Hi stupid question but what is the “mega conference” ???

Umm you planning to live in the home and is it your first property purchase? The government is giving FIRST HOME OWNERS who live in the house the grant not investors.

Re sunbury there are currently 96 houses available for rent (according to realestate.com.au within the suburb with plenty of these houses being brand new! )

We have our family home in Caroline Springs because when we decided to get our PPOR 10 years ago the land was cheap and the facilities planned were fantastic and we got to build what we wanted. Having said that I would not buy an investment property here. Like sunbury and a lot of new estates there are plenty of houses on the market for rent. Caroline Springs has over 100 houses available for rent right now!

Your CF+ calculations assume you will find a renter on day one and it will never be without a tenant! With another 96 vacant properties for rent that probably wont happen without reducing the rent to below market which then might not make it CF+

If you want CF+ forget Victoria because you wont find it. Seems QLD and to some extent Tasmania are the main areas offering CF+ potential investment but these areas are actually having negative Capital Gain at the moment as well!

Hi this is my first post here but I have just finished putting in an offer for a house only yesterday so thought I would share my experience and probably more questions for you! We had a similar dilemna in what to put at a starting point as well!

The place we just got literally yesterday was as follows:

Went on the market on Monday 26th March 2012 for $345K.
Went for an open for inspection only yesterday Saturday 31st March 2012.
Put in an initial offer of $340K they came down to $344K and we went to $342K with the condition of the timeframe for building inspection to be increased from 7 days to 14 days and extended the subject to finance condition by a further week.

Only 12K under offer price but well within what we were willing to pay.

What I did between the property being listed on Monday and making the offer on Saturday was as follows:

1) I subscribed last week to Australian Property Investor Magazine after buying a copy last month! It came with three months free access to Price Finder which is a valuation software.

2) Put the property through the price finder software which actually valued it at around 380K straight off. When I did comparable sales it increased the value up to 395K.

3) I then cross checked my valuations with a property profile provided by my bank which came up with pretty much the same figures!

3) Based on the price finder valuation it seemed that even at asking price was a good buy. I had decided I was prepared to even pay asking price but obviously wanted to get the price down if possible.

4) We decided to go for a quick kill rather than wait just in case someone else realised the true market value of the property!

5) Researched to “discounting rate” for the area. Discounting is at around 6%. But this is really a reflection of agents generally overpricing the properties and factoring this in!

6) in the end we were going to use the line of ” well your asking for 354 and the discounting in the area is roughly 6% so we will offer $333K to start which is the discount for the area” However after inspecting we decided it ticked all boxes and thought well I have said I want to pay $340 so lets put that in to show we are serious. We only ended up paying 2K more than that to secure it and achieved extended timeframes for building inspections and pest inspections and finance final approval.

As its an investment we were also happy to accomodate 3.5 months for settlement as the agent wanted to marry up the settlement of this place with the new house they bought. It then gives us plenty of time to get a tenant in from day one!

The issue we had was do we go in with a soft offer or do we go in with something close by to what we wanted to pay. We decided to go in with close by. Being only listed if we went to far down then the seller would say lets wait and see. Getting close made them realise they can get it sold within a week of being listed.

From the above have you:

Actually checked what the market value of the property would be or as you say you “think” it would not be worth more than 480K. I based ours on facts and numbers and not on gut feel. Have you done an independent check (through price finder or similar) on what the actual value of the property is?

Have you checked the discounting for the area?

Have you checked the average number of days properties stay on the market in the area?

Being a new listing means the sellers are more than likely to take a wait and see approach. If its been on the market already for a couple of months then they are more than likely to accept lower offers.

Also try to suss out the reason the owners are trying to sell and move away to figure out what there priorities are. In our example they had 3.5 months to 4 months before settling on a new property so if we didnt go in with a serious enough offer they would take the wait and see approach. If however they were after a 30 day settlement or something then we would of gone in with less knowing they are looking for a quick sale!

Australian property investor lists all the average days, discounting etc in the back of the magazine each issue.