trendies looking for a first home.  A lot of redevelopment is going on with blocks that can be subdivided, but things on smaller blocks and townhouses, units are still in demand.  There is fairly good public transport and train for city access, plus close to beach and southern access. You might get something around the $350-$400,000 mark that can be done up and sold again for $500 +, depending on the area.  West of Brighton Rd. is a higher price bracket.  Best to ask the advice of a few local agents first.

I have heard 'experts' recommending the closer city areas such as Torrensville, Mile End and Cowandilla (flight path!) but obviously the homes are older and may have extra hidden renovation issues.

Good luck,
G

Hi Ken.

Yes, I believe this problem relates to newer properties built recently.  When looking in locations such as Florida the advertisements refer to it as 'Chinese drywall'.  I assume a building inspection would rule it out?

Regards,
G

Hi.  We have a house in a holiday location and currently have it rented permanently, but would consider doing what you are contemplating in the future, so we can use it some of the time.  When I discussed the idea with the local agent they stressed the need to have it well appointed with furniture and fittings, but I assume it all depends on the market you wish to attract.

If you use the local real estate agencies, they will manage bookings for you, but take quite a high percentage of the rent (25%?) We know people who set up a website to manage the whole thing themselves, which I understand is now quite successful. I think the key was to have it linked in to other services in the area, so people find it easily when searching the net. 

I don't know whether it has to involve the council, but as far as claiming the expenses, I have been told that you can claim the property expenses for the period it is available for rent.  Therefore so long as it is advertised as available, it can be negatively geared, etc.  I guess a primary consideration is whether you live near enough to administer the management.

Let us know how you go, it would be interesting to hear.

G

Hi Ryan.

I am a former teacher and mother of four, from twenties down to twelve.  All advice so far is great, but I know you'll find that each child is VERY different! Hence, role model, play monopoly and teach delayed gratification with each one, and I am pretty sure you'll still get a different result!!  One possibility is that they may react against what they see their parents doing, whatever it is.  While my oldest is great with money and already investing, the next one sees money as a way of acquiring clothes and travel.  On a cheerier note, I realized she had absorbed a lot of useful knowledge when a boyfriend's mother was about to enter into a poor investment – she thoughtfully recognized the pros and cons.

The most interesting thing I can share are findings from research by W. Danko (I think, The Millionaire Next Door fame, someone will correct me I am sure) that discovered that (almost) no matter what occupation a person had, they ended up less financial if they had received 'economic outpatient care' (money help) from their parents along the way!!!  So I think the message there is to teach children to expect less, and to work for what they want.  It is very hard in this consumer society.

I am sure you will do well as you are already aware and interested.

G

Hi again Eva.

My information at the time was that the management company (Breakaway) take the unit AND carpark!!  I know my brother in law was paying $35 a week a couple of years ago to park in town, but sorry, I don't know much about that area .

CU,

G

Hi Eva,

We're in SA and I've looked at similar things.  This one looks spacious enough for someone to live/invest in beyond being like a hotel room.  The ones I investigated are managed by Breakaway and are located in the city west area (Hindley, train station, Uni SA, TAFE).  They also have car parks underneath (at least the 2 bedroom ones do) which add to the income.  I think there is one on RE.com. at the moment.  I don't know if anyone else has knowledge of them?  They are only about 15 years old, too  so maybe check that option out as a comparison.  They were possibly even better priced than the one you've found.  This time last year a 2 bedroom, 80 approx square unit with car space was selling for under $200,000.  I wish we'd bought it actually.

These are the type of investments you don't have to do much to, if you like that, but also that means you don't have a lot of control over them income-wise either, as the managers obviously take their cut first and you get whats left.  A downside is the lending, as the banks won't lend the same percentage on something let commercially.  Also, I believe you get a quarterly payment, so you need funds to pay your mortgage until that comes in.   I'd be interested to know what you decide.  We currently prefer things we can improve.

Regards,

G

This is an interesting discussion everyone, thanks.

Last year I got all excited about investing in America after seeing all the properties available on US ebay!  My mother and I thought we'd go in together, as it seemed for such a small amount of money, you wouldn't be taking much of a risk.  Then I got on to big auction sites and went as far as contacting one or two agents and property brokers.  It was when I started researching areas in more detail that I really started to realize some of the complexities.  For example,  there appears to be a lot of varying opinions re. section 8 tenants, not to mention differing laws, insurance issues and so on. Also, the areas that were cheap seemed to be so for a reason. I decided it was all too much for little old me!!

If this discussion can deal with some of these practicalities it would be great information.  It is great to hear how others forge ahead.  I can live vicariously through your experiences.

Thanks,

G