Hi, retirement IS hard work! I used to flippantly say I want to retire at 40. I actually stopped working at 42. Young & attractive still, enjoyed mucking around & found my money ran out very fast. That was when I started buying property.Managed to finally 'retire' at 52. Not so young & attractive but still …I bought a property & redeveloped it,…[Read more]

Hi, one relative who retired on independent resources bought a 3BR house in a stylish retirement village. The first 2 years were good & then management costs kept increasing, shares kept dropping.Their wealth dwindled and they decided to sell out. The buyers were scarce. In the end, they took a big loss and got out. Bought a 2 BR new house in a…[Read more]

Hi, Richard Taylor & Terryw are 2 of the best at what they do. A buyer's agent [one goes by the name Propertunity is very good] will be worth his weight in gold in your case.* Your savings rate is VERY low if you only saved $20K on a 190K p.a.  – not being critical, just a comment on the numbers you've thrown out.Can you review your PAYG…[Read more]

Hi, catalyst is exactly right. To be 21 again, ah!!!Consider this: what would you do if your property went backwards for 10 years? You get 4.5% yield so fork out 2.5% in costs. Then price drops by 20% add to that, transaction costs, you have a deficit to answer to.I bought my 1st house for $166200 and it rented for $400 per month. The house next…[Read more]

Hi, I own 5 student accommodation units, all in NZ.If I were given a choice to go back 7-8 years & with the info I have now, I would not choose to invest in student accommodation.My investments aren't bad, as such. The NZ managers are very good.I calculated my position yesterday & it looks like this: I'd put in around 175 thousand. I have equity…[Read more]

Hi again, and that precisely is why I asked that question. There've been concerns about sustainability & current auction rates & high volumes of stock in Brisbane. So interstate where? Maybe Perth?But from all accounts, it's likely to be flat.So considering your LVR position, why rush to pay LMI when there's such a high probability that cap gain…[Read more]

Hi Jlia, I presume you're talking about buying another IP in SA? May I ask what you've seen that makes it so urgent to buy immediately?KY

Hi, finance is not an issue. How to minimise & capitalise on your PAYG is.Do you realise you have some VERY savvy property investors in Melbourne? Steve McKnight, Michael Yardney, & a host of other investors who don't 'teach' but who post on these forums? KY

Hi, check this carefully. I don't think you need to pro rate the depreciation. KY

Hi, have you done a depreciation schedule? If your unit is new, you may get a LOT of tax deductions. And if you rent to 2 tenants, are you providing white goods [fridge, dishwasher, oven, etc etc]? Curtains, blinds, carpets, lights are ALL good depreciation items. Around 25%It means that you can whack $5000 off your taxable income, which adds…[Read more]

Hi, I thought you were talking about the other block of land.So, $110K x 2 = $220000[say $250000]$28K rent p.a. can support a loan of $320000Seems quite comfortable without having to sell. You need to factor in holding costs – the faster you can do it, the less the cost but in your case, it's really not difficult because you can use the existing…[Read more]

Hi, some fantastic ideas there, Susan & the sooner you start, the better. The reason is very simple: raw land has far less value than improved land. I'd suggest comparing the pros & cons of selling or holding for rental. The agent suggests $150K sale on a $110K house? Who would enrich more, you or the agent or the govt? Profit = $40K, $4K to the…[Read more]

Hi, not to be taken as advice but your wife might have an instinctive feel & knowledge of her own backyard.I'm Asian and I have NZ properties. I've been thinking that it's a good time to be buying older or even decrepit houses on big land to rebuild. Stacks of -ve gearing with depreciation = +ve cf. All the 5 units I have are set up like that. I…[Read more]

Hi,a) 25-30% of total project costb)constantly, especially when interest rate goes up!c)surprisingly none, the actual profit was $75K per house, same as what was estimated/hoped for when the block was purchased [the initial assessment was each house would make a profit of $60K]  However, the deviation in the actual cost was 25% [originally…[Read more]

Hi, I'll take it with a big spoon of salt. No need to spend so much to find out what he says. Just go to the library & borrow his 2 earlier books. The Roaring 20s and the Big Boom Ahead, something like that.He way way overshot in predicting the Great Boom [said Dow would pass 20000, which it never did] and got the time frame not right either.So…[Read more]

Hi danviv1, losty & young guns et al,I'm not sure that you all have considered the super issue in depth. The reason your super went -ve is because your fund is weighted heavily in equities. And fees march on regardless of whether the fund makes any profit or not. What I'm suggesting is that one who earns enough to be in the 30-40% tax bracket has…[Read more]

Hi, while I'm a property afficionado, I'd like to caution you about the downside to property investing. Tenant & vacancy problems, + management costs, maintenance etc erode yields. Your problem is going to be that you need the income to live on & depending on the amount of cash you have in hand [if you still have a home loan, that amount is going…[Read more]

Hi, you've answered your own question, basically. I didn't look at the 2nd part where one income stops.The best financial outcome is not necessarily the lifestyle choice.In the present scenario, the best outcome is achieved by making current PPOR a rental. Can you bear the pain & inconvenience of that? KY

Hi, Richard Taylor's going to jump on you!Why is the IP loan less than the PPOR loan? And why oh why is the IP loan P&I?Ideally, it should be IP loan $350000 and PPOR loan $330000Look at the discussions on debt recycling. Try to work your PAYG down as low as you can.KY

Hi, you might also want to look at your PAYG. You're in a high % tax area.Ideally, one of you should be in the low income category [lots of freebies if your taxable income <30K]Deductible interest is one way of lowering the taxable income, depreciation is another & super is another. Paying to dependents eg minors is yet another way of lowering…[Read more]