Forum Replies Created
Fatboy,
We do the same thing, buy ex housing commission – or mainly, and sometimes do them up, sometimes not. We have had a few problems, but that has mainly been our lack of managament of our agents. Whenever life gets too busy, and we rely completely on agents, things tend to reflect that. With a young family, and moving interstate for the 6th time in 10 years, sometimes, things do get slack. So the last 4 months we have been slack, and in the last 2 weeks we have 2 tenants skip on us. Neither have been trashed but for those less experienced, this is a list of what we have had to do:
Obtain possession through the courts
replace locks
clean carpets
clean house
mow and clean outdoors.
Find new tenant.
This all takes time and money (Our $440 bond at one had an indoor cleaning bill of $800 alone)Having said all this, we have insurance and do chase tenants, but this all takes time and money in the meantime.
As far as the intial comments on this thread, we do invest in low socio economic areas, sometimes with high crime rates. We have had our ups and downs – but we move on and forward and learn and make more money next time.
For those who are familiar with Melbourne – the 'birds nest' in Werribee is a perfect example of this type of investment. Over the last 12 months this area has seen some capital gains, and rents have always been good. The place had been known for high crime and low income – but this is slowly changing. Our experience is this area has been good, with good tenants who always pay on time or early.
JL
I had a bad today. Thanks for the laugh, it has cheered me up.
JLThanks all.
Good one Duckster, they do wine insurance as well. Sounds like a company I will need in the future (or maybe I will just keep drinking to make this headache go away).
JLThanks. Appreciate your prompt response.
Have a great evening.
JLThey actually do have Australian houses on their sight, all be it only a couple, including a 3 bedroom, 2 bath "Ranch" in Canberra.
JLMike,
Thankyou for the report. I had not seen one before so thank you for the education. I also appreciate the prompt reply.I will pass on your details to friends.
Thankyou,
JLWith all this mining gloom, does anyone have an opinion on the mine opening by the end of the month 20km outside Ouyen. Illuka have received the final approvals and began preparation to begin mining before end of Jan.
Personnally, I still think it is good buying.
Thanks,
JLSo, it's happening. Check this link for the media report.
http://www.bananasinpyjamas.com/news/stories/2009/01/09/2462242.htmI haven't spoken to my agent yet, but it will be interesting to follow the property now.
JL
Thanks for all your advice. The agent did go in and checked that it was locked up, hence knowing the carpet needed cleaning, the yard needs a tidy and the possessions that are left in the house. The tenant had advised by phone that she would return the key, but every time she says she will, she never shows. Now she won't answer her phone. I would instruct the agent just to go ahead and clean up, but she still has stuff in the house, even if it be minimal. We are not in a position to go and see for ourselves, so we rely on the agent. They seem to think that the bond should cover all repairs and cleaning, which is good.
Thanks
JLMy understanding is that you get the insurance before settlement to cover yourself. If on the settlement inspection (usually a day before settlement) things are not as they were, then you can delay settlement, until the necessary repairs are completed. What if that doesn;t happen for two years. You have a contract, they have your deposit, and you may be unable to buy elsewhere. This way you can make a claim, fix it and all is happy for settlement to occur. Please correct me if I'm wrong.
Just remember that not everyone has insurance.
JLC2,
Thanks great. I love your thinking. At this stage the agent has applied to tribunal, but we have to wait a couple of weeks for the hearing – the joys of having regional properties.
I think we might just get a debt collecting agency to collect the rent arrears once an order has been made. Even if we have to forfeit 50%, we are still better off than getting nothing.
JLThe agent does have a spare and went round the other day. She said they still some limited furniture in the place and photos of the kids, but no sign of anyone living there. The agent spoke with one of the tenants last Friday when she was moving out. They said they would hand the keys back Monday. (I think I have a nieve REA)
What's the deal with legalities before an order has been signed to terminate their tenancy. I thought that by entering without the tenants permission, we would be shotting ourshelves in the foot as far as gettting any money for damages or rental arrears. There are two tenants on the lease and one works, so I am hopeful to get some money in the longer term. The place is in NSW.
Thanks in advance,
JLbenmelbs,
Have you bought in Ouyen. I notice that a set of 5 x 1units have come on the market for 180-220k. If you could hold until the mine opens, it could be a very profitable purchase?
JLWho did you get the 'info' from?
Did they give you detailed figures.
JLI know I am a bit late. I got onto this Illuka thing late last year and went up to Ouyen for an Auction. The town is nice. I spoke with many, including the girls at the bank, the bakery, the supermarket and even high jacked the unemployed single mother walking the streets etc. I could not find a person who did not like living their. So I went to the Auction and to my surprised was the only one to turn up to bid. I got the property very cheap. I settled at end of January. Had it rented the next day. That tenant stayed 6 months and I just signed a lease for 12 months with 5 days vacancy.
I would say that prices over the past few months have gone up considerably – around 40% in the last 12 months I think. I'm not sure how accurate a reflection this is of the market though as only 17 have been sold, and this includes mine well below your 80k mark and a newly built brick home that had been listed for 250K. The town was very busy, lots of people in the street going about their lives. I personnally believe this is a great buy, because even if the mine workers don't stay in town, there will be an increase need for others in town.
So good luck in finding one for sale these days, but if you can, I say go for it.
I do have a word of caution, the agent fees are high and maintenance fees are high.
JL
This is my opinion only, so please do your own research.For the first time ever we have had more than one applicant for a property we have that is vacant. We did our own advertising and initial vetting. Narrowed it too four. Then passed to the agent. Three applied and we had to choose. We live 4000k from this property. I respect our agent, but understand they don't only work for us. They have to manage their time, and some are better at this than others. So four days of vacancy and we have a tenant. Nothing beats working together instead of expect the world. Remember the agents are running a business too. Having said that, nothing excusses some of the behaviour of others I have had dealings with, and swiftly moved on from.
JLSo just out of interest, we have had a property on the market for over 100 days. We listed it at 229k. The highest offer was 215k and we thought about it for a couple of hours and in the mean time the offer was withdrawn. The next highest offer was 195k. This website said the property was worth within 2k of what we advertised.
JLHave you tried gumtree.com.au (I think thats it – but type gumtree and your cappital city and it should come up). It is free and seems to have heaps of traffic.
JLSay you live in country australia and your first home will cost you $80k. Your income may only be 30k. You only pay $2400 tax anyway, and with some normal work deductions this means that you may only get back $2k per year of the interest you pay. It may take you 5 years to gain the same benefit as it does with the current system, all the while having a larger loan, because you had $7k less of a deposit. And even worst, without that $7k a home may not be possible because you cannot save enough on the low income to have a deposit, particularly while paying rent.
It's a good idea, it just won't work.
JLSounds to me like your idea will give the rich a much better deal, and those on low incomes a much worst deal than they already have.
I'll think I'll get rich, buy the most expensive house I can with the biggest mortgage I can and claim the deduction (at the highest tax bracket of course). And instead of moving I'll just borrow more to extend and renovate every few years. All the while earning 8% on the cash I have in the bank. Bring it on (In about 5 years when I can take advantage of your proposal).
Having said that, keep posting your ideas.
JL
