Forum Replies Created
There are many different types of investment properties.
Hotels are consider as commercial property as far as lenders see it, so they would lend 50-70% LVR. Only some can lend up to 80% but many conditions apply.
The good part for Hotel investments are they offer fantastic incomes, so your yield could be very high depending upon the occupancy levels and room rates (as they are seasonal). Most Hotel operators would do a income split with you, eg 60/40 or 55/45. eg if you get 4 nights occupied for $300 per night, thats $1,200 for that week. say the Hotel takes 50%, you'd still have $600 income that week. So compared to a normal 1 bed apartment, you migh only get $350pw.
However, there are risks involved, they could be high vacancies, or low room rates. so this is not the best for someones first property, as you do need to have more funds and be able to ride out the seasonal rates/occupancy levels.
Just like anything, HIGHER THE RISK, HIGHER THE RETURN.
If you're starting out for your first property, best save a 10 to 20% deposit and buy within your means. but do take action and buy!
Good luck!
Eric
Homersyd,
Good on you that you've bought your own property! Syd market is tipped to increase in a big way in the next few years! BIS Shrapnel.
About your next investment property, you'd need to have at least a 10% to 20% deposit. Either in savings, equity in your home, or family/friends loan. Also there is a creative way if you have enough super saved, you could self manage your own super and use that as a deposit and lend the balance?
Obviously you should consult a financier and they can assist.
If you would like someone to see you in Sydney, I can refer a property investment consultant to see you and help show you how to obtain your next investment.
Eric
dbliss,
Hindsight sure is bliss… sad to see how your husband feels about the property market…. many thought the same about the FHOG, last year many people bought their home…. while others speculated that the market was too high and would wait for it to end thinking the market would drop. It did not. It actually increased to everyones dismay!
Like it or not, Australia's population increased last year over 400,000 people (ABS), and now our population is over 22,000,000. Land is still not supplied enough. Lenders are very tough now and not lending easily to developers… so their will be a massive shortage of property. Demand is growing yet limited supply.
BIS Shrapnel is predicting double digit growth over next 3 years for Australian cities.
Eitherway, I'm not selling…. in fact I may look for more opportunities and buy further.
Buy and hold for long term, you can very go wrong I was told when I was 16. The gentleman who told me this advice had 11 investment properties then.
Up to you… you can think about it…. while others take action and invest.
Eric
dbliss wrote:Hindsight is a wonderful thing!! I was keen to buy last year…but my hubby insisted that we wait until the end of the FHOG…prices would fall he said….hmmmmm………still waiting for THAT to happen!!fWord,
Indeed, good for you you purchased last year, Dec qtr RPdata reported strong growth.
The Australian Medium is now $470,000. Last 12 months property increased in Australia 11.6%. Not bad in a global financial crisis and most developed countries in a recession.
Australia was once of the few countries that increased its interest rates 4 time over the last 5 months. Yes, this is hard on Australians, however investors are the true winners here, rents have increased still.
Most economists and experts have been shocked to see the strong property growth last 12 months, and still expect further increases this year.
Either way, seems that property is defying the opinions of most.
I just bought another property this month. Indeed we saw many people at inspections and property are moving fast… still.
fWord wrote:Heheh…I was reading the first post of this old thread and thought to myself that hindsight is a wonderful thing. If I had bought anything, ANYTHING at all during Mar/ April last year instead of sitting on the fence waiting for property to collapse, I would have made lots of money by now. During that time however I indulged in dinner conversation about the potential crash of the property market considering the abysmal share market conditions around the same period, a mistake indeed.I wound up buying something in August, under the fiery heat of incredible competition, probably overpaying in the process just to get my first home…now perhaps THAT was actually the wrong time to buy because interest rates started to go on the up and up soon after settlement.
Yes, hindsight is a wonderful thing.
Eeyore,
Yes I can, I have a few properties with her.
Helen at Empire Rentals (07 3841 0988) fees are 7% plus gst, if you let her know that Eric referred you, she might be able to give you 6% plus gst!
Good luck.Hi Deidrea8,
Thanks, very interesting website indeed.
Hows the market there now?
deidrea8 wrote:To the original post: We have a local real estate agent that posts reports on our local foreclosures/short sales and other general buying information like prices and so on. She posts them on her site (http://www.maryfloyd.prudentialgeorgia.com/) and her blog and I use it to keep track of the value of my property. I think that this is a valuable resource because it shows the reality of what is happening to houses around mine.Hi Clkhoo
I understand that it seems hard to see properties increase to $1m in time, but we need to be aware of inflation as well. so if properties do become average $1m in time, then average incomes would also be equivalent.
everything is relative. best compare 20 years ago, what were properties worth? what were average incomes? cost of milk ? etc.
and then do the same for todays costs. In 20 years then, income would be average $100,000 and a car might be $80,000 to $100,000 as well. Milk might be $20 a litre?What about what London has proven for the last 1000 years?
Food for thought….
clkhoo wrote:The argument about doubling in house prices based on historical trends may not go on forever.Like everything else it's easier to grow from a low base, e.g. from $50K to $100K, but if its from $500K to $1,000K it is more difficult.
Imagine the next level of doubling from the current median of say $600K…we're talking about $ 1.2m, then what $ 2.4m?
Guess what level of repayments for $2.4m….does one's salary double every 7-10 years as well when one reaches the peak of one's career? Just look at average salaries and you'll know what I mean.
Yes, exceptions do happen, but they're exceptions!
Hi all,
Did you know that Brisbane properties in the lower end (below $450,000) have actually increased in value of 10% over the past 12 months. (Mutusik Insights).
This is the area that is doing well throughtout Australia, not just Brisbane. Obviously the higher end is the area where most are not buying in volume now. Hence, great buying opportunities in the lower end.
Eric
Cargill,
Sorry, too many comments, I'm just trying to respond where I can. Better than no replies.
Cheers.
Eric
Badger r us,
Once again, I've never met you, nor you meet me. How can you make a judgement on someone you never met?
I have not said anything towards you at all.
I do thank you for your comparison of me to Tony Robinson. This is a major compliment as he is one of the worlds most successful and powerful coaches. He has encourage millions of people worldwide to change their lives for the better.
I am only a simple person trying to do extraordinary things.
If everyone only had positive thoughts and not negative, the world would be a much brighter place to live in.
Whatever happened to live, laugh, love, smile, give, encourage, gratitude, thankfulness etc etc.
I seriously do hope you really have a pleasant day. its your choice, good or bad day, its your choice.
Cheers!
Eric
WJ Hooker
Can I ask you a question?
Do you believe property increases in value over time?
Eric
Ajay
Prices of residential property have proven to increase in value over the past 60 years in Australia. Obviously incomes were much lower back then as well, the australian dollar was different and rental were different.
But its all relative.
Incomes have also increased to since then, today average inome based on ABS is close to $60,000 now.
Also inflation plays a part to the dollar value as well.
Again, everything is relative.
Pertol prices used to be only 59 cents a litre years ago now over $1.20 a litre.
A litre of milk used to be just $1.00 and now well over $3.50 a litre.
So, once again, everything is relative.
If you're talking about property, how can you justify a property in central New York worth over $1,500,000 US? or London $1,200,000 pounds! Sydney prices are already well above $2 million now is central locations.
Compared to what? compared to who?
Eric
Reece,
Great to see you are looking to buy a property, please do see a financier to see how much you can afford first. If you can buy it on your own then great, go ahead.
In regards to buying with a friend, this is good in theory but may be challenging in the future. You may wish to seel and buy something else, they may not agree. Your friend must have the same goals as you do and have a strong arrangement, even in writing. Only you will know if this is a good idea of not.
On the question of unit or house, well this then goes to your own situation fincially. Rents are very strong in Adelaide city at the moment as there is not much available. Homes have done vey well over the recent 3 years as well.
If you would like someone to see or talk to, I can refer an investment advisor in Adelaide that you can talk to for FREE advice.
[email protected] ask for Ilvana. She's an investor and very passionate about property.Hope this helps.
Thanks.
Eric
WJ Hooker,
DARWIN grew last year 10% for houses 17% for Units – Matusik Property Insights.
Eric
Badgers_R_Us wrote:Hi Eric!
Super great to hear from you. I bet you are a really super guys who's really great. Great! Love all your ideas – great, super, AMAZING. You must be a really good guy, and great as well . And I bet you'd be great at anything you do. Super.I'm sorry Eric but have you been lobotomised and had the bit removed replaced with a super Tony Robinson happy chip of some kind? Being +ve is one thing, but it sounds a bit fake mate. "I bet you are a great mother" good grief!
Badger r us,
Im not sure where you're going with this, but I'll tkae it a s a compliment.
Have a SUPER day !
Eric
PROPERTY FUNDAMENTALS
1. Australia's Populations (now 21,700,000) is growing both local migration and International Migration.
2. We are not building enough properties (both homes or units/apartments), there is a major under supply of property.
3. Rental Occupancy rates are at historic highs at 98.5% ( or 1.5% are vacant) in most capital cities.
4. Rental prices are increasing, now Australian average is over $350 pw and rising.
5. Employment is at 95% (5% unemplyed)Like it or not, we all need a place to live in, either rent or own home.
Last year we saw properties rise at 11% even in tought circumstances, unit/apartments rose 17%. Some suburbs grew a lot more than this.
To get the best pulse on the market go to inspections, either rentals or buying. There are a good steady flow o f poeple looking at renting and buying right now.
If everyone just holds their ground, be confident that things will cool down over the next 6 months to 12 months, and do not panic, we will see a steady market/economy once again.
Eric
Over the past 50 years in Australia, there have been a number of recesions (state or nationwide) and the property market NEVER CRASHED, it was proven to either hold it value and went sideways for few years, but never dropping to $100,000 or $0!
LONG TERM you cannot go wrong with property.
Eric
Matt,
So you made money in 6 years!
If it was a brand new property.
If it was new, good qoulity and design, either a 2 bedroom apartment or 4 bedroom home, good location, close to schools and shopping centres, public transport, Im sure it would have been ahigher price to buy, yet also worth more as well.
Look at Port Melbourne, Docklands, Toorak etc. Higher pirce growths, vs Craigeburn or Melton etc… lower prices.
Everything is relative, the closer to the city, the more demand hence greater chance of faster growth.
What if you didn't sell? what if you used our strategy and leveraged to buy other property? how many would you own today?
Eiterhway, buy and hold long term is the way to go and prosper!
Eric
Matt,
That great, do you still own it?
If so how much is it worth today? Have you made your money?
Eric
Daniel,
The FHOG most likely go back to $7,000. For the new homes, I believe they will continue that, our economy needs it to sustain housing demand and inject money back into the economy.
Eric
Super great to hear from you. I bet you are a really super guys who's really great. Great! Love all your ideas – great, super, AMAZING. You must be a really good guy, and great as well 
. And I bet you'd be great at anything you do. Super.
