maybe find a way to convert all that equity into a cashflow. Try researching cash bonds. This might increase servicability and allow you to get a line of credit on your ppor. Then the banks will lend to you…. the other solution is to find a income rich/equity poor partner and do a joint deal.

The other thing that is obvious to me is that your current set up is based around your lifestyle.

The luxury of a very expensive house and the further desire to acquire more quality of life items (ie: junk that goes down in value) is the common recipe 97% of the population use, the same 97% that have no money when they retire to even live comfortably!

Some basic principles to consider.

Buy things that go up in value and give you cashflow.

Consider reducing your weekly expenses. Ie; if you lived in a house with no mortgage, then you would have HEAPS of cash to invest.

Spend less than you earn.

Try also researching some “living on equity” principles that might help you to find a way to buy IP’s with your current House.

P.S. you can extend the mortgage on your PPOR to 80 % (or 95+% with LMI) if you have servicability/.

And as for your mortgage broker, if he is a run of the mill broker, I doubt he will be able to give you any guidance as how to invest. In fact, there is a good chance that he will just tell you to refinance to a loan he can get that will give you some play money for lifestyle junk. This will get him his commission and you some toys.

If you are serious about creating a financially free future, I would start reading some books and select an investment strategy that maximises your current strengths.

Possible scenario. Sell your house and move into a modest home, pay cash. Then take out loans on the money left over and combine with a line-of-credit loan against your house. Buy ip’s with a good sized deposit, say 30-40%. This should get you a neutrally geared portfolio and then all your debt is tax deductible. And should give you extra cash each week!

Positive cashflow, capital gains, development, subdivisions, high yields…yada, yada,

It don’t matter too much which way you invest, as long as it works for you!

Are you willing to learn the fundamentals of wealth creation?

Lifexperience

Hey guys,
I don’t like managing my properties because I have found that the monetary return is not worth the time it CAN consume…….enter the 10% of “bad tenant” client stage left that sneaks through the radar. As a private landlord you can’t access the National Tenancy Database to check Blacklists. Plus I’m 200km away from these particular properties.

I don’t really like Agents managing properties either, but I choose them as the lesser of two evils.

I’ve managed over a dozen tenants in the last year and I am over it!

I did advertise privately in the paper (with the intention of handing applicants to agent) but still had no response.
I will keep these particular vacant properties even if the vacancy is extended. I am aware that this particular area has a cyclical rent demand. So I am waiting to get into the high demand period and keep the leases cycling over so that they end in this period again. The town is also getting a major boost in the way of infrastructure soon too which will give it a good kick.

G.R. Hi, I hope my “style”, helps lead me down a similar path to some big deals like I know that you play with.

Here is a quick story that might get a giggle from y’all.

Yesterday I got the phonecall I’d been waiting for all my life…that I had won some easy money.
……I had the opportunity to pick up as many palm trees as I wanted from a friend who was working at one of the big corporate companies in the city. For Nothing!
…..I quickly checked the value of palm trees (slow growing and highly desirable) and the second hand market had them trading in the thousands each!!! I figured a big corporation wouldn’t be skimping on the type of palm they were using as the image for corporate HQ.
…..I spent the next day co-ordinating a big trailer and to pick the money makers up with my friend. I planned to sell them on the drip over the next few months.
…….I got down to the offices early the next day (I only squeezed in 3 hours sleep as I was on Night Shift) and picked up 4 10 foot trees with heaps of foliage. Treating them like delicate babies and loaded them in to trailer. Nearly breaking my back….They were v.heavy.
…….I drove them to a property that I had vacant and bought the best fertiliser and nutrient liquids and mulch to ease their transfer of home.
I was gloating to myself as I cruised down the highway ., the sheer weight of them was bouncing the car on the bounce stops and near ripping the back half of the car off. The front wheels were almost in the air as I half-aqua-planed the 1 hour drive to the property.
……I had contacted a lot of people who were eager to see what type of palm it was. These were going to go like hotcakes.
……Anyway after a full mornings work of HARD YAKKA , I dropped them off and took some photos. A plant guy at work said he would ID them for me.
…..OOOOOOOOO, I couldn’t wait.
……They were cordyline australis. OK, Great!, Now what were they worth in $$$$ ?
…..
….
…..
….
…. I checked the nursery price lists and full grown specimens like these were worth…..
…….
……
…..ONLY $100 bucks each!
…..They were goddamn NZ Cabbage Trees. Messy, common crappy weeds on sticks.

………Oh man, I guess I’ll have to keep waiting for that call….But You can’t say I would have missed the opportunity

Maybe it will be from an agent with a good tenant!

Off topic I know fijfcm, but the solution to this problem is the same as for a property with no tenants.

Burn it to the ground. (and claim insurance)…..

.((ps – only kiddin’.))

Lifexperience

i’m feeling the pain of a few vacancies at the moment too so i know that helpless feeling.

Have faith, two steps backwards 6 steps forwards.

No tenant is better than a bad tenant.

I am taking the opportunity to get in and make some improvements, carpet, paint, clean again!, pray to voodoo property gods, yada.

I am trying multiple agent listings, private ad in newspaper, throwing in the gardening (at a fee), I am holding in an area with a low rental demand so I am trying to meet the market.

Keep trying something new. I might start door knocking neighbourhood and see if I can’t poach someone elses tenant.

Best of luck to you[]

Lifexperience

You can have the loan in your name and the title of the property in the trusts name for neg. geared scenarios.

Then, the trust is making a profit. And you still get to claim the loss of the loan interest against your own income.

Called Hybrid Discretionary Trust.

Lifexperience

I totally agree Celivia, that it is a real shame when parents neglect their responsibilities in upbringing their kids wrt time together….

To watch so many parents create a materialistic lifestyle of new car, fancy furniture and who knows what other useless consumer items ,,,,while their kids grow up under their noses with little interaction.

I see guys at doing loads of shifts and overtime at work complaining one week that they don’t have time to play with their kids or pay the bills …..and the next week are using equity in their own homes to finance a new boat or a new car………… it is a sad thing.

They should have a little note on every useless consumer item for sale that says “Are you willing to trade the time at work to pay for this item for time with your own child?”

Maybe kids are hanging around home til they’re thirty in the hope that they will get to meet their parents!

Wasting a life working.

Lifexperience

Foundation,

I know a lot of people can get wiped out in a market crash and if interest rates soar then highly geared portfolios with no room to move on debt servicing levels will be in for hard times.

But these scenarios don’t last forever and I think anyone in this position would have backup reserves (temp credit, cash buffer, or other)

And if needed you just have to find more money, another job. There are many things you can do before you HAVE to sell in a crashing market.

There are “Sky is falling” doomsayers in every market.

To Quote Margaret Lomas “buy when you can afford to, NOT when you think you are reading the market”

No-one knows for sure this is the top of the market!

[biggrin]

Lifexperience

I hope you are coping ok, stick in there!

Lifexperience

I’m geared to the eyeballs and my balls are right on the line.

89%

Interest rates not property prices is the immediate danger.

I have most in fixed interest so I have negated most of the risk.

I am young and single and could only fall back to where I recently started if it went nuts. Whatever.

and if the need arose I would get a second and/or third job for cashflow.

I am still confident of basic demographics, immigration, strong Australian Economy, Market demand for properties I have and have always believed in Rich Dads Philosophy.

“Somedays the market is excited and overrates things, on other days the market is negative and underrates things, but if you buy a good value investment with strong underlying figures, then you will come out a winner in the end”

Not his exact words, but you get the drift.

And I know that in 10 -20 years time that my properties are going to be worth a lot more than they are now and potentially bring Financial Freedom much closer.

To me that is worth the risk.

My SANF is fine , and if I lose all, heck I’ll just start again.

Comfort zones need to be broken if you want to progress in life.

I wouldn’t recommend my strategy to anyone that isn’t prepared to fall all the way back to the start.

I am going to pump hard into my debts though, and once reduced I will keep things at a more comfortable level.

It’s the early years that can make a big difference later on

.

Lifexperience

Flash, I sympathise

I had an email lost from Bank in the magical cyber space letting me know to chase up documents for loan.

I found out today and the property is due to settle next week.Lucky I’d triple checked by phone.

I know the feeling when it feels like you have to double check up on everthing.

Where can I find competence, WHERE??????????????????

Since I cant beat ’em ,maybe I’ll just join the IDGAF club………NAH

I know there is a wise old saying that says change the things you can and accept those you can’t.

Problem is, some of those things you cant change, HAVE to change…..otherwise youre stuffed…….enter Miracle Maker Investor Extraordinairre. You and me and the rest of us.

Reprimand them strongly, send a angry letter of warning that you will change Agents if incompetence is repeated and somehow let their boss know that they have peeved you off.

I am normally a passive guy, but I recently let fire with both barrells at my Insurance brokers in the above way, and suddenly they went from resting on their laurels to being super speedy and helpful.

Rip ’em.

Lifexperience

Luci,
I would love to hear your reasons as to why you want to JV with these people and what extra benefit you think you will get by doing this?

Lifexperience