Forum Replies Created
Next time this prick annoys you say this to him:
“Hi honey did I mention I have a new hobby?
I am kind of a taxidermist, cept I stuff assholes instead – oh and I use a baseball bat instead of stuffing.” Say it in the sweetest voice possible.
Guaranteed to get results
==
Of course you save it for when you have a replacement job ready. So when your nerd boss fires you, you can turn around and say “Did I mention I am also taking up gardening? Makes it REAL easy to deal with WEEDS like you.”
Then you pretend to squirt him as you walk off home.
<KS>
Is it about the money?
DAMN STRAIGHT IT IS!
I would NEVER live in a property I own unless my lifestyle demanded it (children , fussy wife etc j/k).
MY G/F, best friend and I rent a nice big 4×2 for $185/week (total bargain!).So our share is about $120/wk.
Now I do own a small unit with a tiny mortgage on it of only $75,000, which works out to less than 100/wk in interest.
The thing is that it makes $140/wk in rent – which more than covers the mortgage, and $20 more than we pay in rent. On top of this I can cliam water/council/strata rates and the interest, none of which I could do if I live there.
Not to mention while it is an investment I can jazz it up with airconditioning etc which is tax deductable for any work done – but not if I lived there. I could then move in again later and enjoy the benefits of the upgrades.
===In a nutshell – I you can afford it and it wont adversely affect your L/Style then go for it.
I would go with one of the above suggestions, move into a place for 6 mopnths – do it up then rent it out at a higher rate while you get yourself somewhere else cheap to live. Remenber due to the tax advantages the rent of where you live has to be a fair bit higher than what you make to offset the perks.
<KS>
Is it about the money?
DAMN STRAIGHT IT IS!
Nice one Spanky!!
Let it be the first of many
<KS>
Is it about the money?
DAMN STRAIGHT IT IS!
Originally posted by Jay:Hi KS,
How can you be certain of the profit the development will generate without either (a) a sale, or (b) a bank valuation of the finished product?
How many units/townhouses in the development?
Thanks,
Jay.
Because this is a conservative estimate Jay. I purchased the land for 118k and the house will cost me about 137k to finish off with paving etc.
Thats a total cost of $255k
The development is a house based in the Anchorage which is a whole new small suburb, much easier than dealing with units etc, imho.
Now if you look on http://www.realestate.com.au you cannot get a very nice and modern 4×2 with timber floors and stylestone paving etc for under 350k in this suburb. *Note that my block is classified as being in Shoalwater (closer to the beach) and not Rockingham.*
With the Anchorage estate continuing to increase at a rate of 16.6% per year I have all confidence I will breach a gain of 100k in equity by EOY.
Not to mention the fact that the overall development only has 2 small stages left and that once complete the values will increase and then again when the train line comes through next year.
It is the general concensus that a well built 4×2 with good finishing will be worth 380-400k by the time the area is fully developed.
This is not just simple conjecture as there are blocks identical (or smaller) than mine now selling privately for up to 175k. And the developer is setting a minimum price on the new release at $155k for the smallest blocks.
<KS>
Is it about the money?
DAMN STRAIGHT IT IS!
me too!
<KS>
Is it about the money?
DAMN STRAIGHT IT IS!
I purchased a block of land in Rockingham 6 months ago. The development will be finished in 5 months and the total gain will be 100k in equity.
Sailesh C is correct – best to buy, develop and hold atm as the costs involved are generally less and the long term cumulative gains are much better for your back pocket.
<KS>
Is it about the money?
DAMN STRAIGHT IT IS!
lol – took me a few seconds to work that one out.
must be getting rusty in my young age!!
<KS>
Is it about the money?
DAMN STRAIGHT IT IS!
Apostle，Perth will never reach the level like Sydney. You got to remember.
No offence amused but this statement it TOTALLY irrelevant as to wether or not those places you mentioned in WA are overpriced etc.
WA may as well be another coutry as it has a different economy – the only good thing is that we are happily suffering the ripple effects sent out by the boom and will continue to do so due to our 8 year lag of east state price rises.
I can score a 4×2 in Rockingham now for under 200k – rekon thats a bad investment? Hell no!
My friend was in the market in RK for a 4×2 then missed out the one he wanted most and sulked for 3 months. When he looked again the local prices in his range increased by an average of $15,000 and are selling within 2 days of being put onto the market.
I have made $45,000 on each block of land I bought only 6 months ago in the Anchorage Estate in Rockingham. Once the Houses go up I will be looking at $100k in equity for each project.
I work for Midland Brick (biggest brick producer in the world) and I can tell you Bunbury and Geralton are also a LONG way from finished as areas to look out for. Mandurah is in general flattening out but still good reno homes etc available and is still a good place to buy now for future CG.
Bunbury in particular has BILLIONS of dollars being invested there over the next 8 years = jobs = people = increased RE $ value.
<KS>
Is it about the money?
DAMN STRAIGHT IT IS!
Nice return dude!
Address? – mwhahahaha
Nah – Hope it works out for you – If not let us know why please as I myself am interested in the possibility of a commercial property.
<KS>
Is it about the money?
DAMN STRAIGHT IT IS!
Not trying to argue — just trying to explore different scenarios— Could Ninie say that as she is married she does not have any of those living expenses as she does not work and her husband supports her entirely? So the income from her Capital is entirely “play money” I have not been in the clutches of the banks since about 1992. We in fact have been acting as a bank for our kids when we can. However Knowledge of Lenders requirements is useful and I appreciate all your posts.Nope this is not possible I am afraid.
Marriage alone is not sufficient justification and would DEFINATELY require Ninie to then put forward her husbands income/assets as security against the loan.
Some instances will warrant flexibility – but when it comes to banks and risk with their money their caution is absolute.
They cant go to their insurance company claiming for losses if there was a default on the loan and say “but they said they were married” and then expect a big payout.
Not having a go Magellan – just being brutally honest [blink]
My parents have been the ‘bank’ for me also this year, got a loan for my 2 cars off them which will be paid back plus interest next year – enabled me to move fowards like I have in a much shorter space of time.
Good on you for helpin gyour kids out – I find it teaches a healthy respect for money also – but only if you enforce it like a bank would minus the red tape.
<KS>
Is it about the money?
DAMN STRAIGHT IT IS!
We don’t want to use my husband’s income to apply for the loan as he has assets that we don’t want to jeopardise.Now unless you are currently living very close to the danger zone then the careful spending of your money wont jeoparise your other assets at all – just steer clear of high risk purchases.
As long as you go for a few properties with a deposit of 20% or more and go as close to CF pos/neutral as possible you will fine.
Several people have already correctly stated that rental income is only considered 80% when put towards income, and even then it is only considered a bonus towards servicability if you attach it to a primary source of income.
To put things into perspective for you:
My GF and I = 90k income/year combined.
NO DEBT at all bar tiny mortage on IP property which was CF +ve.
To build my last property I came close to 80% LVR and still had a bit of a tussle with the bank.
Now what your going to be doing is the same process but with NO INCOME at all.
Now if you use hubbies income then asked for a small loan when the properties your buying can be as low as 50% LVR you would be laughing.
<KS>
Is it about the money?
DAMN STRAIGHT IT IS!
@techno —> I HATE YOU!![biggrin]
Nah seriously – well done and good on you, I am dead jealous.
Anyway:
1) 26
2) 35 or sooner (on the 9-5 that is)
3) 35I intend on improving my existing portfolio, expanding into shares and a business or 2 and then once my ideal PPOR is established will travel and read and write like mad. Not to mention learn a few dozen instruments etc [suave]
OH – and write a quality fantasy novel I can be proud of.
<KS>
Is it about the money?
DAMN STRAIGHT IT IS!
Firstly I want to say I am not by any stretch of the imagination a ‘guru’ and am myself in a similar quandry in regards to buying my next IP – but with very different problems.
Unfortunately the first glaring problem you have is no income.
Essentially no matter how roaring to go you are, without an income base you are going to find doing anything from here difficult.
If you are relying on that money to survive most lending institutions wont even look at you to borrow money.
The fact is that from what you have posted you are all cashed up but present a very high lending risk.
1) What debts do you have?
2) Where do you live — Parents? Friends give free board? Or do you pay $500/week rent out of your current cash hoard.
3) What is your investment history like?
4) Do you intend on working soon?You see without further lending you have ZERO leverage. No income means no lendining which means you can ONLY buy what your 250k allows you to.
Another big problem you have is finding CF+ properties. They do exist but with no income how will you maintain them?
Even when you buy a CF+ve property you need a fund in place for emergencies etc ($20,000 is my fund), and you may experience extended vacancy periods etc no matter how good the property looks.
To be blatantly honesty the ONLY option I see for you is to buy an ultra cheap property that will allow you to have some money left over for emergencies and use the income it provides to save a deposit for another property.
But I dont see how you are going to do this since you have no income you surely would need the money to live on?
You would open a vast array of options to yourself if you aquired an income. Even a small income would give you a massive boost in servicability credibility in the eyes of lenders. Otherwise you may have to go to private lenders and experience very expensive forms of lending.
What I would do:
1) Get a job
2) In quick sucession find 3 cheap fix-up properties around the $200,000. Go for future growth and medium rental return, neutral or very slightly negative geared. Much easier to find also. True +ve geared properties at the moment are in general in very risky areas.
3) Place a $40,000 deposit on each to avoid MLI, some investors like MLI – I dont.
4) Do 10k reno on each property to achieve at least a 25k boost in market value.
5) Put $80,000 in a REALLY good managed fund that achieves about 20% gains. Navra fund has been good. This diversifies your portfolio and gives you a much better servicability as you can claim any profits as income.
6) Put remaining $20,000 in an offset account or LOC. If you have a low income at this point put half into a direct offset and other half into a personal LOC account to make tax easier at EOY.
The above does not take fees etc into account but you can tweak it and use your imagination to take it into account.
What you are left with is:
1) $675,00 in property (195k in equity)
2) $80k in shares generating more $
3) $20k for emergencies and saving you interest
4) 3 sources of passive income from tennants—
This is currently the plan I am working on myself, but with a slightly different mix of property types and values. But the principle is the same. Yuo dont need to stop at 3 properties. Once your income and equity grows you can start accumulating more valuable properties and the sky is the limit!
Keep your options open. Be dilligent, but dont procrastinate as that sometimes costs you more than jumping in head first.
<KS>
Is it about the money?
DAMN STRAIGHT IT IS!
Loved the description about your experience with the Really Average Mortgage Service.
I have learnt that although the banks are depicted as the big baddies, they in general have got to where they are by being pretty good and experienced at what they do.
I am now using HOME and have found their service extremely un-professional. At some points I have actually had to tell them how to do their job and my mortage broker is pissed because she recommended them and now regrets it.
To make it worse I took the word of my broker they were offering the best product for what I wanted to do but now realise that I should have stuck to doing the research myself as I have since found better products to use – but its not a big loss so I am not massively upset, just annoyed.
Last thing I wanted to say was that if you ever get to the point where they wont give you your money back then most lenders give you a refund on a large portion MLI if you discharge the loan within 2 years. So this may be a way to go to get to another lender and offset the discharge fees with a MLI refund.
<KS>
Is it about the money?
DAMN STRAIGHT IT IS!
Nice REDWING – Very Nice
I just fired those 2 off to some work collegues of mine and I can still hear them laughing
<KS>
Is it about the money?
DAMN STRAIGHT IT IS!
