G’day again
Working flat out at mo, but will take a few mins out to give some detail, as I can see no one else is going to do it!
Ok, seminar centered around the following objectives:
1. That cash flow properties are not bought, they are MADE, and its all in how the deal is structured. Examples of this were given.
2. The Advanced 11 second solution was confusingly presented, but I think I got it right in the following:
Rental Yield % = Annual Rent/PP x 100
PP = Annual Rent/rental yield%
Navra put this one up also.
3. Steve’s approach when investing
– Multiplication by Division covered
– Velocity of money: Basically, how to access your profits as soon as possible (payback period), given your strategy, but sell if you need to, to fasttrack your investments and trade up.
4. NZ
– Dave, mate, what can I say. Sign me up to do a junket with Steve in NZ.
Basic tips from Dave:
– language used in NZ property, terms, etc
– NZ lenders only do 70% LVR
Appears that Steve and Dave are in market to sell their properties, and if you get an agents list, Im sure most of theirs would be on there.
5. Mappers key points, from their investing
– Its not easy….. its not easy….. keep going
– Lot of renovation and subdivision examples
– Great NZ tips from Mapper purchases, including real estate agent attitude and statements
– you can be $400K in debt and still trade $9 million in deals within 12 months! Amazing story.
6. Understanding the market & taking a position always and dont become passive.
Steve talked about the fact that you should be clear on 2 things, taking a position on what the market will do and thus being clear on your strategy (are you in the market, out of market, or confused).
Understanding the market was simple economics, such that in interpreting events or factors that affect the market (e.g. Govt removing -ve gearing tax relief, introducing NSW style double stanp duty, FHOG, US interest rates, etc) to think this through, and ask the question, is this Demand stimulating or Demand stifling, and being either one will drive your position and opinion on the market and how you will proceed. He looked at a lot of Demand stifling and demand stimulating factors and how that can effect your portfolio. These were also shown graphically, as well as analysing the market trends and the fact that after a boom, there is often, for instance in melb, has been followed by long flat period. He also talked about Home affordability and how this was an issue, that when interest rates were at 17% mark, home affordability was higher than today.
If your look at your current portfolio today, if you look back on what you have done, and if you feel you could have done better, then potentially you were working against market sentiment. Did your portfolio grow due to market growth (i.e by default, due to market condicitons at time) or as a direct result of your efforts and your strategy?
7. Personal, what Steve called, “a-ha” moments:
Problem (property had trouble selling, on market for a while due to …) + Solution (your effort) = Profit (best deals, in quite a few cases). If you buy solutions and sell problems, you lose money.
Im spent. This is surely my longest post.
Hope that helps set the scene for the day, was great, and I LOVE my stress house toy. [strum]
