Now, as property investor you are obviously intelligent enough to make your way in the world. I understand that your wish is to provide a better future for you and your family. No problem. However, if ones providence is based on the impoverishment of another that is a different story.

I certainly don’t want to take away from any other hard working motivated Australian, but I don’t want to subsidize any bludger who has decided that if he does nothing the world owes him a living anyway.    This is the age old debate between Socialism and Capitalism.    

I for one am all for equality.   We should all pay the same tax rate no matter how much we earn – Every working person should pay rates (the cost of maintaining the infrastructure that we all use) – We should all pay the fire levy (not just home owners). 

I think that the basic concept of Amway is good, but I also believe that the break down in the chains is that, from my observations , People pay the joining fee with the expectation of getting rich quick with no work output and as soon as it doesn't happen and the cheques don't come in, they quit.   Not unlike many people who get into property investing and sell at the first sign of a little hard work (that is hanging on in downtimes).   There is an extremly high percentage of people who buy an Investment property and sell in under three years (not counting the speculators)

I would hold this property.   Investment is for the long term and you should not be dissatisfied with the performance in just two years.   After paying selling fees and CGT there will not be a lot of profit and I very much doubt if you could replace this unit with another for $397,500.

Quick profits come from greater risk and are of a more speculative nature.   Are you confident enough to travel this path?

Jon

I'm sure that you will do a great job on this very important Topic.   While I don't fit into any of your categories, I would like to bring one point to you attention (just in case you miss it).   The average new house size today has more than doubled overthe last 20 years, consequently is would be fair to expect that average house prices have increased.   Not withstanding these comments affordability has certainly increased but then so have the gadgets that we find that we can't live without.   Unfortunately these gadgets cost money to buy and maintain and in many cases these items of self gratification come before saving for a deposit for many.

I can share astory about a young couple who were renting a 45m2 one bedroom unit from us.   Over a period of time I got to know them and we had struck up a passing friendship.   One day I asked them if they felt cramped in their small unit to which they replied:- sure Jon but we were renting a house 8k from the City where we work, we had busy jobs and one of them did some shift work which necessitated them to have two cars.   They found that they were not getting ahead as quickly as they wished, neither were they able to save enough for the deposit for their firt property that they so desperately wanted.  They had a heart to heart and decided upon a corse of action which included selling one of the cars ($6,500 into savings).   The weekly saving on running and parking costs were in the vercinity of $100 – again straight into savings.   The other car was only used on weekends or on rainy days so more saving.   They both caught public transport or rode a bike to work.   By moving closer to work and accepting a smaller not so comfortable home they saved a further $120 a week on rent – straight into savings.   By having a plan and sacrificing a little, within two years they had saved over $30K and have now purchased their own cheapie two bedroom unit.   It can be done but the desire to do it has to be greater than the wish to be like your friends and live for the moment.

Good luck with the programe

Jon

Bugger – Don't know what happened there

I’m not for one minute disputing the fact that the Property market is flat at present and in fact I’m sure that in some places the value has fallen.   I would suggest that perhaps the degree of fall would be greater the further out from CBD’s or Regional Centres. Buyers fall into several categories;-First time Buyers with good jobs and income (there are many out there)Those who are upsizingThose who are downsizingThose who have been transferred or have movedDivorcedChange of lifestyleAnd then there are Investors.  From my observations, the good deals at present are being bought by any of the above except the last.   Most investors will need to see the proof of a good deal and that will only happen when they see prices rise. 

Two Auctions on the week end and two record sales based on past sales in block.   One up by 40% in 3 years.   Two OO’s and one Investor bidding and the Investor dropped out $57K under final price.

It's not all doom and gloom – believe it or not there are people out ther with real money and vision.   The rich will get richer and the rest will watch and pray for a collapse.   Isn't that the Australian way?

Jon

Hi Melbally,   As most people wish to believe that the Vendor should always negotiate down, I'll pose the other side of the equation.

While I have no idea where Melton is in Victoria, but with a 3 bedroom house at $185K, I can only assume that it is a regional area.   While as a Buyer you have every right to negotiate as much as you wish and you ultimately either buy or pass up the property.   I believe that you have answered your own question with your statement:-  I still think that it's worth pursuing the property because the repairs (especially in the bathroom) will bring it up to date and therefore, I believe, add value.
The fact that you believe that the repairs will add value says to me that the Seller has taken this into consideration when accepting your offer.   Why should they fund your improvements?

I have no problem with Building Inspections in principal.   That is to say if they uncover a structural or major problem which was unable to be seen during a normal inspection )eg White Ants), then it would be fair to attempt to renegotiate.   You must also accept that it is also fair if the Seller says 'No'.   The problem that gets up my nose is when a person inspects a 100 year old house and notices that the iron roof is rusty but wants to renogiate when the Building Inspector advises 'The roof will require replacement due to rust'.   Guess what.   In order for the Inspector to be covered by his Indemnity Insurance he must make stupid statements such as this.   All 100 year old houses with original iron roofs need re-roofing.

Jon

Might I suggest that one party is going by the letter of the law and the other party is chucking a wobbly because they can't get their own way.   For goodness sake, what's the rush, if a couple of weeks vacancy is going to be that big a problem then you have either overextended on your borrowing capacity or you should not be investing in property.

Jon

You have to be kidding TT552.   Here is a person who has one house with a shortfall of around $100 a week and a Unit that I presume they are currently living in (as it was rented) with a loan value of $370,000 and a service cost of what? guessing around $1000 a week.   So thats a total of $57K a year on hosing and an income of $265K.   Talk about doom and gloom.

You only make a loss if you listen to these doom and gloomers and secumb to their pressure to sell so that they can push prices down to their affordability.

I say if you feel comfortable with your outlays and job security and have a few Dollard over – Buy another property.   Rent rises will be on your side as well.   Remember selling costs will be around $25,000.   In your situation I believe that you would be crazy to sell.

Jon

Tugger, The easiest way to explain is that you own and are responsible for the inside and the Body Corporate is responsible for the outside.  So in answer to your question, Yes you do require strata cover for the inside.

Jon