Hi Buick,

Your strategy will depend on heaps of different factors which include:
– Your time line
– Your level of involvement
– What you WANT to do.
– CF or CG
– Level of risk tolerance
– Flexibility
– Tax implications
– Fin implications
– ETC ETC ETC…

I can only talk in general terms because this may all change due to aforementioned factors. Many of our clients on a high income are land banking medium density development sites in high capital growth areas. The plan is to redevelop and hold these sites as they come to the end of their working career or earlier if they need better servicing due to finance.

Any reason why you want an apartment?

If you have an OTP apartment as your only option, here is my advice:
Personally, I would contact the developers direct and ask for cash back at settlement. Avoid going to a project marketer and DON’T pay the list price. Look for a project that is unique and not just a box. When I say unique, it must have guaranteed uninterrupted views of the ocean or river and no other apartments that can build in the same location. There are a few current projects in Perth which spring to mind, an old example is Raffles.

The two iSpire and Zenith apartments on the website of the project marketer of the Seminar you are going to DON’T look like good investments.

Feel free to PM me for more info on apartments.

Australia is huge, any idea as to what state you will be living in?

Possibly look to your qualifications and then aim for a state that would have job opportunities. Then find the nice place within that state.

Despite the ethical implications of why you would want to be artificially increasing the property’s value, there are many other practical problems.

Firstly your idea is quite common in Commercial Property transactions with unscrupulous vendors and uneducated buyers. The method used to calculate commercial property is the, income capitalization method. This is what Steve is talking about. However, most sophisticated commercial investors check the lease clauses and contract periods as well as comparative letting rates nearby. However, I have heard on many occasions where people have pulled this ‘con’.

In residential property the two most common valuation methods are comparative market analysis (CMA) and cost plus estimation. Both of these valuation methods are not influenced by the income produced by the property. Therefore, I doubt increasing rental yields artificially will have a big impact on price. Remember, even if you are to ‘sell’ the property with the main feature of a 20% rental yield, the bank guaranteeing the loan is going to get a valuer to do a CMA and then your deal will be blown out of the water…

Hi Pasineil, 

Within that budget the following would be possible within the Rossmoyne SHS Zone:

3 bed 1bath – full block very basic home
3 bed 1 bath + bath 1 extension (super lucky) very basic home
3 bed 2 bath half block, but more modern home 

The only caveat I put on this is that because these opportunities for option (1 and 2) don’t come up too often, you would want to have your fin approved, always be looking and ready to go when a deal comes up. Another option which has allowed us to acquire homes for clients with tight parameters is to source off market property through contacting owners direct. 

If you want to know more about how we operate as a Buyers' Agent private message me your details and I would be glad to catch up for coffee obligation free. 

There is no question it is a great idea.

However, to pitch this idea to the next tenant is more of the question and that is why I would strongly advise against it. The day that the say owners can bill tenants’ commercial rates for electricity is the only day I would consider putting up solar panels on a rental property’s roof or when green rating becomes huge.Save your money and put it towards your next investment… 

It starts to get into a little grey area. It depends if the mentoring helps you acquire one particular future property or it provides you with the knowledge to help with your current portfolio. We run a mentoring program and we split the invoice in two.

The first invoice is for the education component (notes, courses and books). This is separate because it gives you knowledge on your existing portfolio. This is the link to the tax ruling on adult education when you have residential property:http://law.ato.gov.au/atolaw/view.htm?docid=AID/AID2003324/00001 

The second component (mentoring) similar to a Buyers Agent fee is a cost of acquiring a property (capital cost) and is thus added to your cost base. This will mean if/when you sell the property it will result in less Capital Gains Tax being paid.  

I would be carful trying to deduct all the mentoring to acquire a future property.

I think the question "how long it has been on the market?" is good, but only when it is preceded and followed with a litany of other questions.

"Has there been any other paper offers?" as well as "why do you think the property hasn't sold?" are good ones to see an agent cringe over. Let's be honest the agent never wants to say "I suck" or alternatively "It's over priced."

When we go out as Buyers Agents we have a script of about 10 – 15 questions we ask. This of course is then reported back to the buyer and a negotiation strategy is undertaken according to this information. I think you can never ask enough questions, regardless of quality, any information you have is good information.

Sometimes, a question is just asked to direct attention away from another question. Let's face it, we've all fallen for the magician before

If you're buying a property I would recommend an electrical report, about $200, as it has come to our attention that even new recently installed smoke detectors and RCDs haven’t been installed correctly.

Basically, the selling agent just calls around for the cheapest quote and because of the cheap price the sparky sends his apprentice out to do the job. 

Cheers for the link,

The site seems a little sparse and doesn't have any prices up.

Does anyone know if this site is expanding?