Kay
I too agree with you about admiring the English as a second language peoples attempts to speak our language. This is not the issue for me. The issue was about some people seeming to deliberately place a different meaning on some of their posts in order to (in my opinion) avoid answering the questions asked of them (much like politicians do). They play dumb in other words when they know quite well what they are saying.
Secondly, although I admire these people trying English, this is a serious investors forum and not English classes.

Like another wise person on this website once said

“If you are going to invest in a one horse town, you had better be very sure the horse doesn’t leave”

That pretty much sums up my thoughts too. I agree with Derek and prefer larger towns/cities.

PI is a specialised field. Some people think they are experts at it and do there own research. Others rely on professionals to do the research for them and advise them. It is not ridiculous to expect that the banks and solicitors to look after the interests of their clients with regard to valuations. It is clear from these cases that the banks (especially Westpac and ANZ) are guilty of unethical conduct here.

Furthermore, the constant pushing of RE as an alternative form of retirement income is fraught with danger and has seen too many people concentrate of this asset class when traditional avenues like Super are much more suitable for most people. It is understandable that many people are upset at the poor performance of super funds and that fact that no matter how badly the fund performs, they always get paid. This must change over time to a model that only rewards the funds and fund managers based on results. It is something that will be resisted but the change is inevitable. Once this occurs, more peoples hard earned retirement savings should be better protected and more suitably invested.

Just to be on the careful side, I suggest you get a building inspection to determine what work needs doing and how much it will cost. As a landlord you have a responsibility to provide a safe environment for your tenants to live in. If the roof collapses and you knew beforehand that it was infested, you would be in deep strife. Insurance would not cover pre-existing situations like this. If the place became unliveable at some point, your would have to put up your tennant in alternative accomodation etc. at your cost. If however you get an inspection that says it is safe for another 12 months and keep getting one every 12 months, the liability should be shifted to the inspectors PL insuance. So factor these inspections and ongoing treatments into your CF calcs.

Not wanting to disappoint with regard to doom and gloom – here goes..

I think interest rates will rise to 9 or 10% and that will happen over the next 3 years. I expect that terrorism will increase now that Israel have moved onto the offensive. This will affect world stock markets and thus people will want property instead of shares to form the backbone of their retirement portfolios. This is however only worth doing if the supply and demand equation is right and one gets a reasonable yield and CG at the end of it. If the large developers continue to flood the market with new projects, this will put a huge question mark over the viability of property as a retirement instrument. An large oversupply of IP’s is my prediction and this will push yields down. At the same time prices of property need to drop by between 20 and 30% on average to return value to this asset class over the longer term. This will then in turn push up the yield if rents remain stationary. This is a complex question but I suspect that the analysts who do this for a living are probably right in the statements that it will take 10 years before another boom. It may be hard for some of you to accept but the boom is over! The downturn will probably last longer than you would like it to, no matter how much you will it not to!

People seem to forget that the government is only meant to be a custodian of our money and that they work for us and therefore we are their bosses. They have a form of arrogance that makes us think that they are in charge and that they will push us around and tell us what is important to us. This is totally wrong and Geoff Kennett found this out when people in Vic decided they had had enough of his arrogance. Maybe other Premiers also need a wake-up call. I also believe that the Libs need to be given a rest at Federal level now as they are also too arrogant. I am getting a little sick of Costello’s smug little smile when asked about things like taxes etc.

I totally agree with teabagted especially the sentence “Too many silly, trendy people paid too much for their properties and created an expectation among their neighbours”

I agree with Bruce, dont count on the higher yield from uni students. If renting to them becomes too arduous and you opt for a “normal” renter your yield will drop to the average for the area (250/w). Based on this yield I would be working out what the highest I would pay would be, say $250K to generate a 5% return when getting 250/w rent. You may feel it is worth the extra headaches having students renting and therefore pay more but I would not. I have rented to students before and as has been said, there are good ones and bad ones. One thing you can count on is that they are always changing as they graduate and move on. I would say that unless you can get the property for less than $300K, forget it. At the high asking price, your chances of CG are also not too good in the short to medium term.