Hi Mikko,

How quickly do you think  you can pay back the credit card debt?

Cool   Remember to insure the buildings but also "some" contents (ie floor coverings and window coverings).  You also need landlord insurance with tenant protection (ie to cover rental default, malicious damage etc).

Hi Sandrae

Rather than become an expert at such things yourself, it's far more efficient to simply leverage a pro.  Why not contact Terry and have it all sorted out in a jiffy.

When I analyse a property, I look at :

Property Management fees

Water bills

Council rates

Insurance

Gardener

Strata fees (if applicable)

Annual maintenance allowance

Annual vacancy allowance

Mortgage interest and fees

Depreciation allowances

Negative gearing if applicable

If purchasing inside a SMSF I also factor in:

Annual accounting and ASIC fees

Death & TPD insurance covering SMSF members

Member contributions

I factor in annual price hikes for each of the bills, as well as rent hikes, as well as factor in the offset account balance – so I can see when a property will be paid off (ie when the balance in the offset account is equivalent to the original loan amount, and therefore the interest payable becomes zero)

I also take a look at the whole portfolio as an aggregate (all totalled up together) to understand what the overall picture looks like (eg one property might be cashflow positive but becomes neutral if it is supporting) and factor in tax payable.  All that allows me to see precisely how much more property a person would need to acquire to eventually be able to live off the rent surpluses, and  when that magical day will arrive.

Hi Rick

Sometimes the best way is to get another bank to pay out the loan with your current bank and start again with an Equity Release Loan.  The "security" for the loan would be your current property (and ONLY your current property), but a big pile of money is provided to you in an "offset account" which you can use to fund deposit and stamp duty on an IP.  You then get yet another loan (with potentially another bank) to fund the remaining 80% of the IP with a regular residential investment loan.

Hmm I might have a crack at running for PM next time round.  I couldn't do any worse than those muppets have been!

Are you serious?  Wow.  In an equivalent type of property in VIC, council rates are $900 a year.  Water is billed separately by the relevant water authority, but water usage is perhaps $40 per quarter.  The privelege of being connected to the water and sewage system is about another $175 per quarter.  Even if this were all billed together, it still does not clock in at $2k per year.

You guys should move to VIC !

Few questions…

What's the story with this payment that's coming in April?  In other words, where is the payment coming from, what is it for, and how many dollars are arriving in the payment?

What are you doing for income (?Centrelink?) and assuming that the payment you are expecting in April helps you catch up, would your current income situation allow you to remain up-to-date with the payments?

Hi Sean

Welcome!

The fact that you are not based in Australia does not exclude you from buying property by yourself.  There is certainly no need to presume that the only path available to you is to plunge your hard earned dollars into a sharing arrangement with others.  Keep in mind that such arrangements give you less control (or no control depending on the setup) of the outcome.

Nothing at all to stop you acquiring properties that you and only you own.  Nothing to stop you renovating them to manufacture your own capital growth, and using that growth to leapfrog onto the next property.

Happy to chitchat to you about how you can make that happen without having to set foot on Aussie soil.  Feel free to drop me a PM (Private Message) which you can do by clicking on "Send PM" under my userid and to the left of this comment.

OK few things to say about this.

Firstly, everyone's rates probably went up at least 10% in the last 12 months.  My council put a sentence on the rates notice, explaining that the bulk of the rise was in the garbage removal charge, which is thanks to the cost of them taking your garbage to the tip, which is thanks to the Carbon Tax.

Secondly, I am guessing that councils in QLD are still trying to recover their towns from the damage done in the last floods.  I presume some of these damage repair bills will be paid for via council rates hikes.

Thirdly, the amount you are charged for  the council rates is related to what council declares the value of your site to be.  Have you taken a look at the valuation amounts on the rates notice, and if so, are they less than what the property would sell for if you sold it? Normally the council "valuation" is less than what you could actually sell your property for in reality.

If they have suddenly decided to "value" your property at more than it is worth, you might want to do something about it.  Did you know that you can challenge the valuation on your rates notice?  Contact council and ask how.