Well, the crest, as long as the original author doesn’t mind, and feels as if his quesiton has been answered… some topics wax and wane. That’s usually ok.

kay henry

Diane and Freak,

I’ve noticed it is my cheaper property, that needs more repairs/maintenance- anyone else noticed that? Cheaper = cheaper rent, but more maintenance. Given that tradespeople don’t charge on a pro-rata as per rental income basis, it’s annoying.

You’re right about tenants being entitled to live in a liveable space, for sure. Makes me think, though, that cheaper properties can be too high maintenance for me.

kay henry

Hey Squash

I’m an average Joe. I just have a love of property. There’s multimillionaires on here, and folks who don’t yet have a property. I sometimes think there’s too much emphasis on heirarchies. I’d like to think that anyone- no matter how average- can have an opinion on anything- no matter how average that opinion might be

kay henry

Thanks wayne…

Can I ask wayne… are you into the kinds of theories he’s discussing or the way he discusses them?

kay henry

http://www.cgu.com.au/index.shtml

kay henry

sam :o)

I think the way some people on this forum can get 10+ investment properties in a few years (and not on a huge income), is not to buy the big 400k number, but to buy rather cheaper houses. So if you decided to, you could buy 8 X 50k houses… instead of one 400k house. Then you could say you had 8 houses

The theory (and practice, for many on here) is to basically buy a house for 50k, and get over 100 bucks rent for it (about 10% rental yield). So the 410k house you buy has 250 bucks yield (about 3% gross) but the 8 X 50k houses would have, between them, 800 bucks a week rent.

This is not merely theory- many on here do just that. However, with the changing market and recent capital gain for almost every area of australia… it’s harder to come by those 50k houses (even if you want to). You’re left with mostly mining towns and country towns (not that there’s anything wrong with that- just depends on if ya want that as your portfolio).

Your 410k house will require money from your pocket (negative gearing) and Fitzgerald is an advocate of that. One point of negative gearing is relying on notion of capital gain for well located properties. Positive gearing proponents are focussed more on rents (although pozz geared places have mostly enjoyed some CG too during the boom).

So if you have an income focus, you might want to buy the cheaper houses. If you have a growth focus, you may want to buy more expensive houses. 8 cheap ones = 1 expensive one…. less rent may equal potential for growth (but not guaranteed)… more rent = you pay nothing from your pocket, and it’s possible that these might achive CG too (but not guaranteed).

I think Fitzgeralds’ stuff has sensible strategies, but you might want to just buy a bunch of books rather than pay a few grand on seminars/products when you first start out.

The notion that land always appreciates in value… well, not in some rural locales. You can still buy land in some places of Australia for $1000 a quarter acre- just as you could ten years ago, and, I imagine, just as you will be able to do in 10 years time for those same blocks.

Whilst I don’t agree that ALL land appreciates (some does- particularly when it’s in scarce supply), buildings do depreciate. Hence, one could use depreciation allowances, kindly brought to you by the Tax Department Post 1985/87 properties have these, and they can reduce your tax.

Sam, you’ve said buying interstate isn’t an option. You’ll find on here that many people have bought land all over australia- and beyond. You might see this as an option later- dunno, you may not

Final point of this tome… one 400k property with a low rental yield, will have you paying it off for a long time. Prices are slowing around many parts of Australia. So you have many, many options to buy well. There may not be a need to rush in right now.

kay henry

viral,

I think it’s important to develop a good relationship with the RE agent when you decide who it will be. There may be times when you feel you need to contact them (“is it sold yet? is it sold yet? ad infinitum…) so it’s good if you choose a RE agent you can relate to- not completely based upon price and bottom line- but also on how they deal with you, the vendor- not only prospective buyers.

I used the agency who managed my property and the agent who sold me the property- he knew it insde and out, so half the legwork was done. Also, because we had known each other for some time, I felt I could trust him- goodwill counts for a lot, in my opinion.

Another thing I did after sale, was to let the Principle of the RE agency know that I was really pleased with the efforts of the agent- I think sometimes they cop a lot of criticism, and don’t get much praise… and a good way to help them in their job is not just to thank them, but to tell their boss that the individual is doing a good job.

kay henry

boronia just lost about 15% of its value, rogue (35k according to that article). It’s so far out is it still considered eastern suburbs?

aussie- waddya think of the bible belt suburbs? In sydney, they’re awful (but growing).

kay henry

wayne, and heya Life (cute curtain smilie- I love that one) :o)

Cynicism can happen, but I work on critique and analysis. I’m an optimist and I believe what people say, so (thinking about the Victor Ollis thread), I believe something can be ok, until I read evidence to the contrary. But I research everything like a mofo, so I find out what I’m getting into.

I have an ex, who once said “never be bitter- it’s one of the worst things in life.” And I’ve always remembered that. So it doesn’t matter how life can disappoint, because I remain optimistic. It helps that I spend my intimate time with people who have a similar outlook and values- it acts as a reinforcement.

LifeX, I still get very angry and sad about injustice in the world, but within my personal sphere, and with anything that might have occurred within my past, it still doesn’t change my perspectives. I have never have a “social worker” attitude to life, but rather a “social justice” approach.

I once lived in the outback, and I saw so much injustice there. It upset me greatly. My mother said I needed to toughen up, so I wouldn’t be so affected. But I saw many people there, who were so embittered, so angry, and so alcoholic (to cope with an environment they told me they hated being in), that I felt I never wanted to become like that.

Dunno, for me it helps to think things can change. Eveyone’s been hurt and messed around, I guess. Some people “become” that disappointment, and it’s a challenge to not become cynical… but it can make life a lot “lighter”, I reckon. Otherwise, it can just becomes baggage that grows.

kay henry

Thanks shaun for the article. It is, to me, a reminder that property is a long-term investment. I’ll just be happy to pay my properties off and have them as assets. CG’s a bonus, and even if property experiences negative growth, at least one has rents I think if one buys and holds for the long-term (45 years?) then at least value-maintenance is almost guaranteed.

kay henry