Forum Replies Created
Interesting times ahead. When this all started to happen I also believed that the the Brits would not leave the EU, but the more and more I spoke to friends who are living in Britain both (expats and lifers) the more and more it became that I thought that they would leave the EU. The biggest complaint I heard were the social issues. Many Brits have experienced the crime rates in their communities rise, they became more and more zenophobic (especially with all the fear around terrorism) and mostly they believed that their everyday lifestyle was being undermined by elements they could not control. For many Britons this was the first chance they have had to say what they want to happen in their country on these social issues and so many of them took the chance to have their say in order to get change.
I think LaTrobe Valley is just like investing in any area as long as it suits you and does the figures for you. I know lots of people in the Real Estate business say "Dont use negative gearing" but if you earn over $120,000 a year it can make "tax sense" to do it as long as it is not a long term condition and you DO NOT over commit yourself. But if you are on a not so high fixed income you need to do your sums carefully and as much as possible make it cash flow positive.
First work out how much money you have to spare to fund your investing, how much rent you can get for various houses and how much your loan payments will be. With loan payments remember most banks and credit unions take the monthly payment and divide it by 2 and that is your fortnightly payment. NOT divide by 30 days and times by 14 etc. Trap for newbies with some calculations. Add rates, insurances, water and at least 5% for maintenance and as much as 25% depending on the age of the house. Buy in a good area as much as possible or in a fringe close to a good area. Try and pick which areas are going to be "gentrified" next. This is happening alot in West Traralgon, and Middle to east of Morwell. There are some areas to avoid in Morwell and in Trarlagon. I wont tell you which areas, you need to find a good and honest agent. And there are some here to avoid. PM me and I can give you an idea of who we deal with.
That being said. REMEMBER – How you treat your house (ie its condition upon rental) is the "Highest" your tenant will treat it. If they see clean painted walls, nice carpeted floors and neat gardens they will more than likely keep it that way. Rent your house out looking like a mess and thats legally the way they can give it back to you on cessation of tenancy. ie in the same condition as commencement of tenancy. When an agent walks through your rental property and sees that it is nice and neat, they will find you a comporable tenant if they are a good agent. Lousy walk through and you will get a lousy tenant. If the agent sees you care then they will more than likely care. We allow about $5,000 for each house we buy in order to clean it up, replace floorings and paint etc. This is on a house valued at about $110,000 in LaTrobe. We can then usually rent it out for about $160 – $180. It takes a lot of hard work to find a $100K house but they are out there. And these are at least 3 BDR's. This does the figures for us okay at the moment and in our particular circumstances. You need to do these figures for yourself.
We are holding onto these properties that we have and then we will vendor finance them down the track. Like I said, your investing, needs to suit your circumstances and plans. When you buy a house you must see its life whilst you own it and what you are going to do with it to the end. ie buy and hold for capital appreciation, rental, or vendor finance or a mix of either or.
Before you buy in LaTrobe valley do some research and come down here for a holiday and see what you think. You dont have to like the area – just see if it suits your investing purposes. When your investing career takes off it will be less important to see an area, staistics and numbers will mean more to you. But whilst you are learning it is important to get your feet wet and soak it all up. Liaising with agents can be hard and so can just finding your way around a new place. Its all fun! I would do it if you can and LaTrobe Valley seems to do the numbers well at the moment.
Hi Tamar,
Thanks for your response. I will contact Julie pronto.
I am glad to hear that my internet search skills have not gone by the way. I loooked and looked and looked. In the end it was sending me a bit mad.
Once again thanks.
Karen
Hi Tamar,
I have been looking on google and other places like that so I can find an internet site for the Vendor Finance Association and I cannot find any information on them. Do you have a URL or some contact information so that I can contact them?
Cheers
Karen
Also do you know if they have meetings in Victoria at all? – Thanks
Hi
I always believe that the things women look at the most when buying a new house is the kitchen and bathroom. Hands down – these matter the most.
I have learned this not only through buying and selling for investment, but personally as well.
Use second hand and/or auction places for your tiles, whitegoods etc. Look up on the net or maybe in the yellow pages. Most times you can save 30 – 50% on RRP. Then there is always the neighbourhood newspapers. Alot of the times you can get an old kitchen for nothing, all you have to do is remove it.
Hope this helps.
Cheers
Hi
I believe that most people understand the need to commune (spend time) with many different people and groups in order to keep yourself feeling fulfilled in life. Dr John Gray clearly explains this principle in many of his audio and written publications – how necessary it is for all of us to experience the many forms of “love”. These range from the love of a “close someone”, to that of your children (and/or pet), and other like minded groups. These like minded groups range from your footy or sporting club to that of an investment club. Human beings also have the need to “feel loved and respected” by their same sex. This verifies that how they are acting is not only socially acceptable, but in line with “who they should be” in the scheme of their lives. A good example of this is how uncomfortable we may feel in a new social situation. Until we learn the “accepted rules” for that group we are unsure of how to act”
Groups such as Womens Only investment groups, allow women (and men if they choose) to be less guarded in many of their actions, as they feel somewhat secure within a same sex group. I actually believe in the right for both males and females to have their own separate spaces, whether it be at the gym, or Lords. Plus girls we can all atest to how good it feels after going to the pictures and having a good coffee and cake afterwards with our best girlfriends. We fell happier just for basking in the love of close girlfreinds and spending time with them.
Groups such as this can only serve everyone better. I have no doubt these women go home and talk to their partners about what was discussed, thus its great for everyone. I’m all for it.
And guys, why don’t you start one and have a guest speaker from the women’s group and vica verca?
Cheers
HiWorst luck papers such as the FinRev are in a hard position with this one. I was in the publishing/media industry for eight years and found out very quickly that we could not stop sleazy dealers such as this access to our advertising services. Basically, unless these companies did anything wrong to us (ie not pay their bills) we could not stop them advertising. As a business owner it really peeved me that some sleazy operators were using me to rip people off. I knew of three operators and could not stop them advertising. I did all I could by increasing lead times and payment dates, but most of the time these sleazy dealers know their rights better than the honest people around.
You did morally right to name this past company and if you can prove your claims then it is not either libel or slander. The problem is that there is always some operators who will bleed you dry with expensive court cases that see you lose your wealth and they steal from people to fund their bogus claims. They are able to pay til the end and you have to drop out due to lack of funds. Be wary of what you start in order to protect yourself. Talk to your partner (if you have one) as they will be impacted by what you do and say. There would be nothing to worse to lose the relationship that most probably held you together through this trauma by a few not to well thought out remarks. Plus it sounds like the real fujn is just begining if you are making a formal complaint against them. But remember – At all times protect yourself and those dear to you!
Also DO NOT FEAR SHARES. They are a great way to build up wealth in order to buy investment properties. Maybe save a bit and stick to the Top 10 or 20 on the ASX if this is where your psyche can sit most easy. Buy a book on technical analysis (share trading technique) by Louise Bedford, Daryl Guppy or maybe Christopher Tate. And learn to buy when they might be at a bit of a low (don’t try and pick the low) and then sell either at what you think is a good profit margin for how your psyche is feeling, or just before the high. No one can pick the high and the low all the time so don’t try that. But shares can be an important part of a wealth building strategy.
I suppose what I am trying to say is “Don’t let this sleazoid rob you anymore!” Your future is waiting for you to grab it!
Anyway I am preaching and this is getting longer.
Hi Guys,
Really interested in a group in the Albury Wodonga Area. I live about 2 hours from there but it is my nearest major centre. I only have internet access at work three days a week and I check the boards reguarly. But if there is another meeting I would appreciate it if someone sends me an email. Not that I am abregating responsibility, I would just appreciate it. Thanks heaps!
I will now walk around with a bounce in my step all day; its exciting!
Cheers
HiI get most of my information from the internet and newspapers due to where I live.
Living in little country towns for the last 20 years I have learned that without a council that is progressive little towns stagnate. Pay close attention to a huge shift in change of coucillors at local election time. A country town will progress and new development applications that were previously denied (such as Harvey Norman, Big W, Franklins etc) will be approved when there is a major shift in local councils.
The main reason for this is that many local councillors protect their own financial interests (as they own most of the shops on the main street etc) and they want the money their daily activities bring them.
Secondly study the demographic of the area. If the area is mainly blue collar workers like tradesman (look for the utes and advertising on the cars in the driveways) your market will be different to that of doctors and lawyers etc. The Bureau of Statistics publish their information on the internet. You may have to pay for some reports but these will be specific and in depth.
Go for a Sunday drive around some areas if you have the time. Walk up and down the shopping isles. Pay attention to what is on the shelves and in the trolleys. Just what kind of cars are people driving, what kind of toys are people giving their kids and what is in their trolleys. All this makes up the psyche of the person you will deal with in this area. Whatever we do in this business is about the person, not the real estate.
One last piece of advice, go to Harvey Norman internet sites, RetraVision, Woolworths/Safeway, KMart, McDonalds etc. Where are their new stores going? They spend millions on making sure their newest franchises will last. If its good enough for them then it’s most probably going to be a winner for real estate.
Oh and don’t forget gossip. Long before it comes into being, someone who doesn’t want it to usually tells someone else who tells someone else and eventually the newspaper gets hold of it and whammo gossip has become a huge story in the local towns newspaper and that newspaper is own by another bigger company etc etc. Where there is smoke there’s fire. Its not too much hassles to keep your ear to the ground and listen. Plus the human animal is at least 9 times more motivated by emotion than fact.
I have heaps more that I do when making a decision on where is the next best thing, but these are just some of them. And remember most people don’t mind driving about half an hour to work so explore at least this wide from a major country centre.
One last phenomenon that I have just recently wittnesed and will most probably not happen until the next economic cycle – When housing prices in Sydney exploded many young families (and it could have been retirees) took the opportunity to move to country locations such as from Sydney to Tamworth or Sydney to Coffs Harbour and Port Macquarie. You know places about 6 hours from Sydney. They bought houses that cost about a third of their Sydney home, did renovations and now have 50% of what they sold their Sydney home for in the bank.
As a real estate investor, if you can pick when the money is going to move from Sydney and Melbourne and other capital centres to country locations and buy before this, there will be $100’s and $1000’s of dollars in capital gains to be made.
This is just some of thie information I have gathered. Anyway hope it helps.
Cheers
[gorgeous]
Hi gazzasliquor,What a huge question. I think you need to find a really good accountant and legal advisor, get heaps of information, with lots of finacial scenarios and work out what will best suit you for this time and into the future. You may find that selling the Sydney house, although giving you the most available $’s, is not the best idea as it is giving you your best return on your money. Or that your best gains are made by selling two of the other IP’s. The numbers have to be worked to get a better picture.
I know this sounds wishy washy and not a great deal of concrete advice, but I believe you really need to work out just where you want to be in say five years time and work back from that.
Do you want to retire then or keep working? If you own a business, do you want to be able to hand it over to someone else to manage and maybe start another business? You have to answer all these questions first and then work back to your current situation with your future goals in mind. Set goals and time frames and keep a copy of it where you can see it.
Before you make any major decisions see if you can get along to one of Steve’s MasterClasses. They are coming up very soon. From there see if you have the mindset to do what is required to be a property investor. You may decide that your wife is the property investor and you would rather keep doing what you are now. Or maybe you want to be one half of a working relationship with another investor. The combinations are endless and going to one of Steve’s classess will get you in touch with like minded individuals so as to help you formulate a plan for your future.
A word of advice though. We all know the property market is cyclical. There is already rumblings that these current high prices will not last too much longer. Plus I believe that we will see a rise in interest rates in the second quarter of this year and by March next year maybe a full percentage point increase. (DO NOT TAKE THIS AS GOSPEL – THIS IS MY OPINION ONLY) Over the next 5 – 7 years money will get tighter. That in itself will be a good reason to lighten the liability load.
Anyway, it sounds like you already have a strong financial base to work with. I hope it grants you and those you love many years of happiness and joy.
Keep us in touch.
Cheers
[gorgeous]Hi jazpo
Getting funds will not be a problem if you have the right deal. A lender will see the positive cash flow and gladly give you the funds. But I dare say that the lender will not be the every day run of the mill bank/credit union etc. You may have to go to a Mortgage Agency or Broker to source these funds. A quick search on this site and through google etc will more than likely give you some good results.
It is important when presenting your investment property deal to the lender that he can see that you have crunched the numbers and allowed for all contingencies. This will prove that you have financial nouse and are well aware of the costs in purchasing and maintaining your investment property.
When you crunch these numbers include a current financial postion, ie $90K mortgage, payments and income, and then $290K (?) mortgage payments, income and investment property income. When seen side by side your balance sheet with the investment property should be more cash flow positive.
It is also wise to include notes such as opening a new account specifically for IP income etc, this way the lender sees that you are not comingliging (putting private and business) funds together. Open a separate account for each IP so that separate IP funds are not comingled. There are many reasons why you should do this and it is best to speak to your accountant and legal advisors for a better rundown on this very important information.
As far as cash on cash return, or COC as you may see it sometimes, it is all about the velocity of your money.
Say you buy a house for $150K. You put a $10K deposit on it and pay $5K in legal and closing costs. Your total input into that IP is $15K. If you recoop all that $15K in the first 12 months your COC is 100%. If it takes 24 months then your COC is 5%. Conversely if it only takes 6 months to get your $15K back then your COC is 200%.
I have created spreadsheets to work out all of this and now I only put the basic numbers in and the computer works out my COC. This way I can keep a record of that particular property’s fundamentals.
Anyway I hope this helps. Remember to think outside the box. Buy the newspaper on the real estate day, this is usually Saturday, and most of the brokers advertise there. Start a scrapbook to put all this information in. Don’t try and hope you will remember all this. As your progress as an investor there are more important things you have to remember.
Cheers
[gorgeous]PS I hope this posting works – its my first
