Forum Replies Created
Live example:
Location: Mount Druitt
Option Fee: $5K
Strike Price: $295,000
Weekly Rent: $250
Weekly Option: $145Combined weekly: $395
Term 36months
Did not excersize option at 18 months. did it again at a higher price!
Cheers
KiwiHey there,
The rule in general is, the longer the option is in place … the higher the chance the option will be excersized.For example only 25% of tennants will excersize the option in the first year.
This increases as the years go by and almost 90% excersize in the final year.
Hope this helps. This is based on past experience and research averages. This is mainly due to commitment factor from the tennants part…. It is a bit like a relationship :o) the longer you stay togehter the higher the chances you will marry ….. just get to a time where you just take the plunge!This is my opinion only and I suggest you could conduct your own research to support you.
Thanks
KiwiHey all,
Great comments and brain strain!You have to remember that the $44,400 credited back in 5 years will be more than enough to secure the deal as proeprty prices will have possibly nearly doubled so the security that the bank holds will be already in excess of say 50% of LVR…. any bank would lend on this. – based on the fact that proeprty in SYDNEY have doubled every 5-7 years.
I would be even more generous:
Perhaps offer a $50,000 bonus at the 60th payment if they go ahead and purchase. increathe strike price to $400,000 – $450,000 and you get an instant win-win situation… they get $94,400 equity to apply tothe house purchase…and you get profit in the following ways:1. Upfront $7,400 (tax Free)-as it is an option and you may have to pay it pack to the tennant.
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2. Nett profit weekly from your outgoings to the weekly income coming in.
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3. end profit from purchase; Bank writes out a cheque for $355,600 ($450K – $94,400 rent credit)
you pay out your remaining loan and keep the rest!Sounds like a good plan to me!
Cheers
KiwiHi Peter,
I have posted you a PM I have a place in Seven Hills you may be interested in.Cheers
KiwiHi Eloise,
You can start with no cash…. however you need one or more of the following:
– The skills to formulate advanced deals where you put together the transaction and get hte money partners and take a cut.
– The Education to know how to use various tools of the trade such as lease options, Options, Sadnwish Options, Joint Ventures, Vendor Finance deals etc.
These can be tricky to put together and the hardest part I have found personally is to be ableto find anyone to put thier money where there mouth is…. So when I was up against it all I had to just go out ant put it all on the line… that family home,,,, car…. job the lot.
It is a gutsy move and you would need to be resolved in your plans and strategies to ensure the highest propability of success….Best of luck.
Kiwi
http://www.kiwilogic.bizif you are looking for an over all great tool … then I think the PIA PRO is fantastic…. and if you are looking to see how much you will be paying over a period of time …. you just need to find an amortisations spreadsheet.
Thanks
KiwiHey Thanks :o)
Looking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.Paying off your own property is a loability as it is taking money out of your pocket….. however when you sell it you will turning it into an asset as long as the nett ammount you have paid (repayments, rates, insurance, repairs and renovations etc) do not exceed the return from the sales price.
The other thing to condiser is the banks will only allow you upto 95% LVR to lend against another property …. so if you find hte perfect deal then you may possibly lose it if you have to wait to sell your house first because the banks will not come to the party.
Food for thought anyhow……
Cheers
KiwiLooking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.Hey There,
If you are not sure what you are doing then I might suggest keep on doing what you are doing…. educate yourself some more and it will eventually fall into place and you will know where you wnat to go, how you want to do it and WHY.Cheers
KiwiLooking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.Stu,
Could you actually charge the trust interest for hte use of the funds?
Cheers
KiwiLooking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.Hi There,
The challenge here is to find a lender that will lend to a unit trust or company that is a trustee to the trust. Most lenders require 2 years financials (your accountants). And you have to have been trading for at least 2 yeasr also. This can be an expensive excersize and painful awaiting for the day you can actually use the company for the task you want to.
Accountants fees to do the books and submit all correct documentation for a PTY LTD is not cheap….
Any add ons to this one people?
Cheers
KiwiHi all,
I am confused here…. if hte seller and the buyer have agreed and the bank agrees that the property values up …. and the buyer can service the loan…. where is the issue again?
Cheers
Kiwi.Looking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.Hi There,
Good on you for choosing cashflow over capital gain….. well at least for now.
Best of luck with your endeavours,
Regards,
KiwiLooking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.Hey Harry,
Good on you for asking questions.
Most landlords that complain about vandalism and vacancies non paying etc…. either:
Do not have the correct insurance in place, incorrect property managers, bought in the war zone, Not a thorough enough check in tennants (or a combination of these.The more entry and exit strategies you learn the better …. but only if you put one or two of them into practice and do not end up sitting on your hands wondering if any of it owrks at all.
Hope this sheds some light to some of the darker nooks and crannies!
Cheers
KiwiLooking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.Hi Camder…. Well what can I say …. you are kicking ass out there! Good one you.
There are a million things you can do and frustration is a key part as it usually forces change. Just to answer one of your questions about why would someone do the 12 month settlement scenario? I have done this a few times successfully and usually the reasons are they are either investors that are currently selling off a portion of thier portfolio and are developing a new deal… thus need to know the property is presold and can work around the 12 month time line to comlete thier new project…. some just want to get rid of the property or have purchased a new property and need the deposit funds to renovate etc!… there are a heap of reasons…. you only need to ask and if it does not work for you then you obviously know what ot do if it doesn’t…. Exactly, walk away and look for another transaction. Education is useless without action and vice versa to some extent…. best of luck.
Kiwi[headphone]Looking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.Either way (installment contracts or Lease Options…… you are trading off some of the future profits for cash today. In both cases you are committed to locking in the price no matter what the future holds.
good luck people.
KiwiDon’t send/provide all of your application forms to the applicants until they have expressed interest in the house… I’m still trying to understand what’s best here??I get applicants to pay up fee on the spot.- I can’t count how many hours I have spent mucking about chasing up prospects …. and faxing … and posting off apps…. FORGET IT. They are either in … or they are out!
Looking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.Try Resi-Home Loans…..
They are originators and if you have a concept to sell… then they may work with you.
Cheers,
KiwiLooking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.You could set up a joint venture partnership for a single property. If the property is cashflow positive then you should not have to many issues getting finance… unless you are trying to come up with the 20% that the bank will not cover.
If you have equity in the property then you could access it to provied the 25% that the bank will not lend you and register a second mortgage on the investment house as you really need to secure your interest in the property. Then you could perhaps find a lender that accepts gifting and then you are away.
Looking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.Hey Mini Mogul…. price on this one os over $1,000,000 … .and yo uare correct …. offers are like tumbleweed rolling in.
Cheers,
KiwiLooking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.You can do this ……
Two ways I have done this is…..1. Sign up a standard option… you can get out of it but will forfeit your option fee if you pull out (usually (but not always) need a larger option fee to create that win-win with the seller)… You simply find a buyer and pass contracts for a fee & or sales price difference.
2. Sign up a option with put and call clauses ( I have not done this one myself) This is common in come off the plan transactions…however you can NOT get out of it if your buyer pulls out… you must purchase no matter what….. you can onsell after the option is excercised… however you will wear the Stamp duty and so will the new buyer.
Hope this sheds a little light at the end of the tunnel.
Cheers,
KiwiLooking for Positive cashflow solutions?
Look no further
Wraps-Lease Options & JV’s
http://www.kiwilogic.biz
We are investing in NZ so if you are looking for + cashflow properties…contact: [email protected] to join our database.
