I see where you’re coming from Terry and an offset account is great for its flexibility. But the $100,000 paid down on the loan could be used as equity value / security to be borrowed against for the second property. I don’t think it’s a limitation. Having said that, the offset account is still a viable option if you have $100,000 sitting around…[Read more]

You know what, that’s actually a common misconception. An offset account is only fantastic if you have a lot of cash sitting idle in your bank account. If you went to a bank, you’ll find that an offset account typically has a higher interest rate compared to the standard mortgage rates – if you’re depositing $300-$400 cash into the offset per…[Read more]

Spandex wrote:
Thank you for the helpful post I will be having a 10k buffer savings for spikes,sickness,repairs etc. I currently save 1200 a week and still above my needs so 200 a week out of pocket for negative gearing is no worrie. Should I aim to make extra repayments to get to a pos geared loan as soon as I can?

The buffer is a very good…[Read more]

Hi Spandex

I think there’s been quite a few comments about negative gearing being a bad idea, which I think isn’t completely true. Obviously, a positive geared property is fantastic if you can find it, but it’s often difficult.

Given your high income, you are paying a LOT of tax. You should use it to your advantage (let tax work for you) but it…[Read more]

Hey Dellas,

Good job on saving $110K, that must’ve taken a lot of discipline – very impressive.

With $110k in savings, you can easily take out a mortgage of over $400K. Potentially up to $550K if the property generates positive cashflow (assuming you use the $110K as the deposit on an 80% LVR basis).

It depends on your goals in life. Property…[Read more]

Hi there,

There’s already been some great comments above so I won’t repeat them.

What I will add is that many high volume sales real estate agents will typically distribute Weekly/Monthly Property E-Magazines. For instance, Bryn Fowler from Sydney Cove properties in Sydney distribute weekly e-magazine…[Read more]

Wirraway,Scott No Mates is absolutely right.  Selling or gifting a property to a trust or company will create a capital gains event however if you are receiving nothing in exchange for your property, you will need to get an independent valuation to provide that the exchange was at arms length basis for tax purposes as you will need to pay CG at…[Read more]

Hi recyclingguy,That’s always a key question and I would always suggest that you speak to a professional tax advisor or your local accountant to help you out. Essentially you'll have to calculate your tax position under both scenarios and see what gives you the best tax position.But just as a little guide I think I can help. Just based on the d…[Read more]

Hi all,Some great posts and some interesting insights regarding Gladstone.I can't call myself an expert in the particular area but it seems like people are investing in Gladstone essentially as a mining town play – which all investments in mining towns carry very specific risks different from property investments in cities such as Sydney and M…[Read more]

Pinkboy,

Could’ve hedged your spending in MAC camps by buying shares in the company. The share price performed fantastically in the 24 months leading up to their takeover. Could’ve made all your money back and more.

Just a thought.

Jase

Hi Christine,

There’s already been some excellent feedback on this topic already – especially Cath Wood who provided an interesting perspective of the pitfalls of mining town investments.

As Crj pointed out, Mining Town property investments are inherently more risk than Capital City property as investors are exposed to both commodity price risk…[Read more]

Hi dougie,

With $200K you do have options but understand that you may have a number of personal circumstances that may make things a bit harder for you. All i can say that you are doing the right thing in asking around for advice. Here are couple of decent options if you can get a casual job to support your daily expenses:
1) Given your current…[Read more]

Hi Tony19,

No credit history shouldn’t be a big deal. As long as you have a good deposit and a steady income, you should be able to get approval from the bank for a mortgage.

Now with respect to where to start, you’re on the right track. You’ve already thought about investment and owning your own business as the means to your financial freedom.…[Read more]

Hi Matt,Congrats on your first buy. I was in your shoes many years ago. If you had time off, I would suggest that you pound the pavement. Get to know the top and reputable real estate agents in your city and discuss your ambitions. Get yourself on their mailing list.  The more investment opportunities you'll have to look at, the more chances t…[Read more]

Hi Breeza,I think it is great that you are serious about looking after your future through investments such as property. I can understand your situation – limited credit, limited savings, getting married, getting older. All I can say is not to worry. You still have plenty of time to create a nest egg for you and your future husband.If you are…[Read more]

Zaul,I think you have a great ambition and vision, which is where it all starts. Whilst I think it'll be a challenge to obtain finance, it's still possible. – Do you have family or friends who are willing to guarantee you on a loan? – Can you take out some form of insurance product in Canada whereby the insurance company guarantees your mortgage…[Read more]

Great story and contribution as always Angel. Completely agree – Australians are fixated with the negative gearing story – sold to them continuously by banks, mortgage brokers, tax agents etc. Unfortunately the whole point behind negative gearing is that you're making a loss on your investment on purpose so you can take advantage of the tax…[Read more]

Hi Daewoo, Wow, good stuff on the first property investment. I think you're at the right place -there's lots of people on here who are willing to help. There are a lot of people with hidden agenda in the property investment game and I would suggest that you should find yourself a property mentor who has also been down this path and…[Read more]

Hi Sherry1Good question!If I was going to invest in mining towns, I would look for cash flow positive properties with the view of making medium capital gains over a shorter than average investment horizon. I like to analyse a property based on the following two criterias:1. Financial (in view of financials / cash flow, capital gain potential, a…[Read more]

Hi George,You're absolutely on the right track. Save, learn, keep up with the markets and learn the numbers before any investment.I think the press have all pointed to housing affordability being a major issue for the property market. In my view, that doesn't necessary translate to a market crash for investors since this issue really only conc…[Read more]