Forum Replies Created
The RESULTS group is a mentoring program run by Steve and Dave. The program goes for 12 months and provides a wealth of resources (written, audio, video), plus meetings every couple of months, plus a mentor or coach that you can get help and support from. The second program has just started but is full. I’m not sure if Steve has a waiting list yet for the next one.
I’m on the current one, and it’s brilliant. Early days yet but I’m already getting huge benefit from it.
Janet
0427 778875Hi Ron
I’m envious of your age – I wish I’d started investing that young!
Have you thought about student accommodation? There are people out there who are leasing 3-4 bed houses near universities and then sub-letting them by the room. Positive cash flow without having to actually buy the property. The only risk is having the property empty. But then you can either terminate the lease, or look for other tenants.
Being a student yourself, you’re in regular contact with your target market, so can find out what they look for in accommodation. Also, could be a great way to build up your cash.
It might be worth asking on the forum who has done these sort of deals and what their experience has been.
Good luck!
Janet
0427 778875Hi Dominico
A good place to start is with the local Council. They’ll have info on planned infrastructure development, building approvals etc.
You can also try the Australian Bureau of Statistics for demographic data on the area you’re looking at (eg how many renters, average age etc).
You may get some info also from the relevant states Real Estate Institue site, although I’ve found that you’ve got to subscribe to get much of value from those sites these days.
Janet
0427 778875Low doc loans usually require that you have an ABN number. Some lenders require you to have had this for a minimum of 2 years. As Terry has said, the alternative is a no-doc loan, which doesn’t require an income declaration or an ABN.
Having said that, I recently got a low doc loan from Westpac and they only required that I sign a declaration saying that I could afford to repay the loan. I didn’t have to sign any statement re my income.
Bear in mind however that the ATO is targeting low doc loans where borrowers have overstated their income. I always take out audit insurance in the event that I am audited. This covers my accounting costs (but not any fine or other penalties). So, if declaring income, just be careful that you can substantiate it in the event that you are audited.
Hope this helps.
Janet
0427 778875This is why Steve and Dave advocate using cash to fund deposits and costs rather than use equity loans. Which is all fine and dandy if you have cash.
I currently rely on equity loans to finance deposits and costs for new purchases, but am also looking at ways to pay down these debts. Ideally, you sell property and put the profits toward paying down your debt so that you are not so exposed to rising interest rates.
But you’ve got to start somewhere. Just be cautious though and when calculating your positive cash flow make sure you factor in the interest on the loan over the property and the interest on your equity loan.
Good luck!
Janet
Janet
0427 778875Hi Ananda
Try talking to Paul Dobson. He is a regular contributor to the forum and has a lot of experience with vendor finance.
Good luck.
Janet
I thought that vendor financing in SA was illegal??? Can’t remember where I read that, but it was only recently.
Hi Paul – it has crossed my mind that perhaps using a wrap might be able to turn the situation around. Being a new investor, I need to gain a much deeper education as to how vendor finance works and to figure out whether it would work in this situation.
Can I email you privately to run through it with you and get some help in working out whether it might be an option?
Hi Ellis1. Thanks for the reply. I’ll be able to pay the bank loan out as I’ve got another property on the market which I’ll make a very substantial CG on. If the dud sells first, I can transfer the balance of the loan to be secured by the other property, so will be able to get the Title Deed released. The 2 properties are cross collateralised now anyway, so that shouldn’t be too difficult.
Hi Simon
In answer to your question, I would not buy the property at today’s price as it would still be negatively geared, and yes, I would think it is a dog!Hi DLPP – thanks for the reply. The reason for the big loss is that I bought at the peak of the market in 2002, financing 100% + costs, and prices have dropped since. Really dumb investment decision, but I’ve learnt a lot since then.
Question – what’s a Moderator and what’s a sticky?[wacko]
I’m looking at Community Titling a block of units I’ve just bought. I’ll be talking to a surveyor shortly so will be able to fill in more detail, but what I know at the moment is that Community Title is a bit like Torrens (although some common property) in that the units can then be sold individually. I think you can only do it where the units are on one level (as mine are) otherwise you have to go Strata Title. My units are in SA, so not sure if things are different there.
I will post more information as I get it.
For those of you who are trying to reduce debt so that you can invest, there’s a great website that I use to help save money on just about everything. It’s called simplesavings.com.au. There’s some free stuff there, but to get all the tips you need to subscribe. I think there’s a special at the moment of $35 to join and 1 year subscription. It’s then about $17 per year to renew the sub. I’ve slashed our household budget and it’s really helping me to direct more of our income to paying off debt.[thumbsupanim]
I’m glad I’m not the only one waiting for the next instalment of Virtual Kick Start. I was starting to wonder whether there was something wrong with my email!
Come on Steve – we want more![whistle]
